I 

113TH CONGRESS 

2D SESSION H. R. 4302 

To amend the Social Security Act to extend Medicare payments to physicians 

and other provisions of the Medicare and Medicaid programs, and for 

other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 26, 2014 

Mr. PITTS introduced the following bill; which was referred to the Committee 

on Energy and Commerce, and in addition to the Committees on Ways 

and Means and the Budget, 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 the Social Security Act to extend Medicare payments to physicians and other provisions of the Medicare 

and Medicaid programs, and for other purposes. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Protecting Access to Medicare Act of 2014’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 


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TITLE I—MEDICARE EXTENDERS 

Sec. 101. Physician payment update. 

Sec. 102. Extension of work GPCI floor. 

Sec. 103. Extension of therapy cap exceptions process. 

Sec. 104. Extension of ambulance add-ons. 

Sec. 105. Extension of increased inpatient hospital payment adjustment for certain low-volume hospitals. 

Sec. 106. Extension of the Medicare-dependent hospital (MDH) program. 

Sec. 107. Extension for specialized Medicare Advantage plans for special needs 

individuals. 

Sec. 108. Extension of Medicare reasonable cost contracts. 

Sec. 109. Extension of funding for quality measure endorsement, input, and selection. 

Sec. 110. Extension of funding outreach and assistance for low-income programs. 

Sec. 111. Extension of two-midnight rule. 

Sec. 112. Technical changes to Medicare LTCH amendments. 

TITLE II—OTHER HEALTH PROVISIONS 

Sec. 201. Extension of the qualifying individual (QI) program. 

Sec. 202. Temporary extension of transitional medical assistance (TMA). 

Sec. 203. Extension of Medicaid and CHIP express lane option. 

Sec. 204. Extension of special diabetes program for type I diabetes and for Indians. 

Sec. 205. Extension of abstinence education. 

Sec. 206. Extension of personal responsibility education program (PREP). 

Sec. 207. Extension of funding for family-to-family health information centers. 

Sec. 208. Extension of health workforce demonstration project for low-income 

individuals. 

Sec. 209. Extension of maternal, infant, and early childhood home visiting programs. 

Sec. 210. Pediatric quality measures. 

Sec. 211. Delay of effective date for Medicaid amendments relating to beneficiary liability settlements. 

Sec. 212. Delay in transition from ICD–9 TO ICD–10 code sets. 

Sec. 213. Elimination of limitation on deductibles for employer-sponsored 

health plans. 

Sec. 214. GAO report on the Children’s Hospital Graduate Medical Education 

Program. 

Sec. 215. Skilled nursing facility value-based purchasing. 

Sec. 216. Improving Medicare policies for clinical diagnostic laboratory tests. 

Sec. 217. Revisions under the Medicare ESRD prospective payment system. 

Sec. 218. Quality incentives for computed tomography diagnostic imaging and 

promoting evidence-based care. 

Sec. 219. Using funding from Transitional Fund for Sustainable Growth Rate 

(SGR) Reform. 

Sec. 220. Ensuring accurate valuation of services under the physician fee 

schedule. 

Sec. 221. Medicaid DSH. 

Sec. 222. Realignment of the Medicare sequester for fiscal year 2024. 

Sec. 223. Demonstration programs to improve community mental health services. 


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Sec. 224. Assisted outpatient treatment grant program for individuals with serious mental illness. 

Sec. 225. Exclusion from PAYGO scorecards. 

1 TITLE I—MEDICARE EXTENDERS 

2 SEC. 101. PHYSICIAN PAYMENT UPDATE. 

3 Section 1848(d) of the Social Security Act (42 U.S.C. 

4 1395w–4(d)) is amended— 

5 (1) in paragraph (15)— 

6 (A) in the heading, by striking ‘‘JANUARY

7 THROUGH MARCH OF’’; 

8 (B) in subparagraph (A), by striking ‘‘for 

9 the period beginning on January 1, 2014, and 

10 ending on March 31, 2014’’; and 

11 (C) in subparagraph (B)— 

12 (i) in the heading, by striking ‘‘RE13 MAINING PORTION OF 2014 AND’’; and 

14 (ii) by striking ‘‘the period beginning 

15 on April 1, 2014, and ending on December 

16 31, 2014, and for’’; and 

17 (2) by adding at the end the following new 

18 paragraph: 

19 ‘‘(16) UPDATE FOR JANUARY THROUGH MARCH

20 OF 2015.— 

21 ‘‘(A) IN GENERAL.—Subject to paragraphs 

22 (7)(B), (8)(B), (9)(B), (10)(B), (11)(B), 

23 (12)(B), (13)(B), (14)(B), and (15)(B), in lieu 

24 of the update to the single conversion factor esVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 tablished in paragraph (1)(C) that would other2 wise apply for 2015 for the period beginning on 

3 January 1, 2015, and ending on March 31, 

4 2015, the update to the single conversion factor 

5 shall be 0.0 percent. 

6 ‘‘(B) NO EFFECT ON COMPUTATION OF

7 CONVERSION FACTOR FOR REMAINING PORTION

8 OF 2015 AND SUBSEQUENT YEARS.—The con9 version factor under this subsection shall be 

10 computed under paragraph (1)(A) for the pe11 riod beginning on April 1, 2015, and ending on 

12 December 31, 2015, and for 2016 and subse13 quent years as if subparagraph (A) had never 

14 applied.’’. 

15 SEC. 102. EXTENSION OF WORK GPCI FLOOR. 

16 Section 1848(e)(1)(E) of the Social Security Act (42 

17 U.S.C. 1395w–4(e)(1)(E)) is amended by striking ‘‘April 

18 1, 2014’’ and inserting ‘‘April 1, 2015’’. 

19 SEC. 103. EXTENSION OF THERAPY CAP EXCEPTIONS PROC20 ESS. 

21 Section 1833(g) of the Social Security Act (42 U.S.C. 

22 1395l(g)) is amended— 

23 (1) in paragraph (5)(A), in the first sentence, 

24 by striking ‘‘March 31, 2014’’ and inserting ‘‘March 

25 31, 2015’’; and 


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1 (2) in paragraph (6)(A)— 

2 (A) by striking ‘‘March 31, 2014’’ and in3 serting ‘‘March 31, 2015’’; and 

4 (B) by striking ‘‘2012, 2013, or the first 

5 three months of 2014’’ and inserting ‘‘2012, 

6 2013, 2014, or the first three months of 2015’’. 

7 SEC. 104. EXTENSION OF AMBULANCE ADD-ONS. 

8 (a) GROUND AMBULANCE.—Section 1834(l)(13)(A) 

9 of the Social Security Act (42 U.S.C. 1395m(l)(13)(A)) 

10 is amended by striking ‘‘April 1, 2014’’ and inserting 

11 ‘‘April 1, 2015’’ each place it appears. 

12 (b) SUPER RURAL GROUND AMBULANCE.—Section 

13 1834(l)(12)(A) of the Social Security Act (42 U.S.C. 

14 1395m(l)(12)(A)) is amended, in the first sentence, by 

15 striking ‘‘April 1, 2014’’ and inserting ‘‘April 1, 2015’’. 

16 SEC. 105. EXTENSION OF INCREASED INPATIENT HOSPITAL 

17 PAYMENT ADJUSTMENT FOR CERTAIN LOW18 VOLUME HOSPITALS. 

19 Section 1886(d)(12) of the Social Security Act (42 

20 U.S.C. 1395ww(d)(12)) is amended— 

21 (1) in subparagraph (B), in the matter pre22 ceding clause (i), by striking ‘‘in the portion of fiscal 

23 year 2014 beginning on April 1, 2014, fiscal year 

24 2015, and subsequent fiscal years’’ and inserting ‘‘in 


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1 fiscal year 2015 (beginning on April 1, 2015), fiscal 

2 year 2016, and subsequent fiscal years’’; 

3 (2) in subparagraph (C)(i), by striking ‘‘fiscal 

4 years 2011, 2012, and 2013, and the portion of fis5 cal year 2014 before’’ and inserting ‘‘fiscal years 

6 2011 through 2014 and fiscal year 2015 (before 

7 April 1, 2015),’’ each place it appears; and 

8 (3) in subparagraph (D), by striking ‘‘fiscal 

9 years 2011, 2012, and 2013, and the portion of fis10 cal year 2014 before April 1, 2014,’’ and inserting 

11 ‘‘fiscal years 2011 through 2014 and fiscal year 

12 2015 (before April 1, 2015),’’. 

13 SEC. 106. EXTENSION OF THE MEDICARE-DEPENDENT HOS14 PITAL (MDH) PROGRAM. 

15 (a) IN GENERAL.—Section 1886(d)(5)(G) of the So16 cial Security Act (42 U.S.C. 1395ww(d)(5)(G)) is amend17 ed— 

18 (1) in clause (i), by striking ‘‘April 1, 2014’’ 

19 and inserting ‘‘April 1, 2015’’; and 

20 (2) in clause (ii)(II), by striking ‘‘April 1, 

21 2014’’ and inserting ‘‘April 1, 2015’’. 

22 (b) CONFORMING AMENDMENTS.— 

23 (1) EXTENSION OF TARGET AMOUNT.—Section 

24 1886(b)(3)(D) of the Social Security Act (42 U.S.C. 

25 1395ww(b)(3)(D)) is amended— 


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1 (A) in the matter preceding clause (i), by 

2 striking ‘‘April 1, 2014’’ and inserting ‘‘April 1, 

3 2015’’; and 

4 (B) in clause (iv), by striking ‘‘through fis5 cal year 2013 and the portion of fiscal year 

6 2014 before April 1, 2014’’ and inserting 

7 ‘‘through fiscal year 2014 and the portion of 

8 fiscal year 2015 before April 1, 2015’’. 

9 (2) PERMITTING HOSPITALS TO DECLINE RE10 CLASSIFICATION.—Section 13501(e)(2) of the Omni11 bus Budget Reconciliation Act of 1993 (42 U.S.C. 

12 1395ww note) is amended by striking ‘‘through the 

13 first 2 quarters of fiscal year 2014’’ and inserting 

14 ‘‘through the first 2 quarters of fiscal year 2015’’. 

15 SEC. 107. EXTENSION FOR SPECIALIZED MEDICARE ADVAN16 TAGE PLANS FOR SPECIAL NEEDS INDIVID17 UALS. 

18 Section 1859(f)(1) of the Social Security Act (42 

19 U.S.C. 1395w–28(f)(1)) is amended by striking ‘‘2016’’ 

20 and inserting ‘‘2017’’. 

21 SEC. 108. EXTENSION OF MEDICARE REASONABLE COST 

22 CONTRACTS. 

23 Section 1876(h)(5)(C)(ii) of the Social Security Act 

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1 ter preceding subclause (I), by striking ‘‘January 1, 2015’’ 

2 and inserting ‘‘January 1, 2016’’. 

3 SEC. 109. EXTENSION OF FUNDING FOR QUALITY MEASURE 

4 ENDORSEMENT, INPUT, AND SELECTION. 

5 Section 1890(d) of the Social Security Act (42 U.S.C. 

6 1395aaa(d)) is amended— 

7 (1) by inserting ‘‘(1)’’ before ‘‘For purposes’’; 

8 and 

9 (2) by adding at the end the following new 

10 paragraph: 

11 ‘‘(2) For purposes of carrying out this section and 

12 section 1890A (other than subsections (e) and (f)), the 

13 Secretary shall provide for the transfer, from the Federal 

14 Hospital Insurance Trust Fund under section 1817 and 

15 the Federal Supplementary Medical Insurance Trust 

16 Fund under section 1841, in such proportion as the Sec17 retary determines appropriate, to the Centers for Medicare 

18 & Medicaid Services Program Management Account of 

19 $5,000,000 for fiscal year 2014 and $15,000,000 for the 

20 first 6 months of fiscal year 2015. Amounts transferred 

21 under the preceding sentence shall remain available until 

22 expended.’’. 


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1 SEC. 110. EXTENSION OF FUNDING OUTREACH AND ASSIST2 ANCE FOR LOW-INCOME PROGRAMS. 

3 (a) ADDITIONAL FUNDING FOR STATE HEALTH IN4 SURANCE PROGRAMS.—Subsection (a)(1)(B) of section 

5 119 of the Medicare Improvements for Patients and Pro6 viders Act of 2008 (42 U.S.C. 1395b–3 note), as amended 

7 by section 3306 of the Patient Protection and Affordable 

8 Care Act Public Law 111–148), section 610 of the Amer9 ican Taxpayer Relief Act of 2012 (Public Law 112–240), 

10 and section 1110 of the Pathway for SGR Reform Act 

11 of 2013 (Public Law 113–67), is amended— 

12 (1) in clause (iii), by striking ‘‘and’’ at the end; 

13 (2) by striking clause (iv); and 

14 (3) by adding at the end the following new 

15 clauses: 

16 ‘‘(iv) for fiscal year 2014, of 

17 $7,500,000; and 

18 ‘‘(v) for the portion of fiscal year 

19 2015 before April 1, 2015, of 

20 $3,750,000.’’. 

21 (b) ADDITIONAL FUNDING FOR AREA AGENCIES ON

22 AGING.—Subsection (b)(1)(B) of such section 119, as so 

23 amended, is amended— 

24 (1) in clause (iii), by striking ‘‘and’’ at the end; 

25 (2) by striking clause (iv); and 


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1 (3) by inserting after clause (iii) the following 

2 new clauses: 

3 ‘‘(iv) for fiscal year 2014, of 

4 $7,500,000; and 

5 ‘‘(v) for the portion of fiscal year 

6 2015 before April 1, 2015, of 

7 $3,750,000.’’. 

8 (c) ADDITIONAL FUNDING FOR AGING AND DIS9 ABILITY RESOURCE CENTERS.—Subsection (c)(1)(B) of 

10 such section 119, as so amended, is amended— 

11 (1) in clause (iii), by striking ‘‘and’’ at the end; 

12 (2) by striking clause (iv); and 

13 (3) by inserting after clause (iii) the following 

14 new clauses: 

15 ‘‘(iv) for fiscal year 2014, of 

16 $5,000,000; and 

17 ‘‘(v) for the portion of fiscal year 

18 2015 before April 1, 2015, of 

19 $2,500,000.’’. 

20 (d) ADDITIONAL FUNDING FOR CONTRACT WITH

21 THE NATIONAL CENTER FOR BENEFITS AND OUTREACH

22 ENROLLMENT.—Subsection (d)(2) of such section 119, as 

23 so amended, is amended— 

24 (1) in clause (iii), by striking ‘‘and’’ at the end; 

25 (2) by striking clause (iv); and 


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1 (3) by inserting after clause (iii) the following 

2 new clauses: 

3 ‘‘(iv) for fiscal year 2014, of 

4 $5,000,000; and 

5 ‘‘(v) for the portion of fiscal year 

6 2015 before April 1, 2015, of 

7 $2,500,000.’’. 

8 SEC. 111. EXTENSION OF TWO-MIDNIGHT RULE. 

9 (a) CONTINUATION OF CERTAIN MEDICAL REVIEW

10 ACTIVITIES.—The Secretary of Health and Human Serv11 ices may continue medical review activities described in 

12 the notice entitled ‘‘Selecting Hospital Claims for Patient 

13 Status Reviews: Admissions On or After October 1, 

14 2013’’, posted on the Internet website of the Centers for 

15 Medicare & Medicaid Services, through the first 6 months 

16 of fiscal year 2015 for such additional hospital claims as 

17 the Secretary determines appropriate. 

18 (b) LIMITATION.—The Secretary of Health and 

19 Human Services shall not conduct patient status reviews 

20 (as described in such notice) on a post-payment review 

21 basis through recovery audit contractors under section 

22 1893(h) of the Social Security Act (42 U.S.C. 

23 1395ddd(h)) for inpatient claims with dates of admission 

24 October 1, 2013, through March 31, 2015, unless there 

25 is evidence of systematic gaming, fraud, abuse, or delays 


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1 in the provision of care by a provider of services (as de2 fined in section 1861(u) of such Act (42 U.S.C. 

3 1395x(u))). 

4 SEC. 112. TECHNICAL CHANGES TO MEDICARE LTCH 

5 AMENDMENTS. 

6 (a) IN GENERAL.—Subclauses (I) and (II) of section 

7 1886(m)(6)(C)(iv) of the Social Security Act (42 U.S.C. 

8 1395ww(m)(6)(C)(iv)) are each amended by striking ‘‘dis9 charges’’ and inserting ‘‘Medicare fee-for-service dis10 charges’’. 

11 (b) MMSEA CORRECTION.—Section 114(d) of the 

12 Medicare, Medicaid, and SCHIP Extension Act of 2007 

13 (42 U.S.C. 1395ww note), as amended by sections 3106(b) 

14 and 10312(b) of Public Law 111–148 and by section 

15 1206(b)(2) of the Pathway for SGR Reform Act of 2013 

16 (division B of Public Law 113–67), is amended— 

17 (1) in paragraph (1), in the matter preceding 

18 subparagraph (A), by striking ‘‘January 1, 2015,’’ 

19 and inserting ‘‘on the date of the enactment of para20 graph (7) of this subsection’’; 

21 (2) in paragraph (6), by striking ‘‘January 1, 

22 2015,’’ and inserting ‘‘on the date of the enactment 

23 of paragraph (7) of this subsection’’; and 

24 (3) by adding at the end the following new 

25 paragraph: 


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1 ‘‘(7) ADDITIONAL EXCEPTION FOR CERTAIN

2 LONG-TERM CARE HOSPITALS.—The moratorium 

3 under paragraph (1)(A) shall not apply to a long4 term care hospital that— 

5 ‘‘(A) began its qualifying period for pay6 ment as a long-term care hospital under section 

7 412.23(e) of title 42, Code of Federal Regula8 tions, on or before the date of enactment of this 

9 paragraph; 

10 ‘‘(B) has a binding written agreement as 

11 of the date of the enactment of this paragraph 

12 with an outside, unrelated party for the actual 

13 construction, renovation, lease, or demolition 

14 for a long-term care hospital, and has ex15 pended, before such date of enactment, at least 

16 10 percent of the estimated cost of the project 

17 (or, if less, $2,500,000); or 

18 ‘‘(C) has obtained an approved certificate 

19 of need in a State where one is required on or 

20 before such date of enactment.’’. 

