I 

114TH CONGRESS 

1ST SESSION H. R. 2502 

To amend title XVIII of the Social Security Act to provide for bundled 

payments for certain episodes of care surrounding a hospitalization. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 21, 2015 

Mrs. BLACK (for herself and Mr. NEAL) introduced the following bill; which 

was referred to the Committee on Ways and Means, and in addition to 

the Committee on Energy and Commerce, for a period to be subsequently 

determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend title XVIII of the Social Security Act to provide 

for bundled payments for certain episodes of care surrounding a hospitalization. 

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 ‘‘Comprehensive Care 

5 Payment Innovation Act of 2015’’. 


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1 SEC. 2. PERMANENT, NATIONAL VOLUNTARY PAYMENT 

2 BUNDLING. 

3 Title XVIII of the Social Security Act is amended by 

4 inserting after section 1866E (42 U.S.C. 1395cc–5) the 

5 following new section: 

6 ‘‘NATIONAL VOLUNTARY PAYMENT BUNDLING

7 ‘‘SEC. 1866F. (a) ESTABLISHMENT AND IMPLEMEN8 TATION.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall provide 

10 for bundled payments under this section for inte11 grated care furnished by a qualified entity during an 

12 episode of care to an applicable beneficiary for appli13 cable conditions involving a hospitalization. 

14 ‘‘(2) DEADLINE.—The Secretary shall imple15 ment this section not later than January 1, 2016. 

16 ‘‘(3) APPLICABLE BENEFICIARY DEFINED.—In 

17 this section, the term ‘applicable beneficiary’ means 

18 an individual who is entitled to, or enrolled for, ben19 efits under part A and enrolled for benefits under 

20 part B, but not enrolled under part C or in a PACE 

21 program under section 1894, and who is admitted to 

22 a hospital for an applicable condition. 

23 ‘‘(b) QUALIFIED ENTITY AND APPLICATION PROC24 ESS.— 

25 ‘‘(1) DEFINITIONS.—In this section: 


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1 ‘‘(A) IN GENERAL.—The term ‘qualified 

2 entity’ means a qualified applicant that has an 

3 application approved by the Secretary to receive 

4 bundled payments for furnishing applicable 

5 services to applicable individuals under this sec6 tion. 

7 ‘‘(B) QUALIFIED APPLICANT.—The term 

8 ‘qualified applicant’ means a corporation, part9 nership, or limited liability company, that is au10 thorized in writing by a group of providers of 

11 services and suppliers, including at least a hos12 pital, that are otherwise participating under 

13 this title to act as their agent for the purpose 

14 of receiving and distributing bundled payments 

15 on their behalf under this section. A qualified 

16 applicant may (but is not required to) be a pro17 vider of services or supplier that is otherwise 

18 participating under this title. 

19 ‘‘(2) APPLICATION.— 

20 ‘‘(A) IN GENERAL.—A qualified applicant 

21 may submit to the Secretary an application to 

22 become a qualified entity to receive bundled 

23 payments under this section. 


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1 ‘‘(B) CONTENTS.—An application under 

2 subparagraph (A) with respect to a group of 

3 providers of services and suppliers— 

4 ‘‘(i) shall contain such information 

5 and assurances as the Secretary may speci6 fy, including with respect to the require7 ments under subsection (c)(1); and 

8 ‘‘(ii) shall indicate the applicable con9 ditions with respect to which the group 

10 seeks to furnish applicable services during 

11 the episode of care involved and the bun12 dled payment methodology under sub13 section (g) or (h) under which the group 

14 would be paid for such services. 

15 ‘‘(3) CHOICE AMONG APPLICABLE CONDI16 TIONS.—A qualified entity may select one or more 

17 applicable conditions for bundled payments under 

18 this section. Nothing in this section shall be con19 strued as requiring, or authorizing the Secretary to 

20 require, a qualified entity to select any particular ap21 plicable condition under this section. 

