I 

114TH CONGRESS 

2D SESSION H. R. 4802 

To require consideration of the impact on beneficiary access to care and 

to enhance due process protections in procedures for suspending payments to Medicaid providers. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 17, 2016 

Mr. BEN RAY LUJA ́N of New Mexico (for himself and Ms. MICHELLE LUJAN

GRISHAM of New Mexico) introduced the following bill; which was referred to the Committee on Energy and Commerce 

A BILL 

To require consideration of the impact on beneficiary access 

to care and to enhance due process protections in procedures for suspending payments to Medicaid providers. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicaid Program In5 tegrity Enhancement Act of 2016’’. 

6 SEC. 2. REVISION OF REGULATIONS. 

7 (a) IN GENERAL.—Not later than 180 days after the 

8 date of enactment of this section, the Secretary shall reVerDate Sep 11 2014 21:58 Mar 18, 2016 Jkt 059200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4802.IH H4802

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1 vise part 455 of title 42, Code of Federal Regulations, re2 lating to Medicaid program integrity as follows: 

3 (1) Section 455.2, relating to the definition of 

4 credible allegation of fraud, to comply with the re5 quirements described in subsection (b). 

6 (2) Section 455.23, relating to the suspension 

7 of Medicaid payments to a provider by a State Med8 icaid agency, to comply with the requirements de9 scribed in subsection (c). 

10 (b) REQUIREMENT TO CONSIDER IMPACT ON BENE11 FICIARY ACCESS TO CARE IN DETERMINING A CREDIBLE

12 ALLEGATION OF FRAUD.—The revised section 455.2 shall 

13 provide that an allegation shall be considered to be a cred14 ible allegation of fraud only if— 

15 (1) the allegation has indicia of reliability; 

16 (2) the State Medicaid agency has reviewed all 

17 allegations, facts, and evidence carefully and acts ju18 diciously on a case-by-case basis; and 

19 (3) the State Medicaid agency has taken into 

20 consideration the potential impact a payment sus21 pension may have on beneficiary access to care. 

22 (c) DUE PROCESS REQUIREMENTS FOR PAYMENT

23 SUSPENSION BASED ON CREDIBLE ALLEGATION OF

24 FRAUD.— 


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1 (1) PROCESS REQUIRED BEFORE SUSPEN2 SION.—A State Medicaid agency that has received 

3 an allegation of fraud against a provider shall not 

4 suspend payments to such provider until the agency 

5 takes the following actions: 

6 (A) The State Medicaid agency consults 

7 with the Medicaid fraud control unit for the 

8 State or, if the State has no Medicaid fraud 

9 control unit, the State attorney general, before 

10 suspending payments and receives a written 

11 verification from the Medicaid fraud control 

12 unit or attorney general, in such form as the 

13 Secretary may require, confirming that such 

14 consultation took place. 

15 (B) The State Medicaid agency certifies to 

16 the Secretary that it has considered whether— 

17 (i) beneficiary access to items or serv18 ices would be jeopardized by a payment 

19 suspension; 

20 (ii) a good cause not to suspend pay21 ments exists under section 455.23(e) of 

22 title 42, Code of Federal Regulations (as 

23 revised after the application of this Act); 

24 and 


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1 (iii) a good cause to suspend pay2 ments only in part exists under section 

3 455.23(f) of such title of such Code (as so 

4 revised). 

5 (C) The State Medicaid agency furnishes 

6 the provider with the agency’s reasons for find7 ing that there is no good cause to refrain from 

8 suspending payments in whole or part. 

9 (2) PROCESS REQUIRED AFTER SUSPENSION.— 

10 After a State Medicaid agency suspends payments 

11 (in whole or part) to a provider on the basis that the 

12 agency has determined that there is a credible alle13 gation of fraud against a provider for which an in14 vestigation is pending under the Medicaid program, 

15 the agency shall take the following actions: 

16 (A) At the beginning of each fiscal quarter 

17 that begins after payments to the provider have 

18 been suspended, the State Medicaid agency 

19 shall— 

20 (i) certify to the Secretary that it has 

21 considered whether the suspension of pay22 ments should be terminated or modified 

23 because— 

24 (I) a good cause not to suspend 

25 payments exists under section 


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1 455.23(e) of title 42, Code of Federal 

2 Regulations (as revised after the ap3 plication of this Act); or 

4 (II) a good cause to suspend pay5 ments only in part exists under sec6 tion 455.23(f) of such title (as so re7 vised); and 

8 (ii) if the agency finds that there is no 

9 good cause to terminate or modify the sus10 pension of payments, furnish to the pro11 vider the agency’s reasons for such finding. 

12 (B) If the investigation is not resolved in 

13 a reasonable amount of time (as determined by 

14 the Secretary), the State Medicaid agency shall 

15 disclose to the provider the specific allegations 

16 of fraud that formed the basis for the agency’s 

17 determination that there is a credible allegation 

18 of fraud against the provider. 

19 (C) Every 180 days after the initiation of 

20 a suspension of payments based on credible al21 legations of fraud, a State Medicaid Agency 

22 shall— 

23 (i) evaluate whether there is good 

24 cause to not continue such suspension; and 


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1 (ii) request a certification from the 

2 Medicaid fraud control unit for the State 

3 or, if the State has no Medicaid fraud con4 trol unit, the State attorney general, or 

5 other law enforcement agency that the 

6 matter continues to be under investigation 

7 warranting continuation of the suspension. 

8 (D) Good cause not to continue to suspend 

9 payments to an individual or entity against 

10 which there are credible allegations of fraud 

11 shall be deemed to exist if a payment suspen12 sion has been in effect for 18 months and there 

13 has not been a resolution of the investigation, 

14 except a State Medicaid Agency may extend a 

15 payment suspension beyond such period if— 

16 (i) the case has been referred to, and 

17 is being considered by, the Medicaid fraud 

18 control unit for the State or, if the State 

19 has no Medicaid fraud control unit, the 

20 State attorney general, for administrative 

21 action or such administrative action is 

22 pending; or 

23 (ii) the Medicaid fraud control unit 

24 for the State or, if the State has no Med25 icaid fraud control unit, the State attorney 


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1 general, submits a written request to the 

2 State Medicaid Agency that the suspension 

3 of payments be continued based on the on4 going investigation and anticipated filing 

5 of criminal or civil action or both or based 

6 on a pending criminal or civil action or 

7 both. At a minimum, the request shall in8 clude the following: 

9 (I) Identification of the entity 

10 under suspension. 

11 (II) The amount of time needed 

12 for continued suspension in order to 

13 conclude the criminal or civil pro14 ceeding or both. 

15 (III) A statement of why or how 

16 criminal or civil action or both may be 

17 affected if the requested extension is 

18 not granted. 

19 (d) DEFINITIONS.—For purposes of this section: 

20 (1) The term ‘‘Medicaid fraud control unit’’ 

21 means a State Medicaid fraud control unit as de22 fined in section 1903(q) of the Social Security Act 

23 (42 U.S.C. 1396b(q)). 

24 (2) The term ‘‘Secretary’’ means the Secretary 

25 of Health and Human Services. 


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1 (3) The term ‘‘State Medicaid agency’’ means 

2 the agency responsible for administering a State 

3 plan under title XIX of the Social Security Act (42 

4 U.S.C. 1396 et seq.). 

5 SEC. 3. APPEALS PROCESS. 

6 (a) IN GENERAL.—Section 1902(a)(39) of the Social 

7 Security Act (42 U.S.C. 1396a(a)(39)) is amended— 

8 (1) by striking ‘‘shall exclude’’ and inserting 

9 ‘‘shall— 

10 ‘‘(A) exclude’’; 

11 (2) by adding ‘‘and’’ after the semicolon at the 

12 end; and 

13 (3) by adding at the end the following new sub14 paragraph: 

15 ‘‘(B) establish and codify a process where16 by a provider to whom payments have been sus17 pended, in whole or part, on the basis of cred18 ible allegations of fraud against such provider 

19 may appeal any decision (including a decision 

20 not to terminate or modify a payment suspen21 sion that is already in place) by the State agen22 cy that no good cause exists under the regula23 tions of the Secretary to terminate, modify, or 

24 refrain from imposing such suspension of pay25 ment;’’. 


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1 (b) EFFECTIVE DATE.— 

2 (1) IN GENERAL.—Subject to paragraph (2), 

3 the amendments made by this section shall take ef4 fect on the date that is 1 year after the date of the 

5 enactment of this Act. 

6 (2) DELAY PERMITTED IF STATE LEGISLATION

7 REQUIRED.—In the case of a State plan approved 

8 under title XIX of the Social Security Act which the 

9 Secretary of Health and Human Services determines 

10 requires State legislation (other than legislation ap11 propriating funds) in order for the plan to meet the 

12 additional requirements imposed by this section, the 

13 State plan shall not be regarded as failing to comply 

14 with the requirements of such title solely on the 

15 basis of the failure of the plan to meet such addi16 tional requirements before the 1st day of the 1st cal17 endar quarter beginning after the close of the 1st 

18 regular session of the State legislature that ends 

19 after the 1-year period beginning with the date of 

20 the enactment of this section. For purposes of the 

21 preceding sentence, in the case of a State that has 

22 a 2-year legislative session, each year of the session 

23 is deemed to be a separate regular session of the 

24 State legislature. 

Æ 


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