21 (c) ADDITIONAL AMENDMENTS.—Section 1206(a) of 

22 the Pathway for SGR Reform Act of 2013 (division B of 

23 Public Law 113–67) is amended— 

24 (1) in paragraph (2)(A), by striking ‘‘Assess25 ment’’ and inserting ‘‘Advisory’’; and 


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1 (2) in paragraph (3)(B), by striking ‘‘shall not 

2 apply to a hospital that is classified as of December 

3 10, 2013, as a subsection (d) hospital (as defined in 

4 section 1886(d)(1)(B) of the Social Security Act, 42 

5 U.S.C. 1395ww(d)(1)(B))’’ and inserting ‘‘shall only 

6 apply to a hospital that is classified as of December 

7 10, 2013, as a long-term care hospital (as defined 

8 in section 1861(ccc) of the Social Security Act, 42 

9 U.S.C. 1395x(ccc))’’. 

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

11 this section are effective as of the date of the enactment 

12 of this Act. 

13 TITLE II—OTHER HEALTH 

14 PROVISIONS 

15 SEC. 201. EXTENSION OF THE QUALIFYING INDIVIDUAL (QI) 

16 PROGRAM. 

17 (a) EXTENSION.—Section 1902(a)(10)(E)(iv) of the 

18 Social Security Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is 

19 amended by striking ‘‘March 2014’’ and inserting ‘‘March 

20 2015’’. 

21 (b) EXTENDING TOTAL AMOUNT AVAILABLE FOR

22 ALLOCATION.—Section 1933(g) of the Social Security Act 

23 (42 U.S.C. 1396u–3(g)) is amended— 

24 (1) in paragraph (2)— 


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1 (A) in subparagraph (T), by striking 

2 ‘‘and’’ at the end; 

3 (B) in subparagraph (U)— 

4 (i) by striking ‘‘March 31, 2014’’ and 

5 inserting ‘‘September 30, 2014’’; and 

6 (ii) by striking ‘‘$200,000,000.’’ and 

7 inserting ‘‘$485,000,000;’’; and 

8 (C) by adding at the end the following new 

9 subparagraphs: 

10 ‘‘(V) for the period that begins on October 

11 1, 2014, and ends on December 31, 2014, the 

12 total allocation amount is $300,000,000; and 

13 ‘‘(W) for the period that begins on Janu14 ary 1, 2015, and ends on March 31, 2015, the 

15 total allocation amount is $250,000,000.’’; and 

16 (2) in paragraph (3), in the matter preceding 

17 subparagraph (A), by striking ‘‘or (T)’’ and insert18 ing ‘‘(T), or (V)’’. 

19 SEC. 202. TEMPORARY EXTENSION OF TRANSITIONAL MED20 ICAL ASSISTANCE (TMA). 

21 Sections 1902(e)(1)(B) and 1925(f) of the Social Se22 curity Act (42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are 

23 each amended by striking ‘‘March 31, 2014’’ and inserting 

24 ‘‘March 31, 2015’’. 


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1 SEC. 203. EXTENSION OF MEDICAID AND CHIP EXPRESS 

2 LANE OPTION. 

3 Section 1902(e)(13)(I) of the Social Security Act (42 

4 U.S.C. 1396a(e)(13)(I)) is amended by striking ‘‘Sep5 tember 30, 2014’’ and inserting ‘‘September 30, 2015’’. 

6 SEC. 204. EXTENSION OF SPECIAL DIABETES PROGRAM 

7 FOR TYPE I DIABETES AND FOR INDIANS. 

8 (a) SPECIAL DIABETES PROGRAMS FOR TYPE I DIA9 BETES.—Section 330B(b)(2)(C) of the Public Health 

10 Service Act (42 U.S.C. 254c–2(b)(2)(C)) is amended by 

11 striking ‘‘2014’’ and inserting ‘‘2015’’. 

12 (b) SPECIAL DIABETES PROGRAMS FOR INDIANS.— 

13 Section 330C(c)(2)(C) of the Public Health Service Act 

14 (42 U.S.C. 254c–3(c)(2)(C)) is amended by striking 

15 ‘‘2014’’ and inserting ‘‘2015’’. 

16 SEC. 205. EXTENSION OF ABSTINENCE EDUCATION. 

17 Subsections (a) and (d) of section 510 of the Social 

18 Security Act (42 U.S.C. 710) are each amended by strik19 ing ‘‘2014’’ and inserting ‘‘2015’’. 

20 SEC. 206. EXTENSION OF PERSONAL RESPONSIBILITY EDU21 CATION PROGRAM (PREP). 

22 Section 513 of the Social Security Act (42 U.S.C. 

23 713) is amended— 

24 (1) in paragraphs (1)(A) and (4)(A) of sub25 section (a), by striking ‘‘2014’’ and inserting 

26 ‘‘2015’’ each place it appears; 


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1 (2) in subsection (a)(4)(B)(i), by striking ‘‘and 

2 2014’’ and inserting ‘‘2014, and 2015’’; and 

3 (3) in subsection (f), by striking ‘‘2014’’ and 

4 inserting ‘‘2015’’. 

5 SEC. 207. EXTENSION OF FUNDING FOR FAMILY-TO-FAMILY 

6 HEALTH INFORMATION CENTERS. 

7 Section 501(c)(1)(A) of the Social Security Act (42 

8 U.S.C. 701(c)(1)(A)) is amended— 

9 (1) in clause (iii), by striking at the end ‘‘and’’; 

10 (2) in clause (iv), by striking the period at the 

11 end and inserting a semicolon and by moving the 

12 margin to align with the margin for clause (iii); and 

13 (3) by adding at the end the following new 

14 clauses: 

15 ‘‘(v) $2,500,000 for the portion of fiscal year 

16 2014 on or after April 1, 2014; and 

17 ‘‘(vi) $2,500,000 for the portion of fiscal year 

18 2015 before April 1, 2015.’’. 

19 SEC. 208. EXTENSION OF HEALTH WORKFORCE DEM20 ONSTRATION PROJECT FOR LOW-INCOME IN21 DIVIDUALS. 

22 Section 2008(c)(1) of the Social Security Act (42 

23 U.S.C. 1397g(c)(1)) is amended by striking ‘‘2014’’ and 

24 inserting ‘‘2015’’. 


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1 SEC. 209. EXTENSION OF MATERNAL, INFANT, AND EARLY 

2 CHILDHOOD HOME VISITING PROGRAMS. 

3 Section 511(j) of the Social Security Act (42 U.S.C. 

4 711(j)) is amended— 

5 (1) in paragraph (1)— 

6 (A) by striking ‘‘and’’ at the end of sub7 paragraph (D); 

8 (B) by striking the period at the end of 

9 subparagraph (E) and inserting ‘‘; and’’; and 

10 (C) by adding at the end the following new 

11 subparagraph: 

12 ‘‘(F) for the period beginning on October 

13 1, 2014, and ending on March 31, 2015, an 

14 amount equal to the amount provided in sub15 paragraph (E).’’; and 

16 (2) in paragraphs (2) and (3), by inserting ‘‘(or 

17 portion of a fiscal year)’’ after ‘‘for a fiscal year’’ 

18 each place it appears. 

19 SEC. 210. PEDIATRIC QUALITY MEASURES. 

20 (a) CONTINUATION OF FUNDING FOR PEDIATRIC

21 QUALITY MEASURES FOR IMPROVING THE QUALITY OF

22 CHILDREN’S HEALTH CARE.—Section 1139B(e) of the 

23 Social Security Act (42 U.S.C. 1320b–9b(e)) is amended 

24 by adding at the end the following: ‘‘Of the funds appro25 priated under this subsection, not less than $15,000,000 

26 shall be used to carry out section 1139A(b).’’. 


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1 (b) ELIMINATION OF RESTRICTION ON MEDICAID

2 QUALITY MEASUREMENT PROGRAM.—Section 

3 1139B(b)(5)(A) of the Social Security Act (42 U.S.C. 

4 1320b–9b(b)(5)(A)) is amended by striking ‘‘The aggre5 gate amount awarded by the Secretary for grants and con6 tracts for the development, testing, and validation of 

7 emerging and innovative evidence-based measures under 

8 such program shall equal the aggregate amount awarded 

9 by the Secretary for grants under section 

10 1139A(b)(4)(A)’’. 

11 SEC. 211. DELAY OF EFFECTIVE DATE FOR MEDICAID 

12 AMENDMENTS RELATING TO BENEFICIARY 

13 LIABILITY SETTLEMENTS. 

14 Effective as if included in the enactment of the Bipar15 tisan Budget Act of 2013 (Public Law 113–67), section 

16 202(c) of such Act is amended by striking ‘‘October 1, 

17 2014’’ and inserting ‘‘October 1, 2016’’. 

18 SEC. 212. DELAY IN TRANSITION FROM ICD–9 TO ICD–10 

19 CODE SETS. 

20 The Secretary of Health and Human Services may 

21 not, prior to October 1, 2015, adopt ICD–10 code sets 

22 as the standard for code sets under section 1173(c) of the 

23 Social Security Act (42 U.S.C. 1320d–2(c)) and section 

24 162.1002 of title 45, Code of Federal Regulations. 


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1 SEC. 213. ELIMINATION OF LIMITATION ON DEDUCTIBLES 

2 FOR EMPLOYER-SPONSORED HEALTH PLANS. 

3 (a) IN GENERAL.—Section 1302(c) of the Patient 

4 Protection and Affordable Care Act (Public Law 111–148; 

5 42 U.S.C. 18022(c)) is amended— 

6 (1) by striking paragraph (2); and 

7 (2) in paragraph (4)(A), by striking ‘‘para8 graphs (1)(B)(i) and (2)(B)(i)’’ and inserting ‘‘para9 graph (1)(B)(i)’’. 

10 (b) CONFORMING AMENDMENT.—Section 2707(b) of 

11 the Public Health Service Act (42 U.S.C. 300gg–6(b)) is 

12 amended by striking ‘‘paragraphs (1) and (2)’’ and insert13 ing ‘‘paragraph (1)’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this Act shall be effective as if included in the enactment 

16 of the Patient Protection and Affordable Care Act (Public 

17 Law 111–148). 

18 SEC. 214. GAO REPORT ON THE CHILDREN’S HOSPITAL 

19 GRADUATE MEDICAL EDUCATION PROGRAM. 

20 (a) IN GENERAL.—In the case that the Children’s 

21 Hospital GME Support Reauthorization Act of 2013 is en22 acted into law, the Comptroller General of the United 

23 States shall, not later than November 30, 2017, conduct 

24 an independent evaluation, and submit to the appropriate 

25 committees of Congress a report, concerning the imple26 mentation of section 340E(h) of the Public Health Service 


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1 Act, as added by section 3 of the Children’s Hospital GME 

2 Support Reauthorization Act of 2013. 

3 (b) CONTENT.—The report described in subsection 

4 (a) shall review and assess each of the following, with re5 spect to hospitals receiving payments under such section 

6 340E(h) during the period of fiscal years 2015 through 

7 2017: 

8 (1) The number and type of such hospitals that 

9 applied for such payments. 

10 (2) The number and type of such hospitals re11 ceiving such payments. 

12 (3) The amount of such payments awarded to 

13 such hospitals. 

14 (4) How such hospitals used such payments. 

15 (5) The impact of such payments on— 

16 (A) the number of pediatric providers; and 

17 (B) health care needs of children. 

18 SEC. 215. SKILLED NURSING FACILITY VALUE-BASED PUR19 CHASING. 

20 (a) IN GENERAL.—Section 1888 of the Social Secu21 rity Act (42 U.S.C. 1395yy) is amended by adding at the 

22 end the following new subsection: 

23 ‘‘(g) SKILLED NURSING FACILITY READMISSION

24 MEASURE.— 


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1 ‘‘(1) READMISSION MEASURE.—Not later than 

2 October 1, 2015, the Secretary shall specify a skilled 

3 nursing facility all-cause all-condition hospital read4 mission measure (or any successor to such a meas5 ure). 

6 ‘‘(2) RESOURCE USE MEASURE.—Not later than 

7 October 1, 2016, the Secretary shall specify a meas8 ure to reflect an all-condition risk-adjusted poten9 tially preventable hospital readmission rate for 

10 skilled nursing facilities. 

11 ‘‘(3) MEASURE ADJUSTMENTS.—When speci12 fying the measures under paragraphs (1) and (2), 

13 the Secretary shall devise a methodology to achieve 

14 a high level of reliability and validity, especially for 

15 skilled nursing facilities with a low volume of re16 admissions. 

17 ‘‘(4) PRE-RULEMAKING PROCESS (MEASURE AP18 PLICATION PARTNERSHIP PROCESS).—The applica19 tion of the provisions of section 1890A shall be op20 tional in the case of a measure specified under para21 graph (1) and a measure specified under paragraph 

22 (2). 

23 ‘‘(5) FEEDBACK REPORTS TO SKILLED NURS24 ING FACILITIES.—Beginning October 1, 2016, and 

25 every quarter thereafter, the Secretary shall provide 


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1 confidential feedback reports to skilled nursing fa2 cilities on the performance of such facilities with re3 spect to a measure specified under paragraph (1) or 

4 (2). 

5 ‘‘(6) PUBLIC REPORTING OF SKILLED NURSING

6 FACILITIES.— 

7 ‘‘(A) IN GENERAL.—Subject to subpara8 graphs (B) and (C), the Secretary shall estab9 lish procedures for making available to the pub10 lic by posting on the Nursing Home Compare 

11 Medicare website (or a successor website) de12 scribed in section 1819(i) information on the 

13 performance of skilled nursing facilities with re14 spect to a measure specified under paragraph 

15 (1) and a measure specified under paragraph 

16 (2). 

17 ‘‘(B) OPPORTUNITY TO REVIEW.—The pro18 cedures under subparagraph (A) shall ensure 

19 that a skilled nursing facility has the oppor20 tunity to review and submit corrections to the 

21 information that is to be made public with re22 spect to the facility prior to such information 

23 being made public. 

24 ‘‘(C) TIMING.—Such procedures shall pro25 vide that the information described in subparaVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 graph (A) is made publicly available beginning 

2 not later than October 1, 2017. 

3 ‘‘(7) NON-APPLICATION OF PAPERWORK REDUC4 TION ACT.—Chapter 35 of title 44, United States 

5 Code (commonly referred to as the ‘Paperwork Re6 duction Act of 1995’) shall not apply to this sub7 section.’’. 

8 (b) VALUE-BASED PURCHASING PROGRAM FOR

9 SKILLED NURSING FACILITIES.—Section 1888 of the So10 cial Security Act (42 U.S.C. 1395yy), as amended by sub11 section (a), is further amended by adding at the end the 

12 following new subsection: 

13 ‘‘(h) SKILLED NURSING FACILITY VALUE-BASED

14 PURCHASING PROGRAM.— 

15 ‘‘(1) ESTABLISHMENT.— 

16 ‘‘(A) IN GENERAL.—Subject to the suc17 ceeding provisions of this subsection, the Sec18 retary shall establish a skilled nursing facility 

19 value-based purchasing program (in this sub20 section referred to as the ‘SNF VBP Program’) 

21 under which value-based incentive payments are 

22 made in a fiscal year to skilled nursing facili23 ties. 

24 ‘‘(B) PROGRAM TO BEGIN IN FISCAL YEAR

25 2019.—The SNF VBP Program shall apply to 


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1 payments for services furnished on or after Oc2 tober 1, 2018. 

3 ‘‘(2) APPLICATION OF MEASURES.— 

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

5 apply the measure specified under subsection 

6 (g)(1) for purposes of the SNF VBP Program. 

7 ‘‘(B) REPLACEMENT.—For purposes of the 

8 SNF VBP Program, the Secretary shall apply 

9 the measure specified under (g)(2) instead of 

10 the measure specified under (g)(1) as soon as 

11 practicable. 

12 ‘‘(3) PERFORMANCE STANDARDS.— 

13 ‘‘(A) ESTABLISHMENT.—The Secretary 

14 shall establish performance standards with re15 spect to the measure applied under paragraph 

16 (2) for a performance period for a fiscal year. 

17 ‘‘(B) HIGHER OF ACHIEVEMENT AND IM18 PROVEMENT.—The performance standards es19 tablished under subparagraph (A) shall include 

20 levels of achievement and improvement. In cal21 culating the SNF performance score under 

22 paragraph (4), the Secretary shall use the high23 er of either improvement or achievement. 

24 ‘‘(C) TIMING.—The Secretary shall estab25 lish and announce the performance standards 


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1 established under subparagraph (A) not later 

2 than 60 days prior to the beginning of the per3 formance period for the fiscal year involved. 

4 ‘‘(4) SNF PERFORMANCE SCORE.— 

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

6 develop a methodology for assessing the total 

7 performance of each skilled nursing facility 

8 based on performance standards established 

9 under paragraph (3) with respect to the meas10 ure applied under paragraph (2). Using such 

11 methodology, the Secretary shall provide for an 

12 assessment (in this subsection referred to as the 

13 ‘SNF performance score’) for each skilled nurs14 ing facility for each such performance period. 

15 ‘‘(B) RANKING OF SNF PERFORMANCE

16 SCORES.—The Secretary shall, for the perform17 ance period for each fiscal year, rank the SNF 

18 performance scores determined under subpara19 graph (A) from low to high. 

20 ‘‘(5) CALCULATION OF VALUE-BASED INCEN21 TIVE PAYMENTS.— 

22 ‘‘(A) IN GENERAL.—With respect to a 

23 skilled nursing facility, based on the ranking 

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1 crease the adjusted Federal per diem rate de2 termined under subsection (e)(4)(G) otherwise 

3 applicable to such skilled nursing facility (and 

4 after application of paragraph (6)) for services 

5 furnished by such facility during such fiscal 

6 year by the value-based incentive payment 

7 amount under subparagraph (B). 