22 ‘‘(4) EXPEDITED APPLICATION PROCESS FOR

23 QUALIFIED APPLICANTS SUCCESSFULLY PARTICI24 PATING IN THE CMI BUNDLED PAYMENT DEM25 ONSTRATION.—In the case of any qualified applicant 


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1 that the Secretary determines has successfully par2 ticipated in any of the payment and service delivery 

3 models tested by the Center for Medicare and Med4 icaid Innovation under section 1115A through the 

5 Bundled Payments for Care Improvement (BPCI) 

6 Initiative, the Secretary shall provide for an expe7 dited application process under this subsection. 

8 ‘‘(c) REQUIREMENTS FOR QUALIFIED ENTITIES.— 

9 ‘‘(1) REQUIREMENTS.— 

10 ‘‘(A) IN GENERAL.—The Secretary shall 

11 develop requirements for qualified entities to re12 ceive bundled payments for furnishing applica13 ble services for applicable conditions during an 

14 episode of care under this section. 

15 ‘‘(B) AGREEMENT PERIOD.—Under such 

16 requirements, a qualified entity shall agree to 

17 receive bundled payments for the furnishing of 

18 such services for a 5-year period (each such 

19 year in such period referred to in this section 

20 as an ‘agreement year’). 

21 ‘‘(C) BENEFICIARY TRANSPARENCY.—Such 

22 requirements shall ensure transparency between 

23 a qualified entity and applicable beneficiaries 

24 such that notice is provided to an applicable 

25 beneficiary sufficiently in advance, to the extent 


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1 practicable, of the beneficiary’s inpatient admis2 sion for the applicable condition and episode of 

3 care involved. Such a notice shall include— 

4 ‘‘(i) appropriate notice of bundled 

5 payments for the applicable condition for 

6 the episode of care involved; and 

7 ‘‘(ii) a statement informing the bene8 ficiary of the beneficiary’s right to select 

9 the providers of services and suppliers fur10 nishing items and services related to the 

11 episode of care. 

12 ‘‘(D) METHODOLOGY AND MEASURES FOR

13 QUALITY AND EFFICIENCY ARRANGEMENTS.— 

14 Insofar as a qualified entity uses or seeks to 

15 implement a quality and efficiency arrangement 

16 under subsection (i), the qualified entity shall 

17 specify in the application to the Secretary in de18 tail the methodology for allocating savings 

19 under the arrangement and the specific meas20 ures to be used to assess the quality of care 

21 under the arrangement. 

22 ‘‘(2) PROVISION OF DATA BY SECRETARY.— 

23 ‘‘(A) CLAIMS DATA.— 

24 ‘‘(i) AVAILABILITY FOR APPLICA25 TION.—The Secretary shall furnish to a 


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1 group of providers of services and suppliers 

2 interested in submitting an application 

3 under subsection (b)(2) claims data under 

4 parts A and B, including complete claims 

5 files, for applicable conditions relating to 

6 the providers and suppliers in the group 

7 that are sufficiently specific to permit such 

8 group to determine whether to submit such 

9 application. 

10 ‘‘(ii) AVAILABILITY DURING AGREE11 MENT PERIOD.—Such claims data shall 

12 also be furnished to a qualified entity 

13 monthly during the agreement period de14 scribed in paragraph (1)(B) of any ap15 proved application with respect to an appli16 cable condition relating to all providers of 

17 services and suppliers participating in the 

18 group under this title for such applicable 

19 condition. 

20 ‘‘(B) QUALITY DATA.—The Secretary shall 

21 furnish to a qualified entity data on quality 

22 measures with respect to any applicable condi23 tion under an approved application during the 

24 agreement period for the entity for each episode 

25 of care and across the continuum of care. 


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1 ‘‘(d) APPLICABLE CONDITIONS.— 

2 ‘‘(1) INITIAL CONDITIONS.—In this section, the 

3 term ‘applicable condition’ means any of the fol4 lowing procedures furnished as part of inpatient hos5 pital services: 

6 ‘‘(A) Hip/Knee joint replacement. 

