H. R. 4302 

One Hundred Thirteenth Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Friday, 

the third day of January, two thousand and fourteen 

An Act 

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. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

Access to Medicare Act of 2014’’. 

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

is as follows: 

Sec. 1. Short title; table of contents. 

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. 
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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. 

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

mental illness. 

Sec. 225. Exclusion from PAYGO scorecards. 

TITLE I—MEDICARE EXTENDERS 

SEC. 101. PHYSICIAN PAYMENT UPDATE. 

Section 1848(d) of the Social Security Act (42 U.S.C. 1395w– 

4(d)) is amended— 

(1) in paragraph (15)— 

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

MARCH OF’’; 

(B) in subparagraph (A), by striking ‘‘for the period 

beginning on January 1, 2014, and ending on March 31, 

2014’’; and 

(C) in subparagraph (B)— 

(i) in the heading, by striking ‘‘REMAINING PORTION

OF 2014 AND’’; and 

(ii) by striking ‘‘the period beginning on April 1, 

2014, and ending on December 31, 2014, and for’’; 

and 

(2) by adding at the end the following new paragraph: 

‘‘(16) UPDATE FOR JANUARY THROUGH MARCH OF 2015.— ‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 

(9)(B), (10)(B), (11)(B), (12)(B), (13)(B), (14)(B), and (15)(B), 

in lieu of the update to the single conversion factor established in paragraph (1)(C) that would otherwise apply for 

2015 for the period beginning on January 1, 2015, and 

ending on March 31, 2015, the update to the single conversion factor shall be 0.0 percent. 

‘‘(B) NO EFFECT ON COMPUTATION OF CONVERSION

FACTOR FOR REMAINING PORTION OF 2015 AND SUBSEQUENT

YEARS.—The conversion factor under this subsection shall 

be computed under paragraph (1)(A) for the period beginning on April 1, 2015, and ending on December 31, 2015, 

and for 2016 and subsequent years as if subparagraph 

(A) had never applied.’’. 

SEC. 102. EXTENSION OF WORK GPCI FLOOR. 

Section 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 

1395w–4(e)(1)(E)) is amended by striking ‘‘April 1, 2014’’ and 

inserting ‘‘April 1, 2015’’. 

SEC. 103. EXTENSION OF THERAPY CAP EXCEPTIONS PROCESS. 

Section 1833(g) of the Social Security Act (42 U.S.C. 1395l(g)) 

is amended— 

(1) in paragraph (5)(A), in the first sentence, by striking 

‘‘March 31, 2014’’ and inserting ‘‘March 31, 2015’’; and 

(2) in paragraph (6)(A)— 

(A) by striking ‘‘March 31, 2014’’ and inserting ‘‘March 

31, 2015’’; and 
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(B) by striking ‘‘2012, 2013, or the first three months 

of 2014’’ and inserting ‘‘2012, 2013, 2014, or the first three 

months of 2015’’. 

SEC. 104. EXTENSION OF AMBULANCE ADD-ONS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended by striking 

‘‘April 1, 2014’’ and inserting ‘‘April 1, 2015’’ each place it appears. 

(b) SUPER RURAL GROUND AMBULANCE.—Section 1834(l)(12)(A) 

of the Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended, 

in the first sentence, by striking ‘‘April 1, 2014’’ and inserting 

‘‘April 1, 2015’’. 

SEC. 105. EXTENSION OF INCREASED INPATIENT HOSPITAL PAYMENT 

ADJUSTMENT FOR CERTAIN LOW-VOLUME HOSPITALS. 

Section 1886(d)(12) of the Social Security Act (42 U.S.C. 

1395ww(d)(12)) is amended— 

(1) in subparagraph (B), in the matter preceding clause 

(i), by striking ‘‘in the portion of fiscal year 2014 beginning 

on April 1, 2014, fiscal year 2015, and subsequent fiscal years’’ 

and inserting ‘‘in fiscal year 2015 (beginning on April 1, 2015), 

fiscal year 2016, and subsequent fiscal years’’; 

(2) in subparagraph (C)(i), by striking ‘‘fiscal years 2011, 

2012, and 2013, and the portion of fiscal year 2014 before’’ 

and inserting ‘‘fiscal years 2011 through 2014 and fiscal year 

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

(3) in subparagraph (D), by striking ‘‘fiscal years 2011, 

2012, and 2013, and the portion of fiscal year 2014 before 

April 1, 2014,’’ and inserting ‘‘fiscal years 2011 through 2014 

and fiscal year 2015 (before April 1, 2015),’’. 

SEC. 106. EXTENSION OF THE MEDICARE-DEPENDENT HOSPITAL (MDH) 

PROGRAM. 

(a) IN GENERAL.—Section 1886(d)(5)(G) of the Social Security 

Act (42 U.S.C. 1395ww(d)(5)(G)) is amended— 

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

‘‘April 1, 2015’’; and 

(2) in clause (ii)(II), by striking ‘‘April 1, 2014’’ and inserting 

‘‘April 1, 2015’’. 

(b) CONFORMING AMENDMENTS.— 

(1) EXTENSION OF TARGET AMOUNT.—Section 1886(b)(3)(D) 

of the Social Security Act (42 U.S.C. 1395ww(b)(3)(D)) is 

amended— 

(A) in the matter preceding clause (i), by striking ‘‘April 

1, 2014’’ and inserting ‘‘April 1, 2015’’; and 

(B) in clause (iv), by striking ‘‘through fiscal year 2013 

and the portion of fiscal year 2014 before April 1, 2014’’ 

and inserting ‘‘through fiscal year 2014 and the portion 

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

(2) PERMITTING HOSPITALS TO DECLINE RECLASSIFICATION.— 

Section 13501(e)(2) of the Omnibus Budget Reconciliation Act 

of 1993 (42 U.S.C. 1395ww note) is amended by striking 

‘‘through the first 2 quarters of fiscal year 2014’’ and inserting 

‘‘through the first 2 quarters of fiscal year 2015’’. 
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SEC. 107. EXTENSION FOR SPECIALIZED MEDICARE ADVANTAGE 

PLANS FOR SPECIAL NEEDS INDIVIDUALS. 

Section 1859(f)(1) of the Social Security Act (42 U.S.C. 1395w– 

28(f)(1)) is amended by striking ‘‘2016’’ and inserting ‘‘2017’’. 

SEC. 108. EXTENSION OF MEDICARE REASONABLE COST CONTRACTS. 

Section 1876(h)(5)(C)(ii) of the Social Security Act (42 U.S.C. 

1395mm(h)(5)(C)(ii)) is amended, in the matter preceding subclause 

(I), by striking ‘‘January 1, 2015’’ and inserting ‘‘January 1, 2016’’. 

SEC. 109. EXTENSION OF FUNDING FOR QUALITY MEASURE ENDORSEMENT, INPUT, AND SELECTION. 

Section 1890(d) of the Social Security Act (42 U.S.C. 1395aaa(d)) 

is amended— 

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

(2) by adding at the end the following new paragraph: 

‘‘(2) For purposes of carrying out this section and section 1890A 

(other than subsections (e) and (f)), the Secretary shall provide 

for the transfer, from the Federal Hospital Insurance Trust Fund 

under section 1817 and the Federal Supplementary Medical Insurance Trust Fund under section 1841, in such proportion as the 

Secretary determines appropriate, to the Centers for Medicare & 

Medicaid Services Program Management Account of $5,000,000 for 

fiscal year 2014 and $15,000,000 for the first 6 months of fiscal 

year 2015. Amounts transferred under the preceding sentence shall 

remain available until expended.’’. 

SEC. 110. EXTENSION OF FUNDING OUTREACH AND ASSISTANCE FOR 

LOW-INCOME PROGRAMS. 

(a) ADDITIONAL FUNDING FOR STATE HEALTH INSURANCE PRO- GRAMS.—Subsection (a)(1)(B) of section 119 of the Medicare 

Improvements for Patients and Providers Act of 2008 (42 U.S.C. 

1395b–3 note), as amended by section 3306 of the Patient Protection 

and Affordable Care Act Public Law 111–148), section 610 of the 

American Taxpayer Relief Act of 2012 (Public Law 112–240), and 

section 1110 of the Pathway for SGR Reform Act of 2013 (Public 

Law 113–67), is amended— 

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

(2) by striking clause (iv); and 

(3) by adding at the end the following new clauses: ‘‘(iv) for fiscal year 2014, of $7,500,000; and 

‘‘(v) for the portion of fiscal year 2015 before April 1, 2015, of $3,750,000.’’. 

(b) ADDITIONAL FUNDING FOR AREA AGENCIES ON AGING.— Subsection (b)(1)(B) of such section 119, as so amended, is 

amended— 

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

(2) by striking clause (iv); and 

(3) by inserting after clause (iii) the following new clauses: ‘‘(iv) for fiscal year 2014, of $7,500,000; and 

‘‘(v) for the portion of fiscal year 2015 before April 1, 2015, of $3,750,000.’’. 

(c) ADDITIONAL FUNDING FOR AGING AND DISABILITY RESOURCE

CENTERS.—Subsection (c)(1)(B) of such section 119, as so amended, 

is amended— 

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

(2) by striking clause (iv); and 

(3) by inserting after clause (iii) the following new clauses: 
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‘‘(iv) for fiscal year 2014, of $5,000,000; and 

‘‘(v) for the portion of fiscal year 2015 before April 

1, 2015, of $2,500,000.’’. 

(d) ADDITIONAL FUNDING FOR CONTRACT WITH THE NATIONAL

CENTER FOR BENEFITS AND OUTREACH ENROLLMENT.—Subsection 

(d)(2) of such section 119, as so amended, is amended— 

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

(2) by striking clause (iv); and 

(3) by inserting after clause (iii) the following new clauses: 

‘‘(iv) for fiscal year 2014, of $5,000,000; and 

‘‘(v) for the portion of fiscal year 2015 before April 

1, 2015, of $2,500,000.’’. 

SEC. 111. EXTENSION OF TWO-MIDNIGHT RULE. 

(a) CONTINUATION OF CERTAIN MEDICAL REVIEW ACTIVITIES.— 

The Secretary of Health and Human Services may continue medical 

review activities described in the notice entitled ‘‘Selecting Hospital 

Claims for Patient Status Reviews: Admissions On or After October 

1, 2013’’, posted on the Internet website of the Centers for Medicare 

& Medicaid Services, through the first 6 months of fiscal year 

2015 for such additional hospital claims as the Secretary determines 

appropriate. 

(b) LIMITATION.—The Secretary of Health and Human Services 

shall not conduct patient status reviews (as described in such notice) 

on a post-payment review basis through recovery audit contractors 

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

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

1, 2013, through March 31, 2015, unless there is evidence of systematic gaming, fraud, abuse, or delays in the provision of care by 

a provider of services (as defined in section 1861(u) of such Act 

(42 U.S.C. 1395x(u))). 

SEC. 112. TECHNICAL CHANGES TO MEDICARE LTCH AMENDMENTS. 

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

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

1395ww(m)(6)(C)(iv)) are each amended by striking ‘‘discharges’’ 

and inserting ‘‘Medicare fee-for-service discharges’’. 

(b) MMSEA CORRECTION.—Section 114(d) of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww note), 

as amended by sections 3106(b) and 10312(b) of Public Law 111– 

148 and by section 1206(b)(2) of the Pathway for SGR Reform 

Act of 2013 (division B of Public Law 113–67), is amended— 

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

(A), by striking ‘‘January 1, 2015,’’ and inserting ‘‘on the date 

of the enactment of paragraph (7) of this subsection’’; 

(2) in paragraph (6), by striking ‘‘January 1, 2015,’’ and 

inserting ‘‘on the date of the enactment of paragraph (7) of 

this subsection’’; and 

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

‘‘(7) ADDITIONAL EXCEPTION FOR CERTAIN LONG-TERM CARE

HOSPITALS.—The moratorium under paragraph (1)(A) shall not 

apply to a long-term care hospital that— 

‘‘(A) began its qualifying period for payment as a longterm care hospital under section 412.23(e) of title 42, Code 

of Federal Regulations, on or before the date of enactment 

of this paragraph; 
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‘‘(B) has a binding written agreement as of the date 

of the enactment of this paragraph with an outside, unrelated party for the actual construction, renovation, lease, 

or demolition for a long-term care hospital, and has 

expended, before such date of enactment, at least 10 percent of the estimated cost of the project (or, if less, 

$2,500,000); or 

‘‘(C) has obtained an approved certificate of need in 

a State where one is required on or before such date 

of enactment.’’. 

(c) ADDITIONAL AMENDMENTS.—Section 1206(a) of the Pathway 

for SGR Reform Act of 2013 (division B of Public Law 113–67) 

is amended— 

(1) in paragraph (2)(A), by striking ‘‘Assessment’’ and 

inserting ‘‘Advisory’’; and 

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

a hospital that is classified as of December 10, 2013, as a 

subsection (d) hospital (as defined in section 1886(d)(1)(B) of 

the Social Security Act, 42 U.S.C. 1395ww(d)(1)(B))’’ and 

inserting ‘‘shall only apply to a hospital that is classified as 

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

in section 1861(ccc) of the Social Security Act, 42 U.S.C. 

1395x(ccc))’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

are effective as of the date of the enactment of this Act. 

TITLE II—OTHER HEALTH PROVISIONS 

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

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

Act (42 U.S.C. 1396a(a)(10)(E)(iv)) is amended by striking ‘‘March 

2014’’ and inserting ‘‘March 2015’’. 

(b) EXTENDING TOTAL AMOUNT AVAILABLE FOR ALLOCATION.— 

Section 1933(g) of the Social Security Act (42 U.S.C. 1396u–3(g)) 

is amended— 

(1) in paragraph (2)— 

(A) in subparagraph (T), by striking ‘‘and’’ at the end; 

(B) in subparagraph (U)— 

(i) by striking ‘‘March 31, 2014’’ and inserting ‘‘September 30, 2014’’; and 

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

‘‘$485,000,000;’’; and 

(C) by adding at the end the following new subparagraphs: 

‘‘(V) for the period that begins on October 1, 2014, 

and ends on December 31, 2014, the total allocation amount 

is $300,000,000; and 

‘‘(W) for the period that begins on January 1, 2015, 

and ends on March 31, 2015, the total allocation amount 

is $250,000,000.’’; and 

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

(A), by striking ‘‘or (T)’’ and inserting ‘‘(T), or (V)’’. 
H. R. 4302—7 

SEC. 202. TEMPORARY EXTENSION OF TRANSITIONAL MEDICAL 

ASSISTANCE (TMA). 

Sections 1902(e)(1)(B) and 1925(f) of the Social Security Act 

(42 U.S.C. 1396a(e)(1)(B), 1396r–6(f)) are each amended by striking 

‘‘March 31, 2014’’ and inserting ‘‘March 31, 2015’’. 