8 ‘‘(B) VALUE-BASED INCENTIVE PAYMENT

9 AMOUNT.—The value-based incentive payment 

10 amount for services furnished by a skilled nurs11 ing facility in a fiscal year shall be equal to the 

12 product of— 

13 ‘‘(i) the adjusted Federal per diem 

14 rate determined under subsection (e)(4)(G) 

15 otherwise applicable to such skilled nursing 

16 facility for such services furnished by the 

17 skilled nursing facility during such fiscal 

18 year; and 

19 ‘‘(ii) the value-based incentive pay20 ment percentage specified under subpara21 graph (C) for the skilled nursing facility 

22 for such fiscal year. 

23 ‘‘(C) VALUE-BASED INCENTIVE PAYMENT

24 PERCENTAGE.— 


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1 ‘‘(i) IN GENERAL.—The Secretary 

2 shall specify a value-based incentive pay3 ment percentage for a skilled nursing facil4 ity for a fiscal year which may include a 

5 zero percentage. 

6 ‘‘(ii) REQUIREMENTS.—In specifying 

7 the value-based incentive payment percent8 age for each skilled nursing facility for a 

9 fiscal year under clause (i), the Secretary 

10 shall ensure that— 

11 ‘‘(I) such percentage is based on 

12 the SNF performance score of the 

13 skilled nursing facility provided under 

14 paragraph (4) for the performance pe15 riod for such fiscal year; 

16 ‘‘(II) the application of all such 

17 percentages in such fiscal year results 

18 in an appropriate distribution of 

19 value-based incentive payments under 

20 subparagraph (B) such that— 

21 ‘‘(aa) skilled nursing facili22 ties with the highest rankings 

23 under paragraph (4)(B) receive 

24 the highest value-based incentive 


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1 payment amounts under subpara2 graph (B); 

3 ‘‘(bb) skilled nursing facili4 ties with the lowest rankings 

5 under paragraph (4)(B) receive 

6 the lowest value-based incentive 

7 payment amounts under subpara8 graph (B); and 

9 ‘‘(cc) in the case of skilled 

10 nursing facilities in the lowest 40 

11 percent of the ranking under 

12 paragraph (4)(B), the payment 

13 rate under subparagraph (A) for 

14 services furnished by such facility 

15 during such fiscal year shall be 

16 less than the payment rate for 

17 such services for such fiscal year 

18 that would otherwise apply under 

19 subsection (e)(4)(G) without ap20 plication of this subsection; and 

21 ‘‘(III) the total amount of value22 based incentive payments under this 

23 paragraph for all skilled nursing fa24 cilities in such fiscal year shall be 

25 greater than or equal to 50 percent, 


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1 but not greater than 70 percent, of 

2 the total amount of the reductions to 

3 payments for such fiscal year under 

4 paragraph (6), as estimated by the 

5 Secretary. 

6 ‘‘(6) FUNDING FOR VALUE-BASED INCENTIVE

7 PAYMENTS.— 

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

9 reduce the adjusted Federal per diem rate de10 termined under subsection (e)(4)(G) otherwise 

11 applicable to a skilled nursing facility for serv12 ices furnished by such facility during a fiscal 

13 year (beginning with fiscal year 2019) by the 

14 applicable percent (as defined in subparagraph 

15 (B)). The Secretary shall make such reductions 

16 for all skilled nursing facilities in the fiscal year 

17 involved, regardless of whether or not the 

18 skilled nursing facility has been determined by 

19 the Secretary to have earned a value-based in20 centive payment under paragraph (5) for such 

21 fiscal year. 

22 ‘‘(B) APPLICABLE PERCENT.—For pur23 poses of subparagraph (A), the term ‘applicable 

24 percent’ means, with respect to fiscal year 2019 

25 and succeeding fiscal years, 2 percent. 


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1 ‘‘(7) ANNOUNCEMENT OF NET RESULT OF AD2 JUSTMENTS.—Under the SNF VBP Program, the 

3 Secretary shall, not later than 60 days prior to the 

4 fiscal year involved, inform each skilled nursing fa5 cility of the adjustments to payments to the skilled 

6 nursing facility for services furnished by such facility 

7 during the fiscal year under paragraphs (5) and (6). 

8 ‘‘(8) NO EFFECT IN SUBSEQUENT FISCAL

9 YEARS.—The value-based incentive payment under 

10 paragraph (5) and the payment reduction under 

11 paragraph (6) shall each apply only with respect to 

12 the fiscal year involved, and the Secretary shall not 

13 take into account such value-based incentive pay14 ment or payment reduction in making payments to 

15 a skilled nursing facility under this section in a sub16 sequent fiscal year. 

17 ‘‘(9) PUBLIC REPORTING.— 

18 ‘‘(A) SNF SPECIFIC INFORMATION.—The 

19 Secretary shall make available to the public, by 

20 posting on the Nursing Home Compare Medi21 care website (or a successor website) described 

22 in section 1819(i) in an easily understandable 

23 format, information regarding the performance 

24 of individual skilled nursing facilities under the 


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1 SNF VBP Program, with respect to a fiscal 

2 year, including— 

3 ‘‘(i) the SNF performance score of the 

4 skilled nursing facility for such fiscal year; 

5 and 

6 ‘‘(ii) the ranking of the skilled nursing 

7 facility under paragraph (4)(B) for the 

8 performance period for such fiscal year. 

9 ‘‘(B) AGGREGATE INFORMATION.—The 

10 Secretary shall periodically post on the Nursing 

11 Home Compare Medicare website (or a suc12 cessor website) described in section 1819(i) ag13 gregate information on the SNF VBP Program, 

14 including— 

15 ‘‘(i) the range of SNF performance 

16 scores provided under paragraph (4)(A); 

17 and 

18 ‘‘(ii) the number of skilled nursing fa19 cilities receiving value-based incentive pay20 ments under paragraph (5) and the range 

21 and total amount of such value-based in22 centive payments. 

23 ‘‘(10) LIMITATION ON REVIEW.—There shall be 

24 no administrative or judicial review under section 

25 1869, section 1878, or otherwise of the following: 


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1 ‘‘(A) The methodology used to determine 

2 the value-based incentive payment percentage 

3 and the amount of the value-based incentive 

4 payment under paragraph (5). 

5 ‘‘(B) The determination of the amount of 

6 funding available for such value-based incentive 

7 payments under paragraph (5)(C)(ii)(III) and 

8 the payment reduction under paragraph (6). 

9 ‘‘(C) The establishment of the performance 

10 standards under paragraph (3) and the per11 formance period. 

12 ‘‘(D) The methodology developed under 

13 paragraph (4) that is used to calculate SNF 

14 performance scores and the calculation of such 

15 scores. 

16 ‘‘(E) The ranking determinations under 

17 paragraph (4)(B). 

18 ‘‘(11) FUNDING FOR PROGRAM MANAGE19 MENT.—The Secretary shall provide for the one time 

20 transfer from the Federal Hospital Insurance Trust 

21 Fund established under section 1817 to the Centers 

22 for Medicare & Medicaid Services Program Manage23 ment Account of— 

24 ‘‘(A) for purposes of subsection (g)(2), 

25 $2,000,000; and 


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1 ‘‘(B) for purposes of implementing this 

2 subsection, $10,000,000. 

3 Such funds shall remain available until expended.’’. 

4 (c) MEDPAC STUDY.—Not later than June 30, 

5 2021, the Medicare Payment Advisory Commission shall 

6 submit to Congress a report that reviews the progress of 

7 the skilled nursing facility value-based purchasing pro8 gram established under section 1888(h) of the Social Se9 curity Act, as added by subsection (b), and makes rec10 ommendations, as appropriate, on any improvements that 

11 should be made to such program. For purposes of the pre12 vious sentence, the Medicare Payment Advisory Commis13 sion shall consider any unintended consequences with re14 spect to such skilled nursing facility value-based pur15 chasing program and any potential adjustments to the re16 admission measure specified under section 1888(g)(1) of 

17 such Act, as added by subsection (a), for purposes of de18 termining the effect of the socio-economic status of a bene19 ficiary under the Medicare program under title XVIII of 

20 the Social Security Act for the SNF performance score 

21 of a skilled nursing facility provided under section 

22 1888(h)(4) of such Act, as added by subsection (b). 


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1 SEC. 216. IMPROVING MEDICARE POLICIES FOR CLINICAL 

2 DIAGNOSTIC LABORATORY TESTS. 

3 (a) IN GENERAL.—Title XVIII of the Social Security 

4 Act is amended by inserting after section 1834 (42 U.S.C. 

5 1395m) the following new section: 

6 ‘‘SEC. 1834A. IMPROVING POLICIES FOR CLINICAL DIAG7 NOSTIC LABORATORY TESTS. 

8 ‘‘(a) REPORTING OF PRIVATE SECTOR PAYMENT

9 RATES FOR ESTABLISHMENT OF MEDICARE PAYMENT

10 RATES.— 

11 ‘‘(1) IN GENERAL.—Beginning January 1, 

12 2016, and every 3 years thereafter (or, annually, in 

13 the case of reporting with respect to an advanced di14 agnostic laboratory test, as defined in subsection 

15 (d)(5)), an applicable laboratory (as defined in para16 graph (2)) shall report to the Secretary, at a time 

17 specified by the Secretary, applicable information (as 

18 defined in paragraph (3)) for a data collection pe19 riod (as defined in paragraph (4)) for each clinical 

20 diagnostic laboratory test that the laboratory fur21 nishes during such period for which payment is 

22 made under this part. 

23 ‘‘(2) DEFINITION OF APPLICABLE LABORA24 TORY.—In this section, the term ‘applicable labora25 tory’ means a laboratory that, with respect to its 

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1 nues are from this section, section 1833(h), or sec2 tion 1848. The Secretary may establish a low vol3 ume or low expenditure threshold for excluding a 

4 laboratory from the definition of applicable labora5 tory under this paragraph, as the Secretary deter6 mines appropriate. 

7 ‘‘(3) APPLICABLE INFORMATION DEFINED.— 

8 ‘‘(A) IN GENERAL.—In this section, sub9 ject to subparagraph (B), the term ‘applicable 

10 information’ means, with respect to a labora11 tory test for a data collection period, the fol12 lowing: 

13 ‘‘(i) The payment rate (as determined 

14 in accordance with paragraph (5)) that 

15 was paid by each private payor for the test 

16 during the period. 

17 ‘‘(ii) The volume of such tests for 

18 each such payor for the period. 

19 ‘‘(B) EXCEPTION FOR CERTAIN CONTRAC20 TUAL ARRANGEMENTS.—Such term shall not 

21 include information with respect to a laboratory 

22 test for which payment is made on a capitated 

23 basis or other similar payment basis during the 

24 data collection period. 


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1 ‘‘(4) DATA COLLECTION PERIOD DEFINED.—In 

2 this section, the term ‘data collection period’ means 

3 a period of time, such as a previous 12 month pe4 riod, specified by the Secretary. 

5 ‘‘(5) TREATMENT OF DISCOUNTS.—The pay6 ment rate reported by a laboratory under this sub7 section shall reflect all discounts, rebates, coupons, 

8 and other price concessions, including those de9 scribed in section 1847A(c)(3). 

10 ‘‘(6) ENSURING COMPLETE REPORTING.—In 

11 the case where an applicable laboratory has more 

12 than one payment rate for the same payor for the 

13 same test or more than one payment rate for dif14 ferent payors for the same test, the applicable lab15 oratory shall report each such payment rate and the 

16 volume for the test at each such rate under this sub17 section. Beginning with January 1, 2019, the Sec18 retary may establish rules to aggregate reporting 

19 with respect to the situations described in the pre20 ceding sentence. 

21 ‘‘(7) CERTIFICATION.—An officer of the labora22 tory shall certify the accuracy and completeness of 

23 the information reported under this subsection. 

24 ‘‘(8) PRIVATE PAYOR DEFINED.—In this sec25 tion, the term ‘private payor’ means the following: 


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1 ‘‘(A) A health insurance issuer and a 

2 group health plan (as such terms are defined in 

3 section 2791 of the Public Health Service Act). 

4 ‘‘(B) A Medicare Advantage plan under 

5 part C. 

6 ‘‘(C) A medicaid managed care organiza7 tion (as defined in section 1903(m)). 

8 ‘‘(9) CIVIL MONEY PENALTY.— 

9 ‘‘(A) IN GENERAL.—If the Secretary deter10 mines that an applicable laboratory has failed 

11 to report or made a misrepresentation or omis12 sion in reporting information under this sub13 section with respect to a clinical diagnostic lab14 oratory test, the Secretary may apply a civil 

15 money penalty in an amount of up to $10,000 

16 per day for each failure to report or each such 

17 misrepresentation or omission. 

18 ‘‘(B) APPLICATION.—The provisions of 

19 section 1128A (other than subsections (a) and 

20 (b)) shall apply to a civil money penalty under 

21 this paragraph in the same manner as they 

22 apply to a civil money penalty or proceeding 

23 under section 1128A(a). 

24 ‘‘(10) CONFIDENTIALITY OF INFORMATION.— 

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1 mation disclosed by a laboratory under this sub2 section is confidential and shall not be disclosed by 

3 the Secretary or a Medicare contractor in a form 

4 that discloses the identity of a specific payor or lab5 oratory, or prices charged or payments made to any 

6 such laboratory, except— 

7 ‘‘(A) as the Secretary determines to be 

8 necessary to carry out this section; 

9 ‘‘(B) to permit the Comptroller General to 

10 review the information provided; 

11 ‘‘(C) to permit the Director of the Con12 gressional Budget Office to review the informa13 tion provided; and 

14 ‘‘(D) to permit the Medicare Payment Ad15 visory Commission to review the information 

16 provided. 

17 ‘‘(11) PROTECTION FROM PUBLIC DISCLO18 SURE.—A payor shall not be identified on informa19 tion reported under this subsection. The name of an 

20 applicable laboratory under this subsection shall be 

21 exempt from disclosure under section 552(b)(3) of 

22 title 5, United States Code. 

23 ‘‘(12) REGULATIONS.—Not later than June 30, 

24 2015, the Secretary shall establish through notice 


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1 and comment rulemaking parameters for data collec2 tion under this subsection. 

3 ‘‘(b) PAYMENT FOR CLINICAL DIAGNOSTIC LABORA4 TORY TESTS.— 

5 ‘‘(1) USE OF PRIVATE PAYOR RATE INFORMA6 TION TO DETERMINE MEDICARE PAYMENT RATES.— 

7 ‘‘(A) IN GENERAL.—Subject to paragraph 

8 (3) and subsections (c) and (d), in the case of 

9 a clinical diagnostic laboratory test furnished on 

10 or after January 1, 2017, the payment amount 

11 under this section shall be equal to the weighted 

12 median determined for the test under para13 graph (2) for the most recent data collection 

14 period. 

15 ‘‘(B) APPLICATION OF PAYMENT AMOUNTS

16 TO HOSPITAL LABORATORIES.—The payment 

17 amounts established under this section shall 

18 apply to a clinical diagnostic laboratory test 

19 furnished by a hospital laboratory if such test 

20 is paid for separately, and not as part of a bun21 dled payment under section 1833(t). 

22 ‘‘(2) CALCULATION OF WEIGHTED MEDIAN.— 

23 For each laboratory test with respect to which infor24 mation is reported under subsection (a) for a data 

25 collection period, the Secretary shall calculate a 


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1 weighted median for the test for the period, by 

2 arraying the distribution of all payment rates re3 ported for the period for each test weighted by vol4 ume for each payor and each laboratory. 

5 ‘‘(3) PHASE-IN OF REDUCTIONS FROM PRIVATE

6 PAYOR RATE IMPLEMENTATION.— 

7 ‘‘(A) IN GENERAL.—Payment amounts de8 termined under this subsection for a clinical di9 agnostic laboratory test for each of 2017 

10 through 2022 shall not result in a reduction in 

11 payments for a clinical diagnostic laboratory 

12 test for the year of greater than the applicable 

13 percent (as defined in subparagraph (B)) of the 

14 amount of payment for the test for the pre15 ceding year. 

16 ‘‘(B) APPLICABLE PERCENT DEFINED.—In 

17 this paragraph, the term ‘applicable percent’ 

18 means— 

19 ‘‘(i) for each of 2017 through 2019, 

20 10 percent; and 

21 ‘‘(ii) for each of 2020 through 2022, 

22 15 percent. 

23 ‘‘(C) NO APPLICATION TO NEW TESTS.— 

24 This paragraph shall not apply to payment 


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1 amounts determined under this section for ei2 ther of the following. 

3 ‘‘(i) A new test under subsection (c). 

4 ‘‘(ii) A new advanced diagnostic test 

5 (as defined in subsection (d)(5)) under 

6 subsection (d). 

7 ‘‘(4) APPLICATION OF MARKET RATES.— 

8 ‘‘(A) IN GENERAL.—Subject to paragraph 

9 (3), once established for a year following a data 

10 collection period, the payment amounts under 

11 this subsection shall continue to apply until the 

12 year following the next data collection period. 

13 ‘‘(B) OTHER ADJUSTMENTS NOT APPLICA14 BLE.—The payment amounts under this section 

15 shall not be subject to any adjustment (includ16 ing any geographic adjustment, budget neu17 trality adjustment, annual update, or other ad18 justment). 

19 ‘‘(5) SAMPLE COLLECTION FEE.—In the case of 

20 a sample collected from an individual in a skilled 

21 nursing facility or by a laboratory on behalf of a 

22 home health agency, the nominal fee that would oth23 erwise apply under section 1833(h)(3)(A) shall be 

24 increased by $2. 


