II

★(Star Print)

106TH CONGRESS

1ST SESSION S. 1678

To amend title XVIII of the Social Security Act to modify the provisions

of the Balanced Budget Act of 1997.

IN THE SENATE OF THE UNITED STATES

OCTOBER 1, 1999

Mr. DASCHLE (for himself, Mr. MOYNIHAN, Mr. ROCKEFELLER, Mr. KENNEDY, Mr. KERRY, Mr. BAUCUS, Mr. BINGAMAN, Ms. MIKULSKI, Mr.

DURBIN, Mr. REID, Mr. KERREY, Mr. TORRICELLI, Mr. CLELAND, Mrs.

BOXER, Mr. JOHNSON, Mr. REED, Mrs. MURRAY, Mr. SCHUMER, Mr.

BREAUX, Mr. DODD, Mr. LEVIN, Mr. SARBANES, Mr. LEAHY, Mr.

WELLSTONE, Mr. BRYAN, Mr. DORGAN, Mr. LAUTENBERG, Mr. BYRD,

Mr. HARKIN, Mrs. FEINSTEIN, Mrs. LINCOLN, Mr. ROBB, Mr. INOUYE,

Mr. HOLLINGS and Mr. EDWARDS) 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 modify

the provisions of the Balanced Budget Act of 1997.

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; AMENDMENTS TO SOCIAL SECU4 RITY ACT; TABLE OF CONTENTS.

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

6 ‘‘Medicare Beneficiary Access to Care Act of 1999’’.
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1 (b) AMENDMENTS TO SOCIAL SECURITY ACT.—Ex2 cept as otherwise specifically provided, whenever in this

3 Act an amendment is expressed in terms of an amendment

4 to or repeal of a section or other provision, the reference

5 shall be considered to be made to that section or other

6 provision of the Social Security Act.

7 (c) TABLE OF CONTENTS.—The table of contents of

8 this Act is as follows:

Sec. 1. Short title; amendments to Social Security Act; table of contents.

TITLE I—HOSPITALS

Sec. 101. Multiyear transition to prospective payment system for hospital outpatient department services.

Sec. 102. Limitation in reduction of payments to disproportionate share hospitals.

Sec. 103. Changes to DSH allotments and transition rule.

Sec. 104. Revision of criteria for designation as a critical access hospital.

Sec. 105. Sole community hospitals and Medicare dependent hospitals.

TITLE II—GRADUATE MEDICAL EDUCATION

Sec. 201. Revision of multiyear reduction of indirect graduate medical education payments.

Sec. 202. Acceleration of GME phase-in.

Sec. 203. Exclusion of nursing and allied health education costs in calculating

Medicare+Choice payment rate.

Sec. 204. Adjustments to limitations on number of interns and residents.

TITLE III—HOSPICE CARE

Sec. 301. Increase in payments for hospice care.

TITLE IV—SKILLED NURSING FACILITIES

Sec. 401. Modification of case mix categories for certain conditions.

Sec. 402. Exclusion of clinical social worker services and services performed

under a contract with a rural health clinic or Federally qualified health center from the PPS for SNFs.

Sec. 403. Exclusion of certain services from the PPS for SNFs.

Sec. 404. Exclusion of swing beds in critical access hospitals from the PPS for

SNFs.

TITLE V—OUTPATIENT REHABILITATION SERVICES

Sec. 501. Modification of financial limitation on rehabilitation services.

TITLE VI—PHYSICIANS’ SERVICES
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Sec. 601. Technical amendment to update adjustment factor and physician sustainable growth rate.

Sec. 602. Publication of estimate of conversion factor and MedPAC review.

TITLE VII—HOME HEALTH

Sec. 701. Delay in the 15 percent reduction in payments under the PPS for

home health services.

Sec. 702. Increase in per visit limit.

Sec. 703. Treatment of Outliers.

Sec. 704. Elimination of 15-minute billing requirement.

Sec. 705. Recoupment of overpayments.

Sec. 706. Refinement of home health agency consolidated billing.

TITLE VIII—MEDICARE+CHOICE

Sec. 801. Delay in ACR deadline under the Medicare+Choice program.

Sec. 802. Change in time period for exclusion of Medicare+Choice organizations that have had a contract terminated.

Sec. 803. Enrollment of medicare beneficiaries in alternative Medicare+Choice

plans and medigap coverage in case of involuntary termination

of Medicare+Choice enrollment.

Sec. 804. Applying medigap and Medicare+Choice protections to disabled and

ESRD medicare beneficiaries.

Sec. 805. Extended Medicare+Choice disenrollment window for certain involuntarily terminated enrollees.

Sec. 806. Nonpreemption of State prescription drug coverage mandates in case

of approved State medigap waivers.

Sec. 807. Modification of payment rules for certain frail elderly Medicare beneficiaries.

Sec. 808. Extension of Medicare community nursing organization demonstration projects.

TITLE IX—CLINICS

Sec. 901. New prospective payment system for Federally-qualified health centers and rural health clinics under the Medicaid Program.

1 TITLE I—HOSPITALS

2 SEC. 101. MULTIYEAR TRANSITION TO PROSPECTIVE PAY3 MENT SYSTEM FOR HOSPITAL OUTPATIENT

4 DEPARTMENT SERVICES.

5 (a) IN GENERAL.—Section 1833(t) (42 U.S.C.

6 1395(t)) is amended by adding at the end the following:

7 ‘‘(10) MULTIYEAR TRANSITION.—

8 ‘‘(A) IN GENERAL.—In the case of covered

9 OPD services furnished by a hospital during a
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1 transition year, the Secretary shall increase the

2 payments for such services under the prospec3 tive payment system established under this sub4 section by the amount (if any) that the Sec5 retary determines is necessary to ensure that

6 the payment to cost ratio of the hospital for the

7 transition year equals the applicable percentage

8 of the payment to cost ratio of the hospital for

9 1996.

10 ‘‘(B) PAYMENT TO COST RATIO.—

11 ‘‘(i) IN GENERAL.—The payment to

12 cost ratio of a hospital for any year is the

13 ratio which—

14 ‘‘(I) the hospital’s reimbursement

15 under this part for covered OPD serv16 ices furnished during the year, includ17 ing through cost-sharing described in

18 subparagraph (D)(ii), bears to

19 ‘‘(II) the cost of such services.

20 ‘‘(ii) CALCULATION OF 1996 PAYMENT

21 TO COST RATIO.—The Secretary shall de22 termine each hospital’s payment to cost

23 ratio for 1996 as if the amendments to

24 this title by the provisions of section 4521
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1 of the Balanced Budget Act of 1997 were

2 in effect in 1996.

3 ‘‘(iii) TRANSITION YEARS.—The Sec4 retary shall estimate each payment to cost

5 ratio of a hospital for any transition year

6 before the beginning of such year.

7 ‘‘(C) INTERIM PAYMENTS.—

8 ‘‘(i) IN GENERAL.—The Secretary

9 shall make interim payments to a hospital

10 during any transition year for which the

11 Secretary estimates a payment is required

12 under subparagraph (A).

13 ‘‘(ii) ADJUSTMENTS.—If the Secretary

14 makes payments under clause (i) for any

15 transition year, the Secretary shall make

16 retrospective adjustments to each hospital

17 based on its settled cost report so that the

18 amount of any additional payment to a

19 hospital for such year equals the amount

20 described in subparagraph (A).

21 ‘‘(D) DEFINITIONS.—In this paragraph:

22 ‘‘(i) APPLICABLE PERCENTAGE.—The

23 term ‘applicable percentage’ means, with

24 respect to covered OPD services furnished

25 during—
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1 ‘‘(I) the first full year (and any

2 portion of the immediately preceding

3 year) for which the prospective pay4 ment system under this subsection is

5 in effect, 95 percent;

6 ‘‘(II) the second full calendar

7 year for which such system is in ef8 fect, 90 percent; and

9 ‘‘(III) the third full calendar year

10 for which such system is in effect, 85

11 percent.

12 ‘‘(ii) COST-SHARING.—The term ‘cost13 sharing’ includes—

14 ‘‘(I) copayment amounts de15 scribed in paragraph (5);

16 ‘‘(II) coinsurance described in

17 section 1866(a)(2)(A)(ii); and

18 ‘‘(III) the deductible described

19 under section 1833(b).

20 ‘‘(iii) TRANSITION YEAR.—The term

21 ‘transition year’ means any year (or por22 tion thereof) described in clause (i).

23 ‘‘(E) EFFECT ON COPAYMENTS.—Nothing

24 in this paragraph shall be construed as affect-
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1 ing the unadjusted copayment amount de2 scribed in paragraph (3)(B).

3 ‘‘(F) APPLICATION WITHOUT REGARD TO

4 BUDGET NEUTRALITY.—The transitional pay5 ments made under this paragraph—

6 ‘‘(i) shall not be considered an adjust7 ment under paragraph (2)(E); and

8 ‘‘(ii) shall not be implemented in a

9 budget neutral manner.’’.