SEC. 203. EXTENSION OF MEDICAID AND CHIP EXPRESS LANE OPTION. 

Section 1902(e)(13)(I) of the Social Security Act (42 U.S.C. 

1396a(e)(13)(I)) is amended by striking ‘‘September 30, 2014’’ and 

inserting ‘‘September 30, 2015’’. 

SEC. 204. EXTENSION OF SPECIAL DIABETES PROGRAM FOR TYPE I 

DIABETES AND FOR INDIANS. 

(a) SPECIAL DIABETES PROGRAMS FOR TYPE I DIABETES.—Section 330B(b)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

2(b)(2)(C)) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’. 

(b) SPECIAL DIABETES PROGRAMS FOR INDIANS.—Section 

330C(c)(2)(C) of the Public Health Service Act (42 U.S.C. 254c– 

3(c)(2)(C)) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’. 

SEC. 205. EXTENSION OF ABSTINENCE EDUCATION. 

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

Act (42 U.S.C. 710) are each amended by striking ‘‘2014’’ and 

inserting ‘‘2015’’. 

SEC. 206. EXTENSION OF PERSONAL RESPONSIBILITY EDUCATION 

PROGRAM (PREP). 

Section 513 of the Social Security Act (42 U.S.C. 713) is 

amended— 

(1) in paragraphs (1)(A) and (4)(A) of subsection (a), by 

striking ‘‘2014’’ and inserting ‘‘2015’’ each place it appears; 

(2) in subsection (a)(4)(B)(i), by striking ‘‘and 2014’’ and 

inserting ‘‘2014, and 2015’’; and 

(3) in subsection (f), by striking ‘‘2014’’ and inserting ‘‘2015’’. 

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

INFORMATION CENTERS. 

Section 501(c)(1)(A) of the Social Security Act (42 U.S.C. 

701(c)(1)(A)) is amended— 

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

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

inserting a semicolon and by moving the margin to align with 

the margin for clause (iii); and 

(3) by adding at the end the following new clauses: 

‘‘(v) $2,500,000 for the portion of fiscal year 2014 on or 

after April 1, 2014; and ‘‘(vi) $2,500,000 for the portion of fiscal year 2015 before 

April 1, 2015.’’. 

SEC. 208. EXTENSION OF HEALTH WORKFORCE DEMONSTRATION 

PROJECT FOR LOW-INCOME INDIVIDUALS. 

Section 2008(c)(1) of the Social Security Act (42 U.S.C. 

1397g(c)(1)) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’. 

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

HOME VISITING PROGRAMS. 

Section 511(j) of the Social Security Act (42 U.S.C. 711(j)) 

is amended— 

(1) in paragraph (1)— 
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(A) by striking ‘‘and’’ at the end of subparagraph (D); 

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

(E) and inserting ‘‘; and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(F) for the period beginning on October 1, 2014, and 

ending on March 31, 2015, an amount equal to the amount 

provided in subparagraph (E).’’; and 

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

of a fiscal year)’’ after ‘‘for a fiscal year’’ each place it appears. 

SEC. 210. PEDIATRIC QUALITY MEASURES. 

(a) CONTINUATION OF FUNDING FOR PEDIATRIC QUALITY MEASURES FOR IMPROVING THE QUALITY OF CHILDREN’S HEALTH CARE.— 

Section 1139B(e) of the Social Security Act (42 U.S.C. 1320b–9b(e)) 

is amended by adding at the end the following: ‘‘Of the funds 

appropriated under this subsection, not less than $15,000,000 shall 

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

(b) ELIMINATION OF RESTRICTION ON MEDICAID QUALITY

MEASUREMENT PROGRAM.—Section 1139B(b)(5)(A) of the Social 

Security Act (42 U.S.C. 1320b–9b(b)(5)(A)) is amended by striking 

‘‘The aggregate amount awarded by the Secretary for grants and 

contracts for the development, testing, and validation of emerging 

and innovative evidence-based measures under such program shall 

equal the aggregate amount awarded by the Secretary for grants 

under section 1139A(b)(4)(A)’’. 

SEC. 211. DELAY OF EFFECTIVE DATE FOR MEDICAID AMENDMENTS 

RELATING TO BENEFICIARY LIABILITY SETTLEMENTS. 

Effective as if included in the enactment of the Bipartisan 

Budget Act of 2013 (Public Law 113–67), section 202(c) of such 

Act is amended by striking ‘‘October 1, 2014’’ and inserting ‘‘October 

1, 2016’’. 

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

The Secretary of Health and Human Services may not, prior 

to October 1, 2015, adopt ICD–10 code sets as the standard for 

code sets under section 1173(c) of the Social Security Act (42 U.S.C. 

1320d–2(c)) and section 162.1002 of title 45, Code of Federal Regulations. 

SEC. 213. ELIMINATION OF LIMITATION ON DEDUCTIBLES FOR 

EMPLOYER-SPONSORED HEALTH PLANS. 

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

Affordable Care Act (Public Law 111–148; 42 U.S.C. 18022(c)) is 

amended— 

(1) by striking paragraph (2); and 

(2) in paragraph (4)(A), by striking ‘‘paragraphs (1)(B)(i) 

and (2)(B)(i)’’ and inserting ‘‘paragraph (1)(B)(i)’’. 

(b) CONFORMING AMENDMENT.—Section 2707(b) of the Public 

Health Service Act (42 U.S.C. 300gg–6(b)) is amended by striking 

‘‘paragraphs (1) and (2)’’ and inserting ‘‘paragraph (1)’’. 

(c) EFFECTIVE DATE.—The amendments made by this Act shall 

be effective as if included in the enactment of the Patient Protection 

and Affordable Care Act (Public Law 111–148). 
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SEC. 214. GAO REPORT ON THE CHILDREN’S HOSPITAL GRADUATE 

MEDICAL EDUCATION PROGRAM. 

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

Support Reauthorization Act of 2013 is enacted into law, the Comptroller General of the United States shall, not later than November 

30, 2017, conduct an independent evaluation, and submit to the 

appropriate committees of Congress a report, concerning the 

implementation of section 340E(h) of the Public Health Service 

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

Reauthorization Act of 2013. 

(b) CONTENT.—The report described in subsection (a) shall 

review and assess each of the following, with respect to hospitals 

receiving payments under such section 340E(h) during the period 

of fiscal years 2015 through 2017: 

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

for such payments. 

(2) The number and type of such hospitals receiving such 

payments. 

(3) The amount of such payments awarded to such hospitals. 

(4) How such hospitals used such payments. 

(5) The impact of such payments on— 

(A) the number of pediatric providers; and 

(B) health care needs of children. 

SEC. 215. SKILLED NURSING FACILITY VALUE-BASED PURCHASING. 

(a) IN GENERAL.—Section 1888 of the Social Security Act (42 

U.S.C. 1395yy) is amended by adding at the end the following 

new subsection: 

‘‘(g) SKILLED NURSING FACILITY READMISSION MEASURE.— 

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

2015, the Secretary shall specify a skilled nursing facility allcause all-condition hospital readmission measure (or any successor to such a measure). 

‘‘(2) RESOURCE USE MEASURE.—Not later than October 1, 

2016, the Secretary shall specify a measure to reflect an allcondition risk-adjusted potentially preventable hospital 

readmission rate for skilled nursing facilities. 

‘‘(3) MEASURE ADJUSTMENTS.—When specifying the measures under paragraphs (1) and (2), the Secretary shall devise 

a methodology to achieve a high level of reliability and validity, 

especially for skilled nursing facilities with a low volume of 

readmissions. 

‘‘(4) PRE-RULEMAKING PROCESS (MEASURE APPLICATION PARTNERSHIP PROCESS).—The application of the provisions of section 

1890A shall be optional in the case of a measure specified 

under paragraph (1) and a measure specified under paragraph 

(2). 

‘‘(5) FEEDBACK REPORTS TO SKILLED NURSING FACILITIES.— 

Beginning October 1, 2016, and every quarter thereafter, the 

Secretary shall provide confidential feedback reports to skilled 

nursing facilities on the performance of such facilities with 

respect to a measure specified under paragraph (1) or (2). 

‘‘(6) PUBLIC REPORTING OF SKILLED NURSING FACILITIES.— 

‘‘(A) IN GENERAL.—Subject to subparagraphs (B) and 

(C), the Secretary shall establish procedures for making 

available to the public by posting on the Nursing Home 
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Compare Medicare website (or a successor website) 

described in section 1819(i) information on the performance 

of skilled nursing facilities with respect to a measure specified under paragraph (1) and a measure specified under 

paragraph (2). 

‘‘(B) OPPORTUNITY TO REVIEW.—The procedures under 

subparagraph (A) shall ensure that a skilled nursing 

facility has the opportunity to review and submit corrections to the information that is to be made public with 

respect to the facility prior to such information being made 

public. 

‘‘(C) TIMING.—Such procedures shall provide that the 

information described in subparagraph (A) is made publicly 

available beginning not later than October 1, 2017. 

‘‘(7) NON-APPLICATION OF PAPERWORK REDUCTION ACT.— 

Chapter 35 of title 44, United States Code (commonly referred 

to as the ‘Paperwork Reduction Act of 1995’) shall not apply 

to this subsection.’’. 

(b) VALUE-BASED PURCHASING PROGRAM FOR SKILLED NURSING

FACILITIES.—Section 1888 of the Social Security Act (42 U.S.C. 

1395yy), as amended by subsection (a), is further amended by 

adding at the end the following new subsection: 

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

PROGRAM.— 

‘‘(1) ESTABLISHMENT.— ‘‘(A) IN GENERAL.—Subject to the succeeding provisions 

of this subsection, the Secretary shall establish a skilled 

nursing facility value-based purchasing program (in this 

subsection referred to as the ‘SNF VBP Program’) under 

which value-based incentive payments are made in a fiscal 

year to skilled nursing facilities. 

‘‘(B) PROGRAM TO BEGIN IN FISCAL YEAR 2019.—The 

SNF VBP Program shall apply to payments for services 

furnished on or after October 1, 2018. 

‘‘(2) APPLICATION OF MEASURES.— ‘‘(A) IN GENERAL.—The Secretary shall apply the 

measure specified under subsection (g)(1) for purposes of 

the SNF VBP Program. 

‘‘(B) REPLACEMENT.—For purposes of the SNF VBP 

Program, the Secretary shall apply the measure specified 

under (g)(2) instead of the measure specified under (g)(1) 

as soon as practicable. 

‘‘(3) PERFORMANCE STANDARDS.— 

‘‘(A) ESTABLISHMENT.—The Secretary shall establish 

performance standards with respect to the measure applied 

under paragraph (2) for a performance period for a fiscal 

year. 

‘‘(B) HIGHER OF ACHIEVEMENT AND IMPROVEMENT.— The performance standards established under subparagraph (A) shall include levels of achievement and improvement. In calculating the SNF performance score under 

paragraph (4), the Secretary shall use the higher of either 

improvement or achievement. 

‘‘(C) TIMING.—The Secretary shall establish and 

announce the performance standards established under 

subparagraph (A) not later than 60 days prior to the beginning of the performance period for the fiscal year involved. 
H. R. 4302—11 

‘‘(4) SNF PERFORMANCE SCORE.— 

‘‘(A) IN GENERAL.—The Secretary shall develop a methodology for assessing the total performance of each skilled 

nursing facility based on performance standards established under paragraph (3) with respect to the measure 

applied under paragraph (2). Using such methodology, the 

Secretary shall provide for an assessment (in this subsection referred to as the ‘SNF performance score’) for 

each skilled nursing facility for each such performance 

period. 

‘‘(B) RANKING OF SNF PERFORMANCE SCORES.—The Secretary shall, for the performance period for each fiscal 

year, rank the SNF performance scores determined under 

subparagraph (A) from low to high. 

‘‘(5) CALCULATION OF VALUE-BASED INCENTIVE PAYMENTS.— 

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

facility, based on the ranking under paragraph (4)(B) for 

a performance period for a fiscal year, the Secretary shall 

increase the adjusted Federal per diem rate determined 

under subsection (e)(4)(G) otherwise applicable to such 

skilled nursing facility (and after application of paragraph 

(6)) for services furnished by such facility during such 

fiscal year by the value-based incentive payment amount 

under subparagraph (B). 

‘‘(B) VALUE-BASED INCENTIVE PAYMENT AMOUNT.—The 

value-based incentive payment amount for services furnished by a skilled nursing facility in a fiscal year shall 

be equal to the product of— 

‘‘(i) the adjusted Federal per diem rate determined 

under subsection (e)(4)(G) otherwise applicable to such 

skilled nursing facility for such services furnished by 

the skilled nursing facility during such fiscal year; 

and 

‘‘(ii) the value-based incentive payment percentage 

specified under subparagraph (C) for the skilled 

nursing facility for such fiscal year. 

‘‘(C) VALUE-BASED INCENTIVE PAYMENT PERCENTAGE.— ‘‘(i) IN GENERAL.—The Secretary shall specify a 

value-based incentive payment percentage for a skilled 

nursing facility for a fiscal year which may include 

a zero percentage. 

‘‘(ii) REQUIREMENTS.—In specifying the valuebased incentive payment percentage for each skilled 

nursing facility for a fiscal year under clause (i), the 

Secretary shall ensure that— 

‘‘(I) such percentage is based on the SNF 

performance score of the skilled nursing facility 

provided under paragraph (4) for the performance 

period for such fiscal year; 

‘‘(II) the application of all such percentages 

in such fiscal year results in an appropriate distribution of value-based incentive payments under 

subparagraph (B) such that— 

‘‘(aa) skilled nursing facilities with the 

highest rankings under paragraph (4)(B) 

receive the highest value-based incentive payment amounts under subparagraph (B); 
H. R. 4302—12 

‘‘(bb) skilled nursing facilities with the 

lowest rankings under paragraph (4)(B) 

receive the lowest value-based incentive payment amounts under subparagraph (B); and 

‘‘(cc) in the case of skilled nursing facilities 

in the lowest 40 percent of the ranking under 

paragraph (4)(B), the payment rate under 

subparagraph (A) for services furnished by 

such facility during such fiscal year shall be 

less than the payment rate for such services 

for such fiscal year that would otherwise apply 

under subsection (e)(4)(G) without application 

of this subsection; and 

‘‘(III) the total amount of value-based incentive 

payments under this paragraph for all skilled 

nursing facilities in such fiscal year shall be 

greater than or equal to 50 percent, but not greater 

than 70 percent, of the total amount of the reductions to payments for such fiscal year under paragraph (6), as estimated by the Secretary. 

‘‘(6) FUNDING FOR VALUE-BASED INCENTIVE PAYMENTS.— 

‘‘(A) IN GENERAL.—The Secretary shall reduce the 

adjusted Federal per diem rate determined under subsection (e)(4)(G) otherwise applicable to a skilled nursing 

facility for services furnished by such facility during a 

fiscal year (beginning with fiscal year 2019) by the 

applicable percent (as defined in subparagraph (B)). The 

Secretary shall make such reductions for all skilled nursing 

facilities in the fiscal year involved, regardless of whether 

or not the skilled nursing facility has been determined 

by the Secretary to have earned a value-based incentive 

payment under paragraph (5) for such fiscal year. 