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1 ‘‘(c) PAYMENT FOR NEW TESTS THAT ARE NOT AD2 VANCED DIAGNOSTIC LABORATORY TESTS.— 

3 ‘‘(1) PAYMENT DURING INITIAL PERIOD.—In 

4 the case of a clinical diagnostic laboratory test that 

5 is assigned a new or substantially revised HCPCS 

6 code on or after the date of enactment of this sec7 tion, and which is not an advanced diagnostic lab8 oratory test (as defined in subsection (d)(5)), during 

9 an initial period until payment rates under sub10 section (b) are established for the test, payment for 

11 the test shall be determined— 

12 ‘‘(A) using cross-walking (as described in 

13 section 414.508(a) of title 42, Code of Federal 

14 Regulations, or any successor regulation) to the 

15 most appropriate existing test under the fee 

16 schedule under this section during that period; 

17 or 

18 ‘‘(B) if no existing test is comparable to 

19 the new test, according to the gapfilling process 

20 described in paragraph (2). 

21 ‘‘(2) GAPFILLING PROCESS DESCRIBED.—The 

22 gapfilling process described in this paragraph shall 

23 take into account the following sources of informa24 tion to determine gapfill amounts, if available: 


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1 ‘‘(A) Charges for the test and routine dis2 counts to charges. 

3 ‘‘(B) Resources required to perform the 

4 test. 

5 ‘‘(C) Payment amounts determined by 

6 other payors. 

7 ‘‘(D) Charges, payment amounts, and re8 sources required for other tests that may be 

9 comparable or otherwise relevant. 

10 ‘‘(E) Other criteria the Secretary deter11 mines appropriate. 

12 ‘‘(3) ADDITIONAL CONSIDERATION.—In deter13 mining the payment amount under crosswalking or 

14 gapfilling processes under this subsection, the Sec15 retary shall consider recommendations from the 

16 panel established under subsection (f)(1). 

17 ‘‘(4) EXPLANATION OF PAYMENT RATES.—In 

18 the case of a clinical diagnostic laboratory test for 

19 which payment is made under this subsection, the 

20 Secretary shall make available to the public an ex21 planation of the payment rate for the test, including 

22 an explanation of how the criteria described in para23 graph (2) and paragraph (3) are applied. 

24 ‘‘(d) PAYMENT FOR NEW ADVANCED DIAGNOSTIC

25 LABORATORY TESTS.— 


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1 ‘‘(1) PAYMENT DURING INITIAL PERIOD.— 

2 ‘‘(A) IN GENERAL.—In the case of an ad3 vanced diagnostic laboratory test for which pay4 ment has not been made under the fee schedule 

5 under section 1833(h) prior to the date of en6 actment of this section, during an initial period 

7 of three quarters, the payment amount for the 

8 test for such period shall be based on the actual 

9 list charge for the laboratory test. 

10 ‘‘(B) ACTUAL LIST CHARGE.—For pur11 poses of subparagraph (A), the term ‘actual list 

12 charge’, with respect to a laboratory test fur13 nished during such period, means the publicly 

14 available rate on the first day at which the test 

15 is available for purchase by a private payor. 

16 ‘‘(2) SPECIAL RULE FOR TIMING OF INITIAL

17 REPORTING.—With respect to an advanced diag18 nostic laboratory test described in paragraph (1)(A), 

19 an applicable laboratory shall initially be required to 

20 report under subsection (a) not later than the last 

21 day of the second quarter of the initial period under 

22 such paragraph. 

23 ‘‘(3) APPLICATION OF MARKET RATES AFTER

24 INITIAL PERIOD.—Subject to paragraph (4), data re25 ported under paragraph (2) shall be used to estabVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00045 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 lish the payment amount for an advanced diagnostic 

2 laboratory test after the initial period under para3 graph (1)(A) using the methodology described in 

4 subsection (b). Such payment amount shall continue 

5 to apply until the year following the next data collec6 tion period. 

7 ‘‘(4) RECOUPMENT IF ACTUAL LIST CHARGE

8 EXCEEDS MARKET RATE.—With respect to the initial 

9 period described in paragraph (1)(A), if, after such 

10 period, the Secretary determines that the payment 

11 amount for an advanced diagnostic laboratory test 

12 under paragraph (1)(A) that was applicable during 

13 the period was greater than 130 percent of the pay14 ment amount for the test established using the 

15 methodology described in subsection (b) that is ap16 plicable after such period, the Secretary shall recoup 

17 the difference between such payment amounts for 

18 tests furnished during such period. 

19 ‘‘(5) ADVANCED DIAGNOSTIC LABORATORY

20 TEST DEFINED.—In this subsection, the term ‘ad21 vanced diagnostic laboratory test’ means a clinical 

22 diagnostic laboratory test covered under this part 

23 that is offered and furnished only by a single labora24 tory and not sold for use by a laboratory other than 


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1 the original developing laboratory (or a successor 

2 owner) and meets one of the following criteria: 

3 ‘‘(A) The test is an analysis of multiple 

4 biomarkers of DNA, RNA, or proteins com5 bined with a unique algorithm to yield a single 

6 patient-specific result. 

7 ‘‘(B) The test is cleared or approved by the 

8 Food and Drug Administration. 

9 ‘‘(C) The test meets other similar criteria 

10 established by the Secretary. 

11 ‘‘(e) CODING.— 

12 ‘‘(1) TEMPORARY CODES FOR CERTAIN NEW

13 TESTS.— 

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

15 adopt temporary HCPCS codes to identify new 

16 advanced diagnostic laboratory tests (as defined 

17 in subsection (d)(5)) and new laboratory tests 

18 that are cleared or approved by the Food and 

19 Drug Administration. 

20 ‘‘(B) DURATION.— 

21 ‘‘(i) IN GENERAL.—Subject to clause 

22 (ii), the temporary code shall be effective 

23 until a permanent HCPCS code is estab24 lished (but not to exceed 2 years). 


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1 ‘‘(ii) EXCEPTION.—The Secretary 

2 may extend the temporary code or estab3 lish a permanent HCPCS code, as the Sec4 retary determines appropriate. 

5 ‘‘(2) EXISTING TESTS.—Not later than January 

6 1, 2016, for each existing advanced diagnostic lab7 oratory test (as so defined) and each existing clinical 

8 diagnostic laboratory test that is cleared or approved 

9 by the Food and Drug Administration for which 

10 payment is made under this part as of the date of 

11 enactment of this section, if such test has not al12 ready been assigned a unique HCPCS code, the Sec13 retary shall— 

14 ‘‘(A) assign a unique HCPCS code for the 

15 test; and 

16 ‘‘(B) publicly report the payment rate for 

17 the test. 

18 ‘‘(3) ESTABLISHMENT OF UNIQUE IDENTIFIER

19 FOR CERTAIN TESTS.—For purposes of tracking and 

20 monitoring, if a laboratory or a manufacturer re21 quests a unique identifier for an advanced diagnostic 

22 laboratory test (as so defined) or a laboratory test 

23 that is cleared or approved by the Food and Drug 

24 Administration, the Secretary shall utilize a means 


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1 to uniquely track such test through a mechanism 

2 such as a HCPCS code or modifier. 

3 ‘‘(f) INPUT FROM CLINICIANS AND TECHNICAL EX4 PERTS.— 

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

6 with an expert outside advisory panel, established by 

7 the Secretary not later than July 1, 2015, composed 

8 of an appropriate selection of individuals with exper9 tise, which may include molecular pathologists, re10 searchers, and individuals with expertise in labora11 tory science or health economics, in issues related to 

12 clinical diagnostic laboratory tests, which may in13 clude the development, validation, performance, and 

14 application of such tests, to provide— 

15 ‘‘(A) input on— 

16 ‘‘(i) the establishment of payment 

17 rates under this section for new clinical di18 agnostic laboratory tests, including wheth19 er to use crosswalking or gapfilling proc20 esses to determine payment for a specific 

21 new test; and 

22 ‘‘(ii) the factors used in determining 

23 coverage and payment processes for new 

24 clinical diagnostic laboratory tests; and 


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1 ‘‘(B) recommendations to the Secretary 

2 under this section. 

3 ‘‘(2) COMPLIANCE WITH FACA.—The panel 

4 shall be subject to the Federal Advisory Committee 

5 Act (5 U.S.C. App.). 

6 ‘‘(3) CONTINUATION OF ANNUAL MEETING.— 

7 The Secretary shall continue to convene the annual 

8 meeting described in section 1833(h)(8)(B)(iii) after 

9 the implementation of this section for purposes of 

10 receiving comments and recommendations (and data 

11 on which the recommendations are based) as de12 scribed in such section on the establishment of pay13 ment amounts under this section. 

14 ‘‘(g) COVERAGE.— 

15 ‘‘(1) ISSUANCE OF COVERAGE POLICIES.— 

16 ‘‘(A) IN GENERAL.—A medicare adminis17 trative contractor shall only issue a coverage 

18 policy with respect to a clinical diagnostic lab19 oratory test in accordance with the process for 

20 making a local coverage determination (as de21 fined in section 1869(f)(2)(B)), including the 

22 appeals and review process for local coverage 

23 determinations under part 426 of title 42, Code 

24 of Federal Regulations (or successor regula25 tions). 


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1 ‘‘(B) NO EFFECT ON NATIONAL COVERAGE

2 DETERMINATION PROCESS.—This paragraph 

3 shall not apply to the national coverage deter4 mination process (as defined in section 

5 1869(f)(1)(B)). 

6 ‘‘(C) EFFECTIVE DATE.—This paragraph 

7 shall apply to coverage policies issued on or 

8 after January 1, 2015. 

9 ‘‘(2) DESIGNATION OF ONE OR MORE MEDICARE

10 ADMINISTRATIVE CONTRACTORS FOR CLINICAL DIAG11 NOSTIC LABORATORY TESTS.—The Secretary may 

12 designate one or more (not to exceed 4) medicare 

13 administrative contractors to either establish cov14 erage policies or establish coverage policies and proc15 ess claims for payment for clinical diagnostic labora16 tory tests, as determined appropriate by the Sec17 retary. 

18 ‘‘(h) IMPLEMENTATION.— 

19 ‘‘(1) IMPLEMENTATION.—There shall be no ad20 ministrative or judicial review under section 1869, 

21 section 1878, or otherwise, of the establishment of 

22 payment amounts under this section. 

23 ‘‘(2) ADMINISTRATION.—Chapter 35 of title 44, 

24 United States Code, shall not apply to information 

25 collected under this section. 


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1 ‘‘(3) FUNDING.—For purposes of implementing 

2 this section, the Secretary shall provide for the 

3 transfer, from the Federal Supplementary Medical 

4 Insurance Trust Fund under section 1841, to the 

5 Centers for Medicare & Medicaid Services Program 

6 Management Account, for each of fiscal years 2014 

7 through 2018, $4,000,000, and for each of fiscal 

8 years 2019 through 2023, $3,000,000. Amounts 

9 transferred under the preceding sentence shall re10 main available until expended. 

11 ‘‘(i) TRANSITIONAL RULE.—During the period begin12 ning on the date of enactment of this section and ending 

13 on December 31, 2016, with respect to advanced diag14 nostic laboratory tests under this part, the Secretary shall 

15 use the methodologies for pricing, coding, and coverage 

16 in effect on the day before such date of enactment, which 

17 may include cross-walking or gapfilling methods.’’. 

18 (b) CONFORMING AMENDMENTS.— 

19 (1) Section 1833(a) of the Social Security Act 

20 (42 U.S.C. 1395l(a)) is amended— 

21 (A) in paragraph (1)(D)— 

22 (i) by striking ‘‘(i) on the basis’’ and 

23 inserting ‘‘(i)(I) on the basis’’; 

24 (ii) in subclause (I), as added by 

25 clause (i), by striking ‘‘subsection (h)(1)’’ 


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1 and inserting ‘‘subsection (h)(1) (for tests 

2 furnished before January 1, 2017)’’; 

3 (iii) by striking ‘‘or (ii)’’ and inserting 

4 ‘‘or (II) under section 1834A (for tests 

5 furnished on or after January 1, 2017), 

6 the amount paid shall be equal to 80 per7 cent (or 100 percent, in the case of such 

8 tests for which payment is made on an as9 signment-related basis) of the lesser of the 

10 amount determined under such section or 

11 the amount of the charges billed for the 

12 tests, or (ii)’’; and 

13 (iv) in clause (ii), by striking ‘‘on the 

14 basis’’ and inserting ‘‘for tests furnished 

15 before January 1, 2017, on the basis’’; 

16 (B) in paragraph (2)(D)— 

17 (i) by striking ‘‘(i) on the basis’’ and 

18 inserting ‘‘(i)(I) on the basis’’; 

19 (ii) in subclause (I), as added by 

20 clause (i), by striking ‘‘subsection (h)(1)’’ 

21 and inserting ‘‘subsection (h)(1) (for tests 

22 furnished before January 1, 2017)’’; 

23 (iii) by striking ‘‘or (ii)’’ and inserting 

24 ‘‘or (II) under section 1834A (for tests 

25 furnished on or after January 1, 2017), 


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1 the amount paid shall be equal to 80 per2 cent (or 100 percent, in the case of such 

3 tests for which payment is made on an as4 signment-related basis or to a provider 

5 having an agreement under section 1866) 

6 of the lesser of the amount determined 

7 under such section or the amount of the 

8 charges billed for the tests, or (ii)’’; and 

9 (iv) in clause (ii), by striking ‘‘on the 

10 basis’’ and inserting ‘‘for tests furnished 

11 before January 1, 2017, on the basis’’; 

12 (C) in subsection (b)(3)(B), by striking 

13 ‘‘on the basis’’ and inserting ‘‘for tests fur14 nished before January 1, 2017, on the basis’’; 

15 (D) in subsection (h)(2)(A)(i), by striking 

16 ‘‘and subject to’’ and inserting ‘‘and, for tests 

17 furnished before the date of enactment of sec18 tion 1834A, subject to’’; 

19 (E) in subsection (h)(3), in the matter pre20 ceding subparagraph (A), by striking ‘‘fee 

21 schedules’’ and inserting ‘‘fee schedules (for 

22 tests furnished before January 1, 2017) or 

23 under section 1834A (for tests furnished on or 

24 after January 1, 2017), subject to subsection 

25 (b)(5) of such section’’; 


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1 (F) in subsection (h)(6), by striking ‘‘In 

2 the case’’ and inserting ‘‘For tests furnished be3 fore January 1, 2017, in the case’’; and 

4 (G) in subsection (h)(7), in the first sen5 tence— 

6 (i) by striking ‘‘and (4)’’ and inserting 

7 ‘‘and (4) and section 1834A’’; and 

8 (ii) by striking ‘‘under this sub9 section’’ and inserting ‘‘under this part’’. 

10 (2) Section 1869(f)(2) of the Social Security 

11 Act (42 U.S.C. 1395ff(f)(2)) is amended by adding 

12 at the end the following new subparagraph: 

13 ‘‘(C) LOCAL COVERAGE DETERMINATIONS

14 FOR CLINICAL DIAGNOSTIC LABORATORY

15 TESTS.—For provisions relating to local cov16 erage determinations for clinical diagnostic lab17 oratory tests, see section 1834A(g).’’. 

18 (c) GAO STUDY AND REPORT; MONITORING OF

19 MEDICARE EXPENDITURES AND IMPLEMENTATION OF

20 NEW PAYMENT SYSTEM FOR LABORATORY TESTS.— 

21 (1) GAO STUDY AND REPORT ON IMPLEMENTA22 TION OF NEW PAYMENT RATES FOR CLINICAL DIAG23 NOSTIC LABORATORY TESTS.— 

24 (A) STUDY.—The Comptroller General of 

25 the United States (in this subsection referred to 


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1 as the ‘‘Comptroller General’’) shall conduct a 

2 study on the implementation of section 1834A 

3 of the Social Security Act, as added by sub4 section (a). The study shall include an analysis 

5 of— 

6 (i) payment rates paid by private 

7 payors for laboratory tests furnished in 

8 various settings, including— 

9 (I) how such payment rates com10 pare across settings; 

11 (II) the trend in payment rates 

12 over time; and 

13 (III) trends by private payors to 

14 move to alternative payment meth15 odologies for laboratory tests; 

16 (ii) the conversion to the new payment 

17 rate for laboratory tests under such sec18 tion; 

19 (iii) the impact of such implementa20 tion on beneficiary access under title 

21 XVIII of the Social Security Act; 

22 (iv) the impact of the new payment 

23 system on laboratories that furnish a low 

24 volume of services and laboratories that 

25 specialize in a small number of tests; 


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1 (v) the number of new Healthcare 

2 Common Procedure Coding System 

3 (HCPCS) codes issued for laboratory tests; 

4 (vi) the spending trend for laboratory 

5 tests under such title; 

6 (vii) whether the information reported 

7 by laboratories and the new payment rates 

8 for laboratory tests under such section ac9 curately reflect market prices; 

10 (viii) the initial list price for new lab11 oratory tests and the subsequent reported 

12 rates for such tests under such section; 

13 (ix) changes in the number of ad14 vanced diagnostic laboratory tests and lab15 oratory tests cleared or approved by the 

16 Food and Drug Administration for which 

17 payment is made under such section; and 

18 (x) healthcare economic information 

19 on downstream cost impacts for such tests 

20 and decision making based on accepted 

21 methodologies. 

22 (B) REPORT.—Not later than October 1, 

23 2018, the Comptroller General shall submit to 

24 the Committee on Ways and Means and the 

25 Committee on Energy and Commerce of the 


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1 House of Representatives and the Committee 

2 on Finance of the Senate a report on the study 

3 under subparagraph (A), including rec4 ommendations for such legislation and adminis5 trative action as the Comptroller General deter6 mines appropriate. 

7 (2) MONITORING OF MEDICARE EXPENDITURES

8 AND IMPLEMENTATION OF NEW PAYMENT SYSTEM

9 FOR LABORATORY TESTS.—The Inspector General of 

10 the Department of Health and Human Services 

11 shall— 

12 (A) publicly release an annual analysis of 

13 the top 25 laboratory tests by expenditures 

14 under title XVIII of the Social Security Act; 

15 and 

16 (B) conduct analyses the Inspector General 

17 determines appropriate with respect to the im18 plementation and effect of the new payment 

19 system for laboratory tests under section 1834A 

20 of the Social Security Act, as added by sub21 section (a). 


