II

106TH CONGRESS

2D SESSION S. 2600

To amend title XVIII of the Social Security Act to make enhancements

to the critical access hospital program under the medicare program.

IN THE SENATE OF THE UNITED STATES

MAY 22, 2000

Ms. SNOWE 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 make

enhancements to the critical access hospital program

under the medicare program.

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 ‘‘Critical Access Hos5 pital Enhancement Act of 2000’’.

6 SEC. 2. ENHANCEMENTS TO CRITICAL ACCESS HOSPITAL

7 (CAH) PROGRAM.

8 (a) EXEMPTION FROM BAD DEBT REDUCTIONS.—

9 Section 1861(v)(1)(T) of the Social Security Act (42

10 U.S.C. 1395x(v)(1)(T)) is amended—
2

•S 2600 IS

1 (1) by redesignating clauses (i), (ii), and (iii) as

2 subclauses (I), (II), and (III), respectively;

3 (2) by inserting ‘‘(i)’’ after ‘‘(T)’’; and

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

5 clause:

6 ‘‘(ii) The reductions required by clause (i) shall not

7 apply to critical access hospitals for cost reporting periods

8 beginning on or after October 1, 1998.’’.

9 (b) EXEMPTION FROM PAYMENT REDUCTIONS AND

10 FEE SCHEDULE FOR AMBULANCE SERVICES.—

11 (1) EXEMPTION FROM FEE SCHEDULE.—

12 (A) IN GENERAL.—Section 1834(l) of the

13 Social Security Act (42 U.S.C. 1395m(l)) is

14 amended by adding at the end the following

15 new paragraph:

16 ‘‘(8) INAPPLICABILITY OF FEE SCHEDULE TO

17 CERTAIN SERVICES.—In the case of ambulance serv18 ices (described in section 1861(s)(7)) that are pro19 vided in a locality by a critical access hospital that

20 is the only provider of ambulance services in the lo21 cality, or by an entity that is owned and operated by

22 such a critical access hospital—

23 ‘‘(A) the fee schedule established under

24 this subsection shall not apply; and
3

•S 2600 IS

1 ‘‘(B) payment under this part shall be paid

2 on the basis of the reasonable costs incurred in

3 providing such services.’’.

4 (B) CONFORMING AMENDMENT.—Section

5 1833(a)(1)(R) of the Social Security Act (42

6 U.S.C. 1395l(a)(1)(R)) is amended by inserting

7 ‘‘(other than the ambulance services described

8 in section 1834(l)(8))’’ after ‘‘ambulance serv9 ice’’.

10 (C) EFFECTIVE DATE.—The amendments

11 made by this paragraph shall take effect as if

12 included in the enactment of the Balanced

13 Budget Act of 1997 (Public Law 105–33; 111

14 Stat. 251).

15 (2) EXEMPTION FROM REASONABLE COST RE16 DUCTIONS.—Section 1861(v)(1)(U) of the Social Se17 curity Act (42 U.S.C. 1395x(v)(1)(U)) is amended

18 by inserting after the first sentence the following

19 new sentence: ‘‘The reductions required by the pre20 ceding sentence shall not apply in the case of ambu21 lance services that are provided in a locality on or

22 after October 1, 1998, by a critical access hospital

23 that is the only provider of ambulance services in the

24 locality, or by an entity that is owned and operated

25 by such a critical access hospital.’’.
4

•S 2600 IS

1 (c) EXEMPTION FROM HOME HEALTH PAYMENT

2 LIMITS AND PPS.—

3 (1) EXEMPTION FROM COST LIMITS.—Section

4 1861(v)(1)(L) of the Social Security Act (42 U.S.C.

5 1395x(v)(1)(L)) (as amended by section 303 of the

6 Medicare, Medicaid, and SCHIP Balanced Budget

7 Refinement Act of 1999 (113 Stat. 1501A–360), as

8 enacted into law by section 1000(a)(6) of Public

9 Law 106–113) is amended by adding at the end the

10 following new clause:

11 ‘‘(xi) The preceding provisions of this subparagraph

12 shall not apply to home health services that are furnished

13 on or after October 1, 1998, by a home health agency that

14 is—

15 ‘‘(I) the only home health agency serving a lo16 cality; and

17 ‘‘(II) owned and operated by a critical access

18 hospital.’’.

19 (2) EXEMPTION FROM PPS.—

20 (A) IN GENERAL.—Section 1895 of the So21 cial Security Act (42 U.S.C. 1395fff) is amend22 ed by adding at the end the following new sub23 section:

24 ‘‘(e) EXCEPTION.—The prospective payment system

25 established under this section shall not apply in deter-
5

•S 2600 IS

1 mining payments for home health services furnished by

2 a home health agency that is—

3 ‘‘(1) the only home health agency serving a lo4 cality; and

5 ‘‘(2) owned and operated by a critical access

6 hospital.’’.

7 (B) CONFORMING AMENDMENT.—Section

8 1833(a)(2)(A) of the Social Security Act (42

9 U.S.C. 1395l(a)(2)(A)) is amended by inserting

10 ‘‘home health services described in section

11 1895(e) and’’ after ‘‘other than’’.

12 (C) EFFECTIVE DATE.—The amendments

13 made by this paragraph shall take effect as if

14 included in the enactment of the Balanced

15 Budget Act of 1997 (Public Law 105–33; 111

16 Stat. 251).

17 (d) PAYMENT FOR SWING BED SERVICES.—

18 (1) EXEMPTION FROM PPS FOR SKILLED NURS19 ING FACILITY SERVICES.—Section 1888(e)(7) of the

20 Social Security Act (42 U.S.C. 1395yy(e)(7)) is

21 amended—

22 (A) in the heading, by striking ‘‘TRANSI23 TION FOR’’ and inserting ‘‘TREATMENT OF’’;

24 (B) in subparagraph (A), by striking ‘‘IN

25 GENERAL.—The’’ and inserting ‘‘TRANSI-
6

•S 2600 IS

1 TION.—Except as provided in subparagraph

2 (C), the’’;

3 (C) in subparagraph (B), by striking

4 ‘‘1883’’ and all that follows through ‘‘date)’’

5 and inserting ‘‘1883 (other than critical access

6 hospitals)’’; and

7 (D) by adding at the end the following:

8 ‘‘(C) TREATMENT OF SWING-BED SERV9 ICES FURNISHED BY CRITICAL ACCESS HOS10 PITALS.—The prospective payment system es11 tablished under this subsection shall not apply

12 to services furnished by a critical access hos13 pital pursuant to an agreement described in

14 section 1883.’’.

15 (2) PAYMENT BASIS FOR SWING BED SERVICES

16 FURNISHED BY CRITICAL ACCESS HOSPITALS.—Sec17 tion 1883(a) of the Social Security Act (42 U.S.C

18 1395tt(a)) is amended—

19 (A) in paragraph (2)(A), by inserting

20 ‘‘(other than a critical access hospital)’’ after

21 ‘‘any hospital’’; and

22 (B) by adding at the end the following new

23 paragraph:

24 ‘‘(3) Notwithstanding any other provision of

25 this title, a critical access hospital shall be paid for
7

•S 2600 IS

1 services furnished under an agreement entered into

2 under this section on the basis of the reasonable

3 costs of such services (as determined under section

4 1861(v)).’’.

5 (3) EFFECTIVE DATES.—

6 (A) The amendments made by paragraph

7 (1) shall take effect as if included in the enact8 ment of the Balanced Budget Act of 1997

9 (Public Law 105–33; 111 Stat. 251).

10 (B) The amendments made by paragraph

11 (2) shall apply to cost reporting periods begin12 ning on or after October 1, 1998.

13 (e) PAYMENT BASIS FOR OUTPATIENT LABORATORY

14 TESTS.—

15 (1) PAYMENT ON COST BASIS WITHOUT BENE16 FICIARY COST-SHARING.—

17 (A) IN GENERAL.—Section 1833(a)(6) of

18 the Social Security Act (42 U.S.C. 1395l(a)(6))

19 is amended by inserting ‘‘(including clinical di20 agnostic laboratory services furnished by a crit21 ical access hospital)’’ after ‘‘outpatient critical

22 access hospital services’’.

23 (B) NO BENEFICIARY COST-SHARING.—

24 (i) IN GENERAL.—Section 1834(g) of

25 the Social Security Act (42 U.S.C.
8

•S 2600 IS

1 1395m(g)) is amended by inserting ‘‘(ex2 cept that in the case of clinical diagnostic

3 laboratory services furnished by a critical

4 access hospital the amount of payment

5 shall be equal to 100 percent of the rea6 sonable costs of the critical access hospital

7 in providing such services)’’ before the pe8 riod at the end.