‘‘(B) APPLICABLE PERCENT.—For purposes of subparagraph (A), the term ‘applicable percent’ means, with respect 

to fiscal year 2019 and succeeding fiscal years, 2 percent. 

‘‘(7) ANNOUNCEMENT OF NET RESULT OF ADJUSTMENTS.— 

Under the SNF VBP Program, the Secretary shall, not later 

than 60 days prior to the fiscal year involved, inform each 

skilled nursing facility of the adjustments to payments to the 

skilled nursing facility for services furnished by such facility 

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

‘‘(8) NO EFFECT IN SUBSEQUENT FISCAL YEARS.—The valuebased incentive payment under paragraph (5) and the payment 

reduction under paragraph (6) shall each apply only with 

respect to the fiscal year involved, and the Secretary shall 

not take into account such value-based incentive payment or 

payment reduction in making payments to a skilled nursing 

facility under this section in a subsequent fiscal year. 

‘‘(9) PUBLIC REPORTING.— 

‘‘(A) SNF SPECIFIC INFORMATION.—The Secretary shall 

make available to the public, by posting on the Nursing 

Home Compare Medicare website (or a successor website) 

described in section 1819(i) in an easily understandable 

format, information regarding the performance of individual skilled nursing facilities under the SNF VBP Program, with respect to a fiscal year, including— 
H. R. 4302—13 

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

nursing facility for such fiscal year; and 

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

under paragraph (4)(B) for the performance period for 

such fiscal year. 

‘‘(B) AGGREGATE INFORMATION.—The Secretary shall 

periodically post on the Nursing Home Compare Medicare 

website (or a successor website) described in section 1819(i) 

aggregate information on the SNF VBP Program, 

including— 

‘‘(i) the range of SNF performance scores provided 

under paragraph (4)(A); and 

‘‘(ii) the number of skilled nursing facilities 

receiving value-based incentive payments under paragraph (5) and the range and total amount of such 

value-based incentive payments. 

‘‘(10) LIMITATION ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of the following: 

‘‘(A) The methodology used to determine the valuebased incentive payment percentage and the amount of 

the value-based incentive payment under paragraph (5). 

‘‘(B) The determination of the amount of funding available for such value-based incentive payments under paragraph (5)(C)(ii)(III) and the payment reduction under paragraph (6). 

‘‘(C) The establishment of the performance standards 

under paragraph (3) and the performance period. 

‘‘(D) The methodology developed under paragraph (4) 

that is used to calculate SNF performance scores and the 

calculation of such scores. 

‘‘(E) The ranking determinations under paragraph 

(4)(B). 

‘‘(11) FUNDING FOR PROGRAM MANAGEMENT.—The Secretary 

shall provide for the one time transfer from the Federal Hospital Insurance Trust Fund established under section 1817 

to the Centers for Medicare & Medicaid Services Program 

Management Account of— 

‘‘(A) for purposes of subsection (g)(2), $2,000,000; and 

‘‘(B) for purposes of implementing this subsection, 

$10,000,000. 

Such funds shall remain available until expended.’’. 

(c) MEDPAC STUDY.—Not later than June 30, 2021, the Medicare Payment Advisory Commission shall submit to Congress a 

report that reviews the progress of the skilled nursing facility 

value-based purchasing program established under section 1888(h) 

of the Social Security Act, as added by subsection (b), and makes 

recommendations, as appropriate, on any improvements that should 

be made to such program. For purposes of the previous sentence, 

the Medicare Payment Advisory Commission shall consider any 

unintended consequences with respect to such skilled nursing 

facility value-based purchasing program and any potential adjustments to the readmission measure specified under section 1888(g)(1) 

of such Act, as added by subsection (a), for purposes of determining 

the effect of the socio-economic status of a beneficiary under the 

Medicare program under title XVIII of the Social Security Act 
H. R. 4302—14 

for the SNF performance score of a skilled nursing facility provided 

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

SEC. 216. IMPROVING MEDICARE POLICIES FOR CLINICAL DIAGNOSTIC 

LABORATORY TESTS. 

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

amended by inserting after section 1834 (42 U.S.C. 1395m) the 

following new section: 

‘‘SEC. 1834A. IMPROVING POLICIES FOR CLINICAL DIAGNOSTIC LABORATORY TESTS. 

‘‘(a) REPORTING OF PRIVATE SECTOR PAYMENT RATES FOR

ESTABLISHMENT OF MEDICARE PAYMENT RATES.— ‘‘(1) IN GENERAL.—Beginning January 1, 2016, and every 

3 years thereafter (or, annually, in the case of reporting with 

respect to an advanced diagnostic laboratory test, as defined 

in subsection (d)(5)), an applicable laboratory (as defined in 

paragraph (2)) shall report to the Secretary, at a time specified 

by the Secretary, applicable information (as defined in paragraph (3)) for a data collection period (as defined in paragraph 

(4)) for each clinical diagnostic laboratory test that the laboratory furnishes during such period for which payment is made 

under this part. 

‘‘(2) DEFINITION OF APPLICABLE LABORATORY.—In this section, the term ‘applicable laboratory’ means a laboratory that, 

with respect to its revenues under this title, a majority of 

such revenues are from this section, section 1833(h), or section 

1848. The Secretary may establish a low volume or low expenditure threshold for excluding a laboratory from the definition 

of applicable laboratory under this paragraph, as the Secretary 

determines appropriate. 

‘‘(3) APPLICABLE INFORMATION DEFINED.— ‘‘(A) IN GENERAL.—In this section, subject to subparagraph (B), the term ‘applicable information’ means, with 

respect to a laboratory test for a data collection period, 

the following: 

‘‘(i) The payment rate (as determined in accordance 

with paragraph (5)) that was paid by each private 

payor for the test during the period. 

‘‘(ii) The volume of such tests for each such payor 

for the period. 

‘‘(B) EXCEPTION FOR CERTAIN CONTRACTUAL ARRANGE- MENTS.—Such term shall not include information with 

respect to a laboratory test for which payment is made 

on a capitated basis or other similar payment basis during 

the data collection period. 

‘‘(4) DATA COLLECTION PERIOD DEFINED.—In this section, 

the term ‘data collection period’ means a period of time, such 

as a previous 12 month period, specified by the Secretary. 

‘‘(5) TREATMENT OF DISCOUNTS.—The payment rate 

reported by a laboratory under this subsection shall reflect 

all discounts, rebates, coupons, and other price concessions, 

including those described in section 1847A(c)(3). 

‘‘(6) ENSURING COMPLETE REPORTING.—In the case where 

an applicable laboratory has more than one payment rate for 

the same payor for the same test or more than one payment 

rate for different payors for the same test, the applicable laboratory shall report each such payment rate and the volume for 
H. R. 4302—15 

the test at each such rate under this subsection. Beginning 

with January 1, 2019, the Secretary may establish rules to 

aggregate reporting with respect to the situations described 

in the preceding sentence. 

‘‘(7) CERTIFICATION.—An officer of the laboratory shall certify the accuracy and completeness of the information reported 

under this subsection. 

‘‘(8) PRIVATE PAYOR DEFINED.—In this section, the term 

‘private payor’ means the following: 

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

plan (as such terms are defined in section 2791 of the 

Public Health Service Act). 

‘‘(B) A Medicare Advantage plan under part C. 

‘‘(C) A medicaid managed care organization (as defined 

in section 1903(m)). 

‘‘(9) CIVIL MONEY PENALTY.— 

‘‘(A) IN GENERAL.—If the Secretary determines that 

an applicable laboratory has failed to report or made a 

misrepresentation or omission in reporting information 

under this subsection with respect to a clinical diagnostic 

laboratory test, the Secretary may apply a civil money 

penalty in an amount of up to $10,000 per day for each 

failure to report or each such misrepresentation or omission. 

‘‘(B) APPLICATION.—The provisions of section 1128A 

(other than subsections (a) and (b)) shall apply to a civil 

money penalty under this paragraph in the same manner 

as they apply to a civil money penalty or proceeding under 

section 1128A(a). 

‘‘(10) CONFIDENTIALITY OF INFORMATION.—Notwithstanding 

any other provision of law, information disclosed by a laboratory 

under this subsection is confidential and shall not be disclosed 

by the Secretary or a Medicare contractor in a form that discloses the identity of a specific payor or laboratory, or prices 

charged or payments made to any such laboratory, except— 

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

carry out this section; 

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

information provided; 

‘‘(C) to permit the Director of the Congressional Budget 

Office to review the information provided; and 

‘‘(D) to permit the Medicare Payment Advisory 

Commission to review the information provided. 

‘‘(11) PROTECTION FROM PUBLIC DISCLOSURE.—A payor shall 

not be identified on information reported under this subsection. 

The name of an applicable laboratory under this subsection 

shall be exempt from disclosure under section 552(b)(3) of title 

5, United States Code. 

‘‘(12) REGULATIONS.—Not later than June 30, 2015, the 

Secretary shall establish through notice and comment rulemaking parameters for data collection under this subsection. 

‘‘(b) PAYMENT FOR CLINICAL DIAGNOSTIC LABORATORY TESTS.— ‘‘(1) USE OF PRIVATE PAYOR RATE INFORMATION TO DETER- MINE MEDICARE PAYMENT RATES.— ‘‘(A) IN GENERAL.—Subject to paragraph (3) and subsections (c) and (d), in the case of a clinical diagnostic 

laboratory test furnished on or after January 1, 2017, the 
H. R. 4302—16 

payment amount under this section shall be equal to the 

weighted median determined for the test under paragraph 

(2) for the most recent data collection period. 

‘‘(B) APPLICATION OF PAYMENT AMOUNTS TO HOSPITAL

LABORATORIES.—The payment amounts established under 

this section shall apply to a clinical diagnostic laboratory 

test furnished by a hospital laboratory if such test is paid 

for separately, and not as part of a bundled payment under 

section 1833(t). 

‘‘(2) CALCULATION OF WEIGHTED MEDIAN.—For each laboratory test with respect to which information is reported under 

subsection (a) for a data collection period, the Secretary shall 

calculate a weighted median for the test for the period, by 

arraying the distribution of all payment rates reported for 

the period for each test weighted by volume for each payor 

and each laboratory. 

‘‘(3) PHASE-IN OF REDUCTIONS FROM PRIVATE PAYOR RATE

IMPLEMENTATION.— 

‘‘(A) IN GENERAL.—Payment amounts determined 

under this subsection for a clinical diagnostic laboratory 

test for each of 2017 through 2022 shall not result in 

a reduction in payments for a clinical diagnostic laboratory 

test for the year of greater than the applicable percent 

(as defined in subparagraph (B)) of the amount of payment 

for the test for the preceding year. 

‘‘(B) APPLICABLE PERCENT DEFINED.—In this paragraph, the term ‘applicable percent’ means— 

‘‘(i) for each of 2017 through 2019, 10 percent; 

and 

‘‘(ii) for each of 2020 through 2022, 15 percent. 

‘‘(C) NO APPLICATION TO NEW TESTS.—This paragraph 

shall not apply to payment amounts determined under 

this section for either of the following. 

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

‘‘(ii) A new advanced diagnostic test (as defined 

in subsection (d)(5)) under subsection (d). 

‘‘(4) APPLICATION OF MARKET RATES.— 

‘‘(A) IN GENERAL.—Subject to paragraph (3), once established for a year following a data collection period, the 

payment amounts under this subsection shall continue to 

apply until the year following the next data collection 

period. 

‘‘(B) OTHER ADJUSTMENTS NOT APPLICABLE.—The payment amounts under this section shall not be subject to 

any adjustment (including any geographic adjustment, 

budget neutrality adjustment, annual update, or other 

adjustment). 

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

collected from an individual in a skilled nursing facility or 

by a laboratory on behalf of a home health agency, the nominal 

fee that would otherwise apply under section 1833(h)(3)(A) 

shall be increased by $2. 

‘‘(c) PAYMENT FOR NEW TESTS THAT ARE NOT ADVANCED DIAGNOSTIC LABORATORY TESTS.— 

‘‘(1) PAYMENT DURING INITIAL PERIOD.—In the case of a 

clinical diagnostic laboratory test that is assigned a new or 
H. R. 4302—17 

substantially revised HCPCS code on or after the date of enactment of this section, and which is not an advanced diagnostic 

laboratory test (as defined in subsection (d)(5)), during an initial 

period until payment rates under subsection (b) are established 

for the test, payment for the test shall be determined— 

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

414.508(a) of title 42, Code of Federal Regulations, or any 

successor regulation) to the most appropriate existing test 

under the fee schedule under this section during that 

period; or 

‘‘(B) if no existing test is comparable to the new test, 

according to the gapfilling process described in paragraph 

(2). 

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

process described in this paragraph shall take into account 

the following sources of information to determine gapfill 

amounts, if available: 

‘‘(A) Charges for the test and routine discounts to 

charges. 

‘‘(B) Resources required to perform the test. 

‘‘(C) Payment amounts determined by other payors. 

‘‘(D) Charges, payment amounts, and resources 

required for other tests that may be comparable or otherwise relevant. 

‘‘(E) Other criteria the Secretary determines appropriate. 

‘‘(3) ADDITIONAL CONSIDERATION.—In determining the payment amount under crosswalking or gapfilling processes under 

this subsection, the Secretary shall consider recommendations 

from the panel established under subsection (f)(1). 

‘‘(4) EXPLANATION OF PAYMENT RATES.—In the case of a 

clinical diagnostic laboratory test for which payment is made 

under this subsection, the Secretary shall make available to 

the public an explanation of the payment rate for the test, 

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

‘‘(d) PAYMENT FOR NEW ADVANCED DIAGNOSTIC LABORATORY

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

‘‘(A) IN GENERAL.—In the case of an advanced diagnostic laboratory test for which payment has not been 

made under the fee schedule under section 1833(h) prior 

to the date of enactment of this section, during an initial 

period of three quarters, the payment amount for the test 

for such period shall be based on the actual list charge 

for the laboratory test. 

‘‘(B) ACTUAL LIST CHARGE.—For purposes of subparagraph (A), the term ‘actual list charge’, with respect to 

a laboratory test furnished during such period, means the 

publicly available rate on the first day at which the test 

is available for purchase by a private payor. 