7 ‘‘(B) Lumbar spine fusion. 

8 ‘‘(C) Coronary artery bypass graft. 

9 ‘‘(D) Heart valve replacement. 

10 ‘‘(E) Percutaneous coronary intervention 

11 with stent. 

12 ‘‘(F) Colon resection. 

13 ‘‘(2) DISCRETION TO ADD CONDITIONS.—Such 

14 term also includes such additional procedures or 

15 conditions as the Secretary may select. In selecting 

16 such procedures or conditions, the Secretary may 

17 take into consideration the factors described in sec18 tion 1866D(a)(2)(B). 

19 ‘‘(e) APPLICABLE SERVICES; EPISODE OF CARE.—In 

20 this section: 

21 ‘‘(1) APPLICABLE SERVICES.— 

22 ‘‘(A) IN GENERAL.—Subject to subpara23 graph (B), the term ‘applicable services’ means 

24 the following items and services: 

25 ‘‘(i) Acute care inpatient services. 


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1 ‘‘(ii) Physicians’ services delivered in 

2 and outside of an acute care hospital set3 ting. 

4 ‘‘(iii) Outpatient hospital services. 

5 ‘‘(iv) Post-acute care services, includ6 ing home health services, skilled nursing 

7 services, inpatient rehabilitation services, 

8 and inpatient hospital services furnished by 

9 a long-term care hospital. 

10 ‘‘(v) Subject to subparagraph (B), 

11 other services the Secretary determines ap12 propriate. 

13 ‘‘(B) EXCEPTION.—Such term does not in14 clude items and services described in section 

15 1861(s)(9), except for those off-the-shelf 

16 orthotic devices described in section 

17 1847(a)(2)(C) that meet the following condi18 tions: 

19 ‘‘(i) The Secretary has included those 

20 devices in an actively operating competitive 

21 bidding program under section 1847. 

22 ‘‘(ii) The devices require adjustment 

23 only by the patient and not by any other 

24 person, such as a caretaker or supplier. 


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1 ‘‘(iii) The Secretary has provided noti2 fication of the identity of those devices 

3 pursuant to notice and comment rule4 making. 

5 ‘‘(2) EPISODE OF CARE.— 

6 ‘‘(A) IN GENERAL.—Subject to subpara7 graph (B), the term ‘episode of care’ means, 

8 with respect to an applicable condition and an 

9 applicable beneficiary, the period consisting 

10 of— 

11 ‘‘(i) the 3 days prior to the admission 

12 of the applicable beneficiary to a hospital 

13 with respect to the applicable condition; 

14 ‘‘(ii) the duration of the applicable 

15 beneficiary’s initial inpatient stay in such 

16 hospital for the applicable condition; and 

17 ‘‘(iii) the 90 days following the dis18 charge of the applicable beneficiary from 

19 such hospital. 

20 ‘‘(B) ESTABLISHMENT OF PERIOD BY THE

21 SECRETARY.—The Secretary, as appropriate, 

22 may establish a period (other than the period 

23 described in subparagraph (A)) for an episode 

24 of care under this section based on data anal25 yses. 


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1 ‘‘(3) DISCHARGING HOSPITAL.—The term ‘dis2 charging hospital’ means, with respect to applicable 

3 services in an episode of care, the hospital referred 

4 to in paragraph (2)(A). 

5 ‘‘(f) BUNDLED PAYMENT DEVELOPMENT.— 

6 ‘‘(1) IN GENERAL.—Subject to the succeeding 

7 provisions of this subsection, the Secretary shall de8 velop bundled payments for qualified entities. A bun9 dled payment shall provide for comprehensive pay10 ment for the costs of applicable services furnished to 

11 an applicable beneficiary during an episode of care 

12 for an applicable condition, including readmissions 

13 related to the applicable condition but excluding un14 related readmissions, under either a fee-for-service 

15 model with shared savings and losses (under sub16 section (g)) or under a prospective payment model 

17 for advanced qualified entities (under subsection 

18 (h)). Bundled payments shall be based on the spend19 ing targets computed under paragraph (2). 