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1 SEC. 217. REVISIONS UNDER THE MEDICARE ESRD PRO2 SPECTIVE PAYMENT SYSTEM. 

3 (a) DELAY OF IMPLEMENTATION OF ORAL-ONLY

4 POLICY.—Section 632(b)(1) of the American Taxpayer 

5 Relief Act of 2012 (42 U.S.C. 1395rr note) is amended— 

6 (1) by striking ‘‘2016’’ and inserting ‘‘2024’’; 

7 and 

8 (2) by adding at the end the following new sen9 tence: ‘‘Notwithstanding section 1881(b)(14)(A)(ii) 

10 of the Social Security Act (42 U.S.C. 

11 1395rr(b)(14)(A)(ii)), implementation of the policy 

12 described in the previous sentence shall be based on 

13 data from the most recent year available.’’. 

14 (b) MITIGATION OF THE APPLICATION OF ADJUST15 MENT TO ESRD BUNDLED PAYMENT RATE TO ACCOUNT

16 FOR CHANGES IN THE UTILIZATION OF CERTAIN DRUGS

17 AND BIOLOGICALS.— 

18 (1) IN GENERAL.—Section 1881(b)(14)(I) of 

19 the Social Security Act (42 U.S.C. 1395rr(b)(14)(I)) 

20 is amended by inserting ‘‘and before January 1, 

21 2015,’’ after ‘‘January 1, 2014,’’. 

22 (2) MARKET BASKET.—Section 

23 1881(b)(14)(F)(i) of the Social Security Act (42 

24 U.S.C. 1395rr(b)(14)(F)(i)) is amended— 

25 (A) in subclause (I)— 


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1 (i) by striking ‘‘subclause (II)’’ and 

2 inserting ‘‘subclauses (II) and (III)’’; and 

3 (ii) by adding at the end the following 

4 new sentence: ‘‘In order to accomplish the 

5 purposes of subparagraph (I) with respect 

6 to 2016, 2017, and 2018, after deter7 mining the increase factor described in the 

8 preceding sentence for each of 2016, 2017, 

9 and 2018, the Secretary shall reduce such 

10 increase factor by 1.25 percentage points 

11 for each of 2016 and 2017 and by 1 per12 centage point for 2018.’’; 

13 (B) in subclause (II), by striking ‘‘For 

14 2012’’ and inserting ‘‘Subject to subclause 

15 (III), for 2012’’; and 

16 (C) by adding at the end the following new 

17 subclause: 

18 ‘‘(III) Notwithstanding subclauses (I) and (II), 

19 in order to accomplish the purposes of subparagraph 

20 (I) with respect to 2015, the increase factor de21 scribed in subclause (I) for 2015 shall be 0.0 percent 

22 pursuant to the regulation issued by the Secretary 

23 on December 2, 2013, entitled ‘Medicare Program; 

24 End-Stage Renal Disease Prospective Payment Sys25 tem, Quality Incentive Program, and Durable MedVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00060 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 ical Equipment, Prosthetics, Orthotics, and Supplies; 

2 Final Rule’ (78 Fed. Reg. 72156).’’. 

3 (c) DRUG DESIGNATIONS.—As part of the promulga4 tion of annual rule for the Medicare end stage renal dis5 ease prospective payment system under section 

6 1881(b)(14) of the Social Security Act (42 U.S.C. 

7 1395rr(b)(14)) for calendar year 2016, the Secretary of 

8 Health and Human Services (in this subsection referred 

9 to as the ‘‘Secretary’’) shall establish a process for— 

10 (1) determining when a product is no longer an 

11 oral-only drug; and 

12 (2) including new injectable and intravenous 

13 products into the bundled payment under such sys14 tem. 

15 (d) QUALITY MEASURES RELATED TO CONDITIONS

16 TREATED BY ORAL-ONLY DRUGS UNDER THE ESRD 

17 QUALITY INCENTIVE PROGRAM.—Section 1881(h)(2) of 

18 the Social Security Act (42 U.S.C. 1395rr(h)(2)) is 

19 amended— 

20 (1) in subparagraph (A)— 

21 (A) in clause (ii), by striking ‘‘and’’ at the 

22 end; 

23 (B) by redesignating clause (iii) as clause 

24 (iv); and 


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1 (C) by inserting after clause (ii) the fol2 lowing new clause: 

3 ‘‘(iii) for 2016 and subsequent years, 

4 measures described in subparagraph 

5 (E)(i); and’’; 

6 (2) in subparagraph (B)(i), by striking 

7 ‘‘(A)(iii)’’ and inserting ‘‘(A)(iv)’’; and 

8 (3) by adding at the end the following new sub9 paragraph: 

10 ‘‘(E) MEASURES SPECIFIC TO THE CONDI11 TIONS TREATED WITH ORAL-ONLY DRUGS.— 

12 ‘‘(i) IN GENERAL.—The measures de13 scribed in this subparagraph are measures 

14 specified by the Secretary that are specific 

15 to the conditions treated with oral-only 

16 drugs. To the extent feasible, such meas17 ures shall be outcomes-based measures. 

18 ‘‘(ii) CONSULTATION.—In specifying 

19 the measures under clause (i), the Sec20 retary shall consult with interested stake21 holders. 

22 ‘‘(iii) USE OF ENDORSED MEAS23 URES.— 

24 ‘‘(I) IN GENERAL.—Subject to 

25 subclause (I), any measures specified 


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1 under clause (i) must have been en2 dorsed by the entity with a contract 

3 under section 1890(a). 

4 ‘‘(II) EXCEPTION.—If the entity 

5 with a contract under section 1890(a) 

6 has not endorsed a measure for a 

7 specified area or topic related to 

8 measures described in clause (i) that 

9 the Secretary determines appropriate, 

10 the Secretary may specify a measure 

11 that is endorsed or adopted by a con12 sensus organization recognized by the 

13 Secretary that has expertise in clinical 

14 guidelines for kidney disease.’’. 

15 (e) AUDITS OF COST REPORTS OF ESRD PROVIDERS

16 AS RECOMMENDED BY MEDPAC.— 

17 (1) IN GENERAL.—The Secretary of Health and 

18 Human Services shall conduct audits of Medicare 

19 cost reports beginning during 2012 for a representa20 tive sample of providers of services and renal dialysis 

21 facilities furnishing renal dialysis services. 

22 (2) FUNDING.—For purposes of carrying out 

23 paragraph (1), the Secretary of Health and Human 

24 Services shall provide for the transfer from the Fed25 eral Supplementary Medical Insurance Trust Fund 


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1 established under section 1841 of the Social Security 

2 Act (42 U.S.C. 1395t) to the Centers for Medicare 

3 & Medicaid Services Program Management Account 

4 of $18,000,000 for fiscal year 2014. Amounts trans5 ferred under this paragraph for a fiscal year shall be 

6 available until expended. 

7 SEC. 218. QUALITY INCENTIVES FOR COMPUTED TOMOG8 RAPHY DIAGNOSTIC IMAGING AND PRO9 MOTING EVIDENCE-BASED CARE. 

10 (a) QUALITY INCENTIVES TO PROMOTE PATIENT

11 SAFETY AND PUBLIC HEALTH IN COMPUTED TOMOG12 RAPHY DIAGNOSTIC IMAGING.— 

13 (1) IN GENERAL.—Section 1834 of the Social 

14 Security Act (42 U.S.C. 1395m) is amended by add15 ing at the end the following new subsection: 

16 ‘‘(p) QUALITY INCENTIVES TO PROMOTE PATIENT

17 SAFETY AND PUBLIC HEALTH IN COMPUTED TOMOG18 RAPHY.— 

19 ‘‘(1) QUALITY INCENTIVES.—In the case of an 

20 applicable computed tomography service (as defined 

21 in paragraph (2)) for which payment is made under 

22 an applicable payment system (as defined in para23 graph (3)) and that is furnished on or after January 

24 1, 2016, using equipment that is not consistent with 

25 the CT equipment standard (described in paragraph 


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1 (4)), the payment amount for such service shall be 

2 reduced by the applicable percentage (as defined in 

3 paragraph (5)). 

4 ‘‘(2) APPLICABLE COMPUTED TOMOGRAPHY

5 SERVICES DEFINED.—In this subsection, the term 

6 ‘applicable computed tomography service’ means a 

7 service billed using diagnostic radiological imaging 

8 codes for computed tomography (identified as of 

9 January 1, 2014, by HCPCS codes 70450–70498, 

10 71250–71275, 72125–72133, 72191–72194, 73200– 

11 73206, 73700–73706, 74150–74178, 74261–74263, 

12 and 75571–75574 (and any succeeding codes). 

13 ‘‘(3) APPLICABLE PAYMENT SYSTEM DE14 FINED.—In this subsection, the term ‘applicable 

15 payment system’ means the following: 

16 ‘‘(A) The technical component and the 

17 technical component of the global fee under the 

18 fee schedule established under section 1848(b). 

19 ‘‘(B) The prospective payment system for 

20 hospital outpatient department services under 

21 section 1833(t). 

22 ‘‘(4) CONSISTENCY WITH CT EQUIPMENT

23 STANDARD.—In this subsection, the term ‘not con24 sistent with the CT equipment standard’ means, 

25 with respect to an applicable computed tomography 


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1 service, that the service was furnished using equip2 ment that does not meet each of the attributes of 

3 the National Electrical Manufacturers Association 

4 (NEMA) Standard XR–29–2013, entitled ‘Standard 

5 Attributes on CT Equipment Related to Dose Opti6 mization and Management’. Through rulemaking, 

7 the Secretary may apply successor standards. 

8 ‘‘(5) APPLICABLE PERCENTAGE DEFINED.—In 

9 this subsection, the term ‘applicable percentage’ 

10 means— 

11 ‘‘(A) for 2016, 5 percent; and 

12 ‘‘(B) for 2017 and subsequent years, 15 

13 percent. 

14 ‘‘(6) IMPLEMENTATION.— 

15 ‘‘(A) INFORMATION.—The Secretary shall 

16 require that information be provided and at17 tested to by a supplier and a hospital outpatient 

18 department that indicates whether an applicable 

19 computed tomography service was furnished 

20 that was not consistent with the CT equipment 

21 standard (described in paragraph (4)). Such in22 formation may be included on a claim and may 

23 be a modifier. Such information shall be 

24 verified, as appropriate, as part of the periodic 


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1 accreditation of suppliers under section 1834(e) 

2 and hospitals under section 1865(a). 

3 ‘‘(B) ADMINISTRATION.—Chapter 35 of 

4 title 44, United States Code, shall not apply to 

5 information described in subparagraph (A).’’. 

6 (2) CONFORMING AMENDMENTS.— 

7 (A) PROSPECTIVE PAYMENT SYSTEM FOR

8 HOSPITAL OUTPATIENT DEPARTMENT SERV9 ICES.—Section 1833(t) of the Social Security 

10 Act (42 1395l(t)) is amended by adding at the 

11 end the following new paragraph: 

12 ‘‘(20) NOT BUDGET NEUTRAL APPLICATION OF

13 REDUCED EXPENDITURES RESULTING FROM QUAL14 ITY INCENTIVES FOR COMPUTED TOMOGRAPHY.— 

15 The Secretary shall not take into account the re16 duced expenditures that result from the application 

17 of section 1834(p) in making any budget neutrality 

18 adjustments this subsection.’’. 

19 (B) PHYSICIAN FEE SCHEDULE.—Section 

20 1848(c)(2)(B)(v) of the Social Security Act (42 

21 U.S.C. 1395w–4(c)(2)(B)(v)) is amended by 

22 adding at the end the following new subclause: 

23 ‘‘(VIII) REDUCED EXPENDI24 TURES ATTRIBUTABLE TO APPLICA25 TION OF QUALITY INCENTIVES FOR


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1 COMPUTED TOMOGRAPHY.—Effective 

2 for fee schedules established beginning 

3 with 2016, reduced expenditures at4 tributable to the application of the 

5 quality incentives for computed to6 mography under section 1834(p)’’. 

7 (b) PROMOTING EVIDENCE-BASED CARE.— 

8 (1) IN GENERAL.—Section 1834 of the Social 

9 Security Act (42 U.S.C. 1395m), as amended by 

10 subsection (a), is amended by adding at the end the 

11 following new subsection: 

12 ‘‘(q) RECOGNIZING APPROPRIATE USE CRITERIA FOR

13 CERTAIN IMAGING SERVICES.— 

14 ‘‘(1) PROGRAM ESTABLISHED.— 

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

16 establish a program to promote the use of ap17 propriate use criteria (as defined in subpara18 graph (B)) for applicable imaging services (as 

19 defined in subparagraph (C)) furnished in an 

20 applicable setting (as defined in subparagraph 

21 (D)) by ordering professionals and furnishing 

22 professionals (as defined in subparagraphs (E) 

23 and (F), respectively). 

24 ‘‘(B) APPROPRIATE USE CRITERIA DE25 FINED.—In this subsection, the term ‘approVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00068 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 priate use criteria’ means criteria, only devel2 oped or endorsed by national professional med3 ical specialty societies or other provider-led enti4 ties, to assist ordering professionals and fur5 nishing professionals in making the most appro6 priate treatment decision for a specific clinical 

7 condition for an individual. To the extent fea8 sible, such criteria shall be evidence-based. 

9 ‘‘(C) APPLICABLE IMAGING SERVICE DE10 FINED.—In this subsection, the term ‘applicable 

11 imaging service’ means an advanced diagnostic 

12 imaging service (as defined in subsection 

13 (e)(1)(B)) for which the Secretary determines— 

14 ‘‘(i) one or more applicable appro15 priate use criteria specified under para16 graph (2) apply; 

17 ‘‘(ii) there are one or more qualified 

18 clinical decision support mechanisms listed 

19 under paragraph (3)(C); and 

20 ‘‘(iii) one or more of such mechanisms 

21 is available free of charge. 

22 ‘‘(D) APPLICABLE SETTING DEFINED.—In 

23 this subsection, the term ‘applicable setting’ 

24 means a physician’s office, a hospital outpatient 

25 department (including an emergency departVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00069 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 ment), an ambulatory surgical center, and any 

2 other provider-led outpatient setting determined 

3 appropriate by the Secretary. 

4 ‘‘(E) ORDERING PROFESSIONAL DE5 FINED.—In this subsection, the term ‘ordering 

6 professional’ means a physician (as defined in 

7 section 1861(r)) or a practitioner described in 

8 section 1842(b)(18)(C) who orders an applica9 ble imaging service. 

10 ‘‘(F) FURNISHING PROFESSIONAL DE11 FINED.—In this subsection, the term ‘fur12 nishing professional’ means a physician (as de13 fined in section 1861(r)) or a practitioner de14 scribed in section 1842(b)(18)(C) who furnishes 

15 an applicable imaging service. 

16 ‘‘(2) ESTABLISHMENT OF APPLICABLE APPRO17 PRIATE USE CRITERIA.— 

18 ‘‘(A) IN GENERAL.—Not later than No19 vember 15, 2015, the Secretary shall through 

20 rulemaking, and in consultation with physi21 cians, practitioners, and other stakeholders, 

22 specify applicable appropriate use criteria for 

23 applicable imaging services only from among 

24 appropriate use criteria developed or endorsed 


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1 by national professional medical specialty soci2 eties or other provider-led entities. 

3 ‘‘(B) CONSIDERATIONS.—In specifying ap4 plicable appropriate use criteria under subpara5 graph (A), the Secretary shall take into account 

6 whether the criteria— 

7 ‘‘(i) have stakeholder consensus; 

8 ‘‘(ii) are scientifically valid and evi9 dence based; and 

10 ‘‘(iii) are based on studies that are 

11 published and reviewable by stakeholders. 

12 ‘‘(C) REVISIONS.—The Secretary shall re13 view, on an annual basis, the specified applica14 ble appropriate use criteria to determine if 

15 there is a need to update or revise (as appro16 priate) such specification of applicable appro17 priate use criteria and make such updates or 

18 revisions through rulemaking. 

19 ‘‘(D) TREATMENT OF MULTIPLE APPLICA20 BLE APPROPRIATE USE CRITERIA.—In the case 

21 where the Secretary determines that more than 

22 one appropriate use criterion applies with re23 spect to an applicable imaging service, the Sec24 retary shall apply one or more applicable approVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00071 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 priate use criteria under this paragraph for the 

2 service. 

3 ‘‘(3) MECHANISMS FOR CONSULTATION WITH

4 APPLICABLE APPROPRIATE USE CRITERIA.— 

5 ‘‘(A) IDENTIFICATION OF MECHANISMS TO

6 CONSULT WITH APPLICABLE APPROPRIATE USE

7 CRITERIA.— 

8 ‘‘(i) IN GENERAL.—The Secretary 

9 shall specify qualified clinical decision sup10 port mechanisms that could be used by or11 dering professionals to consult with appli12 cable appropriate use criteria for applicable 

13 imaging services. 

14 ‘‘(ii) CONSULTATION.—The Secretary 

15 shall consult with physicians, practitioners, 

16 health care technology experts, and other 

17 stakeholders in specifying mechanisms 

18 under this paragraph. 

19 ‘‘(iii) INCLUSION OF CERTAIN MECHA20 NISMS.—Mechanisms specified under this 

21 paragraph may include any or all of the 

22 following that meet the requirements de23 scribed in subparagraph (B)(ii): 

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1 nology (as defined in section 

2 1848(o)(4)). 

3 ‘‘(II) Use of private sector clin4 ical decision support mechanisms that 

5 are independent from certified EHR 

6 technology, which may include use of 

7 clinical decision support mechanisms 

8 available from medical specialty orga9 nizations. 

10 ‘‘(III) Use of a clinical decision 

11 support mechanism established by the 

12 Secretary. 

13 ‘‘(B) QUALIFIED CLINICAL DECISION SUP14 PORT MECHANISMS.— 

15 ‘‘(i) IN GENERAL.—For purposes of 

16 this subsection, a qualified clinical decision 

17 support mechanism is a mechanism that 

18 the Secretary determines meets the re19 quirements described in clause (ii). 

20 ‘‘(ii) REQUIREMENTS.—The require21 ments described in this clause are the fol22 lowing: 

23 ‘‘(I) The mechanism makes avail24 able to the ordering professional appli25 cable appropriate use criteria specified 


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1 under paragraph (2) and the sup2 porting documentation for the applica3 ble imaging service ordered. 

4 ‘‘(II) In the case where there is 

5 more than one applicable appropriate 

6 use criterion specified under such 

7 paragraph for an applicable imaging 

8 service, the mechanism indicates the 

9 criteria that it uses for the service. 

10 ‘‘(III) The mechanism determines 

11 the extent to which an applicable im12 aging service ordered is consistent 

13 with the applicable appropriate use 

14 criteria so specified. 

15 ‘‘(IV) The mechanism generates 

16 and provides to the ordering profes17 sional a certification or documentation 

18 that documents that the qualified clin19 ical decision support mechanism was 

20 consulted by the ordering professional. 

21 ‘‘(V) The mechanism is updated 

22 on a timely basis to reflect revisions 

23 to the specification of applicable ap24 propriate use criteria under such 

25 paragraph. 


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1 ‘‘(VI) The mechanism meets pri2 vacy and security standards under ap3 plicable provisions of law. 

4 ‘‘(VII) The mechanism performs 

5 such other functions as specified by 

6 the Secretary, which may include a re7 quirement to provide aggregate feed8 back to the ordering professional. 

9 ‘‘(C) LIST OF MECHANISMS FOR CON10 SULTATION WITH APPLICABLE APPROPRIATE

11 USE CRITERIA.— 

12 ‘‘(i) INITIAL LIST.—Not later than 

13 April 1, 2016, the Secretary shall publish 

14 a list of mechanisms specified under this 

15 paragraph. 

16 ‘‘(ii) PERIODIC UPDATING OF LIST.— 

17 The Secretary shall identify on an annual 

18 basis the list of qualified clinical decision 

19 support mechanisms specified under this 

20 paragraph. 

21 ‘‘(4) CONSULTATION WITH APPLICABLE APPRO22 PRIATE USE CRITERIA.— 

23 ‘‘(A) CONSULTATION BY ORDERING PRO24 FESSIONAL.—Beginning with January 1, 2017, 

25 subject to subparagraph (C), with respect to an 


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1 applicable imaging service ordered by an order2 ing professional that would be furnished in an 

3 applicable setting and paid for under an appli4 cable payment system (as defined in subpara5 graph (D)), an ordering professional shall— 

6 ‘‘(i) consult with a qualified decision 

7 support mechanism listed under paragraph 

8 (3)(C); and 

9 ‘‘(ii) provide to the furnishing profes10 sional the information described in clauses 

11 (i) through (iii) of subparagraph (B). 

12 ‘‘(B) REPORTING BY FURNISHING PROFES13 SIONAL.—Beginning with January 1, 2017, 

14 subject to subparagraph (C), with respect to an 

15 applicable imaging service furnished in an ap16 plicable setting and paid for under an applica17 ble payment system (as defined in subpara18 graph (D)), payment for such service may only 

19 be made if the claim for the service includes the 

20 following: 

21 ‘‘(i) Information about which qualified 

22 clinical decision support mechanism was 

23 consulted by the ordering professional for 

24 the service. 

25 ‘‘(ii) Information regarding— 


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1 ‘‘(I) whether the service ordered 

2 would adhere to the applicable appro3 priate use criteria specified under 

4 paragraph (2); 

5 ‘‘(II) whether the service ordered 

6 would not adhere to such criteria; or 

7 ‘‘(III) whether such criteria was 

8 not applicable to the service ordered. 

9 ‘‘(iii) The national provider identifier 

10 of the ordering professional (if different 

11 from the furnishing professional). 

12 ‘‘(C) EXCEPTIONS.—The provisions of sub13 paragraphs (A) and (B) and paragraph (6)(A) 

14 shall not apply to the following: 

15 ‘‘(i) EMERGENCY SERVICES.—An ap16 plicable imaging service ordered for an in17 dividual with an emergency medical condi18 tion (as defined in section 1867(e)(1)). 

19 ‘‘(ii) INPATIENT SERVICES.—An appli20 cable imaging service ordered for an inpa21 tient and for which payment is made under 

22 part A. 

23 ‘‘(iii) SIGNIFICANT HARDSHIP.—An 

24 applicable imaging service ordered by an 

25 ordering professional who the Secretary 


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1 may, on a case-by-case basis, exempt from 

2 the application of such provisions if the 

3 Secretary determines, subject to annual re4 newal, that consultation with applicable ap5 propriate use criteria would result in a sig6 nificant hardship, such as in the case of a 

7 professional who practices in a rural area 

8 without sufficient Internet access. 

9 ‘‘(D) APPLICABLE PAYMENT SYSTEM DE10 FINED.—In this subsection, the term ‘applicable 

11 payment system’ means the following: 

12 ‘‘(i) The physician fee schedule estab13 lished under section 1848(b). 

14 ‘‘(ii) The prospective payment system 

15 for hospital outpatient department services 

16 under section 1833(t). 

17 ‘‘(iii) The ambulatory surgical center 

18 payment systems under section 1833(i). 

19 ‘‘(5) IDENTIFICATION OF OUTLIER ORDERING

20 PROFESSIONALS.— 

21 ‘‘(A) IN GENERAL.—With respect to appli22 cable imaging services furnished beginning with 

23 2017, the Secretary shall determine, on an an24 nual basis, no more than five percent of the 


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1 total number of ordering professionals who are 

2 outlier ordering professionals. 

3 ‘‘(B) OUTLIER ORDERING PROFES4 SIONALS.—The determination of an outlier or5 dering professional shall— 

6 ‘‘(i) be based on low adherence to ap7 plicable appropriate use criteria specified 

8 under paragraph (2), which may be based 

9 on comparison to other ordering profes10 sionals; and 

11 ‘‘(ii) include data for ordering profes12 sionals for whom prior authorization under 

13 paragraph (6)(A) applies. 

14 ‘‘(C) USE OF TWO YEARS OF DATA.—The 

15 Secretary shall use two years of data to identify 

16 outlier ordering professionals under this para17 graph. 

18 ‘‘(D) PROCESS.—The Secretary shall es19 tablish a process for determining when an 

20 outlier ordering professional is no longer an 

21 outlier ordering professional. 

22 ‘‘(E) CONSULTATION WITH STAKE23 HOLDERS.—The Secretary shall consult with 

24 physicians, practitioners and other stakeholders 


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1 in developing methods to identify outlier order2 ing professionals under this paragraph. 

3 ‘‘(6) PRIOR AUTHORIZATION FOR ORDERING

4 PROFESSIONALS WHO ARE OUTLIERS.— 

5 ‘‘(A) IN GENERAL.—Beginning January 1, 

6 2020, subject to paragraph (4)(C), with respect 

7 to services furnished during a year, the Sec8 retary shall, for a period determined appro9 priate by the Secretary, apply prior authoriza10 tion for applicable imaging services that are or11 dered by an outlier ordering professional identi12 fied under paragraph (5). 

13 ‘‘(B) APPROPRIATE USE CRITERIA IN

14 PRIOR AUTHORIZATION.—In applying prior au15 thorization under subparagraph (A), the Sec16 retary shall utilize only the applicable appro17 priate use criteria specified under this sub18 section. 

19 ‘‘(C) FUNDING.—For purposes of carrying 

20 out this paragraph, the Secretary shall provide 

21 for the transfer, from the Federal Supple22 mentary Medical Insurance Trust Fund under 

23 section 1841, of $5,000,000 to the Centers for 

24 Medicare & Medicaid Services Program Man25 agement Account for each of fiscal years 2019 


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1 through 2021. Amounts transferred under the 

2 preceding sentence shall remain available until 

3 expended. 

4 ‘‘(7) CONSTRUCTION.—Nothing in this sub5 section shall be construed as granting the Secretary 

6 the authority to develop or initiate the development 

7 of clinical practice guidelines or appropriate use cri8 teria.’’. 

9 (2) CONFORMING AMENDMENT.—Section 

10 1833(t)(16) of the Social Security Act (42 U.S.C. 

11 1395l(t)(16)) is amended by adding at the end the 

12 following new subparagraph: 

13 ‘‘(E) APPLICATION OF APPROPRIATE USE

14 CRITERIA FOR CERTAIN IMAGING SERVICES.— 

15 For provisions relating to the application of ap16 propriate use criteria for certain imaging serv17 ices, see section 1834(q).’’. 

18 (3) REPORT ON EXPERIENCE OF IMAGING AP19 PROPRIATE USE CRITERIA PROGRAM.—Not later 

20 than 18 months after the date of the enactment of 

21 this Act, the Comptroller General of the United 

22 States shall submit to Congress a report that in23 cludes a description of the extent to which appro24 priate use criteria could be used for other services 

25 under part B of title XVIII of the Social Security 


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1 Act (42 U.S.C. 1395j et seq.), such as radiation 

2 therapy and clinical diagnostic laboratory services. 

3 SEC. 219. USING FUNDING FROM TRANSITIONAL FUND FOR 

4 SUSTAINABLE GROWTH RATE (SGR) REFORM. 

5 Section 1898(b)(1) of the Social Security Act (42 

6 U.S.C. 1395iii(b)(1)) is amended by striking 

7 ‘‘$2,300,000,000’’ and inserting ‘‘$0’’. 

8 SEC. 220. ENSURING ACCURATE VALUATION OF SERVICES 

9 UNDER THE PHYSICIAN FEE SCHEDULE. 

10 (a) AUTHORITY TO COLLECT AND USE INFORMA11 TION ON PHYSICIANS’ SERVICES IN THE DETERMINATION

12 OF RELATIVE VALUES.— 

13 (1) IN GENERAL.—Section 1848(c)(2) of the 

14 Social Security Act (42 U.S.C. 1395w–4(c)(2)) is 

15 amended by adding at the end the following new 

16 subparagraph: 

17 ‘‘(M) AUTHORITY TO COLLECT AND USE

18 INFORMATION ON PHYSICIANS’ SERVICES IN

19 THE DETERMINATION OF RELATIVE VALUES.— 

20 ‘‘(i) COLLECTION OF INFORMATION.— 

21 Notwithstanding any other provision of 

22 law, the Secretary may collect or obtain in23 formation on the resources directly or indi24 rectly related to furnishing services for 

25 which payment is made under the fee 


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1 schedule established under subsection (b). 

2 Such information may be collected or ob3 tained from any eligible professional or any 

4 other source. 

5 ‘‘(ii) USE OF INFORMATION.—Not6 withstanding any other provision of law, 

7 subject to clause (v), the Secretary may 

8 (as the Secretary determines appropriate) 

9 use information collected or obtained pur10 suant to clause (i) in the determination of 

11 relative values for services under this sec12 tion. 

13 ‘‘(iii) TYPES OF INFORMATION.—The 

14 types of information described in clauses 

15 (i) and (ii) may, at the Secretary’s discre16 tion, include any or all of the following: 

17 ‘‘(I) Time involved in furnishing 

18 services. 

19 ‘‘(II) Amounts and types of prac20 tice expense inputs involved with fur21 nishing services. 

22 ‘‘(III) Prices (net of any dis23 counts) for practice expense inputs, 

24 which may include paid invoice prices 

25 or other documentation or records. 


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1 ‘‘(IV) Overhead and accounting 

2 information for practices of physicians 

3 and other suppliers. 

4 ‘‘(V) Any other element that 

5 would improve the valuation of serv6 ices under this section. 

7 ‘‘(iv) INFORMATION COLLECTION

8 MECHANISMS.—Information may be col9 lected or obtained pursuant to this sub10 paragraph from any or all of the following: 

11 ‘‘(I) Surveys of physicians, other 

12 suppliers, providers of services, manu13 facturers, and vendors. 

14 ‘‘(II) Surgical logs, billing sys15 tems, or other practice or facility 

16 records. 

17 ‘‘(III) Electronic health records. 

18 ‘‘(IV) Any other mechanism de19 termined appropriate by the Sec20 retary. 

21 ‘‘(v) TRANSPARENCY OF USE OF IN22 FORMATION.— 

23 ‘‘(I) IN GENERAL.—Subject to 

24 subclauses (II) and (III), if the Sec25 retary uses information collected or 


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1 obtained under this subparagraph in 

2 the determination of relative values 

3 under this subsection, the Secretary 

4 shall disclose the information source 

5 and discuss the use of such informa6 tion in such determination of relative 

7 values through notice and comment 

8 rulemaking. 

9 ‘‘(II) THRESHOLDS FOR USE.— 

10 The Secretary may establish thresh11 olds in order to use such information, 

12 including the exclusion of information 

13 collected or obtained from eligible pro14 fessionals who use very high resources 

15 (as determined by the Secretary) in 

16 furnishing a service. 

17 ‘‘(III) DISCLOSURE OF INFORMA18 TION.—The Secretary shall make ag19 gregate information available under 

20 this subparagraph but shall not dis21 close information in a form or manner 

22 that identifies an eligible professional 

23 or a group practice, or information 

24 collected or obtained pursuant to a 

25 nondisclosure agreement. 


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1 ‘‘(vi) INCENTIVE TO PARTICIPATE.— 

2 The Secretary may provide for such pay3 ments under this part to an eligible profes4 sional that submits such solicited informa5 tion under this subparagraph as the Sec6 retary determines appropriate in order to 

7 compensate such eligible professional for 

8 such submission. Such payments shall be 

9 provided in a form and manner specified 

10 by the Secretary. 

11 ‘‘(vii) ADMINISTRATION.—Chapter 35 

12 of title 44, United States Code, shall not 

13 apply to information collected or obtained 

14 under this subparagraph. 

15 ‘‘(viii) DEFINITION OF ELIGIBLE PRO16 FESSIONAL.—In this subparagraph, the 

17 term ‘eligible professional’ has the meaning 

18 given such term in subsection (k)(3)(B). 

19 ‘‘(ix) FUNDING.—For purposes of car20 rying out this subparagraph, in addition to 

21 funds otherwise appropriated, the Sec22 retary shall provide for the transfer, from 

23 the Federal Supplementary Medical Insur24 ance Trust Fund under section 1841, of 

25 $2,000,000 to the Centers for Medicare & 


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1 Medicaid Services Program Management 

2 Account for each fiscal year beginning with 

3 fiscal year 2014. Amounts transferred 

4 under the preceding sentence for a fiscal 

5 year shall be available until expended.’’. 

6 (2) LIMITATION ON REVIEW.—Section 

7 1848(i)(1) of the Social Security Act (42 U.S.C. 

8 1395w–4(i)(1)) is amended— 

9 (A) in subparagraph (D), by striking 

10 ‘‘and’’ at the end; 

11 (B) in subparagraph (E), by striking the 

12 period at the end and inserting ‘‘, and’’; and 

13 (C) by adding at the end the following new 

14 subparagraph: 

15 ‘‘(F) the collection and use of information 

16 in the determination of relative values under 

17 subsection (c)(2)(M).’’. 

18 (b) AUTHORITY FOR ALTERNATIVE APPROACHES TO

19 ESTABLISHING PRACTICE EXPENSE RELATIVE VAL20 UES.—Section 1848(c)(2) of the Social Security Act (42 

21 U.S.C. 1395w–4(c)(2)), as amended by subsection (a), is 

22 amended by adding at the end the following new subpara23 graph: 

24 ‘‘(N) AUTHORITY FOR ALTERNATIVE AP25 PROACHES TO ESTABLISHING PRACTICE EXVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00087 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 PENSE RELATIVE VALUES.—The Secretary may 

2 establish or adjust practice expense relative val3 ues under this subsection using cost, charge, or 

4 other data from suppliers or providers of serv5 ices, including information collected or obtained 

6 under subparagraph (M).’’. 

7 (c) REVISED AND EXPANDED IDENTIFICATION OF

8 POTENTIALLY MISVALUED CODES.—Section 

9 1848(c)(2)(K)(ii) of the Social Security Act (42 U.S.C. 

10 1395w–4(c)(2)(K)(ii)) is amended to read as follows: 

11 ‘‘(ii) IDENTIFICATION OF POTEN12 TIALLY MISVALUED CODES.—For purposes 

13 of identifying potentially misvalued codes 

14 pursuant to clause (i)(I), the Secretary 

15 shall examine codes (and families of codes 

16 as appropriate) based on any or all of the 

17 following criteria: 

18 ‘‘(I) Codes that have experienced 

19 the fastest growth. 

20 ‘‘(II) Codes that have experi21 enced substantial changes in practice 

22 expenses. 

23 ‘‘(III) Codes that describe new 

24 technologies or services within an ap25 propriate time period (such as 3 


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1 years) after the relative values are ini2 tially established for such codes. 

3 ‘‘(IV) Codes which are multiple 

4 codes that are frequently billed in con5 junction with furnishing a single serv6 ice. 

7 ‘‘(V) Codes with low relative val8 ues, particularly those that are often 

9 billed multiple times for a single treat10 ment. 

11 ‘‘(VI) Codes that have not been 

12 subject to review since implementation 

13 of the fee schedule. 

14 ‘‘(VII) Codes that account for 

15 the majority of spending under the 

16 physician fee schedule. 

17 ‘‘(VIII) Codes for services that 

18 have experienced a substantial change 

19 in the hospital length of stay or proce20 dure time. 

21 ‘‘(IX) Codes for which there may 

22 be a change in the typical site of serv23 ice since the code was last valued. 

24 ‘‘(X) Codes for which there is a 

25 significant difference in payment for 


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1 the same service between different 

2 sites of service. 

3 ‘‘(XI) Codes for which there may 

4 be anomalies in relative values within 

5 a family of codes. 

6 ‘‘(XII) Codes for services where 

7 there may be efficiencies when a serv8 ice is furnished at the same time as 

9 other services. 

10 ‘‘(XIII) Codes with high intra11 service work per unit of time. 

12 ‘‘(XIV) Codes with high practice 

13 expense relative value units. 