‘‘(2) SPECIAL RULE FOR TIMING OF INITIAL REPORTING.— With respect to an advanced diagnostic laboratory test 

described in paragraph (1)(A), an applicable laboratory shall 

initially be required to report under subsection (a) not later 

than the last day of the second quarter of the initial period 

under such paragraph. 
H. R. 4302—18 

‘‘(3) APPLICATION OF MARKET RATES AFTER INITIAL PERIOD.— 

Subject to paragraph (4), data reported under paragraph (2) 

shall be used to establish the payment amount for an advanced 

diagnostic laboratory test after the initial period under paragraph (1)(A) using the methodology described in subsection 

(b). Such payment amount shall continue to apply until the 

year following the next data collection period. 

‘‘(4) RECOUPMENT IF ACTUAL LIST CHARGE EXCEEDS MARKET

RATE.—With respect to the initial period described in paragraph 

(1)(A), if, after such period, the Secretary determines that the 

payment amount for an advanced diagnostic laboratory test 

under paragraph (1)(A) that was applicable during the period 

was greater than 130 percent of the payment amount for the 

test established using the methodology described in subsection 

(b) that is applicable after such period, the Secretary shall 

recoup the difference between such payment amounts for tests 

furnished during such period. 

‘‘(5) ADVANCED DIAGNOSTIC LABORATORY TEST DEFINED.— 

In this subsection, the term ‘advanced diagnostic laboratory 

test’ means a clinical diagnostic laboratory test covered under 

this part that is offered and furnished only by a single laboratory and not sold for use by a laboratory other than the original 

developing laboratory (or a successor owner) and meets one 

of the following criteria: 

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

of DNA, RNA, or proteins combined with a unique algorithm to yield a single patient-specific result. 

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

Drug Administration. 

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

by the Secretary. 

‘‘(e) CODING.— 

‘‘(1) TEMPORARY CODES FOR CERTAIN NEW TESTS.— ‘‘(A) IN GENERAL.—The Secretary shall adopt temporary HCPCS codes to identify new advanced diagnostic 

laboratory tests (as defined in subsection (d)(5)) and new 

laboratory tests that are cleared or approved by the Food 

and Drug Administration. 

‘‘(B) DURATION.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the temporary code shall be effective until a permanent 

HCPCS code is established (but not to exceed 2 years). 

‘‘(ii) EXCEPTION.—The Secretary may extend the 

temporary code or establish a permanent HCPCS code, 

as the Secretary determines appropriate. 

‘‘(2) EXISTING TESTS.—Not later than January 1, 2016, for 

each existing advanced diagnostic laboratory test (as so defined) 

and each existing clinical diagnostic laboratory test that is 

cleared or approved by the Food and Drug Administration 

for which payment is made under this part as of the date 

of enactment of this section, if such test has not already been 

assigned a unique HCPCS code, the Secretary shall— 

‘‘(A) assign a unique HCPCS code for the test; and 

‘‘(B) publicly report the payment rate for the test. 

‘‘(3) ESTABLISHMENT OF UNIQUE IDENTIFIER FOR CERTAIN

TESTS.—For purposes of tracking and monitoring, if a laboratory 

or a manufacturer requests a unique identifier for an advanced 
H. R. 4302—19 

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

that is cleared or approved by the Food and Drug Administration, the Secretary shall utilize a means to uniquely track 

such test through a mechanism such as a HCPCS code or 

modifier. 

‘‘(f) INPUT FROM CLINICIANS AND TECHNICAL EXPERTS.— 

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

expert outside advisory panel, established by the Secretary 

not later than July 1, 2015, composed of an appropriate selection of individuals with expertise, which may include molecular 

pathologists, researchers, and individuals with expertise in laboratory science or health economics, in issues related to clinical 

diagnostic laboratory tests, which may include the development, 

validation, performance, and application of such tests, to provide— 

‘‘(A) input on— 

‘‘(i) the establishment of payment rates under this 

section for new clinical diagnostic laboratory tests, 

including whether to use crosswalking or gapfilling 

processes to determine payment for a specific new test; 

and 

‘‘(ii) the factors used in determining coverage and 

payment processes for new clinical diagnostic laboratory tests; and 

‘‘(B) recommendations to the Secretary under this section. 

‘‘(2) COMPLIANCE WITH FACA.—The panel shall be subject 

to the Federal Advisory Committee Act (5 U.S.C. App.). 

‘‘(3) CONTINUATION OF ANNUAL MEETING.—The Secretary 

shall continue to convene the annual meeting described in 

section 1833(h)(8)(B)(iii) after the implementation of this section 

for purposes of receiving comments and recommendations (and 

data on which the recommendations are based) as described 

in such section on the establishment of payment amounts under 

this section. 

‘‘(g) COVERAGE.— 

‘‘(1) ISSUANCE OF COVERAGE POLICIES.— 

‘‘(A) IN GENERAL.—A medicare administrative contractor shall only issue a coverage policy with respect to 

a clinical diagnostic laboratory test in accordance with 

the process for making a local coverage determination (as 

defined in section 1869(f)(2)(B)), including the appeals and 

review process for local coverage determinations under part 

426 of title 42, Code of Federal Regulations (or successor 

regulations). 

‘‘(B) NO EFFECT ON NATIONAL COVERAGE DETERMINATION PROCESS.—This paragraph shall not apply to the 

national coverage determination process (as defined in section 1869(f)(1)(B)). 

‘‘(C) EFFECTIVE DATE.—This paragraph shall apply to 

coverage policies issued on or after January 1, 2015. 

‘‘(2) DESIGNATION OF ONE OR MORE MEDICARE ADMINISTRATIVE CONTRACTORS FOR CLINICAL DIAGNOSTIC LABORATORY

TESTS.—The Secretary may designate one or more (not to exceed 

4) medicare administrative contractors to either establish coverage policies or establish coverage policies and process claims 
H. R. 4302—20 

for payment for clinical diagnostic laboratory tests, as determined appropriate by the Secretary. 

‘‘(h) IMPLEMENTATION.— 

‘‘(1) IMPLEMENTATION.—There shall be no administrative 

or judicial review under section 1869, section 1878, or otherwise, of the establishment of payment amounts under this 

section. 

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

Code, shall not apply to information collected under this section. 

‘‘(3) FUNDING.—For purposes of implementing this section, 

the Secretary shall provide for the transfer, from the Federal 

Supplementary Medical Insurance Trust Fund under section 

1841, to the Centers for Medicare & Medicaid Services Program 

Management Account, for each of fiscal years 2014 through 

2018, $4,000,000, and for each of fiscal years 2019 through 

2023, $3,000,000. Amounts transferred under the preceding 

sentence shall remain available until expended. 

‘‘(i) TRANSITIONAL RULE.—During the period beginning on the 

date of enactment of this section and ending on December 31, 

2016, with respect to advanced diagnostic laboratory tests under 

this part, the Secretary shall use the methodologies for pricing, 

coding, and coverage in effect on the day before such date of enactment, which may include cross-walking or gapfilling methods.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Section 1833(a) of the Social Security Act (42 U.S.C. 

1395l(a)) is amended— 

(A) in paragraph (1)(D)— 

(i) by striking ‘‘(i) on the basis’’ and inserting ‘‘(i)(I) 

on the basis’’; 

(ii) in subclause (I), as added by clause (i), by 

striking ‘‘subsection (h)(1)’’ and inserting ‘‘subsection 

(h)(1) (for tests furnished before January 1, 2017)’’; 

(iii) by striking ‘‘or (ii)’’ and inserting ‘‘or (II) under 

section 1834A (for tests furnished on or after January 

1, 2017), the amount paid shall be equal to 80 percent 

(or 100 percent, in the case of such tests for which 

payment is made on an assignment-related basis) of 

the lesser of the amount determined under such section 

or the amount of the charges billed for the tests, or 

(ii)’’; and 

(iv) in clause (ii), by striking ‘‘on the basis’’ and 

inserting ‘‘for tests furnished before January 1, 2017, 

on the basis’’; 

(B) in paragraph (2)(D)— 

(i) by striking ‘‘(i) on the basis’’ and inserting ‘‘(i)(I) 

on the basis’’; 

(ii) in subclause (I), as added by clause (i), by 

striking ‘‘subsection (h)(1)’’ and inserting ‘‘subsection 

(h)(1) (for tests furnished before January 1, 2017)’’; 

(iii) by striking ‘‘or (ii)’’ and inserting ‘‘or (II) under 

section 1834A (for tests furnished on or after January 

1, 2017), the amount paid shall be equal to 80 percent 

(or 100 percent, in the case of such tests for which 

payment is made on an assignment-related basis or 

to a provider having an agreement under section 1866) 

of the lesser of the amount determined under such 
H. R. 4302—21 

section or the amount of the charges billed for the 

tests, or (ii)’’; and 

(iv) in clause (ii), by striking ‘‘on the basis’’ and 

inserting ‘‘for tests furnished before January 1, 2017, 

on the basis’’; 

(C) in subsection (b)(3)(B), by striking ‘‘on the basis’’ 

and inserting ‘‘for tests furnished before January 1, 2017, 

on the basis’’; 

(D) in subsection (h)(2)(A)(i), by striking ‘‘and subject 

to’’ and inserting ‘‘and, for tests furnished before the date 

of enactment of section 1834A, subject to’’; 

(E) in subsection (h)(3), in the matter preceding 

subparagraph (A), by striking ‘‘fee schedules’’ and inserting 

‘‘fee schedules (for tests furnished before January 1, 2017) 

or under section 1834A (for tests furnished on or after 

January 1, 2017), subject to subsection (b)(5) of such section’’; 

(F) in subsection (h)(6), by striking ‘‘In the case’’ and 

inserting ‘‘For tests furnished before January 1, 2017, in 

the case’’; and 

(G) in subsection (h)(7), in the first sentence— 

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

and section 1834A’’; and 

(ii) by striking ‘‘under this subsection’’ and 

inserting ‘‘under this part’’. 

(2) Section 1869(f)(2) of the Social Security Act (42 U.S.C. 

1395ff(f)(2)) is amended by adding at the end the following 

new subparagraph: 

‘‘(C) LOCAL COVERAGE DETERMINATIONS FOR CLINICAL

DIAGNOSTIC LABORATORY TESTS.—For provisions relating to 

local coverage determinations for clinical diagnostic laboratory tests, see section 1834A(g).’’. 

(c) GAO STUDY AND REPORT; MONITORING OF MEDICARE

EXPENDITURES AND IMPLEMENTATION OF NEW PAYMENT SYSTEM

FOR LABORATORY TESTS.— 

(1) GAO STUDY AND REPORT ON IMPLEMENTATION OF NEW

PAYMENT RATES FOR CLINICAL DIAGNOSTIC LABORATORY TESTS.— 

(A) STUDY.—The Comptroller General of the United 

States (in this subsection referred to as the ‘‘Comptroller 

General’’) shall conduct a study on the implementation 

of section 1834A of the Social Security Act, as added by 

subsection (a). The study shall include an analysis of— 

(i) payment rates paid by private payors for laboratory tests furnished in various settings, including— 

(I) how such payment rates compare across 

settings; 

(II) the trend in payment rates over time; 

and 

(III) trends by private payors to move to alternative payment methodologies for laboratory tests; 

(ii) the conversion to the new payment rate for 

laboratory tests under such section; 

(iii) the impact of such implementation on beneficiary access under title XVIII of the Social Security 

Act; 
H. R. 4302—22 

(iv) the impact of the new payment system on 

laboratories that furnish a low volume of services and 

laboratories that specialize in a small number of tests; 

(v) the number of new Healthcare Common Procedure Coding System (HCPCS) codes issued for laboratory tests; 

(vi) the spending trend for laboratory tests under 

such title; 

(vii) whether the information reported by laboratories and the new payment rates for laboratory tests 

under such section accurately reflect market prices; 

(viii) the initial list price for new laboratory tests 

and the subsequent reported rates for such tests under 

such section; 

(ix) changes in the number of advanced diagnostic 

laboratory tests and laboratory tests cleared or 

approved by the Food and Drug Administration for 

which payment is made under such section; and 

(x) healthcare economic information on downstream cost impacts for such tests and decision making 

based on accepted methodologies. 

(B) REPORT.—Not later than October 1, 2018, the 

Comptroller General shall submit to the Committee on 

Ways and Means and the Committee on Energy and Commerce of the House of Representatives and the Committee 

on Finance of the Senate a report on the study under 

subparagraph (A), including recommendations for such 

legislation and administrative action as the Comptroller 

General determines appropriate. 

(2) MONITORING OF MEDICARE EXPENDITURES AND

IMPLEMENTATION OF NEW PAYMENT SYSTEM FOR LABORATORY

TESTS.—The Inspector General of the Department of Health 

and Human Services shall— 

(A) publicly release an annual analysis of the top 25 

laboratory tests by expenditures under title XVIII of the 

Social Security Act; and 

(B) conduct analyses the Inspector General determines 

appropriate with respect to the implementation and effect 

of the new payment system for laboratory tests under 

section 1834A of the Social Security Act, as added by subsection (a). 

SEC. 217. REVISIONS UNDER THE MEDICARE ESRD PROSPECTIVE PAYMENT SYSTEM. 

(a) DELAY OF IMPLEMENTATION OF ORAL-ONLY POLICY.—Section 

632(b)(1) of the American Taxpayer Relief Act of 2012 (42 U.S.C. 

1395rr note) is amended— 

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

(2) by adding at the end the following new sentence: ‘‘Notwithstanding section 1881(b)(14)(A)(ii) of the Social Security 

Act (42 U.S.C. 1395rr(b)(14)(A)(ii)), implementation of the policy 

described in the previous sentence shall be based on data 

from the most recent year available.’’. 

(b) MITIGATION OF THE APPLICATION OF ADJUSTMENT TO ESRD 

BUNDLED PAYMENT RATE TO ACCOUNT FOR CHANGES IN THE UTILIZATION OF CERTAIN DRUGS AND BIOLOGICALS.— 
H. R. 4302—23 

(1) IN GENERAL.—Section 1881(b)(14)(I) of the Social Security Act (42 U.S.C. 1395rr(b)(14)(I)) is amended by inserting 

‘‘and before January 1, 2015,’’ after ‘‘January 1, 2014,’’. 

(2) MARKET BASKET.—Section 1881(b)(14)(F)(i) of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)(F)(i)) is amended— 

(A) in subclause (I)— 

(i) by striking ‘‘subclause (II)’’ and inserting ‘‘subclauses (II) and (III)’’; and 

(ii) by adding at the end the following new sentence: ‘‘In order to accomplish the purposes of subparagraph (I) with respect to 2016, 2017, and 2018, after 

determining the increase factor described in the preceding sentence for each of 2016, 2017, and 2018, the 

Secretary shall reduce such increase factor by 1.25 

percentage points for each of 2016 and 2017 and by 

1 percentage point for 2018.’’; 

(B) in subclause (II), by striking ‘‘For 2012’’ and 

inserting ‘‘Subject to subclause (III), for 2012’’; and 

(C) by adding at the end the following new subclause: 

‘‘(III) Notwithstanding subclauses (I) and (II), in order to 

accomplish the purposes of subparagraph (I) with respect to 

2015, the increase factor described in subclause (I) for 2015 

shall be 0.0 percent pursuant to the regulation issued by the 

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

End-Stage Renal Disease Prospective Payment System, Quality 

Incentive Program, and Durable Medical Equipment, Prosthetics, Orthotics, and Supplies; Final Rule’ (78 Fed. Reg. 