20 ‘‘(2) COMPUTATION OF SPENDING TARGETS.— 

21 ‘‘(A) IN GENERAL.—The Secretary shall 

22 compute under this paragraph, for each quali23 fied entity for each applicable condition for an 

24 episode of care beginning in an agreement year 

25 (beginning with 2016) that is attributable to a 


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1 discharging hospital, a spending target equal to 

2 the updated amount computed under subpara3 graph (C) for that entity, episode, and year. 

4 ‘‘(B) INITIAL WEIGHTED AVERAGE CAL5 CULATION FOR DISCHARGING HOSPITALS.— 

6 ‘‘(i) IN GENERAL.—Using fee-for-serv7 ice claims data from the base period (as 

8 defined in subparagraph (D)), subject to 

9 clause (ii), the Secretary shall first cal10 culate a base average spending target for 

11 each applicable condition for each dis12 charging hospital equal to a weighted aver13 age of spending under parts A and B for 

14 all applicable services for such applicable 

15 condition associated with initial admissions 

16 to such hospital computed as the sum of 

17 the following (with respect to such hos18 pital): 

19 ‘‘(I) 60 percent of the standard20 ized spending per episode in the most 

21 recent year in the base period. 

22 ‘‘(II) 30 percent of the standard23 ized spending per episode in the pre24 vious year. 


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1 ‘‘(III) 10 percent of the stand2 ardized spending per episode in the 

3 second previous year. 

4 ‘‘(ii) EXCLUSION OF OUTLIERS AND

5 STANDARDIZATION.—In calculating the 

6 amount of the base average spending tar7 get for an applicable condition under 

8 clause (i) for a discharging hospital, the 

9 Secretary shall— 

10 ‘‘(I) exclude from the calculation 

11 payments for episodes of care for the 

12 applicable condition that exceed the 

13 95th percentile of all such spending 

14 for such episodes of care and applica15 ble condition, as estimated by the Sec16 retary, based on the most recent data 

17 available; and 

18 ‘‘(II) standardize the spending 

19 made in each year in the base period 

20 to each provider of service or supplier 

21 to remove the spending adjustments 

22 in effect in such year relating to pro23 vider or supplier location (such as 

24 area wage indices) and provider type 

25 (such as indirect medical education 


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1 adjustments and disproportionate 

2 share hospital adjustments). 

3 ‘‘(C) TRENDING THE SPENDING TARGETS

4 BASED ON NATIONAL GROWTH RATES TO

5 AGREEMENT YEAR; PERIODIC REBASING FOR

6 NEW AGREEMENT PERIODS.— 

7 ‘‘(i) IN GENERAL.—The Secretary 

8 shall update the base average spending tar9 gets for all discharging hospitals under 

10 subparagraph (B) for each applicable con11 dition and agreement year based on trends 

12 in the national fee-for-service claims data 

13 for applicable services furnished during an 

14 episode of care for an applicable condition 

15 from the base period to the agreement year 

16 involved. Such update shall not vary by 

17 discharging hospital. 

18 ‘‘(ii) PERIODIC REBASING FOR NEW

19 AGREEMENT PERIODS.—At the start of 

20 each new agreement period, the Secretary 

21 shall update the base period and calculate 

22 new spending targets under the previous 

23 provisions of this paragraph for a dis24 charging hospital and applicable condi25 tions, including providing for adjustments 


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1 by provider location and provider type of 

2 the type described in subparagraph 

3 (B)(ii)(II). 