9 (ii) BBRA AMENDMENT.—Section

10 1834(g) of the Social Security Act (42

11 U.S.C. 1395m(g)) (as amended by section

12 403(d) of the Medicare, Medicaid, and

13 SCHIP Balanced Budget Refinement Act

14 of 1999 (113 Stat. 1501A–371), as en15 acted into law by section 1000(a)(6) of

16 Public Law 106–113) is amended—

17 (I) in paragraph (1), by inserting

18 ‘‘(except that in the case of clinical di19 agnostic laboratory services furnished

20 by a critical access hospital the

21 amount of payment shall be equal to

22 100 percent of the reasonable costs of

23 the critical access hospital in pro24 viding such services)’’ after ‘‘such

25 services,’’; and
9

•S 2600 IS

1 (II) in paragraph (2)(A), by in2 serting ‘‘(except that in the case of

3 clinical diagnostic laboratory services

4 furnished by a critical access hospital

5 the amount of payment shall be equal

6 to 100 percent of the reasonable costs

7 of the critical access hospital in pro8 viding such services)’’ before the pe9 riod at the end.

10 (2) CONFORMING AMENDMENTS.—Paragraphs

11 (1)(D)(i) and (2)(D)(i) of section 1833(a) of the So12 cial Security Act (42 U.S.C. 1395l(a)(1)(D)(i);

13 1395l(a)(2)(D)(i)) (as amended by section 403(e) of

14 the Medicare, Medicaid, and SCHIP Balanced

15 Budget Refinement Act of 1999 (113 Stat. 1501A–

16 371), as enacted into law by section 1000(a)(6) of

17 Public Law 106–113) are amended by striking ‘‘or

18 which are furnished on an outpatient basis by a crit19 ical access hospital’’ each place it appears.

20 (3) EFFECTIVE DATES.—

21 (A) IN GENERAL.—Except as provided in

22 subparagraph (B), the amendments made by

23 this subsection shall apply to services furnished

24 on or after November 29, 1999.
10

•S 2600 IS

1 (B) BBRA AMENDMENT.—The amend2 ment made by paragraph (1)(B)(ii) shall take

3 effect as if included in the enactment of section

4 403(d) of the Medicare, Medicaid, and SCHIP

5 Balanced Budget Refinement Act of 1999 (113

6 Stat. 1501A–371), as enacted into law by sec7 tion 1000(a)(6) of Public Law 106–113.

8 (f) ALTERNATIVE TO 15-BED LIMIT.—Section 1820

9 of the Social Security Act (42 U.S.C. 1395i–4) is

10 amended—

11 (1) in subsection (c)—

12 (A) in paragraph (2)(B)(iii), by striking

13 ‘‘provides’’ and inserting ‘‘subject to paragraph

14 (3), provides’’; and

15 (B) by adding at the end the following new

16 paragraph:

17 ‘‘(3) FLEXIBILITY ON BED LIMITS FOR CER18 TAIN FACILITIES.—Notwithstanding clause (iii) and

19 subsection (f), a State may designate (and the Sec20 retary may certify) a facility with more than 15 (or

21 in the case of a facility under an agreement de22 scribed in subsection (f), 25) acute care inpatient

23 beds as a critical access hospital if—
11

•S 2600 IS

1 ‘‘(A) the service area of the facility experi2 ences substantial seasonal fluctuations in popu3 lation;

4 ‘‘(B) the number of beds used by the facil5 ity for acute care inpatient services, determined

6 on an average annual basis, does not exceed 15;

7 and

8 ‘‘(C) in the case of a facility under an

9 agreement described in subsection (f), the total

10 number of beds used by the facility for either

11 acute care or extended care services, determined

12 on an average annual basis, does not exceed

13 25.’’; and

14 (2) in subsection (f), by inserting ‘‘(or, in the

15 case of a facility with a service area that experiences

16 substantial seasonal fluctuations in population, so

17 long as the facility meets the requirements of sub18 paragraphs (B) and (C) of subsection (c)(3)’’ after

19 ‘‘15 beds’’.

Æ