72156).’’. 

(c) DRUG DESIGNATIONS.—As part of the promulgation of annual 

rule for the Medicare end stage renal disease prospective payment 

system under section 1881(b)(14) of the Social Security Act (42 

U.S.C. 1395rr(b)(14)) for calendar year 2016, the Secretary of Health 

and Human Services (in this subsection referred to as the ‘‘Secretary’’) shall establish a process for— 

(1) determining when a product is no longer an oral-only 

drug; and 

(2) including new injectable and intravenous products into 

the bundled payment under such system. 

(d) QUALITY MEASURES RELATED TO CONDITIONS TREATED BY

ORAL-ONLY DRUGS UNDER THE ESRD QUALITY INCENTIVE PROGRAM.—Section 1881(h)(2) of the Social Security Act (42 U.S.C. 

1395rr(h)(2)) is amended— 

(1) in subparagraph (A)— 

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

(B) by redesignating clause (iii) as clause (iv); and 

(C) by inserting after clause (ii) the following new 

clause: 

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

described in subparagraph (E)(i); and’’; 

(2) in subparagraph (B)(i), by striking ‘‘(A)(iii)’’ and 

inserting ‘‘(A)(iv)’’; and 

(3) by adding at the end the following new subparagraph: 

‘‘(E) MEASURES SPECIFIC TO THE CONDITIONS TREATED

WITH ORAL-ONLY DRUGS.— ‘‘(i) IN GENERAL.—The measures described in this 

subparagraph are measures specified by the Secretary 

that are specific to the conditions treated with oral- 
H. R. 4302—24 

only drugs. To the extent feasible, such measures shall 

be outcomes-based measures. 

‘‘(ii) CONSULTATION.—In specifying the measures 

under clause (i), the Secretary shall consult with 

interested stakeholders. 

‘‘(iii) USE OF ENDORSED MEASURES.— 

‘‘(I) IN GENERAL.—Subject to subclause (I), any 

measures specified under clause (i) must have been 

endorsed by the entity with a contract under section 1890(a). 

‘‘(II) EXCEPTION.—If the entity with a contract 

under section 1890(a) has not endorsed a measure 

for a specified area or topic related to measures 

described in clause (i) that the Secretary determines appropriate, the Secretary may specify a 

measure that is endorsed or adopted by a consensus organization recognized by the Secretary 

that has expertise in clinical guidelines for kidney 

disease.’’. 

(e) AUDITS OF COST REPORTS OF ESRD PROVIDERS AS RECOMMENDED BY MEDPAC.— 

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

Services shall conduct audits of Medicare cost reports beginning 

during 2012 for a representative sample of providers of services 

and renal dialysis facilities furnishing renal dialysis services. 

(2) FUNDING.—For purposes of carrying out paragraph (1), 

the Secretary of Health and Human Services shall provide 

for the transfer from the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of the Social 

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

& Medicaid Services Program Management Account of 

$18,000,000 for fiscal year 2014. Amounts transferred under 

this paragraph for a fiscal year shall be available until 

expended. 

SEC. 218. QUALITY INCENTIVES FOR COMPUTED TOMOGRAPHY DIAGNOSTIC IMAGING AND PROMOTING EVIDENCE-BASED 

CARE. 

(a) QUALITY INCENTIVES TO PROMOTE PATIENT SAFETY AND

PUBLIC HEALTH IN COMPUTED TOMOGRAPHY DIAGNOSTIC IMAGING.— (1) IN GENERAL.—Section 1834 of the Social Security Act 

(42 U.S.C. 1395m) is amended by adding at the end the following new subsection: 

‘‘(p) QUALITY INCENTIVES TO PROMOTE PATIENT SAFETY AND

PUBLIC HEALTH IN COMPUTED TOMOGRAPHY.— 

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

computed tomography service (as defined in paragraph (2)) 

for which payment is made under an applicable payment system 

(as defined in paragraph (3)) and that is furnished on or after 

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

the CT equipment standard (described in paragraph (4)), the 

payment amount for such service shall be reduced by the 

applicable percentage (as defined in paragraph (5)). 

‘‘(2) APPLICABLE COMPUTED TOMOGRAPHY SERVICES

DEFINED.—In this subsection, the term ‘applicable computed 

tomography service’ means a service billed using diagnostic 

radiological imaging codes for computed tomography (identified 
H. R. 4302—25 

as of January 1, 2014, by HCPCS codes 70450–70498, 71250– 

71275, 72125–72133, 72191–72194, 73200–73206, 73700–73706, 

74150–74178, 74261–74263, and 75571–75574 (and any succeeding codes). 

‘‘(3) APPLICABLE PAYMENT SYSTEM DEFINED.—In this subsection, the term ‘applicable payment system’ means the following: 

‘‘(A) The technical component and the technical component of the global fee under the fee schedule established 

under section 1848(b). 

‘‘(B) The prospective payment system for hospital outpatient department services under section 1833(t). 

‘‘(4) CONSISTENCY WITH CT EQUIPMENT STANDARD.—In this 

subsection, the term ‘not consistent with the CT equipment 

standard’ means, with respect to an applicable computed tomography service, that the service was furnished using equipment 

that does not meet each of the attributes of the National 

Electrical Manufacturers Association (NEMA) Standard XR– 

29–2013, entitled ‘Standard Attributes on CT Equipment 

Related to Dose Optimization and Management’. Through rulemaking, the Secretary may apply successor standards. 

‘‘(5) APPLICABLE PERCENTAGE DEFINED.—In this subsection, 

the term ‘applicable percentage’ means— 

‘‘(A) for 2016, 5 percent; and 

‘‘(B) for 2017 and subsequent years, 15 percent. 

‘‘(6) IMPLEMENTATION.— 

‘‘(A) INFORMATION.—The Secretary shall require that 

information be provided and attested to by a supplier and 

a hospital outpatient department that indicates whether 

an applicable computed tomography service was furnished 

that was not consistent with the CT equipment standard 

(described in paragraph (4)). Such information may be 

included on a claim and may be a modifier. Such information shall be verified, as appropriate, as part of the periodic 

accreditation of suppliers under section 1834(e) and hospitals under section 1865(a). 

‘‘(B) ADMINISTRATION.—Chapter 35 of title 44, United 

States Code, shall not apply to information described in 

subparagraph (A).’’. 

(2) CONFORMING AMENDMENTS.— 

(A) PROSPECTIVE PAYMENT SYSTEM FOR HOSPITAL OUTPATIENT DEPARTMENT SERVICES.—Section 1833(t) of the 

Social Security Act (42 1395l(t)) is amended by adding 

at the end the following new paragraph: 

‘‘(20) NOT BUDGET NEUTRAL APPLICATION OF REDUCED

EXPENDITURES RESULTING FROM QUALITY INCENTIVES FOR COM- PUTED TOMOGRAPHY.—The Secretary shall not take into account 

the reduced expenditures that result from the application of 

section 1834(p) in making any budget neutrality adjustments 

this subsection.’’. 

(B) PHYSICIAN FEE SCHEDULE.—Section 1848(c)(2)(B)(v) 

of the Social Security Act (42 U.S.C. 1395w–4(c)(2)(B)(v)) 

is amended by adding at the end the following new subclause: 

‘‘(VIII) REDUCED EXPENDITURES ATTRIBUTABLE

TO APPLICATION OF QUALITY INCENTIVES FOR COM- PUTED TOMOGRAPHY.—Effective for fee schedules 
H. R. 4302—26 

established beginning with 2016, reduced expenditures attributable to the application of the quality 

incentives for computed tomography under section 

1834(p)’’. 

(b) PROMOTING EVIDENCE-BASED CARE.— 

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

(42 U.S.C. 1395m), as amended by subsection (a), is amended 

by adding at the end the following new subsection: 

‘‘(q) RECOGNIZING APPROPRIATE USE CRITERIA FOR CERTAIN

IMAGING SERVICES.— 

‘‘(1) PROGRAM ESTABLISHED.— 

‘‘(A) IN GENERAL.—The Secretary shall establish a program to promote the use of appropriate use criteria (as 

defined in subparagraph (B)) for applicable imaging services (as defined in subparagraph (C)) furnished in an 

applicable setting (as defined in subparagraph (D)) by 

ordering professionals and furnishing professionals (as 

defined in subparagraphs (E) and (F), respectively). 

‘‘(B) APPROPRIATE USE CRITERIA DEFINED.—In this subsection, the term ‘appropriate use criteria’ means criteria, 

only developed or endorsed by national professional medical 

specialty societies or other provider-led entities, to assist 

ordering professionals and furnishing professionals in 

making the most appropriate treatment decision for a specific clinical condition for an individual. To the extent feasible, such criteria shall be evidence-based. 

‘‘(C) APPLICABLE IMAGING SERVICE DEFINED.—In this 

subsection, the term ‘applicable imaging service’ means 

an advanced diagnostic imaging service (as defined in subsection (e)(1)(B)) for which the Secretary determines— 

‘‘(i) one or more applicable appropriate use criteria 

specified under paragraph (2) apply; 

‘‘(ii) there are one or more qualified clinical decision support mechanisms listed under paragraph 

(3)(C); and 

‘‘(iii) one or more of such mechanisms is available 

free of charge. 

‘‘(D) APPLICABLE SETTING DEFINED.—In this subsection, 

the term ‘applicable setting’ means a physician’s office, 

a hospital outpatient department (including an emergency 

department), an ambulatory surgical center, and any other 

provider-led outpatient setting determined appropriate by 

the Secretary. 

‘‘(E) ORDERING PROFESSIONAL DEFINED.—In this subsection, the term ‘ordering professional’ means a physician 

(as defined in section 1861(r)) or a practitioner described 

in section 1842(b)(18)(C) who orders an applicable imaging 

service. 

‘‘(F) FURNISHING PROFESSIONAL DEFINED.—In this subsection, the term ‘furnishing professional’ means a physician (as defined in section 1861(r)) or a practitioner 

described in section 1842(b)(18)(C) who furnishes an 

applicable imaging service. 

‘‘(2) ESTABLISHMENT OF APPLICABLE APPROPRIATE USE CRITERIA.— 
H. R. 4302—27 

‘‘(A) IN GENERAL.—Not later than November 15, 2015, 

the Secretary shall through rulemaking, and in consultation with physicians, practitioners, and other stakeholders, 

specify applicable appropriate use criteria for applicable 

imaging services only from among appropriate use criteria 

developed or endorsed by national professional medical specialty societies or other provider-led entities. 

‘‘(B) CONSIDERATIONS.—In specifying applicable appropriate use criteria under subparagraph (A), the Secretary 

shall take into account whether the criteria— 

‘‘(i) have stakeholder consensus; 

‘‘(ii) are scientifically valid and evidence based; 

and 

‘‘(iii) are based on studies that are published and 

reviewable by stakeholders. 

‘‘(C) REVISIONS.—The Secretary shall review, on an 

annual basis, the specified applicable appropriate use criteria to determine if there is a need to update or revise 

(as appropriate) such specification of applicable appropriate 

use criteria and make such updates or revisions through 

rulemaking. 

‘‘(D) TREATMENT OF MULTIPLE APPLICABLE APPROPRIATE

USE CRITERIA.—In the case where the Secretary determines 

that more than one appropriate use criterion applies with 

respect to an applicable imaging service, the Secretary 

shall apply one or more applicable appropriate use criteria 

under this paragraph for the service. 

‘‘(3) MECHANISMS FOR CONSULTATION WITH APPLICABLE

APPROPRIATE USE CRITERIA.— 

‘‘(A) IDENTIFICATION OF MECHANISMS TO CONSULT WITH

APPLICABLE APPROPRIATE USE CRITERIA.— 

‘‘(i) IN GENERAL.—The Secretary shall specify 

qualified clinical decision support mechanisms that 

could be used by ordering professionals to consult with 

applicable appropriate use criteria for applicable 

imaging services. 

‘‘(ii) CONSULTATION.—The Secretary shall consult 

with physicians, practitioners, health care technology 

experts, and other stakeholders in specifying mechanisms under this paragraph. 

‘‘(iii) INCLUSION OF CERTAIN MECHANISMS.—Mechanisms specified under this paragraph may include any 

or all of the following that meet the requirements 

described in subparagraph (B)(ii): 

‘‘(I) Use of clinical decision support modules 

in certified EHR technology (as defined in section 

1848(o)(4)). 

‘‘(II) Use of private sector clinical decision support mechanisms that are independent from certified EHR technology, which may include use of 

clinical decision support mechanisms available 

from medical specialty organizations. 

‘‘(III) Use of a clinical decision support mechanism established by the Secretary. 

‘‘(B) QUALIFIED CLINICAL DECISION SUPPORT MECHANISMS.— 
H. R. 4302—28 

‘‘(i) IN GENERAL.—For purposes of this subsection, 

a qualified clinical decision support mechanism is a 

mechanism that the Secretary determines meets the 

requirements described in clause (ii). 

‘‘(ii) REQUIREMENTS.—The requirements described 

in this clause are the following: 

‘‘(I) The mechanism makes available to the 

ordering professional applicable appropriate use 

criteria specified under paragraph (2) and the supporting documentation for the applicable imaging 

service ordered. 

‘‘(II) In the case where there is more than 

one applicable appropriate use criterion specified 

under such paragraph for an applicable imaging 

service, the mechanism indicates the criteria that 

it uses for the service. 

‘‘(III) The mechanism determines the extent 

to which an applicable imaging service ordered 

is consistent with the applicable appropriate use 

criteria so specified. 

‘‘(IV) The mechanism generates and provides 

to the ordering professional a certification or documentation that documents that the qualified clinical decision support mechanism was consulted by 

the ordering professional. 

‘‘(V) The mechanism is updated on a timely 

basis to reflect revisions to the specification of 

applicable appropriate use criteria under such 

paragraph. 

‘‘(VI) The mechanism meets privacy and security standards under applicable provisions of law. 

‘‘(VII) The mechanism performs such other 

functions as specified by the Secretary, which may 

include a requirement to provide aggregate feedback to the ordering professional. 

‘‘(C) LIST OF MECHANISMS FOR CONSULTATION WITH

APPLICABLE APPROPRIATE USE CRITERIA.— 

‘‘(i) INITIAL LIST.—Not later than April 1, 2016, 

the Secretary shall publish a list of mechanisms specified under this paragraph. 

‘‘(ii) PERIODIC UPDATING OF LIST.—The Secretary 

shall identify on an annual basis the list of qualified 

clinical decision support mechanisms specified under 

this paragraph. 