10 (b) SPECIAL RULE FOR RURAL AND CANCER HOS11 PITALS.—Section 1833(t) (42 U.S.C. 1395(t)), as amend12 ed by subsection (a), is amended by adding at the end

13 the following:

14 ‘‘(11) SPECIAL RULE FOR RURAL AND CANCER

15 HOSPITALS.—

16 ‘‘(A) IN GENERAL.—For each year (or por17 tion thereof), beginning in 2000, in the case of

18 covered OPD services furnished by a medicare19 dependent, small rural hospital (as defined in

20 section 1886(d)(5)(G)(iv)), a sole community

21 hospital (as defined in section

22 1886(d)(5)(D)(iii)), or in a hospital described

23 in section 1886(d)(1)(B)(v), the Secretary shall

24 increase the payments for such services under

25 the prospective payment system established
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1 under this subsection by the amount (if any)

2 that the Secretary determines is necessary to

3 ensure that the payment to cost ratio of the

4 hospital (as determined pursuant to paragraph

5 (10)(B)) for the year equals the payment to

6 cost ratio of the hospital for 1996 (as cal7 culated under clause (ii) of such paragraph).

8 ‘‘(B) INTERIM PAYMENTS.—

9 ‘‘(i) IN GENERAL.—The Secretary

10 shall make interim payments to a hospital

11 during any year for which the Secretary

12 estimates a payment is required under sub13 paragraph (A).

14 ‘‘(ii) ADJUSTMENTS.—If the Secretary

15 makes payments under clause (i) for any

16 year, the Secretary shall make retrospec17 tive adjustments to each hospital based on

18 its settled cost report so that the amount

19 of any additional payment to a hospital for

20 such year equals the amount described in

21 subparagraph (A).

22 ‘‘(C) EFFECT ON COPAYMENTS.—Nothing

23 in this paragraph shall be construed as affect24 ing the unadjusted copayment amount de25 scribed in paragraph (3)(B).
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1 ‘‘(D) APPLICATION WITHOUT REGARD TO

2 BUDGET NEUTRALITY.—The payments made

3 under this paragraph—

4 ‘‘(i) shall not be considered an adjust5 ment under paragraph (2)(E); and

6 ‘‘(ii) shall not be implemented in a

7 budget neutral manner.’’.

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

9 this section shall take effect as if included in the amend10 ments made by section 4523 of the Balanced Budget Act

11 of 1997 (Public Law 105–33; 111 Stat. 445).

12 SEC. 102. LIMITATION IN REDUCTION OF PAYMENTS TO

13 DISPROPORTIONATE SHARE HOSPITALS.

14 (a) IN GENERAL.—Section 1886(d)(5)(F)(ix) (42

15 U.S.C. 1395ww(d)(5)(F)(ix)) is amended—

16 (1) in subclause (II)—

17 (A) by striking ‘‘fiscal year 1999,’’ and in18 serting ‘‘each of fiscal years 1999, 2000, 2001,

19 and 2002,’’; and

20 (B) by inserting ‘‘and’’ after the semicolon;

21 (2) by striking subclauses (III), (IV), and (V);

22 and

23 (3) by redesignating subclause (VI) as sub24 clause (III).
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1 (b) EFFECTIVE DATE.—The amendments made by

2 subsection (a) shall take effect as if included in the

3 amendments made by section 4403 of the Balanced Budg4 et Act of 1997 (Public Law 105–33; 111 Stat. 398).

5 SEC. 103. CHANGES TO DSH ALLOTMENTS AND TRANSITION

6 RULE.

7 (a) CHANGE IN DISPROPORTIONATE SHARE HOS8 PITAL ALLOTMENTS.—Section 1923(f)(2) (42 U.S.C.

9 1396r–4(f)(2)) is amended, in the table contained in such

10 section and in the DSH Allotments for fiscal years 2000,

11 2001, and 2002—

12 (1) for Minnesota, by striking ‘‘16’’ and insert13 ing ‘‘33’’;

14 (2) for New Mexico, by striking ‘‘5’’ and insert15 ing ‘‘9’’; and

16 (3) for Wyoming, by striking ‘‘0’’ and inserting

17 ‘‘0.1’’.

18 (b) MAKING MEDICAID DSH TRANSITION RULE

19 PERMANENT.—Section 4721(e) of the Balanced Budget

20 Act of 1997 is amended—

21 (1) in the matter before paragraph (1), by

22 striking ‘‘1923(g)(2)(A)’’ and ‘‘1396r–4(g)(2)(A)’’

23 and inserting ‘‘1923(g)(2)’’ and ‘‘1396r–4(g)(2)’’,

24 respectively;

25 (2) in paragraphs (1) and (2)—
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1 (A) by striking ‘‘, and before July 1,

2 1999’’; and

3 (B) by striking ‘‘in such section’’ and in4 serting ‘‘in subparagraph (A) of such section’’;

5 and

6 (3) by striking ‘‘and’’ at the end of paragraph

7 (1), by striking the period at the end of paragraph

8 (2) and inserting ‘‘; and’’, and by adding at the end

9 the following:

10 ‘‘(3) effective for State fiscal years that begin

11 on or after July 1, 1999, ‘or (b)(1)(B)’ were in12 serted in 1923(g)(2)(B)(ii)(I) after ‘(b)(1)(A)’.’’.

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

14 this section shall take effect as if included in the enact15 ment of the Balanced Budget Act of 1997 (Public Law

16 105–33; 111 Stat. 251).

17 SEC. 104. REVISION OF CRITERIA FOR DESIGNATION AS A

18 CRITICAL ACCESS HOSPITAL.

19 (a) CRITERIA FOR DESIGNATION.—Section

20 1820(c)(2)(B)(iii) (42 U.S.C. 1395i–4(c)(2)(B)(iii)) is

21 amended by striking ‘‘to exceed 96 hours’’ and all that

22 follows before the semicolon and inserting ‘‘to exceed, on

23 average, 96 hours per patient’’.
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1 (b) EFFECTIVE DATE.—The amendment made by

2 subsection (a) shall take effect 60 days after the date of

3 enactment of this Act.

4 SEC. 105. SOLE COMMUNITY HOSPITALS AND MEDICARE

5 DEPENDENT HOSPITALS.

6 (a) IN GENERAL.—Section 1886(b)(3)(B)(iv) (42

7 U.S.C. 1395ww(b)(3)(B)(iv)) is amended—

8 (1) in subclause (III), by striking ‘‘and’’ at the

9 end;

10 (2) in subclause (IV)—

11 (A) by striking ‘‘fiscal year 1996 and each

12 subsequent fiscal year’’ and inserting ‘‘fiscal

13 years 1996 through 1999’’; and

14 (B) by striking the period at the end and

15 inserting ‘‘, and’’; and

16 (3) by adding at the end the following:

17 ‘‘(V) for fiscal year 2000 and each subsequent

18 fiscal year, the market basket percentage increase.’’.

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

20 subsection (a) shall take effect on the date of enactment

21 of this Act.
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1 TITLE II—GRADUATE MEDICAL

2 EDUCATION

3 SEC. 201. REVISION OF MULTIYEAR REDUCTION OF INDI4 RECT GRADUATE MEDICAL EDUCATION PAY5 MENTS.

6 (a) IN GENERAL.—Section 1886(d)(5)(B)(ii) (42

7 U.S.C. 1395ww(d)(5)(B)(ii)) is amended by striking sub8 clauses (III), (IV), and (V) and inserting the following:

9 ‘‘(III) during each of fiscal years

10 1999 through 2007, ‘c’ is equal to

11 1.6; and

12 ‘‘(IV) on or after October 1,

13 2007, ‘c’ is equal to 1.35.’’.

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

15 subsection (a) shall take effect as if included in section

16 4621 of the Balanced Budget Act of 1997 (Public Law

17 105–33; 111 Stat. 475).

18 SEC. 202. ACCELERATION OF GME PHASE-IN.

19 (a) ACCELERATION OF PAYMENT TO HOSPITALS OF

20 INDIRECT AND DIRECT MEDICAL EDUCATION COSTS FOR

21 MEDICARE+CHOICE ENROLLEES.—

22 (1) IN GENERAL.—Section 1886(h)(3)(D)(ii)

23 (42 U.S.C. 1395ww(h)(3)(D)(ii)) is amended by

24 striking subclauses (IV) and (V) and inserting the

25 following:
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1 ‘‘(IV) 100 percent in 2001 and

2 subsequent years.’’.

3 (2) ACCELERATION OF CARVE-OUT.—Section

4 1853(c)(3)(B)(ii) (42 U.S.C. 1395w–23(c)(3)(B)(ii))

5 is amended—

6 (A) in subclause (III), by inserting ‘‘and’’

7 at the end;

8 (B) by striking subclause (IV); and

9 (C) by redesignating subclause (V) as sub10 clause (IV).

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

12 subsection (a) shall take effect as if included in the enact13 ment of the Balanced Budget Act of 1997 (Public Law

14 105–33; 111 Stat. 251).

15 SEC. 203. EXCLUSION OF NURSING AND ALLIED HEALTH

16 EDUCATION COSTS IN CALCULATING

17 MEDICARE+CHOICE PAYMENT RATE.

18 (a) EXCLUDING COSTS IN CALCULATING PAYMENT

19 RATE.—

20 (1) IN GENERAL.—Section 1853(c)(3)(C)(i) (42

21 U.S.C. 1395w–23(c)(3)(C)(i)) is amended—

22 (A) in subclause (I), by striking ‘‘and’’ at

23 the end;

24 (B) in subclause (II), by striking the pe25 riod at the end and inserting ‘‘, and’’; and
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1 (C) by adding at the end the following:

2 ‘‘(III) for costs attributable to

3 approved nursing and allied health

4 education programs under section

5 1861(v).’’.

6 (2) EFFECTIVE DATE.—The amendments made

7 by paragraph (1) shall apply in determining the an8 nual per capita rate of payment for years beginning

9 with 2001.