4 ‘‘(D) BASE PERIOD DEFINED.—In this 

5 paragraph, except as provided in subparagraph 

6 (C)(ii), the term ‘base period’ means the most 

7 recent 3-year period for which complete data 

8 are available to carry out this subsection. 

9 ‘‘(g) FEE-FOR-SERVICE BUNDLED PAYMENT MODEL

10 WITH SHARED SAVINGS AND SHARED LOSSES.— 

11 ‘‘(1) FEE-FOR-SERVICE-BASED PAYMENT.—If 

12 the payment model under this subsection is selected 

13 by a qualified entity, the Secretary shall pay pro14 viders of services and suppliers of the entity for ap15 plicable services for an applicable condition during 

16 an episode of care amounts payable under parts A 

17 and B for such services in the same manner as such 

18 providers and suppliers would otherwise be paid 

19 under such parts (referred to in this subsection as 

20 ‘fee-for-service payments’). 

21 ‘‘(2) SHARED SAVINGS AND LOSSES.— 

22 ‘‘(A) COMPUTATION OF EACH QUALIFIED

23 ENTITY’S ACTUAL STANDARDIZED AVERAGE

24 SPENDING PER EPISODE OF CARE.—In applying 

25 this subsection, in calculating the actual standVerDate Sep 11 2014 02:53 May 28, 2015 Jkt 049200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\H2502.IH H2502

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1 ardized average fee-for-service spending per epi2 sode of care for a discharging hospital for each 

3 applicable condition in each agreement year, the 

4 Secretary shall exclude outlier episodes of care 

5 described in subsection (f)(2)(B)(ii)(I), as esti6 mated by the Secretary, based on data applica7 ble to payments in the agreement year and shall 

8 standardize such spending per episode of care 

9 in the manner provided in subsection 

10 (f)(2)(B)(ii)(II). For the purpose of identifying 

11 outlier episodes of care for each applicable con12 dition, the percentile ranking of each episode of 

13 care and applicable condition and the 95th per14 centile shall be based on payments standardized 

15 by adjustments for provider location and pro16 vider type of the type described in subsection 

17 (f)(2)(B)(ii)(II). 

18 ‘‘(B) COMPUTATION OF GROSS SHARED

19 SAVINGS AND SHARED LOSSES FOR EACH AP20 PLICABLE CONDITION FOR EACH DISCHARGING

21 HOSPITAL.—For purposes of applying subpara22 graph (C), if actual standardized average fee23 for-service payments to a qualified entity for all 

24 episodes of care for an applicable condition in 


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1 an agreement year for a discharging hospital, 

2 as calculated under subparagraph (A), are— 

3 ‘‘(i) less than the applicable spending 

4 target under subsection (f)(2)(C) for such 

5 condition, year, and hospital, there shall be 

6 a gross shared savings for such applicable 

7 condition, year, and hospital equal to 60 

8 percent of the difference between such ac9 tual average payments and the spending 

10 target for such condition, year, and hos11 pital; or 

12 ‘‘(ii) greater than such applicable 

13 spending target, there shall be a gross 

14 shared loss for such applicable condition, 

15 year, and hospital equal to 60 percent of 

16 such difference. 

17 ‘‘(C) RETROSPECTIVE RECONCILIATION.— 

18 ‘‘(i) TOTALING GROSS SHARED SAV19 INGS AND LOSSES FOR ALL CONDITIONS

20 AND ALL DISCHARGING HOSPITALS FOR A

21 QUALIFIED ENTITY.—At the end of each 

22 agreement year for each qualified entity, 

23 for purposes of applying clauses (ii) and 

24 (iii), the Secretary shall aggregate the 

25 gross shared savings and the gross shared 


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1 losses under subparagraph (B) of such en2 tity for the year for all applicable condi3 tions and for all discharging hospitals. 

