II

106TH CONGRESS

1ST SESSION S. 1500

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

payment for services provided to certain high-cost individuals under the

prospective payment system for skilled nursing facility services, and for

other purposes.

IN THE SENATE OF THE UNITED STATES

AUGUST 5, 1999

Mr. HATCH (for himself, Mr. DOMENICI, Mr. DASCHLE, Mr. KERREY, Mr.

INOUYE, Mr. BINGAMAN, Mr. COCHRAN, Ms. MIKULSKI, Mr. BURNS,

Mrs. BOXER, Mr. MCCONNELL, Mr. BUNNING, Mr. JEFFORDS, Mr.

ROBB, Mr. SANTORUM, Mr. DODD, and Mrs. FEINSTEIN) introduced the

following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend title XVIII of the Social Security Act to provide

for an additional payment for services provided to certain

high-cost individuals under the prospective payment system for skilled nursing facility services, and for other

purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Medicare Beneficiary

5 Access to Quality Nursing Home Care Act of 1999’’.
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1 SEC. 2. FINDINGS.

2 Congress makes the following findings:

3 (1) Beneficiaries under the Medicare Program

4 under title XVIII of the Social Security Act are ex5 periencing decreased access to skilled nursing facility

6 services due to inadequate reimbursement under the

7 prospective payment system for such services under

8 section 1888(e) of such Act.

9 (2) Such inadequate reimbursement may force

10 skilled nursing facilities to file for bankruptcy and

11 close their doors, resulting in reduced access to

12 skilled nursing facility services for Medicare bene13 ficiaries.

14 (3) The methodology under the prospective pay15 ment system for skilled nursing facility services has

16 made it more difficult for Medicare beneficiaries to

17 find nursing home care. Some beneficiaries are re18 maining in hospitals for extended stays due to re19 duced access to nursing homes. Others are placed in

20 nursing homes that are hours away from family and

21 friends.

22 (4) The Health Care Financing Administration

23 has indicated that the prospective payment system

24 for skilled nursing facility services does not accu25 rately account for the costs associated with pro26 viding medically complex care (non-therapy ancillary
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1 services and supplies). Due to Year 2000 problems,

2 the Health Care Financing Administration claims

3 that it will be unable to properly account for such

4 costs under such system.

5 (5) The Medicare Payment Advisory Commis6 sion (MedPAC) has indicated that payments to

7 skilled nursing facilities under the Medicare Pro8 gram may not be adequate for beneficiaries who

9 need relatively high levels of non-therapy ancillary

10 services and supplies. According to MedPAC, such

11 inadequate funding could result in access problems

12 for beneficiaries with medically complex conditions.

13 (6) In order to provide adequate payment under

14 the prospective payment system for skilled nursing

15 facility services, such system must take into account

16 the costs associated with providing 1 or more of the

17 following services:

18 (A) Ventilator care.

19 (B) Tracheostomy care.

20 (C) Care for pressure ulcers.

21 (D) Care associated with individuals that

22 have experienced a stroke or a hip fracture.

23 (E) Care for non-vent, non-trach pneu24 monia.

25 (F) Dialysis.
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1 (G) Infusion therapy.

2 (H) Deep vein thrombosis.

3 (I) Care associated with individuals with

4 transient peripheral neuropathy, a chronic ob5 structive pulmonary disease, congestive heart

6 failure, diabetes, a wound infection, a res7 piratory infection, sepsis, tuberculosis, HIV, or

8 cancer.

9 (7) A temporary legislative solution is necessary

10 in order to ensure that Medicare beneficiaries with

11 complex conditions continue to receive access to ap12 propriate skilled nursing facility services.

13 (8) The skilled nursing facility market basket

14 increase over the last 3 years evidences a critical

15 payment gap that exists between the actual cost of

16 providing services to Medicare beneficiaries residing

17 in a skilled nursing facility and the reimbursement

18 levels for such services under the prospective pay19 ment system. In addition, the Health Care Financ20 ing Administration, in establishing the skilled nurs21 ing facility market basket index under section

22 1888(e)(5)(A) of the Social Security Act only ac23 counted for the cost of goods, but not for the cost

24 of services, as such section requires.
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1 SEC. 3. MODIFICATION OF CASE MIX CATEGORIES FOR

2 CERTAIN CONDITIONS.

3 (a) IN GENERAL.—For purposes of applying any for4 mula under paragraph (1) of section 1888(e) of the Social

5 Security Act (42 U.S.C. 1395yy(e)), for services provided

6 on or after October 1, 1999, and before the earlier of Oc7 tober 1, 2001, or the date described in subsection (c), the

8 Secretary of Health and Human Services shall increase

9 the adjusted Federal per diem rate otherwise determined

10 under paragraph (4) of such section for services provided

11 to any individual during the period in which such indi12 vidual is in a RUGS III category by the applicable pay13 ment add-on as determined in accordance with the fol14 lowing table:

RUGS III Category Applicable Payment AddOn

RUC ......................................................................................... $73.57

RUB ......................................................................................... $23.06

RUA ......................................................................................... $17.04

RVC ......................................................................................... $76.25

RVB ......................................................................................... $30.36

RVA ......................................................................................... $20.93

RHC ......................................................................................... $54.07

RHB ......................................................................................... $27.28

RHA ......................................................................................... $25.07

RMC ......................................................................................... $69.98

RMB ........................................................................................ $30.09

RMA ......................................................................................... $24.24

SE3 .......................................................................................... $98.41

SE2 .......................................................................................... $89.05

CA1 .......................................................................................... $27.02.

15 (b) UPDATE.—The Secretary shall update the appli16 cable payment add-on under subsection (a) for fiscal year

17 2001 by the skilled nursing facility market basket percent-
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1 age change (as defined under section 1888(e)(5)(B) of the

2 Social Security Act (42 U.S.C. 1395yy(e)(5)(B))) applica3 ble to such fiscal year.

4 (c) DATE DESCRIBED.—The date described in this

5 subsection is the date that the Secretary of Health and

6 Human Services implements a case mix methodology

7 under section 1888(e)(4)(G)(i) of the Social Security Act

8 (42 U.S.C. 1395yy(e)(4)(G)(i)) that takes into account

9 adjustments for the provision of non-therapy ancillary

10 services and supplies such as drugs and respiratory ther11 apy.

12 SEC. 4. MODIFICATION TO THE SNF UPDATE TO FIRST

13 COST REPORTING PERIOD.

14 (a) IN GENERAL.—Section 1888(e) of the Social Se15 curity Act (42 U.S.C. 1395yy(e)) is amended—

16 (1) in paragraph (3)(B)(i), by striking ‘‘minus

17 1 percentage point’’; and

18 (2) in paragraph (4)(B), by striking ‘‘reduced

19 (on an annualized basis) by 1 percentage point’’.

20 (b) EFFECTIVE DATE.—The amendments made by

21 subsection (a) shall apply to services provided on or after

22 October 1, 1999.

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