14 ‘‘(XV) Codes with high cost sup15 plies. 

16 ‘‘(XVI) Codes as determined ap17 propriate by the Secretary.’’. 

18 (d) TARGET FOR RELATIVE VALUE ADJUSTMENTS

19 FOR MISVALUED SERVICES.— 

20 (1) IN GENERAL.—Section 1848(c)(2) of the 

21 Social Security Act (42 U.S.C. 1395w–4(c)(2)), as 

22 amended by subsections (a) and (b), is amended by 

23 adding at the end the following new subparagraph: 

24 ‘‘(O) TARGET FOR RELATIVE VALUE AD25 JUSTMENTS FOR MISVALUED SERVICES.—With 


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1 respect to fee schedules established for each of 

2 2017 through 2020, the following shall apply: 

3 ‘‘(i) DETERMINATION OF NET REDUC4 TION IN EXPENDITURES.—For each year, 

5 the Secretary shall determine the esti6 mated net reduction in expenditures under 

7 the fee schedule under this section with re8 spect to the year as a result of adjust9 ments to the relative values established 

10 under this paragraph for misvalued codes. 

11 ‘‘(ii) BUDGET NEUTRAL REDISTRIBU12 TION OF FUNDS IF TARGET MET AND

13 COUNTING OVERAGES TOWARDS THE TAR14 GET FOR THE SUCCEEDING YEAR.—If the 

15 estimated net reduction in expenditures de16 termined under clause (i) for the year is 

17 equal to or greater than the target for the 

18 year— 

19 ‘‘(I) reduced expenditures attrib20 utable to such adjustments shall be 

21 redistributed for the year in a budget 

22 neutral manner in accordance with 

23 subparagraph (B)(ii)(II); and 

24 ‘‘(II) the amount by which such 

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1 get for the year shall be treated as a 

2 reduction in expenditures described in 

3 clause (i) for the succeeding year, for 

4 purposes of determining whether the 

5 target has or has not been met under 

6 this subparagraph with respect to that 

7 year. 

8 ‘‘(iii) EXEMPTION FROM BUDGET

9 NEUTRALITY IF TARGET NOT MET.—If the 

10 estimated net reduction in expenditures de11 termined under clause (i) for the year is 

12 less than the target for the year, reduced 

13 expenditures in an amount equal to the 

14 target recapture amount shall not be taken 

15 into account in applying subparagraph 

16 (B)(ii)(II) with respect to fee schedules be17 ginning with 2017. 

18 ‘‘(iv) TARGET RECAPTURE AMOUNT.— 

19 For purposes of clause (iii), the target re20 capture amount is, with respect to a year, 

21 an amount equal to the difference be22 tween— 

23 ‘‘(I) the target for the year; and 


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1 ‘‘(II) the estimated net reduction 

2 in expenditures determined under 

3 clause (i) for the year. 

4 ‘‘(v) TARGET.—For purposes of this 

5 subparagraph, with respect to a year, the 

6 target is calculated as 0.5 percent of the 

7 estimated amount of expenditures under 

8 the fee schedule under this section for the 

9 year.’’. 

10 (2) CONFORMING AMENDMENT.—Section 

11 1848(c)(2)(B)(v) of the Social Security Act (42 

12 U.S.C. 1395w–4(c)(2)(B)(v)) is amended by adding 

13 at the end the following new subclause: 

14 ‘‘(VIII) REDUCTIONS FOR

15 MISVALUED SERVICES IF TARGET NOT

16 MET.—Effective for fee schedules be17 ginning with 2017, reduced expendi18 tures attributable to the application of 

19 the target recapture amount described 

20 in subparagraph (O)(iii).’’. 

21 (e) PHASE-IN OF SIGNIFICANT RELATIVE VALUE

22 UNIT (RVU) REDUCTIONS.— 

23 (1) IN GENERAL.—Section 1848(c) of the So24 cial Security Act (42 U.S.C. 1395w–4(c)) is amendVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00093 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 ed by adding at the end the following new para2 graph: 

3 ‘‘(7) PHASE-IN OF SIGNIFICANT RELATIVE

4 VALUE UNIT (RVU) REDUCTIONS.—Effective for fee 

5 schedules established beginning with 2017, for serv6 ices that are not new or revised codes, if the total 

7 relative value units for a service for a year would 

8 otherwise be decreased by an estimated amount 

9 equal to or greater than 20 percent as compared to 

10 the total relative value units for the previous year, 

11 the applicable adjustments in work, practice expense, 

12 and malpractice relative value units shall be phased13 in over a 2-year period.’’. 

14 (2) CONFORMING AMENDMENTS.—Section 

15 1848(c)(2) of the Social Security Act (42 U.S.C. 

16 1395w–4(c)(2)) is amended— 

17 (A) in subparagraph (B)(ii)(I), by striking 

18 ‘‘subclause (II)’’ and inserting ‘‘subclause (II) 

19 and paragraph (7)’’; and 

20 (B) in subparagraph (K)(iii)(VI)— 

21 (i) by striking ‘‘provisions of subpara22 graph (B)(ii)(II)’’ and inserting ‘‘provi23 sions of subparagraph (B)(ii)(II) and para24 graph (7)’’; and 


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1 (ii) by striking ‘‘under subparagraph 

2 (B)(ii)(II)’’ and inserting ‘‘under subpara3 graph (B)(ii)(I)’’. 

4 (f) AUTHORITY TO SMOOTH RELATIVE VALUES

5 WITHIN GROUPS OF SERVICES.—Section 1848(c)(2)(C) of 

6 the Social Security Act (42 U.S.C. 1395w–4(c)(2)(C)) is 

7 amended— 

8 (1) in each of clauses (i) and (iii), by striking 

9 ‘‘the service’’ and inserting ‘‘the service or group of 

10 services’’ each place it appears; and 

11 (2) in the first sentence of clause (ii), by insert12 ing ‘‘or group of services’’ before the period. 

13 (g) GAO STUDY AND REPORT ON RELATIVE VALUE

14 SCALE UPDATE COMMITTEE.— 

15 (1) STUDY.—The Comptroller General of the 

16 United States (in this subsection referred to as the 

17 ‘‘Comptroller General’’) shall conduct a study of the 

18 processes used by the Relative Value Scale Update 

19 Committee (RUC) to provide recommendations to 

20 the Secretary of Health and Human Services regard21 ing relative values for specific services under the 

22 Medicare physician fee schedule under section 1848 

23 of the Social Security Act (42 U.S.C. 1395w–4). 

24 (2) REPORT.—Not later than 1 year after the 

25 date of the enactment of this Act, the Comptroller 


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1 General shall submit to Congress a report containing 

2 the results of the study conducted under paragraph 

3 (1). 

4 (h) ADJUSTMENT TO MEDICARE PAYMENT LOCAL5 ITIES.— 

6 (1) IN GENERAL.—Section 1848(e) of the So7 cial Security Act (42 U.S.C. 1395w–4(e)) is amend8 ed by adding at the end the following new para9 graph: 

10 ‘‘(6) USE OF MSAS AS FEE SCHEDULE AREAS IN

11 CALIFORNIA.— 

12 ‘‘(A) IN GENERAL.—Subject to the suc13 ceeding provisions of this paragraph and not14 withstanding the previous provisions of this 

15 subsection, for services furnished on or after 

16 January 1, 2017, the fee schedule areas used 

17 for payment under this section applicable to 

18 California shall be the following: 

19 ‘‘(i) Each Metropolitan Statistical 

20 Area (each in this paragraph referred to as 

21 an ‘MSA’), as defined by the Director of 

22 the Office of Management and Budget as 

23 of December 31 of the previous year, shall 

24 be a fee schedule area. 


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1 ‘‘(ii) All areas not included in an MSA 

2 shall be treated as a single rest-of-State 

3 fee schedule area. 

4 ‘‘(B) TRANSITION FOR MSAS PREVIOUSLY

5 IN REST-OF-STATE PAYMENT LOCALITY OR IN

6 LOCALITY 3.— 

7 ‘‘(i) IN GENERAL.—For services fur8 nished in California during a year begin9 ning with 2017 and ending with 2021 in 

10 an MSA in a transition area (as defined in 

11 subparagraph (D)), subject to subpara12 graph (C), the geographic index values to 

13 be applied under this subsection for such 

14 year shall be equal to the sum of the fol15 lowing: 

16 ‘‘(I) CURRENT LAW COMPO17 NENT.—The old weighting factor (de18 scribed in clause (ii)) for such year 

19 multiplied by the geographic index 

20 values under this subsection for the 

21 fee schedule area that included such 

22 MSA that would have applied in such 

23 area (as estimated by the Secretary) 

24 if this paragraph did not apply. 


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1 ‘‘(II) MSA-BASED COMPO2 NENT.—The MSA-based weighting 

3 factor (described in clause (iii)) for 

4 such year multiplied by the geographic 

5 index values computed for the fee 

6 schedule area under subparagraph (A) 

7 for the year (determined without re8 gard to this subparagraph). 

9 ‘‘(ii) OLD WEIGHTING FACTOR.—The 

10 old weighting factor described in this 

11 clause— 

‘‘(I) for 2017, is 5 12 ⁄6; and 

13 ‘‘(II) for each succeeding year, is 

14 the old weighting factor described in 

15 this clause for the previous year 

minus 1 16 ⁄6. 

17 ‘‘(iii) MSA-BASED WEIGHTING FAC18 TOR.—The MSA-based weighting factor 

19 described in this clause for a year is 1 

20 minus the old weighting factor under 

21 clause (ii) for that year. 

22 ‘‘(C) HOLD HARMLESS.—For services fur23 nished in a transition area in California during 

24 a year beginning with 2017, the geographic 

25 index values to be applied under this subsection 


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1 for such year shall not be less than the cor2 responding geographic index values that would 

3 have applied in such transition area (as esti4 mated by the Secretary) if this paragraph did 

5 not apply. 

6 ‘‘(D) TRANSITION AREA DEFINED.—In 

7 this paragraph, the term ‘transition area’ 

8 means each of the following fee schedule areas 

9 for 2013: 

10 ‘‘(i) The rest-of-State payment local11 ity. 

12 ‘‘(ii) Payment locality 3. 

13 ‘‘(E) REFERENCES TO FEE SCHEDULE

14 AREAS.—Effective for services furnished on or 

15 after January 1, 2017, for California, any ref16 erence in this section to a fee schedule area 

17 shall be deemed a reference to a fee schedule 

18 area established in accordance with this para19 graph.’’. 

20 (2) CONFORMING AMENDMENT TO DEFINITION

21 OF FEE SCHEDULE AREA.—Section 1848(j)(2) of the 

22 Social Security Act (42 U.S.C. 1395w–4(j)(2)) is 

23 amended by striking ‘‘The term’’ and inserting ‘‘Ex24 cept as provided in subsection (e)(6)(D), the term’’. 


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1 (i) DISCLOSURE OF DATA USED TO ESTABLISH

2 MULTIPLE PROCEDURE PAYMENT REDUCTION POLICY.— 

3 The Secretary of Health and Human Services shall make 

4 publicly available the information used to establish the 

5 multiple procedure payment reduction policy to the profes6 sional component of imaging services in the final rule pub7 lished in the Federal Register, v. 77, n. 222, November 

8 16, 2012, pages 68891–69380 under the physician fee 

9 schedule under section 1848 of the Social Security Act (42 

10 U.S.C. 1395w–4). 

11 SEC. 221. MEDICAID DSH. 

12 (a) MODIFICATIONS OF REDUCTIONS TO ALLOT13 MENTS.—Section 1923(f) of the Social Security Act (42 

14 U.S.C. 1396r–4(f)) is amended— 

15 (1) in paragraph (7)(A)— 

16 (A) in clause (i), by striking ‘‘2016 

17 through 2020’’ and inserting ‘‘2017 through 

18 2024’’; and 

19 (B) in clause (ii), by striking subclauses 

20 (I) through (IV), and inserting the following: 

21 ‘‘(I) $1,800,000,000 for fiscal 

22 year 2017; 

23 ‘‘(II) $4,700,000,000 for fiscal 

24 year 2018; 


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1 ‘‘(III) $4,700,000,000 for fiscal 

2 year 2019; 

3 ‘‘(IV) $4,700,000,000 for fiscal 

4 year 2020; 

5 ‘‘(V) $4,800,000,000 for fiscal 

6 year 2021; 

7 ‘‘(VI) $5,000,000,000 for fiscal 

8 year 2022; 

9 ‘‘(VII) $5,000,000,000 for fiscal 

10 year 2023; and 

11 ‘‘(VIII) $4,400,000,000 for fiscal 

12 year 2024.’’; and 

13 (2) by striking paragraph (8) and inserting the 

14 following: 

15 ‘‘(8) CALCULATION OF DSH ALLOTMENTS

16 AFTER REDUCTIONS PERIOD.—The DSH allotment 

17 for a State for fiscal years after fiscal year 2024 

18 shall be calculated under paragraph (3) without re19 gard to paragraph (7).’’. 

20 (b) MACPAC REVIEW AND REPORT.—Section 

21 1900(b)(6) of the Social Security Act (42 U.S.C. 

22 1396(b)(6)) is amended— 

23 (1) by striking ‘‘MACPAC shall consult’’ and 

24 inserting the following: 


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1 ‘‘(A) IN GENERAL.—MACPAC shall con2 sult’’; and 

3 (2) by adding at the end the following: 

4 ‘‘(B) REVIEW AND REPORTS REGARDING

5 MEDICAID DSH.— 

6 ‘‘(i) IN GENERAL.—MACPAC shall 

7 review and submit an annual report to 

8 Congress on disproportionate share hos9 pital payments under section 1923. Each 

10 report shall include the information speci11 fied in clause (ii). 

12 ‘‘(ii) REQUIRED REPORT INFORMA13 TION.—Each report required under this 

14 subparagraph shall include the following: 

15 ‘‘(I) Data relating to changes in 

16 the number of uninsured individuals. 

17 ‘‘(II) Data relating to the 

18 amount and sources of hospitals’ un19 compensated care costs, including the 

20 amount of such costs that are the re21 sult of providing unreimbursed or 

22 under-reimbursed services, charity 

23 care, or bad debt. 

24 ‘‘(III) Data identifying hospitals 

25 with high levels of uncompensated 


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1 care that also provide access to essen2 tial community services for low-in3 come, uninsured, and vulnerable popu4 lations, such as graduate medical edu5 cation, and the continuum of primary 

6 through quarternary care, including 

7 the provision of trauma care and pub8 lic health services. 

9 ‘‘(IV) State-specific analyses re10 garding the relationship between the 

11 most recent State DSH allotment and 

12 the projected State DSH allotment for 

13 the succeeding year and the data re14 ported under subclauses (I), (II), and 

15 (III) for the State. 

16 ‘‘(iii) DATA.—Notwithstanding any 

17 other provision of law, the Secretary regu18 larly shall provide MACPAC with the most 

19 recent State reports and most recent inde20 pendent certified audits submitted under 

21 section 1923(j), cost reports submitted 

22 under title XVIII, and such other data as 

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1 mitting the annual reports required under 

2 this subparagraph. 

3 ‘‘(iv) SUBMISSION DEADLINES.—The 

4 first report required under this subpara5 graph shall be submitted to Congress not 

6 later than February 1, 2016. Subsequent 

7 reports shall be submitted as part of, or 

8 with, each annual report required under 

9 paragraph (1)(C) during the period of fis10 cal years 2017 through 2024.’’. 

11 SEC. 222. REALIGNMENT OF THE MEDICARE SEQUESTER 

12 FOR FISCAL YEAR 2024. 

13 Paragraph (6) (relating to implementing direct 

14 spending reductions) of section 251A of the Balanced 

15 Budget and Emergency Deficit Control Act of 1985 (2 

16 U.S.C. 901a) is amended by adding at the end the fol17 lowing new subparagraph: 

18 ‘‘(D) Notwithstanding the 2 percent limit speci19 fied in subparagraph (A) for payments for the Medi20 care programs specified in section 256(d), the se21 questration order of the President under such sub22 paragraph for fiscal year 2024 shall be applied to 

23 such payments so that— 

24 ‘‘(i) with respect to the first 6 months in 

25 which such order is effective for such fiscal 


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1 year, the payment reduction shall be 4.0 per2 cent; and 

3 ‘‘(ii) with respect to the second 6 months 

4 in which such order is so effective for such fis5 cal year, the payment reduction shall be 0.0 

6 percent.’’. 

7 SEC. 223. DEMONSTRATION PROGRAMS TO IMPROVE COM8 MUNITY MENTAL HEALTH SERVICES. 

9 (a) CRITERIA FOR CERTIFIED COMMUNITY BEHAV10 IORAL HEALTH CLINICS TO PARTICIPATE IN DEM11 ONSTRATION PROGRAMS.— 

12 (1) PUBLICATION.—Not later than September 

13 1, 2015, the Secretary shall publish criteria for a 

14 clinic to be certified by a State as a certified com15 munity behavioral health clinic for purposes of par16 ticipating in a demonstration program conducted 

17 under subsection (d). 

18 (2) REQUIREMENTS.—The criteria published 

19 under this subsection shall include criteria with re20 spect to the following: 

21 (A) STAFFING.—Staffing requirements, in22 cluding criteria that staff have diverse discipli23 nary backgrounds, have necessary State-re24 quired license and accreditation, and are culVerDate Mar 15 2010 00:19 Mar 27, 2014 Jkt 039200 PO 00000 Frm 00105 Fmt 6652 Sfmt 6201 E:\BILLS\H4302.IH H4302

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1 turally and linguistically trained to serve the 

2 needs of the clinic’s patient population. 

3 (B) AVAILABILITY AND ACCESSIBILITY OF

4 SERVICES.—Availability and accessibility of 

5 services, including crisis management services 

6 that are available and accessible 24 hours a 

7 day, the use of a sliding scale for payment, and 

8 no rejection for services or limiting of services 

9 on the basis of a patient’s ability to pay or a 

10 place of residence. 

11 (C) CARE COORDINATION.—Care coordina12 tion, including requirements to coordinate care 

13 across settings and providers to ensure seamless 

14 transitions for patients across the full spectrum 

15 of health services including acute, chronic, and 

16 behavioral health needs. Care coordination re17 quirements shall include partnerships or formal 

18 contracts with the following: 

19 (i) Federally-qualified health centers 

20 (and as applicable, rural health clinics) to 

21 provide Federally-qualified health center 

22 services (and as applicable, rural health 

23 clinic services) to the extent such services 

24 are not provided directly through the cer25 tified community behavioral health clinic. 


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1 (ii) Inpatient psychiatric facilities and 

2 substance use detoxification, post-detoxi3 fication step-down services, and residential 

4 programs. 

5 (iii) Other community or regional 

6 services, supports, and providers, including 

7 schools, child welfare agencies, juvenile and 

8 criminal justice agencies and facilities, In9 dian Health Service youth regional treat10 ment centers, State licensed and nationally 

11 accredited child placing agencies for thera12 peutic foster care service, and other social 

13 and human services. 

14 (iv) Department of Veterans Affairs 

15 medical centers, independent outpatient 

16 clinics, drop-in centers, and other facilities 

17 of the Department as defined in section 

18 1801 of title 38, United States Code. 

19 (v) Inpatient acute care hospitals and 

20 hospital outpatient clinics. 

21 (D) SCOPE OF SERVICES.—Provision (in a 

22 manner reflecting person-centered care) of the 

23 following services which, if not available directly 

24 through the certified community behavioral 


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1 health clinic, are provided or referred through 

2 formal relationships with other providers: 

3 (i) Crisis mental health services, in4 cluding 24-hour mobile crisis teams, emer5 gency crisis intervention services, and cri6 sis stabilization. 

7 (ii) Screening, assessment, and diag8 nosis, including risk assessment. 

9 (iii) Patient-centered treatment plan10 ning or similar processes, including risk as11 sessment and crisis planning. 

12 (iv) Outpatient mental health and 

13 substance use services. 

14 (v) Outpatient clinic primary care 

15 screening and monitoring of key health in16 dicators and health risk. 

17 (vi) Targeted case management. 

18 (vii) Psychiatric rehabilitation serv19 ices. 

20 (viii) Peer support and counselor serv21 ices and family supports. 

22 (ix) Intensive, community-based men23 tal health care for members of the armed 

24 forces and veterans, particularly those 

25 members and veterans located in rural 


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1 areas, provided the care is consistent with 

2 minimum clinical mental health guidelines 

3 promulgated by the Veterans Health Ad4 ministration including clinical guidelines 

5 contained in the Uniform Mental Health 

6 Services Handbook of such Administration. 

7 (E) QUALITY AND OTHER REPORTING.— 

8 Reporting of encounter data, clinical outcomes 

9 data, quality data, and such other data as the 

10 Secretary requires. 

11 (F) ORGANIZATIONAL AUTHORITY.—Cri12 teria that a clinic be a non-profit or part of a 

13 local government behavioral health authority or 

14 operated under the authority of the Indian 

15 Health Service, an Indian tribe or tribal organi16 zation pursuant to a contract, grant, coopera17 tive agreement, or compact with the Indian 

18 Health Service pursuant to the Indian Self-De19 termination Act (25 U.S.C. 450 et seq.), or an 

20 urban Indian organization pursuant to a grant 

21 or contract with the Indian Health Service 

22 under title V of the Indian Health Care Im23 provement Act (25 U.S.C. 1601 et seq.). 


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1 (b) GUIDANCE ON DEVELOPMENT OF PROSPECTIVE

2 PAYMENT SYSTEM FOR TESTING UNDER DEMONSTRA3 TION PROGRAMS.— 

4 (1) IN GENERAL.—Not later than September 1, 

5 2015, the Secretary, through the Administrator of 

6 the Centers for Medicare & Medicaid Services, shall 

7 issue guidance for the establishment of a prospective 

8 payment system that shall only apply to medical as9 sistance for mental health services furnished by a 

10 certified community behavioral health clinic partici11 pating in a demonstration program under subsection 

12 (d). 

13 (2) REQUIREMENTS.—The guidance issued by 

14 the Secretary under paragraph (1) shall provide 

15 that— 

16 (A) no payment shall be made for inpatient 

17 care, residential treatment, room and board ex18 penses, or any other non-ambulatory services, 

19 as determined by the Secretary; and 

20 (B) no payment shall be made to satellite 

21 facilities of certified community behavioral 

22 health clinics if such facilities are established 

23 after the date of enactment of this Act. 

24 (c) PLANNING GRANTS.— 


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1 (1) IN GENERAL.—Not later than January 1, 

2 2016, the Secretary shall award planning grants to 

3 States for the purpose of developing proposals to 

4 participate in time-limited demonstration programs 

5 described in subsection (d). 

6 (2) USE OF FUNDS.—A State awarded a plan7 ning grant under this subsection shall— 

8 (A) solicit input with respect to the devel9 opment of such a demonstration program from 

10 patients, providers, and other stakeholders; 

11 (B) certify clinics as certified community 

12 behavioral health clinics for purposes of partici13 pating in a demonstration program conducted 

14 under subsection (d); and 

15 (C) establish a prospective payment system 

16 for mental health services furnished by a cer17 tified community behavioral health clinic par18 ticipating in a demonstration program under 

19 subsection (d) in accordance with the guidance 

20 issued under subsection (b). 

21 (d) DEMONSTRATION PROGRAMS.— 

22 (1) IN GENERAL.—Not later than September 1, 

23 2017, the Secretary shall select States to participate 

24 in demonstration programs that are developed 

25 through planning grants awarded under subsection 


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1 (c), meet the requirements of this subsection, and 

2 represent a diverse selection of geographic areas, in3 cluding rural and underserved areas. 

4 (2) APPLICATION REQUIREMENTS.— 

5 (A) IN GENERAL.—The Secretary shall so6 licit applications to participate in demonstration 

7 programs under this subsection solely from 

8 States awarded planning grants under sub9 section (c). 

10 (B) REQUIRED INFORMATION.—An appli11 cation for a demonstration program under this 

12 subsection shall include the following: 

13 (i) The target Medicaid population to 

14 be served under the demonstration pro15 gram. 

16 (ii) A list of participating certified 

17 community behavioral health clinics. 

18 (iii) Verification that the State has 

19 certified a participating clinic as a certified 

20 community behavioral health clinic in ac21 cordance with the requirements of sub22 section (b). 

23 (iv) A description of the scope of the 

24 mental health services available under the 

25 State Medicaid program that will be paid 


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1 for under the prospective payment system 

2 tested in the demonstration program. 

3 (v) Verification that the State has 

4 agreed to pay for such services at the rate 

5 established under the prospective payment 

6 system. 

7 (vi) Such other information as the 

8 Secretary may require relating to the dem9 onstration program including with respect 

10 to determining the soundness of the pro11 posed prospective payment system. 

12 (3) NUMBER AND LENGTH OF DEMONSTRATION

13 PROGRAMS.—Not more than 8 States shall be se14 lected for 2-year demonstration programs under this 

15 subsection. 

16 (4) REQUIREMENTS FOR SELECTING DEM17 ONSTRATION PROGRAMS.— 

18 (A) IN GENERAL.—The Secretary shall 

19 give preference to selecting demonstration pro20 grams where participating certified community 

21 behavioral health clinics— 

22 (i) provide the most complete scope of 

23 services described in subsection (a)(2)(D) 

24 to individuals eligible for medical assist25 ance under the State Medicaid program; 


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1 (ii) will improve availability of, access 

2 to, and participation in, services described 

3 in subsection (a)(2)(D) to individuals eligi4 ble for medical assistance under the State 

5 Medicaid program; 

6 (iii) will improve availability of, access 

7 to, and participation in assisted outpatient 

8 mental health treatment in the State; or 

9 (iv) demonstrate the potential to ex10 pand available mental health services in a 

11 demonstration area and increase the qual12 ity of such services without increasing net 

13 Federal spending. 

14 (5) PAYMENT FOR MEDICAL ASSISTANCE FOR

15 MENTAL HEALTH SERVICES PROVIDED BY CER16 TIFIED COMMUNITY BEHAVIORAL HEALTH CLIN17 ICS.— 

18 (A) IN GENERAL.—The Secretary shall pay 

19 a State participating in a demonstration pro20 gram under this subsection the Federal match21 ing percentage specified in subparagraph (B) 

22 for amounts expended by the State to provide 

23 medical assistance for mental health services 

24 described in the demonstration program appli25 cation in accordance with paragraph (2)(B)(iv) 


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1 that are provided by certified community behav2 ioral health clinics to individuals who are en3 rolled in the State Medicaid program. Payments 

4 to States made under this paragraph shall be 

5 considered to have been under, and are subject 

6 to the requirements of, section 1903 of the So7 cial Security Act (42 U.S.C. 1396b). 

8 (B) FEDERAL MATCHING PERCENTAGE.— 

9 The Federal matching percentage specified in 

10 this subparagraph is with respect to medical as11 sistance described in subparagraph (A) that is 

12 furnished— 

13 (i) to a newly eligible individual de14 scribed in paragraph (2) of section 1905(y) 

15 of the Social Security Act (42 U.S.C. 

16 1396d(y)), the matching rate applicable 

17 under paragraph (1) of that section; and 

18 (ii) to an individual who is not a 

19 newly eligible individual (as so described) 

20 but who is eligible for medical assistance 

21 under the State Medicaid program, the en22 hanced FMAP applicable to the State. 

23 (C) LIMITATIONS.— 


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1 (i) IN GENERAL.—Payments shall be 

2 made under this paragraph to a State only 

3 for mental health services— 

4 (I) that are described in the dem5 onstration program application in ac6 cordance with paragraph (2)(iv); 

7 (II) for which payment is avail8 able under the State Medicaid pro9 gram; and 

10 (III) that are provided to an indi11 vidual who is eligible for medical as12 sistance under the State Medicaid 

13 program. 

14 (ii) PROHIBITED PAYMENTS.—No 

15 payment shall be made under this para16 graph— 

17 (I) for inpatient care, residential 

18 treatment, room and board expenses, 

19 or any other non-ambulatory services, 

20 as determined by the Secretary; or 

21 (II) with respect to payments 

22 made to satellite facilities of certified 

23 community behavioral health clinics if 

24 such facilities are established after the 

25 date of enactment of this Act. 


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1 (6) WAIVER OF STATEWIDENESS REQUIRE2 MENT.—The Secretary shall waive section 

3 1902(a)(1) of the Social Security Act (42 U.S.C. 

4 1396a(a)(1)) (relating to statewideness) as may be 

5 necessary to conduct demonstration programs in ac6 cordance with the requirements of this subsection. 

7 (7) ANNUAL REPORTS.— 

8 (A) IN GENERAL.—Not later than 1 year 

9 after the date on which the first State is se10 lected for a demonstration program under this 

11 subsection, and annually thereafter, the Sec12 retary shall submit to Congress an annual re13 port on the use of funds provided under all 

14 demonstration programs conducted under this 

15 subsection. Each such report shall include— 

16 (i) an assessment of access to commu17 nity-based mental health services under the 

18 Medicaid program in the area or areas of 

19 a State targeted by a demonstration pro20 gram compared to other areas of the State; 

21 (ii) an assessment of the quality and 

22 scope of services provided by certified com23 munity behavioral health clinics compared 

24 to community-based mental health services 

25 provided in States not participating in a 


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1 demonstration program under this sub2 section and in areas of a demonstration 

3 State that are not participating in the 

4 demonstration program; and 

5 (iii) an assessment of the impact of 

6 the demonstration programs on the Fed7 eral and State costs of a full range of men8 tal health services (including inpatient, 

9 emergency and ambulatory services). 

10 (B) RECOMMENDATIONS.—Not later than 

11 December 31, 2021, the Secretary shall submit 

12 to Congress recommendations concerning 

13 whether the demonstration programs under this 

14 section should be continued, expanded, modi15 fied, or terminated. 

16 (e) DEFINITIONS.—In this section: 

17 (1) FEDERALLY-QUALIFIED HEALTH CENTER

18 SERVICES; FEDERALLY-QUALIFIED HEALTH CENTER; 

19 RURAL HEALTH CLINIC SERVICES; RURAL HEALTH

20 CLINIC.—The terms ‘‘Federally-qualified health cen21 ter services’’, ‘‘Federally-qualified health center’’, 

22 ‘‘rural health clinic services’’, and ‘‘rural health clin23 ic’’ have the meanings given those terms in section 

24 1905(l) of the Social Security Act (42 U.S.C. 

25 1396d(l)). 


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1 (2) ENHANCED FMAP.—The term ‘‘enhanced 

2 FMAP’’ has the meaning given that term in section 

3 2105(b) of the Social Security Act (42 U.S.C. 

4 1397dd(b)) but without regard to the second and 

5 third sentences of that section. 

6 (3) SECRETARY.—The term ‘‘Secretary’’ means 

7 the Secretary of Health and Human Services. 

8 (4) STATE.—The term ‘‘State’’ has the mean9 ing given such term for purposes of title XIX of the 

10 Social Security Act (42 U.S.C. 1396 et seq.). 

11 (f) FUNDING.— 

12 (1) IN GENERAL.—Out of any funds in the 

13 Treasury not otherwise appropriated, there is appro14 priated to the Secretary— 

15 (A) for purposes of carrying out sub16 sections (a), (b), and (d)(7), $2,000,000 for fis17 cal year 2014; and 

18 (B) for purposes of awarding planning 

19 grants under subsection (c), $25,000,000 for 

20 fiscal year 2016. 

21 (2) AVAILABILITY.—Funds appropriated under 

22 paragraph (1) shall remain available until expended. 


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1 SEC. 224. ASSISTED OUTPATIENT TREATMENT GRANT PRO2 GRAM FOR INDIVIDUALS WITH SERIOUS MEN3 TAL ILLNESS. 

4 (a) IN GENERAL.—The Secretary shall establish a 4- 

5 year pilot program to award not more than 50 grants each 

6 year to eligible entities for assisted outpatient treatment 

7 programs for individuals with serious mental illness. 

8 (b) CONSULTATION.—The Secretary shall carry out 

9 this section in consultation with the Director of the Na10 tional Institute of Mental Health, the Attorney General 

11 of the United States, the Administrator of the Administra12 tion for Community Living, and the Administrator of the 

13 Substance Abuse and Mental Health Services Administra14 tion. 

15 (c) SELECTING AMONG APPLICANTS.—The Sec16 retary— 

17 (1) may only award grants under this section to 

18 applicants that have not previously implemented an 

19 assisted outpatient treatment program; and 

20 (2) shall evaluate applicants based on their po21 tential to reduce hospitalization, homelessness, incar22 ceration, and interaction with the criminal justice 

23 system while improving the health and social out24 comes of the patient. 


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1 (d) USE OF GRANT.—An assisted outpatient treat2 ment program funded with a grant awarded under this 

3 section shall include— 

4 (1) evaluating the medical and social needs of 

5 the patients who are participating in the program; 

6 (2) preparing and executing treatment plans for 

7 such patients that— 

8 (A) include criteria for completion of 

9 court-ordered treatment; and 

10 (B) provide for monitoring of the patient’s 

11 compliance with the treatment plan, including 

12 compliance with medication and other treat13 ment regimens; 

14 (3) providing for such patients case manage15 ment services that support the treatment plan; 

16 (4) ensuring appropriate referrals to medical 

17 and social service providers; 

18 (5) evaluating the process for implementing the 

19 program to ensure consistency with the patient’s 

20 needs and State law; and 

21 (6) measuring treatment outcomes, including 

22 health and social outcomes such as rates of incarcer23 ation, health care utilization, and homelessness. 

24 (e) REPORT.—Not later than the end of each of fiscal 

25 years 2016, 2017, and 2018, the Secretary shall submit 


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1 a report to the appropriate congressional committees on 

2 the grant program under this section. Each such report 

3 shall include an evaluation of the following: 

4 (1) Cost savings and public health outcomes 

5 such as mortality, suicide, substance abuse, hos6 pitalization, and use of services. 

7 (2) Rates of incarceration by patients. 

8 (3) Rates of homelessness among patients. 

9 (4) Patient and family satisfaction with pro10 gram participation. 

11 (f) DEFINITIONS.—In this section: 

12 (1) The term ‘‘assisted outpatient treatment’’ 

13 means medically prescribed mental health treatment 

14 that a patient receives while living in a community 

15 under the terms of a law authorizing a State or local 

16 court to order such treatment. 

17 (2) The term ‘‘eligible entity’’ means a county, 

18 city, mental health system, mental health court, or 

19 any other entity with authority under the law of the 

20 State in which the grantee is located to implement, 

21 monitor, and oversee assisted outpatient treatment 

22 programs. 

23 (3) The term ‘‘Secretary’’ means the Secretary 

24 of Health and Human Services. 

25 (g) FUNDING.— 


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1 (1) AMOUNT OF GRANTS.—A grant under this 

2 section shall be in an amount that is not more than 

3 $1,000,000 for each of fiscal years 2015 through 

4 2018. Subject to the preceding sentence, the Sec5 retary shall determine the amount of each grant 

6 based on the population of the area, including esti7 mated patients, to be served under the grant. 

8 (2) AUTHORIZATION OF APPROPRIATIONS.— 

9 There is authorized to be appropriated to carry out 

10 this section $15,000,000 for each of fiscal years 

11 2015 through 2018. 

12 SEC. 225. EXCLUSION FROM PAYGO SCORECARDS. 

13 (a) STATUTORY PAY-AS-YOU-GO SCORECARDS.—The 

14 budgetary effects of this Act shall not be entered on either 

15 PAYGO scorecard maintained pursuant to section 4(d) of 

16 the Statutory Pay-As-You-Go Act of 2010. 

17 (b) SENATE PAYGO SCORECARDS.—The budgetary 

18 effects of this Act shall not be entered on any PAYGO 

19 scorecard maintained for purposes of section 201 of S. 

20 Con. Res. 21 (110th Congress). 

Æ 


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