4 ‘‘(ii) PAYMENT TO ENTITY OF NET

5 SAVINGS.—Subject to clause (iv) and sub6 section (j)(3) (relating to quality perform7 ance thresholds), if such aggregate gross 

8 shared savings exceeds such aggregate 

9 gross shared losses for a qualified entity 

10 for an agreement year, the Secretary shall 

11 pay to the qualified entity a lump sum 

12 amount equal to such excess for such year. 

13 ‘‘(iii) COLLECTION FROM ENTITY OF

14 NET LOSSES.—Subject to clause (iv), if 

15 such aggregate gross shared losses exceeds 

16 such aggregate gross shared savings for a 

17 qualified entity for an agreement year, the 

18 qualified entity shall pay to the Secretary 

19 (and the Secretary shall collect from the 

20 entity) a lump sum amount equal to such 

21 excess for such year. 

22 ‘‘(iv) CAP ON PAYMENTS.—In no case 

23 shall the payment under clause (ii) or (iii) 

24 with respect to a qualified entity for an 

25 agreement year exceed 10 percent of the 


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1 aggregate spending target for that quali2 fied entity for all applicable conditions and 

3 all discharging hospitals for that year. 

4 ‘‘(h) PROSPECTIVE BUNDLED PAYMENT MODEL FOR

5 ADVANCED QUALIFIED ENTITIES.— 

6 ‘‘(1) IN GENERAL.—Subject to approval by the 

7 Secretary, if the payment model under this sub8 section is selected, a qualified entity may elect to re9 ceive a prospective bundled payment for each episode 

10 of care for each applicable condition and discharging 

11 hospital in the agreement year equal to the spending 

12 target for such episode, year, and hospital under 

13 subsection (f)(2) and the provisions of subsection (g) 

14 do not apply. Such spending target shall be ad15 justed, in the same manner described in subsection 

16 (g)(2)(B), in order to take into account outlier epi17 sodes of care and standardized adjustments for pro18 vider location and provider type of the type de19 scribed in subsection (f)(2)(B)(ii)(II). 

20 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in 

21 this section shall be construed as prohibiting a quali22 fied entity that receives bundled payments under 

23 this subsection from participating in an accountable 

24 care organization under section 1899. 


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1 ‘‘(3) RELATIONSHIP TO BPCI.—The Secretary 

2 may not terminate the Bundled Payments for Care 

3 Improvement initiative conducted pursuant to sec4 tion 1115A until the prospective bundled payment 

5 model is implemented under this subsection. 

6 ‘‘(i) QUALITY AND EFFICIENCY ARRANGEMENTS.— 

7 ‘‘(1) IN GENERAL.—Subject to subsection 

8 (c)(1)(D) (relating to application requirements for 

9 notice of quality and efficiency arrangements and 

10 their structure) and subsection (j)(3) (relating to 

11 minimum quality performance thresholds), qualified 

12 entities participating in either the fee-for-service 

13 bundled payment model under subsection (g) or the 

14 prospective bundled payment model under subsection 

15 (h) may enter into quality and efficiency arrange16 ments under which physicians and other health care 

17 practitioners work to improve the quality and effi18 ciency of care under this title. 

19 ‘‘(2) TYPES OF ARRANGEMENTS.—The arrange20 ments under paragraph (1) shall take into account 

21 the utilization of the resources of providers of serv22 ices and suppliers and may provide for a distribution 

23 of a portion of any shared savings (or internal sav24 ing, as the case may be) realized under this section 

25 to qualifying providers and suppliers. 


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1 ‘‘(j) QUALITY MEASURES.— 

2 ‘‘(1) SELECTION; DEVELOPMENT.— 

3 ‘‘(A) SELECTION.—For each applicable 

4 condition, the Secretary shall select quality 

5 measures related to care provided by providers 

6 of services and suppliers through qualified enti7 ties to which bundled payments are made under 

8 this section. In selecting quality measures, to 

9 the extent appropriate and practicable, the Sec10 retary shall choose measures that— 

11 ‘‘(i) are endorsed and validated by the 

12 entity with a contract under section 1890; 

13 ‘‘(ii) pertain to the National Quality 

14 Strategy’s six priorities; 

15 ‘‘(iii) are used by the Secretary under 

16 other provisions of this title; and 

17 ‘‘(iv) minimize the incremental data 

18 extraction and reporting burden on pro19 viders and suppliers. 

20 ‘‘(B) DEVELOPMENT OF ELECTRONICALLY

21 SPECIFIED EPISODIC MEASURES.—The Sec22 retary shall develop longitudinal quality and ef23 ficiency measures to assess performance of 

24 qualified entities with respect to patient out25 comes and the care provided for each applicable 


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1 condition across the associated episodes of care. 

2 Such measures shall be electronically specified 

3 for submittal through the use of qualified elec4 tronic health records (as defined in section 

5 3000(13) of the Public Health Service Act (42 

6 U.S.C. 300jj(13))). 

7 ‘‘(2) REPORTING ON QUALITY MEASURES.— 

8 ‘‘(A) IN GENERAL.—A qualified entity 

9 shall submit data to the Secretary on quality 

10 measures selected under paragraph (1) for each 

11 agreement year in a form and manner specified 

12 by the Secretary consistent with the succeeding 

13 provisions of this paragraph. 

14 ‘‘(B) SUBMISSION OF DATA THROUGH

15 ELECTRONIC HEALTH RECORD.—To the extent 

16 practicable, such data shall be submitted 

17 through the use of a qualified electronic health 

18 record (as defined in section 3000(13) of the 

19 Public Health Service Act (42 U.S.C. 

20 300jj(13))). 

21 ‘‘(C) SUBMISSION OF DATA USED IN

22 OTHER PROGRAMS.—Insofar as quality meas23 ures established under paragraph (1) are the 

24 same as those measures used by the Secretary 

25 under other provisions of this title, such as 


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1 those selected under section 1886(b)(3)(B)(viii), 

2 the Secretary shall use existing processes for 

3 the submission of data for such measures under 

4 this paragraph. 

5 ‘‘(3) QUALITY PERFORMANCE THRESHOLDS.— 

6 ‘‘(A) ESTABLISHMENT.—For each applica7 ble condition, the Secretary shall establish min8 imum quality performance thresholds for the 

9 measures established under paragraph (1). In 

10 the case of a quality and efficiency arrange11 ment, such performance thresholds shall be de12 veloped using the quality measures identified by 

13 the qualified entity in its application under sub14 section (c)(1)(D) if approved by the Secretary. 

15 ‘‘(B) LOSS OF SHARED SAVINGS PAYMENT

16 AND QUALITY AND EFFICIENCY ARRANGEMENTS

17 FOR FAILURE TO MEET MINIMUM QUALITY PER18 FORMANCE THRESHOLDS.—If a qualified entity 

19 fails to meet the minimum quality performance 

20 thresholds established under subparagraph (A) 

21 for an agreement year— 

22 ‘‘(i) no payment may be made to the 

23 entity under subsection (g)(2)(C)(ii) with 

24 respect to that year; and 


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1 ‘‘(ii) the entity may not implement 

2 any quality and efficiency arrangement 

3 under subsection (i) for that year. 

4 ‘‘(k) WAIVERS.— 

5 ‘‘(1) IN GENERAL.—The Secretary shall waive 

6 such provisions of this title and title XI as may be 

7 necessary to carry out the program, including the 

8 following: 

9 ‘‘(A) With respect to authorizing quality 

10 and efficiency arrangements between qualified 

11 entities and providers of services and suppliers, 

12 section 1877(a) (relating to physician self-refer13 ral), paragraphs (1) and (2) of sections 

14 1128A(b) (relating to the gainsharing civil 

15 money penalties), and paragraphs (1) and (2) 

16 of section 1128B(b) (relating to the anti-kick17 back statute). 

18 ‘‘(B) Section 1128A(a)(5) of the Act (re19 lating to the inducement civil money penalties). 