‘‘(4) CONSULTATION WITH APPLICABLE APPROPRIATE USE CRITERIA.— 

‘‘(A) CONSULTATION BY ORDERING PROFESSIONAL.— 

Beginning with January 1, 2017, subject to subparagraph 

(C), with respect to an applicable imaging service ordered 

by an ordering professional that would be furnished in 

an applicable setting and paid for under an applicable 

payment system (as defined in subparagraph (D)), an 

ordering professional shall— 

‘‘(i) consult with a qualified decision support 

mechanism listed under paragraph (3)(C); and 
H. R. 4302—29 

‘‘(ii) provide to the furnishing professional the 

information described in clauses (i) through (iii) of 

subparagraph (B). 

‘‘(B) REPORTING BY FURNISHING PROFESSIONAL.—Beginning with January 1, 2017, subject to subparagraph (C), 

with respect to an applicable imaging service furnished 

in an applicable setting and paid for under an applicable 

payment system (as defined in subparagraph (D)), payment 

for such service may only be made if the claim for the 

service includes the following: 

‘‘(i) Information about which qualified clinical decision support mechanism was consulted by the ordering 

professional for the service. 

‘‘(ii) Information regarding— 

‘‘(I) whether the service ordered would adhere 

to the applicable appropriate use criteria specified 

under paragraph (2); 

‘‘(II) whether the service ordered would not 

adhere to such criteria; or 

‘‘(III) whether such criteria was not applicable 

to the service ordered. 

‘‘(iii) The national provider identifier of the 

ordering professional (if different from the furnishing 

professional). 

‘‘(C) EXCEPTIONS.—The provisions of subparagraphs (A) 

and (B) and paragraph (6)(A) shall not apply to the following: 

‘‘(i) EMERGENCY SERVICES.—An applicable imaging 

service ordered for an individual with an emergency 

medical condition (as defined in section 1867(e)(1)). 

‘‘(ii) INPATIENT SERVICES.—An applicable imaging 

service ordered for an inpatient and for which payment 

is made under part A. 

‘‘(iii) SIGNIFICANT HARDSHIP.—An applicable 

imaging service ordered by an ordering professional 

who the Secretary may, on a case-by-case basis, exempt 

from the application of such provisions if the Secretary 

determines, subject to annual renewal, that consultation with applicable appropriate use criteria would 

result in a significant hardship, such as in the case 

of a professional who practices in a rural area without 

sufficient Internet access. 

‘‘(D) APPLICABLE PAYMENT SYSTEM DEFINED.—In this 

subsection, the term ‘applicable payment system’ means 

the following: 

‘‘(i) The physician fee schedule established under 

section 1848(b). 

‘‘(ii) The prospective payment system for hospital 

outpatient department services under section 1833(t). 

‘‘(iii) The ambulatory surgical center payment systems under section 1833(i). 

‘‘(5) IDENTIFICATION OF OUTLIER ORDERING PROFESSIONALS.— 

‘‘(A) IN GENERAL.—With respect to applicable imaging 

services furnished beginning with 2017, the Secretary shall 

determine, on an annual basis, no more than five percent 
H. R. 4302—30 

of the total number of ordering professionals who are 

outlier ordering professionals. 

‘‘(B) OUTLIER ORDERING PROFESSIONALS.—The determination of an outlier ordering professional shall— 

‘‘(i) be based on low adherence to applicable appropriate use criteria specified under paragraph (2), which 

may be based on comparison to other ordering professionals; and 

‘‘(ii) include data for ordering professionals for 

whom prior authorization under paragraph (6)(A) 

applies. 

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

use two years of data to identify outlier ordering professionals under this paragraph. 

‘‘(D) PROCESS.—The Secretary shall establish a process 

for determining when an outlier ordering professional is 

no longer an outlier ordering professional. 

‘‘(E) CONSULTATION WITH STAKEHOLDERS.—The Secretary shall consult with physicians, practitioners and other 

stakeholders in developing methods to identify outlier 

ordering professionals under this paragraph. 

‘‘(6) PRIOR AUTHORIZATION FOR ORDERING PROFESSIONALS

WHO ARE OUTLIERS.— 

‘‘(A) IN GENERAL.—Beginning January 1, 2020, subject 

to paragraph (4)(C), with respect to services furnished 

during a year, the Secretary shall, for a period determined 

appropriate by the Secretary, apply prior authorization 

for applicable imaging services that are ordered by an 

outlier ordering professional identified under paragraph 

(5). 

‘‘(B) APPROPRIATE USE CRITERIA IN PRIOR AUTHORIZATION.—In applying prior authorization under subparagraph 

(A), the Secretary shall utilize only the applicable appropriate use criteria specified under this subsection. 

‘‘(C) FUNDING.—For purposes of carrying out this paragraph, the Secretary shall provide for the transfer, from 

the Federal Supplementary Medical Insurance Trust Fund 

under section 1841, of $5,000,000 to the Centers for Medicare & Medicaid Services Program Management Account 

for each of fiscal years 2019 through 2021. Amounts transferred under the preceding sentence shall remain available 

until expended. 

‘‘(7) CONSTRUCTION.—Nothing in this subsection shall be 

construed as granting the Secretary the authority to develop 

or initiate the development of clinical practice guidelines or 

appropriate use criteria.’’. 

(2) CONFORMING AMENDMENT.—Section 1833(t)(16) of the 

Social Security Act (42 U.S.C. 1395l(t)(16)) is amended by 

adding at the end the following new subparagraph: 

‘‘(E) APPLICATION OF APPROPRIATE USE CRITERIA FOR

CERTAIN IMAGING SERVICES.—For provisions relating to the 

application of appropriate use criteria for certain imaging 

services, see section 1834(q).’’. 

(3) REPORT ON EXPERIENCE OF IMAGING APPROPRIATE USE

CRITERIA PROGRAM.—Not later than 18 months after the date 

of the enactment of this Act, the Comptroller General of the 

United States shall submit to Congress a report that includes 
H. R. 4302—31 

a description of the extent to which appropriate use criteria 

could be used for other services under part B of title XVIII 

of the Social Security Act (42 U.S.C. 1395j et seq.), such as 

radiation therapy and clinical diagnostic laboratory services. 

SEC. 219. USING FUNDING FROM TRANSITIONAL FUND FOR SUSTAINABLE GROWTH RATE (SGR) REFORM. 

Section 1898(b)(1) of the Social Security Act (42 U.S.C. 

1395iii(b)(1)) is amended by striking ‘‘$2,300,000,000’’ and inserting 

‘‘$0’’. 

SEC. 220. ENSURING ACCURATE VALUATION OF SERVICES UNDER THE 

PHYSICIAN FEE SCHEDULE. 

(a) AUTHORITY TO COLLECT AND USE INFORMATION ON PHYSICIANS’ SERVICES IN THE DETERMINATION OF RELATIVE VALUES.— 

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

Act (42 U.S.C. 1395w–4(c)(2)) is amended by adding at the 

end the following new subparagraph: 

‘‘(M) AUTHORITY TO COLLECT AND USE INFORMATION

ON PHYSICIANS’ SERVICES IN THE DETERMINATION OF RELATIVE VALUES.— 

‘‘(i) COLLECTION OF INFORMATION.—Notwithstanding any other provision of law, the Secretary may 

collect or obtain information on the resources directly 

or indirectly related to furnishing services for which 

payment is made under the fee schedule established 

under subsection (b). Such information may be collected 

or obtained from any eligible professional or any other 

source. 

‘‘(ii) USE OF INFORMATION.—Notwithstanding any 

other provision of law, subject to clause (v), the Secretary may (as the Secretary determines appropriate) 

use information collected or obtained pursuant to 

clause (i) in the determination of relative values for 

services under this section. 

‘‘(iii) TYPES OF INFORMATION.—The types of 

information described in clauses (i) and (ii) may, at 

the Secretary’s discretion, include any or all of the 

following: 

‘‘(I) Time involved in furnishing services. 

‘‘(II) Amounts and types of practice expense 

inputs involved with furnishing services. 

‘‘(III) Prices (net of any discounts) for practice 

expense inputs, which may include paid invoice 

prices or other documentation or records. 

‘‘(IV) Overhead and accounting information for 

practices of physicians and other suppliers. 

‘‘(V) Any other element that would improve 

the valuation of services under this section. 

‘‘(iv) INFORMATION COLLECTION MECHANISMS.— 

Information may be collected or obtained pursuant to 

this subparagraph from any or all of the following: 

‘‘(I) Surveys of physicians, other suppliers, providers of services, manufacturers, and vendors. 

‘‘(II) Surgical logs, billing systems, or other 

practice or facility records. 

‘‘(III) Electronic health records. 
H. R. 4302—32 

‘‘(IV) Any other mechanism determined appropriate by the Secretary. 

‘‘(v) TRANSPARENCY OF USE OF INFORMATION.— 

‘‘(I) IN GENERAL.—Subject to subclauses (II) 

and (III), if the Secretary uses information collected or obtained under this subparagraph in the 

determination of relative values under this subsection, the Secretary shall disclose the information source and discuss the use of such information 

in such determination of relative values through 

notice and comment rulemaking. 

‘‘(II) THRESHOLDS FOR USE.—The Secretary 

may establish thresholds in order to use such 

information, including the exclusion of information 

collected or obtained from eligible professionals 

who use very high resources (as determined by 

the Secretary) in furnishing a service. 

‘‘(III) DISCLOSURE OF INFORMATION.—The Secretary shall make aggregate information available 

under this subparagraph but shall not disclose 

information in a form or manner that identifies 

an eligible professional or a group practice, or 

information collected or obtained pursuant to a 

nondisclosure agreement. 

‘‘(vi) INCENTIVE TO PARTICIPATE.—The Secretary 

may provide for such payments under this part to 

an eligible professional that submits such solicited 

information under this subparagraph as the Secretary 

determines appropriate in order to compensate such 

eligible professional for such submission. Such payments shall be provided in a form and manner specified 

by the Secretary. 

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

United States Code, shall not apply to information 

collected or obtained under this subparagraph. 

‘‘(viii) DEFINITION OF ELIGIBLE PROFESSIONAL.—In 

this subparagraph, the term ‘eligible professional’ has 

the meaning given such term in subsection (k)(3)(B). 

‘‘(ix) FUNDING.—For purposes of carrying out this 

subparagraph, in addition to funds otherwise appropriated, the Secretary shall provide for the transfer, 

from the Federal Supplementary Medical Insurance 

Trust Fund under section 1841, of $2,000,000 to the 

Centers for Medicare & Medicaid Services Program 

Management Account for each fiscal year beginning 

with fiscal year 2014. Amounts transferred under the 

preceding sentence for a fiscal year shall be available 

until expended.’’. 

(2) LIMITATION ON REVIEW.—Section 1848(i)(1) of the Social 

Security Act (42 U.S.C. 1395w–4(i)(1)) is amended— 

(A) in subparagraph (D), by striking ‘‘and’’ at the end; 

(B) in subparagraph (E), by striking the period at 

the end and inserting ‘‘, and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(F) the collection and use of information in the determination of relative values under subsection (c)(2)(M).’’. 
H. R. 4302—33 

(b) AUTHORITY FOR ALTERNATIVE APPROACHES TO ESTABLISHING

PRACTICE EXPENSE RELATIVE VALUES.—Section 1848(c)(2) of the 

Social Security Act (42 U.S.C. 1395w–4(c)(2)), as amended by subsection (a), is amended by adding at the end the following new 

subparagraph: 

‘‘(N) AUTHORITY FOR ALTERNATIVE APPROACHES TO

ESTABLISHING PRACTICE EXPENSE RELATIVE VALUES.—The 

Secretary may establish or adjust practice expense relative 

values under this subsection using cost, charge, or other 

data from suppliers or providers of services, including 

information collected or obtained under subparagraph 

(M).’’. 

(c) REVISED AND EXPANDED IDENTIFICATION OF POTENTIALLY

MISVALUED CODES.—Section 1848(c)(2)(K)(ii) of the Social Security 

Act (42 U.S.C. 1395w–4(c)(2)(K)(ii)) is amended to read as follows: 

‘‘(ii) IDENTIFICATION OF POTENTIALLY MISVALUED

CODES.—For purposes of identifying potentially 

misvalued codes pursuant to clause (i)(I), the Secretary 

shall examine codes (and families of codes as appropriate) based on any or all of the following criteria: 

‘‘(I) Codes that have experienced the fastest 

growth. 

‘‘(II) Codes that have experienced substantial 

changes in practice expenses. 

‘‘(III) Codes that describe new technologies or 

services within an appropriate time period (such 

as 3 years) after the relative values are initially 

established for such codes. 

‘‘(IV) Codes which are multiple codes that are 

frequently billed in conjunction with furnishing 

a single service. 

‘‘(V) Codes with low relative values, particularly those that are often billed multiple times 

for a single treatment. 

‘‘(VI) Codes that have not been subject to 

review since implementation of the fee schedule. 

‘‘(VII) Codes that account for the majority of 

spending under the physician fee schedule. 

‘‘(VIII) Codes for services that have experienced a substantial change in the hospital length 

of stay or procedure time. 

‘‘(IX) Codes for which there may be a change 

in the typical site of service since the code was 

last valued. 

‘‘(X) Codes for which there is a significant 

difference in payment for the same service between 

different sites of service. 

‘‘(XI) Codes for which there may be anomalies 

in relative values within a family of codes. 

‘‘(XII) Codes for services where there may be 

efficiencies when a service is furnished at the same 

time as other services. 

‘‘(XIII) Codes with high intra-service work per 

unit of time. 

‘‘(XIV) Codes with high practice expense relative value units. 

‘‘(XV) Codes with high cost supplies. 
H. R. 4302—34 

‘‘(XVI) Codes as determined appropriate by the 

Secretary.’’. 

(d) TARGET FOR RELATIVE VALUE ADJUSTMENTS FOR MISVALUED

SERVICES.— 

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

Act (42 U.S.C. 1395w–4(c)(2)), as amended by subsections (a) 

and (b), is amended by adding at the end the following new 

subparagraph: 

‘‘(O) TARGET FOR RELATIVE VALUE ADJUSTMENTS FOR

MISVALUED SERVICES.—With respect to fee schedules established for each of 2017 through 2020, the following shall 

apply: 

‘‘(i) DETERMINATION OF NET REDUCTION IN EXPENDITURES.—For each year, the Secretary shall determine 

the estimated net reduction in expenditures under the 

fee schedule under this section with respect to the 

year as a result of adjustments to the relative values 

established under this paragraph for misvalued codes. 