10 (b) PAYMENT TO HOSPITALS OF NURSING AND AL11 LIED HEALTH EDUCATION PROGRAM COSTS FOR

12 MEDICARE+CHOICE ENROLLEES.—Section 1861(v)(1)

13 (42 U.S.C. 1395x(v)(1)) is amended by adding at the end

14 the following:

15 ‘‘(V)(i) In determining the amount of payment to a

16 hospital for portions of cost reporting periods occurring

17 on or after January 1, 2001, with respect to the reason18 able costs for approved nursing and allied health education

19 programs, individuals who are enrolled with a

20 Medicare+Choice organization under part C shall be

21 treated as if they were not so enrolled.

22 ‘‘(ii) The Secretary shall establish rules for applying

23 clause (i) to a hospital reimbursed under a reimbursement

24 system authorized under section 1814(b)(3) in the same
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1 manner as it would apply to the hospital if it were not

2 reimbursed under such section.’’.

3 SEC. 204. ADJUSTMENTS TO LIMITATIONS ON NUMBER OF

4 INTERNS AND RESIDENTS.

5 (a) INDIRECT GRADUATE MEDICAL EDUCATION AD6 JUSTMENT.—Section 1886(d)(5)(B)(v) (42 U.S.C.

7 1395ww(d)(5)(B)(v)) is amended—

8 (1) by striking ‘‘(v) In determining’’ and insert9 ing ‘‘(v)(I) Subject to subclause (II), in deter10 mining’’;

11 (2) by striking ‘‘in the hospital with respect to

12 the hospital’s most recent cost reporting period end13 ing on or before December 31, 1996’’ and inserting

14 ‘‘who were appointed by the hospital’s approved

15 medical residency training programs for the hos16 pital’s most recent cost reporting period ending on

17 or before December 31, 1996’’; and

18 (3) by adding at the end the following:

19 ‘‘(II) Beginning on or after January 1, 1997, in the

20 case of a hospital that sponsors only 1 allopathic or osteo21 pathic residency program, the limit determined for such

22 hospital under subclause (I) may, at the hospital’s discre23 tion, be increased by 1 for each calendar year but shall

24 not exceed a total of 3 more than the limit determined

25 for the hospital under subclause (I).’’.
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1 (b) DIRECT GRADUATE MEDICAL EDUCATION AD2 JUSTMENT.—

3 (1) LIMITATION ON NUMBER OF RESIDENTS.—

4 Section 1886(h)(4)(F) (42 U.S.C. 1395ww(h)(4)(F))

5 is amended by inserting ‘‘who were appointed by the

6 hospital’s approved medical residency training pro7 grams’’ after ‘‘may not exceed the number of such

8 full-time equivalent residents’’.

9 (2) FUNDING FOR PROGRAMS.—Section

10 1886(h)(4)(H)(i) (42 U.S.C. 1395ww(h)(4)(H)(i)) is

11 amended in the second sentence, by inserting ‘‘, in12 cluding facilities that are not located in an under13 served rural area but have established separately ac14 credited rural training tracks’’ before the period.

15 (c) GME PAYMENTS FOR CERTAIN INTERNS AND

16 RESIDENTS.—

17 (1) INDIRECT AND DIRECT MEDICAL EDU18 CATION.—Each limitation regarding the number of

19 residents or interns for which payment may be made

20 under section 1886 of the Social Security Act (42

21 U.S.C. 1395ww) is increased by the number of ap22 plicable residents (as defined in paragraph (2)).

23 (2) APPLICABLE RESIDENT DEFINED.—In this

24 subsection, the term ‘‘applicable resident’’ means a

25 resident or intern that—
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1 (A) participated in graduate medical edu2 cation at a facility of the Department of Vet3 erans Affairs;

4 (B) was subsequently transferred on or

5 after January 1, 1997, and before July 31,

6 1998, to a hospital and the hospital was not a

7 Department of Veterans Affairs facility; and

8 (C) was transferred because the approved

9 medical residency program in which the resi10 dent or intern participated would lose accredita11 tion by the Accreditation Council on Graduate

12 Medical Education if such program continued

13 to train residents at the Department of Vet14 erans Affairs facility.

15 (d) EFFECTIVE DATE.—This section shall take effect

16 as if included in the enactment of the Balanced Budget

17 Act of 1997 (Public Law 105–33; 111 Stat. 251).

18 TITLE III—HOSPICE CARE

19 SEC. 301. INCREASE IN PAYMENTS FOR HOSPICE CARE.

20 (a) IN GENERAL.—Section 1814(i)(1)(C)(ii)(VI) (42

21 U.S.C. 1395f(i)(1)(C)(ii)(VI)) is amended by striking

22 ‘‘through 2002’’ and inserting ‘‘and 1999’’.

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

24 this section shall take effect as if included in the amend-
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1 ments made by section 4441 of the Balanced Budget Act

2 of 1997 (Public Law 105–33; 111 Stat. 422).

3 TITLE IV—SKILLED NURSING

4 FACILITIES

5 SEC. 401. MODIFICATION OF CASE MIX CATEGORIES FOR

6 CERTAIN CONDITIONS.

7 (a) IN GENERAL.—For purposes of applying any for8 mula under paragraph (1) of section 1888(e) of the Social

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

10 on or after April 1, 2000, and before the earlier of October

11 1, 2001, or the date described in subsection (d), the Sec12 retary of Health and Human Services shall increase the

13 adjusted Federal per diem rate otherwise determined

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

15 to any individual during the period in which such indi16 vidual is in a RUG III category by the applicable payment

17 add-on as determined in accordance with the following

18 table:

RUG III category Applicable payment add-on

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

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

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

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

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

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

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

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

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

SSC .......................................................................................... $46.80

SSB .......................................................................................... $55.56

SSA .......................................................................................... $59.94.
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1 (b) UPDATE.—The Secretary shall update the appli2 cable payment add-on under subsection (a) for fiscal year

3 2001 by the skilled nursing facility market basket percent4 age change (as defined under section 1888(e)(5)(B) of the

5 Social Security Act (42 U.S.C. 1395yy(e)(5)(B))) applica6 ble to such fiscal year.

7 (c) RULE OF CONSTRUCTION.—Nothing in this sec8 tion shall be construed as permitting the Secretary of

9 Health and Human Services to include any applicable pay10 ment add-on determined under subsection (a) in updating

11 the Federal per diem rate under section 1888(e)(4) of the

12 Social Security Act (42 U.S.C. 1395yy(e)(4)).

13 (d) DATE DESCRIBED.—The date described in this

14 subsection is the date that the Secretary of Health and

15 Human Services—

16 (1) refines the case mix classification system

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

18 Act (42 U.S.C. 1395yy(e)(4)(G)(i)) to better ac19 count for medically complex patients; and

20 (2) implements such refined system.
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1 SEC. 402. EXCLUSION OF CLINICAL SOCIAL WORKER SERV2 ICES AND SERVICES PERFORMED UNDER A

3 CONTRACT WITH A RURAL HEALTH CLINIC

4 OR FEDERALLY QUALIFIED HEALTH CENTER

5 FROM THE PPS FOR SNFs.

6 (a) IN GENERAL.—Section 1888(e)(2)(A)(ii) (42

7 U.S.C. 1395yy(e)(2)(A)(ii)) is amended—

8 (1) in the first sentence, by inserting ‘‘clinical

9 social worker services,’’ after ‘‘qualified psychologist

10 services,’’; and

11 (2) by inserting after the first sentence the fol12 lowing: ‘‘Services described in this clause also in13 clude services that are provided by a physician, a

14 physician assistant, a nurse practitioner, a qualified

15 psychologist, or a clinical social worker who is em16 ployed, or otherwise under contract, with a rural

17 health clinic or a Federally qualified health center.’’.

18 (b) CONFORMING AMENDMENT.—Section

19 1861(hh)(2) (42 U.S.C. 1395x(hh)(2)) is amended by

20 striking ‘‘and other than services furnished to an inpatient

21 of a skilled nursing facility which the facility is required

22 to provide as a requirement for participation’’.

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

24 this section shall apply to services provided on or after

25 the date which is 60 days after the date of enactment of

26 this Act.
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1 SEC. 403. EXCLUSION OF CERTAIN SERVICES FROM THE

2 PPS FOR SNFs.

3 (a) IN GENERAL.—Section 1888(e)(2)(A)(ii) (42

4 U.S.C. 1395yy(e)(2)(A)(ii)), as amended by section 402,

5 is amended—

6 (1) in the first sentence, by inserting ‘‘ambu7 lance services, services identified by HCPCS code in

8 Program Memorandum Transmittal No. A–98–37

9 issued in November 1998 (but without regard to the

10 setting in which such services are furnished),’’ after

11 ‘‘subparagraphs (F) and (O) of section 1861(s)(2),’’;

12 and

13 (2) by inserting after the second sentence the

14 following: ‘‘In addition to the services described in

15 the previous sentences, services described in this

16 clause include chemotherapy items (identified as of

17 July 1, 1999, by HCPCS codes J9000–J9020,

18 J9040–J9151, J9170–J9185, J9200–J9201,

19 J9206–J9208, J9211, J9230–J9245, and J9265–

20 J9600), chemotherapy administration services (iden21 tified as of July 1, 1999, by HCPCS codes 36260–

22 36262, 36489, 36530–36535, 36640, 36823, and

23 96405–96542), radioisotope services (identified as of

24 July 1, 1999, by HCPCS codes 79030–79440), and

25 customized prosthetic devices (identified as of July

26 1, 1999, by HCPCS codes L5050–L5340, L5500–
23

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1 L5610, L5613–L5986, L5988, L6050–L6370,

2 L6400–L6880, L6920–L7274, and L7362–

3 L7366).’’.

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

5 this section shall apply to services furnished on or after

6 the date which is 60 days after the date of enactment of

7 this Act.