20 ‘‘(C) Section 1861(i) (relating to the 3-day 

21 acute hospitalization prerequisite before eligi22 bility for post-hospital extended care services). 

23 ‘‘(D) With respect to home health serv24 ices— 


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1 ‘‘(i) sections 1814(a)(2)(C) and 

2 1835(a)(2)(A) (relating to the requirement 

3 that an individual be confined to home in 

4 order to be eligible for benefits for home 

5 health services); 

6 ‘‘(ii) limitations on the amount, fre7 quency, and duration on home health serv8 ices; and 

9 ‘‘(iii) prohibitions of free preoperative 

10 home safety assessments by home health 

11 agencies for patients scheduled to undergo 

12 surgery (such as under Advisory Opinion 

13 No. 06–01 of the Inspector General of the 

14 Department of Health and Human Serv15 ices). 

16 ‘‘(2) AUTHORITY TO MODIFY WAIVERS UNDER

17 CERTAIN CIRCUMSTANCES.— 

18 ‘‘(A) IN GENERAL.—In the case of a quali19 fied entity with respect to which one or more 

20 waivers under paragraph (1) is in effect, if 

21 upon a review of the performance or an audit 

22 of the entity the Secretary finds a pattern of 

23 deficiencies or harm to applicable beneficiaries, 

24 the Secretary may modify or revoke any such 


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1 waiver at any time as applied to that qualified 

2 entity. 

3 ‘‘(B) TERMINATION OF CERTAIN WAIVERS

4 IN THE CASE OF EXCESS SHARED LOSSES.— 

5 ‘‘(i) IN GENERAL.—Subject to the 

6 process described in clause (ii), in the case 

7 of a qualified entity that has selected the 

8 payment model under subsection (g) and 

9 has gross shared losses exceeding the cap 

10 under subsection (g)(2)(C)(iv) with respect 

11 to an applicable condition, the Secretary 

12 shall terminate waivers described in para13 graphs (1)(C) and (1)(D) with respect to 

14 such qualified entity and applicable condi15 tion. 

16 ‘‘(ii) PRE-TERMINATION NOTICE.— 

17 The Secretary shall establish a process 

18 whereby a qualified entity is furnished no19 tice of any deficiency that may give rise to 

20 a termination of waivers under clause (i) 

21 not later than 6 months before the pro22 posed effective date of the termination. 

23 ‘‘(l) INDEPENDENT EVALUATION AND REPORTS ON

24 PROGRAM.— 


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1 ‘‘(1) INDEPENDENT EVALUATION.—The Sec2 retary shall conduct an independent evaluation of 

3 the impact of providing bundled payments to quali4 fied entities under this section. Such evaluation shall 

5 include an examination of the extent to which the 

6 bundling of payments this section have resulted in— 

7 ‘‘(A) improved health outcomes; 

8 ‘‘(B) improved access to care for applicable 

9 beneficiaries; 

10 ‘‘(C) reduced spending under this title; and 

11 ‘‘(D) improvement in performance on qual12 ity measures selected under subsection 

13 (j)(1)(A). 

14 ‘‘(2) REPORTS.— 

15 ‘‘(A) INTERIM REPORT.—Not later than 

16 March 1, 2019, the Secretary shall submit to 

17 Congress a report on the initial results of the 

18 independent evaluation conducted under para19 graph (1). 

20 ‘‘(B) FINAL REPORT.—Not later than 

21 March 1, 2021, the Secretary shall submit to 

22 Congress a report on the final results of the 

23 independent evaluation conducted under para24 graph (1) and may include recommendations 

25 for the expansion of bundled payment methVerDate Sep 11 2014 02:53 May 28, 2015 Jkt 049200 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\H2502.IH H2502

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•HR 2502 IH

1 odologies and applicable conditions under this 

2 section as the Secretary determines to be appro3 priate.’’. 

Æ 


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