I

106TH CONGRESS

1ST SESSION H. R. 2341

To amend title XIX of the Social Security Act to establish a new prospective

payment system for Federally-qualified health centers and rural health clinics.

IN THE HOUSE OF REPRESENTATIVES

JUNE 24, 1999

Mr. BURR of North Carolina (for himself and Mr. TOWNS) introduced the

following bill; which was referred to the Committee on Commerce

A BILL

To amend title XIX of the Social Security Act to establish

a new prospective payment system for Federally-qualified

health centers and rural health clinics.

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 ‘‘Safety Net Preserva5 tion Act of 1999’’.

6 SEC. 2. NEW PROSPECTIVE PAYMENT SYSTEM FOR FEDER7 ALLY-QUALIFIED HEALTH CENTERS AND

8 RURAL HEALTH CLINICS.

9 (a) IN GENERAL.—Section 1902(a) of the Social Se10 curity Act (42 U.S.C. 1396a(a)) is amended—
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1 (1) in paragraph (13)—

2 (A) in subparagraph (A), by adding ‘‘and’’

3 at the end;

4 (B) in subparagraph (B), by striking

5 ‘‘and’’ at the end; and

6 (C) by striking subparagraph (C); and

7 (2) by inserting after paragraph (14) the fol8 lowing new paragraph:

9 ‘‘(15) for payment for services described in

10 clause (B) or (C) of section 1905(a)(2) under the

11 plan in accordance with subsection (aa);’’.

12 (b) NEW PROSPECTIVE PAYMENT SYSTEM.—Section

13 1902 of the Social Security Act (42 U.S.C. 1396a) is

14 amended by adding at the end the following:

15 ‘‘(aa) PAYMENT FOR SERVICES PROVIDED BY FED16 ERALLY-QUALIFIED HEALTH CENTERS AND RURAL

17 HEALTH CLINICS.—

18 ‘‘(1) IN GENERAL.—Beginning with fiscal year

19 2000 and each succeeding fiscal year, the State plan

20 shall provide for payment for services described in

21 section 1905(a)(2)(C) furnished by a Federally22 qualified health center and services described in sec23 tion 1905(a)(2)(B) furnished by a rural health clinic

24 in accordance with the provisions of this subsection.
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1 ‘‘(2) FISCAL YEAR 2000.—Subject to paragraph

2 (4), for services furnished during fiscal year 2000,

3 the State plan shall provide for payment for such

4 services in an amount (calculated on a per visit

5 basis) that is equal to 100 percent of the costs of

6 the center or clinic of furnishing such services dur7 ing fiscal year 1999 which are reasonable and re8 lated to the cost of furnishing such services, or

9 based on such other tests of reasonableness as the

10 Secretary prescribes in regulations under section

11 1833(a)(3), or, in the case of services to which such

12 regulations do not apply, the same methodology used

13 under section 1833(a)(3), adjusted to take into ac14 count any increase in the scope of such services fur15 nished by the center or clinic during fiscal year

16 2000.

17 ‘‘(3) FISCAL YEAR 2001 AND SUCCEEDING FIS18 CAL YEARS.—Subject to paragraph (4), for services

19 furnished during fiscal year 2001 or a succeeding

20 fiscal year, the State plan shall provide for payment

21 for such services in an amount (calculated on a per

22 visit basis) that is equal to the amount calculated for

23 such services under this subsection for the preceding

24 fiscal year—
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1 ‘‘(A) increased by the percentage increase

2 in the MEI (as defined in section 1842(i)(3))

3 applicable to primary care services (as defined

4 in section 1842(i)(4)) for that fiscal year; and

5 ‘‘(B) adjusted to take into account any in6 crease in the scope of such services furnished by

7 the center or clinic during that fiscal year.

8 ‘‘(4) ESTABLISHMENT OF INITIAL YEAR PAY9 MENT AMOUNT FOR NEW CENTERS OR CLINICS.—In

10 any case in which an entity first qualifies as a Fed11 erally-qualified health center or rural health clinic

12 after fiscal year 1999, the State plan shall provide

13 for payment for services described in section

14 1905(a)(2)(C) furnished by the center or services

15 described in section 1905(a)(2)(B) furnished by the

16 clinic in the first fiscal year in which the center or

17 clinic so qualifies in an amount (calculated on a per

18 visit basis) that is equal to 100 percent of the costs

19 of furnishing such services during such fiscal year in

20 accordance with the regulations and methodology re21 ferred to in paragraph (2). For each fiscal year fol22 lowing the fiscal year in which the entity first quali23 fies as a Federally-qualified health center or rural

24 health clinic, the State plan shall provide for the
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1 payment amount to be calculated in accordance with

2 paragraph (3).

3 ‘‘(5) ADMINISTRATION IN THE CASE OF MAN4 AGED CARE.—In the case of services furnished by a

5 Federally-qualified health center or rural health clin6 ic pursuant to a contract between the center or clinic

7 and a managed care entity (as defined in section

8 1932(a)(1)(B)), the State plan shall provide for pay9 ment to the center or clinic (at least quarterly) by

10 the State of a supplemental payment equal to the

11 amount (if any) by which the amount determined

12 under paragraphs (2), (3), and (4) of this subsection

13 exceeds the amount of the payments provided under

14 the contract.

15 ‘‘(6) ALTERNATIVE PAYMENT METHODOLO16 GIES.—Notwithstanding any other provision of this

17 section, the State plan may provide for payment in

18 any fiscal year to a Federally-qualified health center

19 for services described in section 1905(a)(2)(C) or to

20 a rural health clinic for services described in section

21 1905(a)(2)(B) in an amount which is determined

22 under an alternative payment methodology that—

23 ‘‘(A) is agreed to by the State and the cen24 ter or clinic; and
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1 ‘‘(B) results in payment to the center or

2 clinic of an amount which is at least equal to

3 the amount otherwise required to be paid to the

4 center or clinic under this section.’’.

5 (c) CONFORMING AMENDMENTS.—

6 (1) Section 4712 of the Balanced Budget Act

7 of 1997 (Public Law 105-33; 111 Stat. 508) is

8 amended by striking subsection (c).

9 (2) Section 1915(b) of the Social Security Act

10 (42 U.S.C. 1396n(b)) is amended by striking

11 ‘‘1902(a)(13)(E)’’ and inserting ‘‘1902(a)(15),

12 1902(aa),’’.

13 (d) EFFECTIVE DATE.—The amendments made by

14 this section take effect on October 1, 1999, and apply to

15 services furnished on or after such date.

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