‘‘(ii) BUDGET NEUTRAL REDISTRIBUTION OF FUNDS

IF TARGET MET AND COUNTING OVERAGES TOWARDS THE

TARGET FOR THE SUCCEEDING YEAR.—If the estimated 

net reduction in expenditures determined under clause 

(i) for the year is equal to or greater than the target 

for the year— 

‘‘(I) reduced expenditures attributable to such 

adjustments shall be redistributed for the year 

in a budget neutral manner in accordance with 

subparagraph (B)(ii)(II); and 

‘‘(II) the amount by which such reduced 

expenditures exceeds the target for the year shall 

be treated as a reduction in expenditures described 

in clause (i) for the succeeding year, for purposes 

of determining whether the target has or has not 

been met under this subparagraph with respect 

to that year. 

‘‘(iii) EXEMPTION FROM BUDGET NEUTRALITY IF TAR- GET NOT MET.—If the estimated net reduction in 

expenditures determined under clause (i) for the year 

is less than the target for the year, reduced expenditures in an amount equal to the target recapture 

amount shall not be taken into account in applying 

subparagraph (B)(ii)(II) with respect to fee schedules 

beginning with 2017. 

‘‘(iv) TARGET RECAPTURE AMOUNT.—For purposes 

of clause (iii), the target recapture amount is, with 

respect to a year, an amount equal to the difference 

between— 

‘‘(I) the target for the year; and 

‘‘(II) the estimated net reduction in expenditures determined under clause (i) for the year. 

‘‘(v) TARGET.—For purposes of this subparagraph, 

with respect to a year, the target is calculated as 

0.5 percent of the estimated amount of expenditures 

under the fee schedule under this section for the year.’’. 

(2) CONFORMING AMENDMENT.—Section 1848(c)(2)(B)(v) of 

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

amended by adding at the end the following new subclause: 
H. R. 4302—35 

‘‘(VIII) REDUCTIONS FOR MISVALUED SERVICES

IF TARGET NOT MET.—Effective for fee schedules 

beginning with 2017, reduced expenditures attributable to the application of the target recapture 

amount described in subparagraph (O)(iii).’’. 

(e) PHASE-IN OF SIGNIFICANT RELATIVE VALUE UNIT (RVU) 

REDUCTIONS.— 

(1) IN GENERAL.—Section 1848(c) of the Social Security 

Act (42 U.S.C. 1395w–4(c)) is amended by adding at the end 

the following new paragraph: 

‘‘(7) PHASE-IN OF SIGNIFICANT RELATIVE VALUE UNIT (RVU)

REDUCTIONS.—Effective for fee schedules established beginning 

with 2017, for services that are not new or revised codes, 

if the total relative value units for a service for a year would 

otherwise be decreased by an estimated amount equal to or 

greater than 20 percent as compared to the total relative value 

units for the previous year, the applicable adjustments in work, 

practice expense, and malpractice relative value units shall 

be phased-in over a 2-year period.’’. 

(2) CONFORMING AMENDMENTS.—Section 1848(c)(2) of the 

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

(A) in subparagraph (B)(ii)(I), by striking ‘‘subclause 

(II)’’ and inserting ‘‘subclause (II) and paragraph (7)’’; and 

(B) in subparagraph (K)(iii)(VI)— 

(i) by striking ‘‘provisions of subparagraph 

(B)(ii)(II)’’ and inserting ‘‘provisions of subparagraph 

(B)(ii)(II) and paragraph (7)’’; and 

(ii) by striking ‘‘under subparagraph (B)(ii)(II)’’ and 

inserting ‘‘under subparagraph (B)(ii)(I)’’. 

(f) AUTHORITY TO SMOOTH RELATIVE VALUES WITHIN GROUPS

OF SERVICES.—Section 1848(c)(2)(C) of the Social Security Act (42 

U.S.C. 1395w–4(c)(2)(C)) is amended— 

(1) in each of clauses (i) and (iii), by striking ‘‘the service’’ 

and inserting ‘‘the service or group of services’’ each place 

it appears; and 

(2) in the first sentence of clause (ii), by inserting ‘‘or 

group of services’’ before the period. 

(g) GAO STUDY AND REPORT ON RELATIVE VALUE SCALE UPDATE

COMMITTEE.— 

(1) STUDY.—The Comptroller General of the United States 

(in this subsection referred to as the ‘‘Comptroller General’’) 

shall conduct a study of the processes used by the Relative 

Value Scale Update Committee (RUC) to provide recommendations to the Secretary of Health and Human Services regarding 

relative values for specific services under the Medicare physician fee schedule under section 1848 of the Social Security 

Act (42 U.S.C. 1395w–4). 

(2) REPORT.—Not later than 1 year after the date of the 

enactment of this Act, the Comptroller General shall submit 

to Congress a report containing the results of the study conducted under paragraph (1). 

(h) ADJUSTMENT TO MEDICARE PAYMENT LOCALITIES.— 

(1) IN GENERAL.—Section 1848(e) of the Social Security 

Act (42 U.S.C. 1395w–4(e)) is amended by adding at the end 

the following new paragraph: 

‘‘(6) USE OF MSAS AS FEE SCHEDULE AREAS IN CALIFORNIA.— 
H. R. 4302—36 

‘‘(A) IN GENERAL.—Subject to the succeeding provisions 

of this paragraph and notwithstanding the previous provisions of this subsection, for services furnished on or after 

January 1, 2017, the fee schedule areas used for payment 

under this section applicable to California shall be the 

following: 

‘‘(i) Each Metropolitan Statistical Area (each in 

this paragraph referred to as an ‘MSA’), as defined 

by the Director of the Office of Management and 

Budget as of December 31 of the previous year, shall 

be a fee schedule area. 

‘‘(ii) All areas not included in an MSA shall be 

treated as a single rest-of-State fee schedule area. 

‘‘(B) TRANSITION FOR MSAS PREVIOUSLY IN REST-OFSTATE PAYMENT LOCALITY OR IN LOCALITY 3.— 

‘‘(i) IN GENERAL.—For services furnished in California during a year beginning with 2017 and ending 

with 2021 in an MSA in a transition area (as defined 

in subparagraph (D)), subject to subparagraph (C), the 

geographic index values to be applied under this subsection for such year shall be equal to the sum of 

the following: 

‘‘(I) CURRENT LAW COMPONENT.—The old 

weighting factor (described in clause (ii)) for such 

year multiplied by the geographic index values 

under this subsection for the fee schedule area 

that included such MSA that would have applied 

in such area (as estimated by the Secretary) if 

this paragraph did not apply. 

‘‘(II) MSA-BASED COMPONENT.—The MSAbased weighting factor (described in clause (iii)) 

for such year multiplied by the geographic index 

values computed for the fee schedule area under 

subparagraph (A) for the year (determined without 

regard to this subparagraph). 

‘‘(ii) OLD WEIGHTING FACTOR.—The old weighting 

factor described in this clause— 

‘‘(I) for 2017, is 5⁄6; and 

‘‘(II) for each succeeding year, is the old 

weighting factor described in this clause for the 

previous year minus 1⁄6. 

‘‘(iii) MSA-BASED WEIGHTING FACTOR.—The MSAbased weighting factor described in this clause for a 

year is 1 minus the old weighting factor under clause 

(ii) for that year. 

‘‘(C) HOLD HARMLESS.—For services furnished in a 

transition area in California during a year beginning with 

2017, the geographic index values to be applied under 

this subsection for such year shall not be less than the 

corresponding geographic index values that would have 

applied in such transition area (as estimated by the Secretary) if this paragraph did not apply. 

‘‘(D) TRANSITION AREA DEFINED.—In this paragraph, 

the term ‘transition area’ means each of the following fee 

schedule areas for 2013: 

‘‘(i) The rest-of-State payment locality. 

‘‘(ii) Payment locality 3. 
H. R. 4302—37 

‘‘(E) REFERENCES TO FEE SCHEDULE AREAS.—Effective 

for services furnished on or after January 1, 2017, for 

California, any reference in this section to a fee schedule 

area shall be deemed a reference to a fee schedule area 

established in accordance with this paragraph.’’. 

(2) CONFORMING AMENDMENT TO DEFINITION OF FEE

SCHEDULE AREA.—Section 1848(j)(2) of the Social Security Act 

(42 U.S.C. 1395w–4(j)(2)) is amended by striking ‘‘The term’’ 

and inserting ‘‘Except as provided in subsection (e)(6)(D), the 

term’’. 

(i) DISCLOSURE OF DATA USED TO ESTABLISH MULTIPLE PROCEDURE PAYMENT REDUCTION POLICY.—The Secretary of Health and 

Human Services shall make publicly available the information used 

to establish the multiple procedure payment reduction policy to 

the professional component of imaging services in the final rule 

published in the Federal Register, v. 77, n. 222, November 16, 

2012, pages 68891–69380 under the physician fee schedule under 

section 1848 of the Social Security Act (42 U.S.C. 1395w–4). 

SEC. 221. MEDICAID DSH. 

(a) MODIFICATIONS OF REDUCTIONS TO ALLOTMENTS.—Section 

1923(f) of the Social Security Act (42 U.S.C. 1396r–4(f)) is 

amended— 

(1) in paragraph (7)(A)— 

(A) in clause (i), by striking ‘‘2016 through 2020’’ and 

inserting ‘‘2017 through 2024’’; and 

(B) in clause (ii), by striking subclauses (I) through 

(IV), and inserting the following: ‘‘(I) $1,800,000,000 for fiscal year 2017; 

‘‘(II) $4,700,000,000 for fiscal year 2018; 

‘‘(III) $4,700,000,000 for fiscal year 2019; 

‘‘(IV) $4,700,000,000 for fiscal year 2020; 

‘‘(V) $4,800,000,000 for fiscal year 2021; 

‘‘(VI) $5,000,000,000 for fiscal year 2022; 

‘‘(VII) $5,000,000,000 for fiscal year 2023; and 

‘‘(VIII) $4,400,000,000 for fiscal year 2024.’’; 

and 

(2) by striking paragraph (8) and inserting the following: 

‘‘(8) CALCULATION OF DSH ALLOTMENTS AFTER REDUCTIONS

PERIOD.—The DSH allotment for a State for fiscal years after 

fiscal year 2024 shall be calculated under paragraph (3) without 

regard to paragraph (7).’’. 

(b) MACPAC REVIEW AND REPORT.—Section 1900(b)(6) of the 

Social Security Act (42 U.S.C. 1396(b)(6)) is amended— 

(1) by striking ‘‘MACPAC shall consult’’ and inserting the 

following: 

‘‘(A) IN GENERAL.—MACPAC shall consult’’; and 

(2) by adding at the end the following: 

‘‘(B) REVIEW AND REPORTS REGARDING MEDICAID DSH.— ‘‘(i) IN GENERAL.—MACPAC shall review and 

submit an annual report to Congress on disproportionate share hospital payments under section 1923. 

Each report shall include the information specified in 

clause (ii). 

‘‘(ii) REQUIRED REPORT INFORMATION.—Each report 

required under this subparagraph shall include the 

following: 
H. R. 4302—38 

‘‘(I) Data relating to changes in the number 

of uninsured individuals. 

‘‘(II) Data relating to the amount and sources 

of hospitals’ uncompensated care costs, including 

the amount of such costs that are the result of 

providing unreimbursed or under-reimbursed services, charity care, or bad debt. 

‘‘(III) Data identifying hospitals with high 

levels of uncompensated care that also provide 

access to essential community services for lowincome, uninsured, and vulnerable populations, 

such as graduate medical education, and the continuum of primary through quarternary care, 

including the provision of trauma care and public 

health services. 

‘‘(IV) State-specific analyses regarding the 

relationship between the most recent State DSH 

allotment and the projected State DSH allotment 

for the succeeding year and the data reported 

under subclauses (I), (II), and (III) for the State. 

‘‘(iii) DATA.—Notwithstanding any other provision 

of law, the Secretary regularly shall provide MACPAC 

with the most recent State reports and most recent 

independent certified audits submitted under section 

1923(j), cost reports submitted under title XVIII, and 

such other data as MACPAC may request for purposes 

of conducting the reviews and preparing and submitting the annual reports required under this subparagraph. 

‘‘(iv) SUBMISSION DEADLINES.—The first report 

required under this subparagraph shall be submitted 

to Congress not later than February 1, 2016. Subsequent reports shall be submitted as part of, or with, 

each annual report required under paragraph (1)(C) 

during the period of fiscal years 2017 through 2024.’’. 

SEC. 222. REALIGNMENT OF THE MEDICARE SEQUESTER FOR FISCAL 

YEAR 2024. 

Paragraph (6) (relating to implementing direct spending reductions) of section 251A of the Balanced Budget and Emergency 

Deficit Control Act of 1985 (2 U.S.C. 901a) is amended by adding 

at the end the following new subparagraph: 

‘‘(D) Notwithstanding the 2 percent limit specified in 

subparagraph (A) for payments for the Medicare programs 

specified in section 256(d), the sequestration order of the President under such subparagraph for fiscal year 2024 shall be 

applied to such payments so that— 

‘‘(i) with respect to the first 6 months in which such 

order is effective for such fiscal year, the payment reduction 

shall be 4.0 percent; and 

‘‘(ii) with respect to the second 6 months in which 

such order is so effective for such fiscal year, the payment 

reduction shall be 0.0 percent.’’. 

SEC. 223. DEMONSTRATION PROGRAMS TO IMPROVE COMMUNITY 

MENTAL HEALTH SERVICES. 

(a) CRITERIA FOR CERTIFIED COMMUNITY BEHAVIORAL HEALTH

CLINICS TO PARTICIPATE IN DEMONSTRATION PROGRAMS.— 
H. R. 4302—39 

(1) PUBLICATION.—Not later than September 1, 2015, the 

Secretary shall publish criteria for a clinic to be certified by 

a State as a certified community behavioral health clinic for 

purposes of participating in a demonstration program conducted 

under subsection (d). 

(2) REQUIREMENTS.—The criteria published under this subsection shall include criteria with respect to the following: 

(A) STAFFING.—Staffing requirements, including criteria that staff have diverse disciplinary backgrounds, have 

necessary State-required license and accreditation, and are 

culturally and linguistically trained to serve the needs 

of the clinic’s patient population. 

(B) AVAILABILITY AND ACCESSIBILITY OF SERVICES.— 

Availability and accessibility of services, including crisis 

management services that are available and accessible 24 

hours a day, the use of a sliding scale for payment, and 

no rejection for services or limiting of services on the basis 

of a patient’s ability to pay or a place of residence. 

(C) CARE COORDINATION.—Care coordination, including 

requirements to coordinate care across settings and providers to ensure seamless transitions for patients across 

the full spectrum of health services including acute, 

chronic, and behavioral health needs. Care coordination 

requirements shall include partnerships or formal contracts 

with the following: 

(i) Federally-qualified health centers (and as 

applicable, rural health clinics) to provide Federallyqualified health center services (and as applicable, 

rural health clinic services) to the extent such services 

are not provided directly through the certified community behavioral health clinic. 

(ii) Inpatient psychiatric facilities and substance 

use detoxification, post-detoxification step-down services, and residential programs. 