8 SEC. 404. EXCLUSION OF SWING BEDS IN CRITICAL ACCESS

9 HOSPITALS FROM THE PPS FOR SNFs.

10 (a) IN GENERAL.—Section 1888(e)(7) of the Social

11 Security Act (42 U.S.C. 1395yy(e)(7)) is amended—

12 (1) in the heading, by striking ‘‘TRANSITION’’

13 and inserting ‘‘SPECIAL RULES’’;

14 (2) in subparagraph (A), by striking ‘‘IN GEN15 ERAL.—The’’ and inserting ‘‘TRANSITION.—Except

16 as provided in subparagraph (C), the’’; and

17 (3) by adding at the end the following:

18 ‘‘(C) EXEMPTION OF SWING BEDS IN

19 CRITICAL ACCESS HOSPITALS FROM

20 PPS.—The prospective payment system

21 under this subsection shall not apply (and

22 section 1834(g) shall apply) to services

23 provided by a critical access hospital under

24 an agreement described in subparagraph

25 (B).’’.
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1 (b) EFFECTIVE DATE.—The amendments made by

2 this section shall apply to services provided on or after

3 October 1, 1999.

4 TITLE V—OUTPATIENT

5 REHABILITATION SERVICES

6 SEC. 501. MODIFICATION OF FINANCIAL LIMITATION ON

7 REHABILITATION SERVICES.

8 (a) 3-YEAR REPEAL.—Section 1833(g) (42 U.S.C.

9 1395l(g)) is amended by adding at the end the following:

10 ‘‘(4) Subject to paragraph (6), the provisions of para11 graphs (1) through (3) shall not apply to outpatient phys12 ical therapy services, outpatient occupational therapy serv13 ices, and outpatient speech-language pathology services

14 covered under this title and furnished on or after January

15 1, 2000.

16 ‘‘(5)(A) Notwithstanding the preceding provisions of

17 this subsection and subject to subparagraph (B), with re18 spect to services described in paragraph (4) that are fur19 nished on or after January 1, 2003, the Secretary shall

20 implement, by not later than January 1, 2003, a payment

21 system for such services that takes into account the needs

22 of beneficiaries under this title for differing amounts of

23 therapy based on factors such as diagnosis, functional sta24 tus, and prior use of services.
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1 ‘‘(B) The payment system established under subpara2 graph (A) shall be designed so that the system shall not

3 result in any increase or decrease in the expenditures

4 under this title on a fiscal year basis, determined as if

5 paragraph (4) had not been enacted.

6 ‘‘(6) If the Secretary for any reason does not imple7 ment the payment system described in paragraph (5) on

8 or before January 1, 2003, paragraph (4) shall not apply

9 with respect to services described in such paragraph that

10 are furnished on or after such date and before the date

11 on which the Secretary implements such payment sys12 tem.’’.

13 (b) EFFECTIVE DATE.—The amendment made by

14 this section shall take effect as if included in the enact15 ment of the Balanced Budget Act of 1997 (Public Law

16 105–33; 111 Stat. 251).

17 TITLE VI—PHYSICIANS’

18 SERVICES

19 SEC. 601. TECHNICAL AMENDMENT TO UPDATE ADJUST20 MENT FACTOR AND PHYSICIAN SUSTAINABLE

21 GROWTH RATE.

22 (a) UPDATE ADJUSTMENT FACTOR.—

23 (1) CHANGE TO CALENDAR YEAR BASIS.—Sec24 tion 1848(d) (42 U.S.C. 1395w–4(d)) is amended—
26

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1 (A) in paragraph (1), by striking subpara2 graph (E) and inserting the following:

3 ‘‘(E) PUBLICATION.—The Secretary shall

4 publish in the Federal Register—

5 ‘‘(i) not later than November 1 of

6 each year (beginning with 1999), the con7 version factor that will apply to physicians’

8 services for the succeeding year and the

9 update determined under paragraph (3)

10 for such year; and

11 ‘‘(ii) not later than November 1 of

12 1999—

13 ‘‘(I) the special update for the

14 year 2000 under paragraph (3)(E)(i);

15 and

16 ‘‘(II) the estimated special ad17 justments for years 2001 through

18 2006 under paragraph (3)(E)(ii).’’;

19 and

20 (B) in paragraph (3)(C)—

21 (i) in the matter preceding clause (i),

22 by striking ‘‘the 12-month period ending

23 with March 31 of’’;

24 (ii) in clause (i)—
27

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1 (I) by striking ‘‘1997’’ and in2 serting ‘‘1996,’’; and

3 (II) by striking ‘‘such 12-month

4 period’’ and inserting ‘‘1996’’; and

5 (iii) in clause (ii)—

6 (I) by inserting a comma after

7 ‘‘subsequent year’’; and

8 (II) by striking ‘‘fiscal year which

9 begins during such 12-month period’’

10 and inserting ‘‘year involved’’.

11 (2) FORMULA FOR DETERMINING THE UPDATE

12 ADJUSTMENT FACTOR.—Section 1848(d)(3) (42

13 U.S.C. 1395w–4(d)(3)) is amended—

14 (A) in subparagraph (A)—

15 (i) in clause (ii), by striking ‘‘(divided

16 by 100),’’ and inserting a period; and

17 (ii) by striking the matter following

18 clause (ii);

19 (B) in subparagraph (B)—

20 (i) in the matter preceding clause (i),

21 by inserting ‘‘the sum of’’ after ‘‘Sec22 retary) to’’; and

23 (ii) by striking clauses (i) and (ii) and

24 inserting the following:

25 ‘‘(i) the figure arrived at by—
28

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1 ‘‘(I) determining the difference

2 between the allowed expenditures for

3 physicians’ services for the prior year

4 (as determined under subparagraph

5 (C)) and the actual expenditures for

6 such services for that year;

7 ‘‘(II) dividing that difference by

8 the actual expenditures for such serv9 ices in that year; and

10 ‘‘(III) multiplying that quotient

11 by 0.75; and

12 ‘‘(ii) the figure arrived at by—

13 ‘‘(I) determining the difference

14 between the allowed expenditures for

15 physicians’ services (as determined

16 under subparagraph (C)) from 1996

17 through the prior year and the actual

18 expenditures for such services during

19 that period, corrected with the best

20 available data;

21 ‘‘(II) dividing that difference by

22 actual expenditures for such services

23 for the prior year as increased by the

24 sustainable growth rate under sub25 section (f) for the year whose update
29

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1 adjustment factor is to be determined;

2 and

3 ‘‘(III) multiplying that quotient

4 by 0.33.’’; and

5 (C) by amending subparagraph (D) to read

6 as follows:

7 ‘‘(D) RESTRICTION ON UPDATE ADJUST8 MENT FACTOR.—The update adjustment factor

9 determined under subparagraph (B) for a year

10 may not be less than negative 0.07 or greater

11 than 0.03.’’.

12 (3) SPECIAL PROVISIONS.—Section 1848(d)(3)

13 (42 U.S.C. 1395w–4(d)(3)) is amended—

14 (A) in subparagraph (A), in the matter

15 preceding clause (i), by striking ‘‘subparagraph

16 (D)’’ and inserting ‘‘subparagraphs (D) and

17 (E)’’; and

18 (B) by adding at the end the following:

19 ‘‘(E) SPECIAL UPDATE AND ADJUST20 MENTS.—

21 ‘‘(i) YEAR 2000.—For the year 2000,

22 the update under this paragraph shall be

23 the percentage that the Secretary esti24 mates will, without regard to any otherwise

25 applicable restriction, result in expendi-
30

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1 tures equal to the expenditures that would

2 have occurred in that year in the absence

3 of the amendments made by section 601 of

4 the Medicare Beneficiary Access to Care

5 Act of 1999.

6 ‘‘(ii) YEARS 2001–2006.—For each of

7 the years 2001 through 2006, the Sec8 retary shall make that adjustment to the

9 update for that year which the Secretary

10 estimates will, without regard to any other11 wise applicable restriction, result in ex12 penditures equal to the expenditures that

13 would have occurred for that year in the

14 absence of the amendments made by sec15 tion 601 of the Medicare Beneficiary Ac16 cess to Care Act of 1999.’’.

17 (b) SUSTAINABLE GROWTH RATE.—Section 1848(f)

18 (42 U.S.C. 1395w–4(f)) is amended—

19 (1) by striking paragraph (1) and inserting the

20 following:

21 ‘‘(1) PUBLICATION.—Not later than November

22 1 of each year (beginning with 1999), the Secretary

23 shall publish in the Federal Register the sustainable

24 growth rate as determined under this subsection for
31

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1 the succeeding year, the current year, and each of

2 the preceding 2 years.’’; and

3 (2) in paragraph (2)—

4 (A) by striking ‘‘fiscal’’ each place it ap5 pears; and

6 (B) in the matter preceding subparagraph

7 (A), by striking ‘‘year 1998’’ and inserting

8 ‘‘1997’’.

9 (c) DATA TO BE USED IN DETERMINING THE SUS10 TAINABLE GROWTH RATE.—Section 1848(f) (42 U.S.C.

11 1395w–4(f)) is amended—

12 (1) by redesignating paragraph (3) as para13 graph (4); and

14 (2) by inserting after paragraph (2) the fol15 lowing:

16 ‘‘(3) METHODOLOGY.—For purposes of deter17 mining the update adjustment factor under sub18 section (d)(3)(B) and the allowed expenditures

19 under subsection (d)(3)(C) for a year, the sustain20 able growth rate for each year taken into consider21 ation in the determination under paragraph (2) shall

22 be determined as follows:

23 ‘‘(A) For purposes of such calculations for

24 the year 2000, the sustainable growth rate shall

25 be determined on the basis of the best data
32

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1 available to the Secretary as of September 1,

2 1999.

3 ‘‘(B) For purposes of such calculations for

4 each year after the year 2000—

5 ‘‘(i) the sustainable growth rate for

6 such year and each of the 2 preceding

7 years shall be determined on the basis of

8 the best data available to the Secretary as

9 of September 1 of such year; and

10 ‘‘(ii) the sustainable growth rate for

11 each year preceding the years specified in

12 clause (i) shall be the rate used for such

13 year in such calculation for the imme14 diately preceding year.’’.

15 (d) EFFECTIVE DATE.—

16 (1) IN GENERAL.—Subject to paragraph (2),

17 the amendments made by this section shall take ef18 fect as if included in the enactment of the Balanced

19 Budget Act of 1997 (Public Law 105–33; 111 Stat.

20 251).

21 (2) NO EFFECT ON UPDATES FOR 1998 AND

22 1999.—The amendments made by this section shall

23 have no effect on the updates established by the Sec24 retary for 1998 and 1999, and such established up25 dates may not be changed.
33

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1 SEC. 602. PUBLICATION OF ESTIMATE OF CONVERSION

2 FACTOR AND MEDPAC REVIEW.

3 (a) PUBLICATION.—Not later than April 15 of each

4 year (beginning in 2000), the Secretary of Health and

5 Human Services (in this section referred to as the ‘‘Sec6 retary’’) shall publish in the Federal Register—

7 (1) an estimate of the single conversion factor

8 to be used in the next calendar year for reimburse9 ment of physicians services under section 1848 of

10 the Social Security Act (42 U.S.C. 1395w–4); and

11 (2) the data on which such estimate is based.

12 (b) MEDPAC REVIEW AND REPORT.—

13 (1) REVIEW.—The Medicare Payment Advisory

14 Commission (in this section referred to as

15 ‘‘MedPAC’’) shall annually review the estimates and

16 data published by the Secretary pursuant to sub17 section (a).

18 (2) REPORT.—Not later than June 30 of each

19 year (beginning in 2000), MedPAC shall submit a

20 report to the Secretary and to the committees of ju21 risdiction in Congress on the review conducted pur22 suant to paragraph (1), together with any rec23 ommendations as determined appropriate by

24 MedPAC.
34

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1 TITLE VII—HOME HEALTH

2 SEC. 701. DELAY IN THE 15 PERCENT REDUCTION IN PAY3 MENTS UNDER THE PPS FOR HOME HEALTH

4 SERVICES.

5 (a) CONTINGENCY REDUCTION.—Section 4603(e) of

6 the Balanced Budget Act of 1997 (42 U.S.C. 1395fff

7 note), as amended by section 5101(c)(3) of the Tax and

8 Trade Relief Extension Act of 1998 (contained in division

9 J of Public Law 105–277), is amended by striking ‘‘Sep10 tember 30, 2000’’ and inserting ‘‘September 30, 2002’’.

11 (b) PROSPECTIVE PAYMENT SYSTEM.—Section

12 1895(b)(3)(A) (42 U.S.C. 1395fff(b)(3)(A)), as amended

13 by section 5101 of the Tax and Trade Relief Extension

14 Act of 1998 (contained in division J of Public Law 105–

15 277), is amended by striking clause (i) and inserting the

16 following:

17 ‘‘(i) IN GENERAL.—Under such sys18 tem the Secretary shall provide for com19 putation of a standard prospective pay20 ment amount (or amounts) as follows:

21 ‘‘(I) Such amount (or amounts)

22 shall initially be based on the most

23 current audited cost report data avail24 able to the Secretary and shall be

25 computed in a manner so that the
35

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1 total amounts payable under the sys2 tem for fiscal year 2001, shall be

3 equal to the total amount that would

4 have been made if the system had not

5 been in effect;

6 ‘‘(II) For fiscal year 2003 such

7 amount (or amounts), shall be equal

8 to the amount (or amounts) that

9 would have been determined under

10 subclause (I), if the reduction in lim11 its described in clause (ii) had been in

12 effect for fiscal year 2001, and up13 dated under subparagraph (B) for fis14 cal years 2002 and 2003.

15 Each such amount shall be standardized in

16 a manner that eliminates the effect of vari17 ations in relative case mix and wage levels

18 among different home health agencies in a

19 budget neutral manner consistent with the

20 case mix and wage level adjustments pro21 vided under paragraph (4)(A). Under the

22 system, the Secretary may recognize re23 gional differences or differences based

24 upon whether or not the services or agency

25 are in an urbanized area.’’.
36

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1 SEC. 702. INCREASE IN PER VISIT LIMIT.

2 (a) INTERIM PAYMENT SYSTEM.—Section

3 1861(v)(1)(L)(i) (42 U.S.C. 1395x(v)(1)(L)(i)), as

4 amended by section 701(b), is amended—

5 (1) in subclause (IV), by striking ‘‘or’’;

6 (2) in subclause (V)—

7 (A) by inserting ‘‘and before October 1,

8 1999,’’ after ‘‘October 1, 1998,’’; and

9 (B) by striking the period and inserting ‘‘,

10 or’’; and

11 (3) by adding at the end the following:

12 ‘‘(VI) October 1, 1999, 112 percent of such me13 dian.’’.

14 (b) ENSURING THE INCREASE IN PER VISIT LIMIT

15 HAS NO EFFECT ON THE PROSPECTIVE PAYMENT SYS16 TEM.—The second sentence of section 1895(b)(3)(A)(i)

17 (42 U.S.C. 1395fff(b)(3)(A)(i)), as amended by section

18 5101(c)(1)(B) of the Tax and Trade Relief Extension Act

19 of 1998 (contained in division J of Public Law 105–277)

20 and section 701(b), is amended—

21 (1) in subclause (I), by inserting ‘‘but if the

22 reference in section 1861(v)(1)(L)(i)(VI) to 112 per23 cent were a reference to 106 percent’’ after ‘‘if the

24 system had not been in effect’’; and

25 (2) in subclause (II), by inserting ‘‘and if the

26 reference in section 1861(v)(1)(L)(i)(VI) to 112 per-
37

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1 cent were a reference to 106 percent’’ after ‘‘clause

2 (ii) had been in effect for fiscal year 2001’’.

3 SEC. 703. TREATMENT OF OUTLIERS.

4 (a) WAIVER OF PER BENEFICIARY LIMITS FOR

5 OUTLIERS.—Section 1861(v)(1)(L) (42 U.S.C.

6 1395x(v)(1)(L)), as amended by section 5101 of the Tax

7 and Trade Relief Extension Act of 1998 (contained in di8 vision J of Public Law 105–277), is amended—

9 (1) by redesignating clause (ix) as clause (x);

10 and

11 (2) by inserting after clause (viii) the following:

12 ‘‘(ix)(I) Notwithstanding the applicable per bene13 ficiary limit under clause (v), (vi), or (viii), but subject

14 to the applicable per visit limit under clause (i), in the

15 case of a provider that demonstrates to the Secretary that

16 with respect to an individual to whom the provider fur17 nished home health services appropriate to the individual’s

18 condition (as determined by the Secretary) at a reasonable

19 cost (as determined by the Secretary), and that such rea20 sonable cost significantly exceeded such applicable per

21 beneficiary limit because of unusual variations in the type

22 or amount of medically necessary care required to treat

23 the individual, the Secretary, upon application by the pro24 vider, shall pay to such provider for such individual such

25 reasonable cost.
38

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1 ‘‘(II) The total amount of the additional payments

2 made to home health agencies pursuant to subclause (I)

3 in any fiscal year shall not exceed an amount equal to 2

4 percent of the amounts that would have been paid under

5 this subparagraph in such year if this clause had not been

6 enacted.’’.

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

8 subsection (a) shall take effect on the date of enactment

9 of this Act, and shall apply to each application for pay10 ment of reasonable costs for outliers submitted by any

11 home health agency for cost reporting periods ending on

12 or after October 1, 1999.

13 SEC. 704. ELIMINATION OF 15-MINUTE BILLING REQUIRE14 MENT.

15 (a) IN GENERAL.—Section 1895(c) (42 U.S.C.

16 1395fff(c)) is amended to read as follows:

17 ‘‘(c) REQUIREMENTS FOR PAYMENT INFORMA18 TION.—With respect to home health services furnished on

19 or after October 1, 1998, no claim for such a service may

20 be paid under this title unless the claim has the unique

21 identifier (provided under section 1842(r)) for the physi22 cian who prescribed the services or made the certification

23 described in section 1814(a)(2) or 1835(a)(2)(A).’’

24 (b) EFFECTIVE DATE.—The amendment made by

25 subsection (a) shall apply to claims submitted on or after
39

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1 the date which is 60 days after the date of enactment of

2 this section.

3 SEC. 705. RECOUPMENT OF OVERPAYMENTS.

4 (a) 36-MONTH REPAYMENT PERIOD.—In the case of

5 an overpayment by the Secretary of Health and Human

6 Services to a home health agency for home health services

7 furnished during a cost reporting period beginning on or

8 after October 1, 1997, as a result of payment limitations

9 provided for under clause (v), (vi), or (viii) of section

10 1861(v)(1)(L) of the Social Security Act (42 U.S.C.

11 1395x(v)(1)(L)), the home health agency may elect to

12 repay the amount of such overpayment ratably over a 36-

13 month period beginning on the date of notification of such

14 overpayment.

15 (b) NO INTEREST ON OVERPAYMENT AMOUNTS.—In

16 the case of an agency that makes an election under sub17 section (a), no interest shall accrue on the outstanding

18 balance of the amount of overpayment during such 36-

19 month period.

20 (c) TERMINATION.—No election under subsection (a)

21 may be made for cost reporting periods, or portions of cost

22 reporting periods, beginning on or after the date of the

23 implementation of the prospective payment system for

24 home health services under section 1895 of the Social Se25 curity Act (42 U.S.C. 1395fff).
40

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1 (d) EFFECTIVE DATE.—The provisions of subsection

2 (a) shall apply to debts that are outstanding as of the date

3 of enactment of this Act.

4 SEC. 706. REFINEMENT OF HOME HEALTH AGENCY CON5 SOLIDATED BILLING.

6 (a) IN GENERAL.—Section 1842(b)(6)(F) (42 U.S.C.

7 1395u(b)(6)(F)) is amended by inserting ‘‘(including med8 ical supplies described in section 1861(m)(5), but exclud9 ing durable medical equipment described in such section)’’

10 after ‘‘home health services’’.

11 (b) CONFORMING AMENDMENT.—Section

12 1862(a)(21) (42 U.S.C. 1395y(a)(21)) is amended by in13 serting ‘‘(including medical supplies described in section

14 1861(m)(5), but excluding durable medical equipment de15 scribed in such section)’’ after ‘‘home health services’’.

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

17 this section shall take effect as if included in the amend18 ments made by section 4603 of the Balanced Budget Act

19 of 1997 (Public Law 105–33; 111 Stat. 467).

20 TITLE VIII—MEDICARE+CHOICE

21 SEC. 801. DELAY IN ACR DEADLINE UNDER THE

22 MEDICARE+CHOICE PROGRAM.

23 (a) DELAY IN DEADLINE FOR SUBMISSION OF AD24 JUSTED COMMUNITY RATES AND RELATED INFORMA-
41

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1 TION.—Section 1854(a)(1) (42 U.S.C. 1395w–24(a)(1)) is

2 amended by striking ‘‘May 1’’ and inserting ‘‘July 1’’.

3 (b) ADJUSTMENT IN INFORMATION DISCLOSURE

4 PROVISIONS.—Section 1851(d)(2)(A)(ii) (42 U.S.C.

5 1395w–21(d)(2)(A)(ii)) is amended in the first sentence

6 by inserting ‘‘, to the extent such information is available

7 at the time of preparation of the material for mailing’’

8 before the period.

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

10 this section shall take effect on the date of enactment of

11 this Act.

12 SEC. 802. CHANGE IN TIME PERIOD FOR EXCLUSION OF

13 MEDICARE+CHOICE ORGANIZATIONS THAT

14 HAVE HAD A CONTRACT TERMINATED.

15 (a) IN GENERAL.—Section 1857(c)(4) (42 U.S.C.

16 1395w–27(c)(4)) is amended by striking ‘‘5-year period’’

17 and inserting ‘‘3-year period’’.

18 (b) EFFECTIVE DATE.—The amendment made by

19 subsection (a) shall apply to contract years beginning on

20 or after January 1, 1999.
42

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1 SEC. 803. ENROLLMENT OF MEDICARE BENEFICIARIES IN

2 ALTERNATIVE MEDICARE+CHOICE PLANS

3 AND MEDIGAP COVERAGE IN CASE OF INVOL4 UNTARY TERMINATION OF

5 MEDICARE+CHOICE ENROLLMENT.

6 (a) PERMITTING ENROLLMENT IN ALTERNATIVE

7 PLANS UPON RECEIPT OF NOTICE OF

8 MEDICARE+CHOICE PLAN TERMINATION.—

9 (1) MEDICARE+CHOICE PLANS.—Section

10 1851(e)(4) (42 U.S.C. 1395w–21(e)(4)) is amended

11 by striking subparagraph (A) and inserting the fol12 lowing:

13 ‘‘(A)(i) the certification of the organization

14 or plan under this part has been terminated, or

15 the organization or plan has notified the indi16 vidual of an impending termination of such cer17 tification; or

18 ‘‘(ii) the organization has terminated or

19 otherwise discontinued providing the plan in the

20 area in which the individual resides, or has no21 tified the individual of an impending termi22 nation or discontinuation of such plan;’’.

23 (2) MEDIGAP PLANS.—

24 (A) IN GENERAL.—Section 1882(s)(3)(A)

25 (42 U.S.C. 1395ss(s)(3)(A)) is amended in the

26 matter following clause (iii)—
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1 (i) by inserting ‘‘(92 days in the case

2 of a termination or discontinuation of cov3 erage under the types of circumstances de4 scribed in section 1851(e)(4)(A))’’ after

5 ‘‘63 days’’;

6 (ii) by inserting ‘‘(or, if elected by the

7 individual, the date of notification of the

8 individual by the plan or organization of

9 the impending termination or discontinu10 ance of the plan in the area in which the

11 individual resides)’’ after ‘‘the date of the

12 termination of enrollment described in

13 such subparagraph’’; and

14 (iii) by inserting ‘‘(or date of such no15 tification)’’ after ‘‘the date of termination

16 or disenrollment’’.

17 (B) EFFECTIVE DATE.—The amendments

18 made by this paragraph shall apply to notices

19 of intended termination made by group health

20 plans and Medicare+Choice organizations after

21 the date of enactment of this Act.

22 (b) GUARANTEED ACCESS FOR CERTAIN MEDICARE

23 BENEFICIARIES TO MEDIGAP POLICIES IN CASE OF IN24 VOLUNTARY TERMINATION OF COVERAGE UNDER A

25 MEDICARE+CHOICE PLAN.—
44

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1 (1) IN GENERAL.—Section 1882(s)(3)(C)(iii)

2 (42 U.S.C. 1395ss(s)(3)(C)(iii)) is amended by in3 serting ‘‘or an individual described in clause (ii) or

4 (iii) of subparagraph (B) in the case of cir5 cumstances described in section 1851(e)(4)(A)’’

6 after ‘‘subparagraph (B)(vi)’’.

7 (2) EFFECTIVE DATE.—

8 (A) IN GENERAL.—Subject to subpara9 graph (B), the amendment made by paragraph

10 (1) shall apply to terminations of coverage ef11 fected on or after the date of enactment of this

12 Act.

13 (B) TRANSITIONAL MEDIGAP OPEN EN14 ROLLMENT PERIOD FOR CERTAIN INDIVIDUALS

15 AFFECTED BY PLAN WITHDRAWALS.—In the

16 case of an individual described in clause (ii) or

17 (iii) of subparagraph (B) of section 1882(s)(3)

18 of the Social Security Act in the case of cir19 cumstances described in section 1851(e)(4)(A)

20 of such Act (relating to discontinuation of a

21 plan or organization entirely or in an area), if

22 the termination or discontinuation of coverage

23 occurred after December 31, 1998, and before

24 the date of enactment of this Act, the provi25 sions of subparagraph (A) of section 1882(s)(3)
45

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1 such Act (in the matter up to and including

2 clause (iii) thereof) shall apply to such an indi3 vidual who seeks enrollment under a medicare

4 supplemental policy during the 92-day period

5 beginning with the first month that begins more

6 than 30 days after the date of enactment of

7 this Act in the same manner as such provisions

8 apply to an individual described in the matter

9 following such clause (iii).

10 SEC. 804. APPLYING MEDIGAP AND MEDICARE+CHOICE

11 PROTECTIONS TO DISABLED AND ESRD

12 MEDICARE BENEFICIARIES.

13 (a) ASSURING AVAILABILITY OF MEDIGAP COV14 ERAGE.—

15 (1) IN GENERAL.—Section 1882(s) (42 U.S.C.

16 1395ss(s)) is amended—

17 (A) in paragraph (2)(A), by striking ‘‘is 65

18 years of age or older and is’’ and inserting ‘‘is

19 first’’;

20 (B) in paragraph (2)(D), by striking ‘‘who

21 is 65 years of age or older as of the date of

22 issuance and’’; and

23 (C) in paragraph (3)(B)(vi), by striking

24 ‘‘at age 65’’.
46

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1 (2) EFFECTIVE DATE.—The amendments made

2 by paragraph (1) shall apply to terminations of cov3 erage effected on or after the date of enactment of

4 this Act, regardless of when the individuals become

5 eligible for benefits under part A or B of title XVIII

6 of the Social Security Act.

7 (b) PERMITTING ESRD BENEFICIARIES TO ELECT

8 ANOTHER MEDICARE+CHOICE PLAN IN CASE OF PLAN

9 DISCONTINUANCE.—

10 (1) IN GENERAL.—Section 1851(a)(3)(B) (42

11 U.S.C. 1395w–21(a)(3)(B)) is amended by striking

12 ‘‘except that’’ and all that follows and inserting the

13 following: ‘‘except that—

14 ‘‘(i) an individual who develops end15 stage renal disease while enrolled in a

16 Medicare+Choice plan may continue to be

17 enrolled in that plan; and

18 ‘‘(ii) in the case of such an individual

19 who is enrolled in a Medicare+Choice plan

20 under clause (i) (or subsequently under

21 this clause), if the enrollment is discon22 tinued under section 1851(e)(4)(A) the in23 dividual will be treated as a

24 ‘Medicare+Choice eligible individual’ for
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1 purposes of electing to continue enrollment

2 in another Medicare+Choice plan.’’.

3 (2) EFFECTIVE DATE.—

4 (A) The amendment made by paragraph

5 (1) shall apply to terminations and

6 discontinuations occurring on or after the date

7 of enactment of this Act.

8 (B) Clause (ii) of section 1851(a)(3)(B) of

9 the Social Security Act (as inserted by such

10 amendment) also shall apply to individuals

11 whose enrollment in a Medicare+Choice plan

12 was terminated or discontinued after December

13 31, 1998, and before the date of enactment of

14 this Act. In applying this subparagraph, such

15 an individual shall be treated, for purposes of

16 part C of title XVIII of the Social Security Act,

17 as having discontinued enrollment in such a

18 plan as of the date of enactment of this Act.

19 SEC. 805. EXTENDED MEDICARE+CHOICE DISENROLLMENT

20 WINDOW FOR CERTAIN INVOLUNTARILY TER21 MINATED ENROLLEES.

22 (a) PREVIOUS MEDIGAP ENROLLEES.—Section

23 1882(s)(3)(B)(v)(III) (42 U.S.C. 1395ss(s)(3)(B)(v)(III))

24 is amended—

25 (1) by inserting ‘‘(aa)’’ after ‘‘(III)’’;
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1 (2) by striking the period and inserting ‘‘, or’’;

2 and

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

4 ‘‘(bb) during the 12-month period de5 scribed in item (aa), is disenrolled under the

6 circumstances described in section

7 1851(e)(4)(A) from the organization described

8 in subclause (II); enrolls, without an inter9 vening enrollment, with another such organiza10 tion; and subsequently disenrolls during such

11 period (during which the enrollee is permitted

12 to disenroll under section 1851(e)).’’.

13 (b) INITIAL MEDIGAP ENROLLEES.—Section

14 1882(s)(3)(B)(vi) (42 U.S.C. 1395ss(s)(3)(B)(vi)), as

15 amended by section 804(a)(1)(C), is amended—

16 (1) by striking ‘‘benefits under part A, enrolls’’

17 and inserting ‘‘benefits under part A—

18 ‘‘(I) enrolls’’;

19 (2) by striking the period and inserting ‘‘, or’’;

20 and

21 (3) by adding at the end the following:

22 ‘‘(II)(aa) enrolls in a Medicare+Choice plan

23 under part C, which enrollment is terminated or dis24 continued under the circumstances described in sec25 tion 1851(e)(4)(A), and
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1 ‘‘(bb) subsequently enrolls, without an inter2 vening enrollment, in another Medicare+Choice

3 plan, and disenrolls from such plan by not later than

4 12 months after the effective date of the enrollment

5 in the Medicare+Choice plan described in item

6 (aa).’’.

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

8 this section shall apply to terminations and

9 discontinuations occurring on or after the date of enact10 ment of this Act.

11 SEC. 806. NONPREEMPTION OF STATE PRESCRIPTION

12 DRUG COVERAGE MANDATES IN CASE OF AP13 PROVED STATE MEDIGAP WAIVERS.

14 (a) IN GENERAL.—Section 1856(b)(3) (42 U.S.C.

15 1395w–26(b)(3)) is amended—

16 (1) in subparagraph (A), by striking ‘‘The

17 standards’’ and inserting ‘‘Subject to subparagraph

18 (C), the standards’’; and

19 (2) by adding at the end the following:

20 ‘‘(C) CONTINUATION OF STATE PRESCRIP21 TION DRUG LAWS.—Subparagraph (A) shall not

22 supersede any State law that requires the com23 prehensive coverage of prescription drugs or

24 any regulation that carries out such a law, if—
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1 ‘‘(i) the State has a waiver in effect

2 under section 1882(p)(6)(A) with respect

3 to requiring such coverage under Medicare

4 supplemental policies; or

5 ‘‘(ii) the Secretary provides for a

6 waiver for the State to impose such a re7 quirement under section 1882(p)(6)(B).’’.

8 (b) MEDIGAP WAIVER.—Section 1882(p)(6) (42

9 U.S.C. 1395ss(p)(6)) is amended—

10 (1) by inserting ‘‘(A)’’ after ‘‘(6)’’; and

11 (2) by adding at the end the following:

12 ‘‘(B) The Secretary also may waive the application

13 of the standards described in paragraph (1)(A)(i) so that

14 a State may include comprehensive prescription drug cov15 erage among the benefits required for all Medicare supple16 mental policies.’’.

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

18 this section shall take effect on the date of enactment of

19 this Act.

20 SEC. 807. MODIFICATION OF PAYMENT RULES FOR CER21 TAIN FRAIL ELDERLY MEDICARE BENE22 FICIARIES.

23 (a) MODIFICATION OF PAYMENT RULES.—Section

24 1853 (42 U.S.C. 1395w–23) is amended—

25 (1) in subsection (a)—
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1 (A) in paragraph (1)(A), by striking ‘‘sub2 sections (e) and (f)’’ and inserting ‘‘subsections

3 (e) through (i)’’;

4 (B) in paragraph (3)(D), by inserting ‘‘and

5 paragraph (4)’’ after ‘‘section 1859(e)(4)’’; and

6 (C) by adding at the end the following:

7 ‘‘(4) EXEMPTION FROM RISK-ADJUSTMENT SYS8 TEM FOR FRAIL ELDERLY BENEFICIARIES EN9 ROLLED IN SPECIALIZED PROGRAMS FOR THE FRAIL

10 ELDERLY.—

11 ‘‘(A) IN GENERAL.—During the period de12 scribed in subparagraph (B), the risk-adjust13 ment described in paragraph (3) shall not apply

14 to a frail elderly Medicare+Choice beneficiary

15 (as defined in subsection (i)(3)) who is enrolled

16 in a Medicare+Choice plan under a specialized

17 program for the frail elderly (as defined in sub18 section (i)(2)).

19 ‘‘(B) PERIOD OF APPLICATION.—The pe20 riod described in this subparagraph begins with

21 January 2000, and ends with the first month

22 for which the Secretary certifies to Congress

23 that a comprehensive risk adjustment method24 ology under paragraph (3)(C) (that takes into
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1 account the types of factors described in sub2 section (i)(1)) is being fully implemented.’’; and

3 (2) by adding at the end the following:

4 ‘‘(i) SPECIAL RULES FOR FRAIL ELDERLY EN5 ROLLED IN SPECIALIZED PROGRAMS FOR THE FRAIL EL6 DERLY.—

7 ‘‘(1) DEVELOPMENT AND IMPLEMENTATION OF

8 NEW PAYMENT SYSTEM.—The Secretary shall de9 velop and implement (as soon as possible after the

10 date of enactment of this subsection), during the pe11 riod described in subsection (a)(4)(B), a payment

12 methodology for frail elderly Medicare+Choice bene13 ficiaries enrolled in a Medicare+Choice plan under

14 a specialized program for the frail elderly (as defined

15 in paragraph (2)(A)). Such methodology shall ac16 count for the prevalence, mix, and severity of chron17 ic conditions among such beneficiaries and shall in18 clude medical diagnostic factors from all provider

19 settings (including hospital and nursing facility set20 tings). It shall include functional indicators of health

21 status and such other factors as may be necessary

22 to achieve appropriate payments for plans serving

23 such beneficiaries.

24 ‘‘(2) SPECIALIZED PROGRAM FOR THE FRAIL

25 ELDERLY DESCRIBED.—
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1 ‘‘(A) IN GENERAL.—For purposes of this

2 part, the term ‘specialized program for the frail

3 elderly’ means a program which the Secretary

4 determines—

5 ‘‘(i) is offered under this part as a

6 distinct part of a Medicare+Choice plan;

7 ‘‘(ii) primarily enrolls frail elderly

8 Medicare+Choice beneficiaries; and

9 ‘‘(iii) has a clinical delivery system

10 that is specifically designed to serve the

11 special needs of such beneficiaries and to

12 coordinate short-term and long-term care

13 for such beneficiaries through the use of a

14 team described in subparagraph (B) and

15 through the provision of primary care serv16 ices to such beneficiaries by means of such

17 a team at the nursing facility involved.

18 ‘‘(B) SPECIALIZED TEAM.—A team de19 scribed in this subparagraph—

20 ‘‘(i) includes—

21 ‘‘(I) a physician; and

22 ‘‘(II) a nurse practitioner or geri23 atric care manager, or both; and

24 ‘‘(ii) has as members individuals who

25 have special training and specialize in the
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1 care and management of the frail elderly

2 beneficiaries.

3 ‘‘(3) FRAIL ELDERLY MEDICARE+CHOICE BEN4 EFICIARY DESCRIBED.—For purposes of this part,

5 the term ‘frail elderly Medicare+Choice beneficiary’

6 means a Medicare+Choice eligible individual who—

7 ‘‘(A) is residing in a skilled nursing facility

8 or a nursing facility (as defined for purposes of

9 title XIX) for an indefinite period and without

10 any intention of residing outside the facility;

11 and

12 ‘‘(B) has a severity of condition that

13 makes the individual frail (as determined under

14 guidelines approved by the Secretary).’’.

15 (b) CONTINUOUS OPEN ENROLLMENT FOR CERTAIN

16 FRAIL ELDERLY MEDICARE BENEFICIARIES.—

17 (1) IN GENERAL.—Section 1851(e) (42 U.S.C.

18 1395w–21(e)) is amended by adding at the end the

19 following:

20 ‘‘(7) SPECIAL RULES FOR FRAIL ELDERLY

21 MEDICARE+CHOICE BENEFICIARIES ENROLLING IN

22 SPECIALIZED PROGRAMS FOR THE FRAIL ELDER23 LY.—There shall be a continuous open enrollment

24 period for any frail elderly Medicare+Choice bene25 ficiary (as defined in section 1853(i)(3)) who is
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1 seeking to enroll in a Medicare+Choice plan under

2 a specialized program for the frail elderly (as defined

3 in section 1853(i)(2)).’’.

4 (2) CONFORMING AMENDMENTS.—

5 (A) OPEN ENROLLMENT PERIODS.—Sec6 tion 1851(e)(6) (42 U.S.C. 1395w–21(e)(6)) is

7 amended—

8 (i) in subparagraph (A), by striking

9 ‘‘and’’ at the end;

10 (ii) by redesignating subparagraph

11 (B) as subparagraph (C); and

12 (iii) by inserting after subparagraph

13 (A) the following:

14 ‘‘(B) that is offering a specialized program

15 for the frail elderly (as defined in section

16 1853(i)(2)), shall accept elections at any time

17 for purposes of enrolling frail elderly

18 Medicare+Choice beneficiaries (as defined in

19 section 1853(i)(3)) in such program; and’’.

20 (B) EFFECTIVENESS OF ELECTIONS.—Sec21 tion 1851(f)(4) (42 U.S.C. 1395w–21(f)(4)) is

22 amended by striking ‘‘subsection (e)(4)’’ and in23 serting ‘‘paragraph (4) or (7) of subsection

24 (e)’’.
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1 (c) DEVELOPMENT OF QUALITY MEASUREMENT

2 PROGRAM FOR SPECIALIZED PROGRAMS FOR THE FRAIL

3 ELDERLY.—Section 1852(e) (42 U.S.C. 1395w–22(e)) is

4 amended by adding at the end the following:

5 ‘‘(5) QUALITY MEASUREMENT PROGRAM FOR

6 SPECIALIZED PROGRAMS FOR THE FRAIL ELDERLY

7 AS PART OF MEDICARE+CHOICE PLANS.—The Sec8 retary shall develop and implement a program to

9 measure the quality of care provided in specialized

10 programs for the frail elderly (as defined in section

11 1853(i)(2)) in order to reflect the unique health as12 pects and needs of frail elderly Medicare+Choice

13 beneficiaries (as defined in section 1853(i)(3)). Such

14 quality measurements may include indicators of the

15 prevalence of pressure sores, reduction of iatrogenic

16 disease, use of urinary catheters, use of antianxiety

17 medications, use of advance directives, incidence of

18 pneumonia, and incidence of congestive heart fail19 ure.’’.

20 (d) EFFECTIVE DATES.—

21 (1) IN GENERAL.—Except as provided in para22 graph (2), the amendments made by this section

23 shall take effect on the date of enactment of this

24 Act.
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1 (2) DEVELOPMENT OF QUALITY MEASUREMENT

2 PROGRAM FOR SPECIALIZED PROGRAMS FOR THE

3 FRAIL ELDERLY.—The Secretary of Health and

4 Human Services shall first provide for the imple5 mentation of the quality measurement program for

6 specialized programs for the frail elderly under the

7 amendment made by subsection (c) by not later than

8 July 1, 2000.

9 SEC. 808. EXTENSION OF MEDICARE COMMUNITY NURSING

10 ORGANIZATION DEMONSTRATION PROJECTS.

11 Notwithstanding any other provision of law and in

12 addition to the extension provided under section 4019 of

13 the Balanced Budget Act of 1997 (Public Law 105–33;

14 111 Stat. 347), demonstration projects conducted under

15 section 4079 of the Omnibus Budget Reconciliation Act

16 of 1987 (Public Law 100–203; 101 Stat. 1330–121) shall

17 be conducted for an additional period of 3 years, and the

18 deadline for any report required relating to the results of

19 such projects shall be not later than 6 months before the

20 end of such additional period.
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1 TITLE IX—CLINICS

2 SEC. 901. NEW PROSPECTIVE PAYMENT SYSTEM FOR FED3 ERALLY-QUALIFIED HEALTH CENTERS AND

4 RURAL HEALTH CLINICS UNDER THE MED5 ICAID PROGRAM.

6 (a) IN GENERAL.—Section 1902(a)(13) (42 U.S.C.

7 1396a(a)(13)) is amended—

8 (1) in subparagraph (A), by adding ‘‘and’’ at

9 the end;

10 (2) in subparagraph (B), by striking ‘‘and’’ at

11 the end; and

12 (3) by striking subparagraph (C).

13 (b) NEW PROSPECTIVE PAYMENT SYSTEM.—Section

14 1902 (42 U.S.C. 1396a) is amended by adding at the end

15 the following:

16 ‘‘(aa) PAYMENT FOR SERVICES PROVIDED BY FED17 ERALLY-QUALIFIED HEALTH CENTERS AND RURAL

18 HEALTH CLINICS.—

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

20 2000 and each succeeding fiscal year, the State plan

21 shall provide for payment for services described in

22 section 1905(a)(2)(C) furnished by a Federally23 qualified health center and services described in sec24 tion 1905(a)(2)(B) furnished by a rural health clinic

25 in accordance with the provisions of this subsection.
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1 ‘‘(2) FISCAL YEAR 2000.—For fiscal year 2000,

2 the State plan shall provide for payment for such

3 services in an amount (calculated on a per visit

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

5 the center or clinic of furnishing such services dur6 ing fiscal year 1999 which are reasonable and re7 lated to the cost of furnishing such services, or

8 based on such other tests of reasonableness as the

9 Secretary prescribes in regulations under section

10 1833(a)(3), or in the case of services to which such

11 regulations do not apply, the same methodology used

12 under section 1833(a)(3), adjusted to take into ac13 count any increase in the scope of such services fur14 nished by the center or clinic during fiscal year

15 2000.

16 ‘‘(3) FISCAL YEAR 2001 AND SUCCEEDING

17 YEARS.—For fiscal year 2001 and each succeeding

18 fiscal year, the State plan shall provide for payment

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

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

21 such services under this subsection for the preceding

22 fiscal year—

23 ‘‘(A) increased by the percentage increase

24 in the MEI (medicare economic index) (as de25 fined in section 1842(i)(3)) applicable to pri-
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1 mary care services (as defined in section

2 1842(i)(4)) for that fiscal year; and

3 ‘‘(B) adjusted to take into account any in4 crease in the scope of such services furnished by

5 the center or clinic during that fiscal year.

6 ‘‘(4) ESTABLISHMENT OF INITIAL YEAR PAY7 MENT AMOUNT FOR NEW CENTERS OR CLINICS.—In

8 any case in which an entity first qualifies as a Fed9 erally-qualified health center or rural health clinic

10 after October 1, 2000, the State plan shall provide

11 for payment for services described in section

12 1905(a)(2)(C) furnished by the center or services

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

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

15 clinic qualifies in an amount (calculated on a per

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

17 of furnishing such services during such fiscal year in

18 accordance with the regulations and methodology re19 ferred to in paragraph (2). For each fiscal year fol20 lowing the fiscal year in which the entity first quali21 fies as a Federally-qualified health center or rural

22 health clinic, the State plan shall provide for the

23 payment amount to be calculated in accordance with

24 paragraph (3) of this subsection.
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1 ‘‘(5) ADMINISTRATION IN THE CASE OF MAN2 AGED CARE.—In the case of services furnished by a

3 Federally-qualified health center or rural health clin4 ic pursuant to a contract between the center or clinic

5 and a managed care entity (as defined in section

6 1932(a)(1)(B)), the State plan shall provide for pay7 ment to the center or clinic (at least quarterly) by

8 the State of a supplemental payment equal to the

9 amount (if any) by which the amount determined

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

11 exceeds the amount of the payments provided under

12 the contract.

13 ‘‘(6) ALTERNATIVE PAYMENT SYSTEM.—Not14 withstanding any other provision of this section, the

15 State plan may provide for payment in any fiscal

16 year to a Federally-qualified health center for serv17 ices described in section 1905(a)(2)(C) or to a rural

18 health clinic for services described in section

19 1905(a)(2)(B) in an amount that is in excess of the

20 amount otherwise required to be paid to the center

21 or clinic under this subsection.’’.

22 (c) CONFORMING AMENDMENTS.—

23 (1) Section 4712 of the Balanced Budget Act

24 of 1997 (Public Law 105–33; 111 Stat. 508) is

25 amended by striking subsection (c).
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1 (2) Section 1915(b) (42 U.S.C. 1396n(b)) is

2 amended by striking ‘‘1902(a)(13)(E)’’ and insert3 ing ‘‘1902(aa)’’.

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

5 this section shall take effect on October 1, 1999.

Æ