I 

113TH CONGRESS 

2D SESSION H. R. 5340 

To amend title XI of the Social Security Act to expand the permissive 

exclusion from Federal health programs to include certain individuals 

with prior interest in sanctioned entities and entities affiliated with 

sanctioned entities and to provide a criminal penalty for the illegal 

distribution of Medicare, Medicaid, or CHIP beneficiary identification 

or provider numbers, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 31, 2014 

Ms. FRANKEL of Florida (for herself and Mr. KEATING) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend title XI of the Social Security Act to expand 

the permissive exclusion from Federal health programs 

to include certain individuals with prior interest in sanctioned entities and entities affiliated with sanctioned entities and to provide a criminal penalty for the illegal 

distribution of Medicare, Medicaid, or CHIP beneficiary 

identification or provider numbers, 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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Fighting Medicare 

3 Fraud Act of 2014’’. 

4 SEC. 2. PERMISSIVE EXCLUSION FROM FEDERAL HEALTH 

5 PROGRAMS EXPANDED TO CERTAIN INDIVID6 UALS WITH PRIOR INTEREST IN SANCTIONED 

7 ENTITIES AND ENTITIES AFFILIATED WITH 

8 SANCTIONED ENTITIES. 

9 Paragraph (15) of section 1128(b) of the Social Secu10 rity Act (42 U.S.C. 1320a–7(b)) is amended to read as 

11 follows: 

12 ‘‘(15) INDIVIDUALS AND ENTITIES AFFILIATED

13 WITH A SANCTIONED ENTITY.—(A) Any of the fol14 lowing: 

15 ‘‘(i) Any individual who— 

16 ‘‘(I) is a person with an ownership or 

17 control interest in a sanctioned entity or 

18 an affiliated entity of such sanctioned enti19 ty (or was a person with such an owner20 ship or control interest at the time of any 

21 of the conduct that formed a basis for the 

22 conviction or exclusion described in sub23 paragraph (B)); and 

24 ‘‘(II) knows or should have known (as 

25 defined in section 1128A(i)(7)) (or knew or 

26 should have known) of such conduct. 


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1 ‘‘(ii) Any individual who is an officer or 

2 managing employee (as defined in section 

3 1126(b)) of a sanctioned entity or affiliated en4 tity of such sanctioned entity (or was such an 

5 officer or managing employee at the time of any 

6 of the conduct that formed a basis for the con7 viction or exclusion described in subparagraph 

8 (B)). 

9 ‘‘(iii) Any affiliated entity of a sanctioned 

10 entity. 

11 ‘‘(B) For purposes of this paragraph, the term 

12 ‘sanctioned entity’ means an entity— 

13 ‘‘(i) that has been convicted of any offense 

14 described in subsection (a) of this section or in 

15 paragraph (1), (2), or (3) of this subsection; or 

16 ‘‘(ii) that has been excluded from partici17 pation under a program under title XVIII or 

18 under a State health care program. 

19 ‘‘(C) For purposes of subparagraph (A), the 

20 term ‘affiliated entity’ means, with respect to a 

21 sanctioned entity, an entity that is (or was at the 

22 time of any of the conduct that formed the basis for 

23 the conviction or exclusion described in subpara24 graph (B)) affiliated with such sanctioned entity, 

25 and includes an entity— 


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1 ‘‘(i) that is a person with an ownership or 

2 control interest in such sanctioned entity (or 

3 was such a person with respect to such sanc4 tioned entity at the time of any conduct that 

5 formed the basis for the conviction described in 

6 subparagraph (B)); 

7 ‘‘(ii) with respect to which a sanctioned en8 tity is a person with an ownership or control in9 terest in such entity (or was such a person with 

10 respect to such entity at the time of any con11 duct that formed the basis for the conviction 

12 described in subparagraph (B)); 

13 ‘‘(iii) with respect to which a person with 

14 an ownership or control interest in such entity 

15 also has such an interest in such sanctioned en16 tity; 

17 ‘‘(iv) with respect to which a person who is 

18 an officer or managing employee (as defined in 

19 section 1126(b)) of such entity also is such an 

20 officer or managing employee of such sanc21 tioned entity. 

22 ‘‘(D) For purposes of this paragraph, the term 

23 ‘person with an ownership or control interest’ has 

24 the meaning given such term in section 

25 1124(a)(3).’’. 


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1 SEC. 3. CRIMINAL PENALTY FOR ILLEGAL DISTRIBUTION 

2 OF MEDICARE, MEDICAID, OR CHIP BENE3 FICIARY IDENTIFICATION OR PROVIDER 

4 NUMBERS. 

5 Section 1128B(b) of the Social Security Act (42 

6 U.S.C. 1320a–7b(b)) is amended by adding at the end the 

7 following: 

8 ‘‘(4) Whoever knowingly and with the intent to de9 fraud purchases, sells or distributes, or arranges for the 

10 purchase, sale, or distribution of two or more Medicare, 

11 Medicaid, or Children’s Health Insurance Program bene12 ficiary identification numbers or provider numbers under 

13 title XVIII, XIX, or XXI shall be imprisoned for not more 

14 than 15 years or fined under title 18, United States Code 

15 (or, if greater, an amount equal to the monetary loss to 

16 the Federal and any State government as a result of such 

17 acts), or both.’’. 

18 SEC. 4. REPORTS ON INCIDENCES OF FRAUD AND ABUSE 

19 UNDER MEDICARE PARTS C AND D. 

20 (a) IN GENERAL.—Section 1857(d) of the Social Se21 curity Act (42 U.S.C. 1395w–27(d)) is amended by adding 

22 at the end the following new paragraph: 

23 ‘‘(7) REPORT ON INCIDENCES OF FRAUD AND

24 ABUSE.— 

25 ‘‘(A) IN GENERAL.—A contract under this 

26 section with an MA organization offering an 


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1 MA plan shall provide that such MA organiza2 tion report to the Secretary (or to any person 

3 or organization designated by the Secretary for 

4 such purpose) any instances of probable fraud 

5 or abuse related to the payment or delivery of 

6 health benefits under such contract not later 

7 than 60 days after such organization identifies 

8 such instance. 

9 ‘‘(B) GUIDANCE.—Not later than 90 days 

10 after the date of the enactment of this para11 graph, the Secretary, in consultation with the 

12 Inspector General of the Department of Health 

13 and Human Services and the Attorney General, 

14 shall issue to MA organizations (and PDP 

15 sponsors) guidance for defining the terms 

16 ‘fraud’ and ‘abuse’ for purposes of subpara17 graph (A).’’. 

18 (b) CONFORMING AMENDMENT TO PART D.—Section 

19 1860D–12(b)(3)(C) of the Social Security Act (42 U.S.C. 

20 1395w–112(b)(3)(C)) is amended by inserting before the 

21 period at the end the following: ‘‘, except in applying para22 graph (7) of such section any reference to an MA organi23 zation, with respect to an MA plan, shall be deemed a ref24 erence to a PDP sponsor or MA organization, with respect 

25 to a prescription drug plan or MA–PD plan’’. 


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

2 subsections (a) and (b) shall apply with respect to plan 

3 years beginning on or after the date of the enactment of 

4 this Act. 

Æ 


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