(iii) Other community or regional services, supports, and providers, including schools, child welfare 

agencies, juvenile and criminal justice agencies and 

facilities, Indian Health Service youth regional treatment centers, State licensed and nationally accredited 

child placing agencies for therapeutic foster care 

service, and other social and human services. 

(iv) Department of Veterans Affairs medical centers, independent outpatient clinics, drop-in centers, 

and other facilities of the Department as defined in 

section 1801 of title 38, United States Code. 

(v) Inpatient acute care hospitals and hospital outpatient clinics. 

(D) SCOPE OF SERVICES.—Provision (in a manner 

reflecting person-centered care) of the following services 

which, if not available directly through the certified community behavioral health clinic, are provided or referred 

through formal relationships with other providers: 

(i) Crisis mental health services, including 24-hour 

mobile crisis teams, emergency crisis intervention services, and crisis stabilization. 

(ii) Screening, assessment, and diagnosis, including 

risk assessment. 
H. R. 4302—40 

(iii) Patient-centered treatment planning or similar 

processes, including risk assessment and crisis planning. 

(iv) Outpatient mental health and substance use 

services. 

(v) Outpatient clinic primary care screening and 

monitoring of key health indicators and health risk. 

(vi) Targeted case management. 

(vii) Psychiatric rehabilitation services. 

(viii) Peer support and counselor services and 

family supports. 

(ix) Intensive, community-based mental health 

care for members of the armed forces and veterans, 

particularly those members and veterans located in 

rural areas, provided the care is consistent with minimum clinical mental health guidelines promulgated 

by the Veterans Health Administration including clinical guidelines contained in the Uniform Mental Health 

Services Handbook of such Administration. 

(E) QUALITY AND OTHER REPORTING.—Reporting of 

encounter data, clinical outcomes data, quality data, and 

such other data as the Secretary requires. 

(F) ORGANIZATIONAL AUTHORITY.—Criteria that a clinic 

be a non-profit or part of a local government behavioral 

health authority or operated under the authority of the 

Indian Health Service, an Indian tribe or tribal organization pursuant to a contract, grant, cooperative agreement, 

or compact with the Indian Health Service pursuant to 

the Indian Self-Determination Act (25 U.S.C. 450 et seq.), 

or an urban Indian organization pursuant to a grant or 

contract with the Indian Health Service under title V of 

the Indian Health Care Improvement Act (25 U.S.C. 1601 

et seq.). 

(b) GUIDANCE ON DEVELOPMENT OF PROSPECTIVE PAYMENT

SYSTEM FOR TESTING UNDER DEMONSTRATION PROGRAMS.— (1) IN GENERAL.—Not later than September 1, 2015, the 

Secretary, through the Administrator of the Centers for Medicare & Medicaid Services, shall issue guidance for the establishment of a prospective payment system that shall only apply 

to medical assistance for mental health services furnished by 

a certified community behavioral health clinic participating 

in a demonstration program under subsection (d). 

(2) REQUIREMENTS.—The guidance issued by the Secretary 

under paragraph (1) shall provide that— 

(A) no payment shall be made for inpatient care, residential treatment, room and board expenses, or any other 

non-ambulatory services, as determined by the Secretary; 

and 

(B) no payment shall be made to satellite facilities 

of certified community behavioral health clinics if such 

facilities are established after the date of enactment of 

this Act. 

(c) PLANNING GRANTS.— 

(1) IN GENERAL.—Not later than January 1, 2016, the Secretary shall award planning grants to States for the purpose 

of developing proposals to participate in time-limited demonstration programs described in subsection (d). 
H. R. 4302—41 

(2) USE OF FUNDS.—A State awarded a planning grant 

under this subsection shall— 

(A) solicit input with respect to the development of 

such a demonstration program from patients, providers, 

and other stakeholders; 

(B) certify clinics as certified community behavioral 

health clinics for purposes of participating in a demonstration program conducted under subsection (d); and 

(C) establish a prospective payment system for mental 

health services furnished by a certified community behavioral health clinic participating in a demonstration program 

under subsection (d) in accordance with the guidance issued 

under subsection (b). 

(d) DEMONSTRATION PROGRAMS.— 

(1) IN GENERAL.—Not later than September 1, 2017, the 

Secretary shall select States to participate in demonstration 

programs that are developed through planning grants awarded 

under subsection (c), meet the requirements of this subsection, 

and represent a diverse selection of geographic areas, including 

rural and underserved areas. 

(2) APPLICATION REQUIREMENTS.— 

(A) IN GENERAL.—The Secretary shall solicit applications to participate in demonstration programs under this 

subsection solely from States awarded planning grants 

under subsection (c). 

(B) REQUIRED INFORMATION.—An application for a demonstration program under this subsection shall include the 

following: 

(i) The target Medicaid population to be served 

under the demonstration program. 

(ii) A list of participating certified community 

behavioral health clinics. 

(iii) Verification that the State has certified a 

participating clinic as a certified community behavioral 

health clinic in accordance with the requirements of 

subsection (b). 

(iv) A description of the scope of the mental health 

services available under the State Medicaid program 

that will be paid for under the prospective payment 

system tested in the demonstration program. 

(v) Verification that the State has agreed to pay 

for such services at the rate established under the 

prospective payment system. 

(vi) Such other information as the Secretary may 

require relating to the demonstration program 

including with respect to determining the soundness 

of the proposed prospective payment system. 

(3) NUMBER AND LENGTH OF DEMONSTRATION PROGRAMS.— Not more than 8 States shall be selected for 2-year demonstration programs under this subsection. 

(4) REQUIREMENTS FOR SELECTING DEMONSTRATION PRO- GRAMS.— 

(A) IN GENERAL.—The Secretary shall give preference 

to selecting demonstration programs where participating 

certified community behavioral health clinics— 

(i) provide the most complete scope of services 

described in subsection (a)(2)(D) to individuals eligible 
H. R. 4302—42 

for medical assistance under the State Medicaid program; 

(ii) will improve availability of, access to, and 

participation in, services described in subsection 

(a)(2)(D) to individuals eligible for medical assistance 

under the State Medicaid program; 

(iii) will improve availability of, access to, and 

participation in assisted outpatient mental health 

treatment in the State; or 

(iv) demonstrate the potential to expand available 

mental health services in a demonstration area and 

increase the quality of such services without increasing 

net Federal spending. 

(5) PAYMENT FOR MEDICAL ASSISTANCE FOR MENTAL HEALTH

SERVICES PROVIDED BY CERTIFIED COMMUNITY BEHAVIORAL

HEALTH CLINICS.— 

(A) IN GENERAL.—The Secretary shall pay a State 

participating in a demonstration program under this subsection the Federal matching percentage specified in 

subparagraph (B) for amounts expended by the State to 

provide medical assistance for mental health services 

described in the demonstration program application in 

accordance with paragraph (2)(B)(iv) that are provided by 

certified community behavioral health clinics to individuals 

who are enrolled in the State Medicaid program. Payments 

to States made under this paragraph shall be considered 

to have been under, and are subject to the requirements 

of, section 1903 of the Social Security Act (42 U.S.C. 1396b). 

(B) FEDERAL MATCHING PERCENTAGE.—The Federal 

matching percentage specified in this subparagraph is with 

respect to medical assistance described in subparagraph 

(A) that is furnished— 

(i) to a newly eligible individual described in paragraph (2) of section 1905(y) of the Social Security Act 

(42 U.S.C. 1396d(y)), the matching rate applicable 

under paragraph (1) of that section; and 

(ii) to an individual who is not a newly eligible 

individual (as so described) but who is eligible for 

medical assistance under the State Medicaid program, 

the enhanced FMAP applicable to the State. 

(C) LIMITATIONS.— 

(i) IN GENERAL.—Payments shall be made under 

this paragraph to a State only for mental health services— 

(I) that are described in the demonstration 

program application in accordance with paragraph 

(2)(iv); 

(II) for which payment is available under the 

State Medicaid program; and 

(III) that are provided to an individual who 

is eligible for medical assistance under the State 

Medicaid program. 

(ii) PROHIBITED PAYMENTS.—No payment shall be 

made under this paragraph— 

(I) for inpatient care, residential treatment, 

room and board expenses, or any other non- 
H. R. 4302—43 

ambulatory services, as determined by the Secretary; or 

(II) with respect to payments made to satellite 

facilities of certified community behavioral health 

clinics if such facilities are established after the 

date of enactment of this Act. 

(6) WAIVER OF STATEWIDENESS REQUIREMENT.—The Secretary shall waive section 1902(a)(1) of the Social Security 

Act (42 U.S.C. 1396a(a)(1)) (relating to statewideness) as may 

be necessary to conduct demonstration programs in accordance 

with the requirements of this subsection. 

(7) ANNUAL REPORTS.— 

(A) IN GENERAL.—Not later than 1 year after the date 

on which the first State is selected for a demonstration 

program under this subsection, and annually thereafter, 

the Secretary shall submit to Congress an annual report 

on the use of funds provided under all demonstration programs conducted under this subsection. Each such report 

shall include— 

(i) an assessment of access to community-based 

mental health services under the Medicaid program 

in the area or areas of a State targeted by a demonstration program compared to other areas of the State; 

(ii) an assessment of the quality and scope of services provided by certified community behavioral health 

clinics compared to community-based mental health 

services provided in States not participating in a demonstration program under this subsection and in areas 

of a demonstration State that are not participating 

in the demonstration program; and 

(iii) an assessment of the impact of the demonstration programs on the Federal and State costs of a 

full range of mental health services (including 

inpatient, emergency and ambulatory services). 

(B) RECOMMENDATIONS.—Not later than December 31, 

2021, the Secretary shall submit to Congress recommendations concerning whether the demonstration programs 

under this section should be continued, expanded, modified, 

or terminated. 

(e) DEFINITIONS.—In this section: 

(1) FEDERALLY-QUALIFIED HEALTH CENTER SERVICES; FEDERALLY-QUALIFIED HEALTH CENTER; RURAL HEALTH CLINIC SERVICES; RURAL HEALTH CLINIC.—The terms ‘‘Federally-qualified 

health center services’’, ‘‘Federally-qualified health center’’, 

‘‘rural health clinic services’’, and ‘‘rural health clinic’’ have 

the meanings given those terms in section 1905(l) of the Social 

Security Act (42 U.S.C. 1396d(l)). 

(2) ENHANCED FMAP.—The term ‘‘enhanced FMAP’’ has the 

meaning given that term in section 2105(b) of the Social Security Act (42 U.S.C. 1397dd(b)) but without regard to the second 

and third sentences of that section. 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

(4) STATE.—The term ‘‘State’’ has the meaning given such 

term for purposes of title XIX of the Social Security Act (42 

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

(f) FUNDING.— 
H. R. 4302—44 

(1) IN GENERAL.—Out of any funds in the Treasury not 

otherwise appropriated, there is appropriated to the Secretary— 

(A) for purposes of carrying out subsections (a), (b), 

and (d)(7), $2,000,000 for fiscal year 2014; and 

(B) for purposes of awarding planning grants under 

subsection (c), $25,000,000 for fiscal year 2016. 

(2) AVAILABILITY.—Funds appropriated under paragraph 

(1) shall remain available until expended. 

SEC. 224. ASSISTED OUTPATIENT TREATMENT GRANT PROGRAM FOR 

INDIVIDUALS WITH SERIOUS MENTAL ILLNESS. 

(a) IN GENERAL.—The Secretary shall establish a 4-year pilot 

program to award not more than 50 grants each year to eligible 

entities for assisted outpatient treatment programs for individuals 

with serious mental illness. 

(b) CONSULTATION.—The Secretary shall carry out this section 

in consultation with the Director of the National Institute of Mental 

Health, the Attorney General of the United States, the Administrator of the Administration for Community Living, and the 

Administrator of the Substance Abuse and Mental Health Services 

Administration. 

(c) SELECTING AMONG APPLICANTS.—The Secretary— 

(1) may only award grants under this section to applicants 

that have not previously implemented an assisted outpatient 

treatment program; and 

(2) shall evaluate applicants based on their potential to 

reduce hospitalization, homelessness, incarceration, and interaction with the criminal justice system while improving the 

health and social outcomes of the patient. 

(d) USE OF GRANT.—An assisted outpatient treatment program 

funded with a grant awarded under this section shall include— 

(1) evaluating the medical and social needs of the patients 

who are participating in the program; 

(2) preparing and executing treatment plans for such 

patients that— 

(A) include criteria for completion of court-ordered 

treatment; and 

(B) provide for monitoring of the patient’s compliance 

with the treatment plan, including compliance with medication and other treatment regimens; 

(3) providing for such patients case management services 

that support the treatment plan; 

(4) ensuring appropriate referrals to medical and social 

service providers; 

(5) evaluating the process for implementing the program 

to ensure consistency with the patient’s needs and State law; 

and 

(6) measuring treatment outcomes, including health and 

social outcomes such as rates of incarceration, health care 

utilization, and homelessness. 

(e) REPORT.—Not later than the end of each of fiscal years 

2016, 2017, and 2018, the Secretary shall submit a report to the 

appropriate congressional committees on the grant program under 

this section. Each such report shall include an evaluation of the 

following: 
H. R. 4302—45 

(1) Cost savings and public health outcomes such as mortality, suicide, substance abuse, hospitalization, and use of services. 

(2) Rates of incarceration by patients. 

(3) Rates of homelessness among patients. 

(4) Patient and family satisfaction with program participation. 

(f) DEFINITIONS.—In this section: 

(1) The term ‘‘assisted outpatient treatment’’ means medically prescribed mental health treatment that a patient receives 

while living in a community under the terms of a law authorizing a State or local court to order such treatment. 

(2) The term ‘‘eligible entity’’ means a county, city, mental 

health system, mental health court, or any other entity with 

authority under the law of the State in which the grantee 

is located to implement, monitor, and oversee assisted outpatient treatment programs. 

(3) The term ‘‘Secretary’’ means the Secretary of Health 

and Human Services. 

(g) FUNDING.— 

(1) AMOUNT OF GRANTS.—A grant under this section shall 

be in an amount that is not more than $1,000,000 for each 

of fiscal years 2015 through 2018. Subject to the preceding 

sentence, the Secretary shall determine the amount of each 

grant based on the population of the area, including estimated 

patients, to be served under the grant. 

(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this section $15,000,000 

for each of fiscal years 2015 through 2018. 

SEC. 225. EXCLUSION FROM PAYGO SCORECARDS. 

(a) STATUTORY PAY-AS-YOU-GO SCORECARDS.—The budgetary 

effects of this Act shall not be entered on either PAYGO scorecard 

maintained pursuant to section 4(d) of the Statutory Pay-As-YouGo Act of 2010. 

(b) SENATE PAYGO SCORECARDS.—The budgetary effects of this 

Act shall not be entered on any PAYGO scorecard maintained 

for purposes of section 201 of S. Con. Res. 21 (110th Congress). 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate.