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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 1133 Introduced in Senate (IS)]

111th CONGRESS
  1st Session
                                S. 1133

  To amend title XVIII of the Social Security Act to provide for the 
establishment of shared decision making standards and requirements and 
to establish a pilot program for the implementation of shared decision 
                   making under the Medicare program.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 21, 2009

 Mr. Wyden (for himself and Mr. Gregg) 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 the 
establishment of shared decision making standards and requirements and 
to establish a pilot program for the implementation of shared decision 
                   making under the Medicare program.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Empowering Medicare Patient Choices 
Act''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) The Dartmouth Atlas Project's work documenting regional 
        variations in medical care has found both underuse, or the 
        failure to deliver needed evidence-based care, and overuse, or 
        the delivery of unnecessary supply-sensitive care.
            (2) The Dartmouth Atlas Project has also found that many 
        clinical decisions physicians make for elective medical 
        treatments are driven by local medical opinion, rather than 
        sound science or the preferences of well-informed patients. For 
        example, the Dartmouth Atlas Project found that, among the 306 
        Hospital Referral Regions in the United States during the 
        period of 2002 through 2003, the incidence of surgery for back 
        pain-related conditions and joint replacement for chronic 
        arthritis of the hip and knee varied 5.9-, 5.6-, and 4.8-fold, 
        respectively, from the lowest to the highest region.
            (3) Discretionary surgery for the following common 
        conditions accounts for 40 percent of Medicare spending for 
        inpatient surgery: early stage cancer of the prostate; early 
        stage cancer of the breast; osteoarthritis of the knee; 
        osteoarthritis of the hip; osteoarthritis of the spine; chest 
        pain due to coronary artery disease; stroke threat from carotid 
        artery disease, ischemia due to peripheral artery disease; gall 
        stones; and enlarged prostate.
            (4) Decisions that involve values trade-offs between the 
        benefits and harms of 2 or more clinically appropriate 
        alternatives should depend on the individual patient's informed 
        choice. In everyday practice, however, patients typically 
        delegate decision making to their physicians who may not have 
        good information on the patient's true preferences.
            (5) The current standard of medical care in the United 
        States fails to adequately ensure that patients are informed 
        about their treatment options and the risks and benefits of 
        those options. This leads to patients getting medical 
        treatments they may not have wanted had they been fully 
        informed of their treatment options and integrated into the 
        decision making process.
            (6) Patient decision aids are tools designed to help people 
        participate in decision making about health care options. 
        Patient decision aids provide information on treatment options 
        and help patients clarify and communicate the personal value 
        they associate with different features of treatment options. 
        Patient decision aids do not advise people to choose one 
        treatment option over another, nor are they meant to replace 
        practitioner consultation. Instead, they prepare patients to 
        make informed, value-based decisions with their physician.
            (7) The Lewin Group estimated that the change in spending 
        resulting from the use of patient decision aids for each of 11 
        conditions using per-procedure costs estimated for the Medicare 
        population studied, assuming full implementation of such 
        patient decision aids in 2010, would save as much as 
        $4,000,000,000.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Eligible provider.--
                    (A) In general.--The term ``eligible provider'' 
                means the following:
                            (i) A primary care practice.
                            (ii) A specialty practice.
                            (iii) A multispecialty group practice.
                            (iv) A hospital.
                            (v) A rural health clinic.
                            (vi) A Federally qualified health center 
                        (as defined in section 1861(aa)(4) of the 
                        Social Security Act (42 U.S.C. 1395x(aa)(4)).
                            (vii) An integrated delivery system.
                            (viii) A State cooperative.
                    (B) Inclusion of medicare advantage plans.--Such 
                term includes a Medicare Advantage plan offered by a 
                Medicare Advantage organization under part C of title 
                XVIII of the Social Security Act (42 U.S.C. 1395w-21 et 
                seq.).
            (2) Patient decision aid.--The term ``patient decision 
        aid'' means an educational tool (such as the Internet, a video, 
        or a pamphlet) that helps patients (or, if appropriate, the 
        family caregiver of the patient) understand and communicate 
        their beliefs and preferences related to their treatment 
        options, and to decide with their health care provider what 
        treatments are best for them based on their treatment options, 
        scientific evidence, circumstances, beliefs, and preferences.
            (3) Preference sensitive care.--The term ``preference 
        sensitive care'' means medical care for which the clinical 
        evidence does not clearly support one treatment option such 
        that the appropriate course of treatment depends on the values 
        of the patient or the preferences of the patient regarding the 
        benefits, harms, and scientific evidence for each treatment 
        option. The use of such care should depend on informed patient 
        choice among clinically appropriate treatment options. Such 
        term includes medical care for the conditions identified in 
        section 5(g).
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (5) Shared decision making.--The term ``shared decision 
        making'' means a collaborative process between patient and 
        clinician that engages the patient in decision making, provides 
        patients with information about trade-offs among treatment 
        options, and facilitates the incorporation of patient 
        preferences and values into the medical plan.
            (6) State cooperative.--The term ``State cooperative'' 
        means an entity that includes the State government and at least 
        one other health care provider which is set up for the purpose 
        of testing shared decision making and patient decision aids.

SEC. 4. ESTABLISHMENT OF INDEPENDENT STANDARDS FOR PATIENT DECISION 
              AIDS.

    (a) Contract With Entity To Establish Standards and Certify Patient 
Decision Aids.--
            (1) Contract.--
                    (A) In general.--For purposes of supporting 
                consensus-based standards for patient decision aids and 
                a certification process for patient decision aids for 
                use in the Medicare program and by other interested 
                parties, the Secretary shall identify and have in 
                effect a contract with an entity that meets the 
                requirements described in paragraph (4). Such contract 
                shall provide that the entity perform the duties 
                described in paragraph (2).
                    (B) Timing for first contract.--As soon as 
                practicable after the date of the enactment of this 
                Act, the Secretary shall enter into the first contract 
                under subparagraph (A).
                    (C) Period of contract.--A contract under 
                subparagraph (A) shall be for a period of 18 months 
                (except such contract may be renewed after a subsequent 
                bidding process).
                    (D) Competitive procedures.--Competitive procedures 
                (as defined in section 4(5) of the Office of Federal 
                Procurement Policy Act (41 U.S.C. 403(5))) shall be 
                used to enter into a contract under subparagraph (A).
            (2) Duties.--The following duties are described in this 
        paragraph:
                    (A) Operate an open and transparent process.--The 
                entity shall conduct its business in an open and 
                transparent manner and provide the opportunity for 
                public comment on the activities described in 
                subparagraphs (B) and (C).
                    (B) Establish standards for patient decision 
                aids.--
                            (i) In general.--The entity shall 
                        synthesize evidence and convene a broad range 
                        of experts and key stakeholders to establish 
                        consensus-based standards, such as those 
                        developed by the International Patient Decision 
                        Aid Standard Collaboration, to determine which 
                        patient decision aids are high quality patient 
                        decision aids.
                            (ii) Draft of proposed standards.--The 
                        entity shall make a draft of proposed standards 
                        available to the public.
                            (iii) 60-day comment period.--Beginning on 
                        the date the entity makes a draft of the 
                        proposed standards available under clause (ii), 
                        the entity shall provide a 60-day period for 
                        public comment on such draft.
                            (iv) Final standards.--
                                    (I) In general.--The standards 
                                established by the entity under this 
                                subparagraph shall be adopted by the 
                                board of the entity.
                                    (II) Public availability.--The 
                                entity shall make such standards 
                                available to the public.
                    (C) Certify patient decision aids.--The entity 
                shall review patient decision aids and certify whether 
                patient decision aids meet the standards established 
                under subparagraph (B) and offer a balanced 
                presentation of treatment options from both the 
                clinical and patient experience perspectives. In 
                conducting such review and certification, the entity 
                shall give priority to the review and certification of 
                patient decision aids for conditions identified in 
                section 5(g).
            (3) Report to the expert panel.--The entity shall submit to 
        the expert panel established under subsection (b) a report on 
        the standards established for patient decision aids under 
        paragraph (2)(B) and patient decision aids that are certified 
        as meeting such standards under paragraph (2)(C).
            (4) Requirements described.--The following requirements are 
        described in this paragraph:
                    (A) Private nonprofit.--The entity is a private 
                nonprofit organization governed by a board.
                    (B) Experience.--The entity shall be able to 
                demonstrate experience with--
                            (i) consumer engagement;
                            (ii) standard setting;
                            (iii) health literacy;
                            (iv) health care quality and safety issues;
                            (v) certification processes;
                            (vi) measure development; and
                            (vii) evaluating health care quality.
                    (C) Membership fees.--If the entity requires a 
                membership fee for participation in the functions of 
                the entity, such fees shall be reasonable and adjusted 
                based on the capacity of the potential member to pay 
                the fee. In no case shall membership fees pose a 
                barrier to the participation of individuals or groups 
                with low or nominal resources to participate in the 
                functions of the entity.
    (b) Expert Panel.--
            (1) Establishment.--Not later than 120 days after the date 
        of enactment of this Act, the Secretary shall establish an 
        expert panel to make recommendations to the Secretary regarding 
        which patient decision aids should be implemented, appropriate 
        training for health care providers on patient decision aids and 
        shared decision making, and appropriate quality measures for 
        use in the pilot program under section 5 and under section 1899 
        of the Social Security Act, as added by section 6.
            (2) Duties.--The expert panel shall carry out the following 
        duties:
                    (A) Approve patient decision aids, from among those 
                patient decision aids certified under paragraph (2)(C) 
                of subsection (a) by the entity with a contract under 
                such subsection, for use in the pilot program under 
                section 5 (including to the extent practicable, patient 
                decision aids for the medical care of the conditions 
                described in section 5(g) and under section 1899 of the 
                Social Security Act, as added by section 6.
                    (B) Review current training curricula for health 
                care providers on patient decision aids and shared 
                decision making and recommend a training process for 
                eligible providers participating in the pilot program 
                under section 5 on the use of such approved patient 
                decision aids and shared decision making.
                    (C) Review existing quality measures regarding 
                patient knowledge, value concordance, and health 
                outcomes that have been endorsed through a consensus-
                based process and recommend appropriate quality 
                measures for selection under section 5(h)(1).
            (3) Appointment.--The expert panel shall be composed of 13 
        members appointed by the Secretary from among leading experts 
        in shared decision making of whom--
                    (A) 2 shall be researchers;
                    (B) 2 shall be primary care physicians;
                    (C) 2 shall be from surgical specialties;
                    (D) 2 shall be patient or consumer community 
                advocates;
                    (E) 2 shall be nonphysician health care providers 
                (such as nurses, nurse practitioners, and physician 
                assistants);
                    (F) 1 shall be from an integrated multispecialty 
                group practice;
                    (G) 1 shall be from the National Cancer Institute; 
                and
                    (H) 1 shall be from the Centers for Disease Control 
                and Prevention.
            (4) Report.--Not later than 2 years after such date of 
        enactment and each year thereafter until the date of the 
        termination of the expert panel under paragraph (5), the expert 
        panel shall submit to the Secretary a report on the patient 
        decision aids approved under paragraph (2)(A), the training 
        process recommended under paragraph (2)(B), the quality 
        measures recommended under paragraph (2)(C), and 
        recommendations on other conditions or medical care the 
        Secretary may want to include in the pilot program under 
        section 5.
            (5) Termination.--The expert panel shall terminate on such 
        date as the Secretary determines appropriate.
    (c) Quality Measure Development.--
            (1) In general.--Section 1890(b)(1)(A) of the Social 
        Security Act (42 U.S.C. 1395aaa(b)(1)(A)) is amended--
                    (A) in clause (ii), by striking ``and'' at the end; 
                and
                    (B) by adding at the end the following new clause:
                            ``(iv) that address conditions described in 
                        section 5(g) of the Empowering Medicare Patient 
                        Choices Act and regional practice variations 
                        under this title; and''.
            (2) Conforming amendment.--Section 1890(d) of the Social 
        Security Act (42 U.S.C. 1395aaa(d)) is amended--
                    (A) by inserting ``(other than subsection 
                (b)(1)(A)(iv))'' after ``this section''; and
                    (B) by adding at the end the following new 
                sentence: ``For provisions relating to funding for the 
                duties described in subsection (b)(1)(A)(iv), see 
                section 5(l) of the Empowering Medicare Patient Choices 
                Act.''.

SEC. 5. ESTABLISHMENT OF SHARED DECISION MAKING PILOT PROGRAM UNDER THE 
              MEDICARE PROGRAM.

    (a) In General.--Not later than 12 months after the date of 
enactment of this Act, the Secretary shall establish a pilot program to 
provide for the phased-in development, implementation, and evaluation 
of shared decision making under the Medicare program using patient 
decision aids to meet the objective of improving the understanding by 
Medicare beneficiaries of their medical treatment options, as compared 
to comparable Medicare beneficiaries who do not participate in a shared 
decision making process using patient decision aids.
    (b) Initial Implementation (Phase I).--
            (1) In general.--During the initial implementation of the 
        pilot program under this section (referred to in this section 
        as ``phase I'' of the pilot program), the Secretary shall 
        enroll in the pilot program not more than 15 eligible providers 
        who have experience in implementing, and have invested in the 
        necessary infrastructure to implement, shared decision making 
        using patient decision aids for a period of 3 years.
            (2) Application.--An eligible provider seeking to 
        participate in the pilot program during phase I shall submit to 
        the Secretary an application at such time and containing such 
        information as the Secretary may require.
            (3) Preference.--In enrolling eligible providers in the 
        pilot program during phase I, the Secretary shall give 
        preference to eligible providers that--
                    (A) have documented experience in using patient 
                decision aids for the conditions identified in 
                subsection (g) and in using shared decision making;
                    (B) have the necessary information technology 
                infrastructure to collect the information required by 
                the Secretary for reporting purposes;
                    (C) are trained in how to use patient decision aids 
                and shared decision making; and
                    (D) would be eligible to receive financial 
                assistance as a Shared Decision Making Resource Center 
                under subsection (c).
    (c) Shared Decision Making Resource Centers.--
            (1) In general.--The Secretary shall provide financial 
        assistance for the establishment and support of Shared Decision 
        Making Resource Centers (referred to in this section as 
        ``centers'') to provide technical assistance to eligible 
        providers and to develop and disseminate best practices and 
        other information to support and accelerate adoption, 
        implementation, and effective use of patient decision aids and 
        shared decision making by eligible providers under the Medicare 
        program.
            (2) Affiliation.--Centers shall be affiliated with a United 
        States-based organization or group that applies for and is 
        awarded financial assistance under this subsection. The 
        Secretary shall provide financial assistance to centers under 
        this subsection on the basis of merit.
            (3) Objectives.--The objective of a center is to enhance 
        and promote the adoption of patient decision aids and shared 
        decision making through--
                    (A) providing assistance to eligible providers with 
                the implementation and effective use of, and training 
                on, patient decision aids;
                    (B) the dissemination of best practices and 
                research on the implementation and effective use of 
                patient decision aids; and
                    (C) providing assistance to eligible providers 
                applying to participate or participating in phase II of 
                the pilot program under this section or under section 
                1899 of the Social Security Act, as added by section 6.
            (4) Regional assistance.--Each center shall aim to provide 
        assistance and education to all eligible providers in a region, 
        including direct assistance to the following eligible 
        providers:
                    (A) Public or not-for-profit hospitals or critical 
                access hospitals (as defined in section 1861(mm)(1) of 
                the Social Security Act (42 U.S.C. 1395x(mm)(1)).
                    (B) Federally qualified health centers (as defined 
                in section 1861(aa)(4) of the Social Security Act (42 
                U.S.C. 1395x(aa)(4)).
                    (C) Entities that are located in a rural area or in 
                area that serves uninsured, underinsured, and medically 
                underserved individuals (regardless of whether such 
                area is urban or rural).
                    (D) Individual or small group practices (or a 
                consortium thereof) that are primarily focused on 
                primary care.
            (5) Financial assistance.--
                    (A) In general.--The Secretary may provide 
                financial assistance for a period of 8 years to any 
                regional center established or supported under this 
                subsection.
                    (B) Cost-sharing requirement.--
                            (i) In general.--Except as provided in 
                        clause (ii), the Secretary shall not provide as 
                        financial assistance under this subsection more 
                        than 50 percent of the capital and annual 
                        operating and maintenance funds required to 
                        establish and support such a center.
                            (ii) Waiver of cost-sharing requirement.--
                        The Secretary may waive the limitation under 
                        clause (i) if the Secretary determines that, as 
                        a result of national economic conditions, such 
                        limitation would be detrimental to the pilot 
                        program under this section. If the Secretary 
                        waives such limitation under the preceding 
                        sentence, the Secretary shall submit to 
                        Congress a report containing the Secretary's 
                        justification for such waiver.
            (6) Notice of program description and availability of 
        funds.--The Secretary shall publish in the Federal Register, 
        not later than 12 months after the date of the enactment of 
        this Act, a draft description of a program for establishing and 
        supporting regional centers under this subsection. Such draft 
        description shall include the following:
                    (A) A detailed explanation of the program and the 
                program goals.
                    (B) Procedures to be followed by applicants for 
                financial assistance.
                    (C) Criteria for determining which applicants are 
                qualified to receive financial assistance.
                    (D) Maximum support levels expected to be available 
                to centers under the program.
            (7) Application review.--The Secretary shall review each 
        application for financial assistance under this subsection 
        based on merit. In making a decision whether to approve such 
        application and provide financial assistance, the Secretary 
        shall consider at a minimum the merits of the application, 
        including those portions of the application regarding--
                    (A) the ability of the applicant to provide 
                assistance to particular categories of eligible 
                providers with respect to the implementation and 
                effective use of, and training on, patient decision 
                aids;
                    (B) the geographical diversity and extent of the 
                service area of the applicant; and
                    (C) the percentage of funding for the center that 
                would be provided as financial assistance under this 
                subsection and the amount of any funding or in-kind 
                commitment from sources of funding in addition to the 
                financial assistance provided under this subsection.
            (8) Biennial evaluation.--Each center which receives 
        financial assistance under this subsection shall be evaluated 
        biennially by an evaluation panel appointed by the Secretary. 
        Each such evaluation panel shall be composed of private 
        experts, none of whom shall be connected with the center 
        involved, and officials of the Federal Government. Each 
        evaluation panel shall measure the performance of the center 
        involved against the objectives specified in paragraph (3). The 
        Secretary shall not continue to provide financial assistance to 
        a center under this subsection unless the most recent 
        evaluation under this paragraph with respect to the center is 
        overall positive.
    (d) Expanded Implementation (Phase II).--
            (1) In general.--Subject to paragraph (2), during the 3-
        year period beginning after the completion of phase I of the 
        pilot program (referred to in this section as ``phase II'' of 
        the pilot program), the Secretary shall enroll additional 
        eligible providers to implement shared decision making using 
        patient decision aids under the pilot program under this 
        section. The Secretary may allow eligible providers to enroll 
        in the pilot program on a regular basis during phase II.
            (2) Contingency.--The Secretary shall not implement phase 
        II of the pilot program if the Secretary finds, not later than 
        90 days after the date of submittal of the interim report under 
        subsection (i)(2)(A), that the continued implementation of 
        shared decision making is not in the best interest of Medicare 
        beneficiaries.
            (3) Preference.--In enrolling eligible providers in the 
        pilot program during phase II, the Secretary shall include, to 
        the extent practicable, eligible providers that--
                    (A) have or can acquire the infrastructure 
                necessary to implement shared decision making supported 
                by patient decision aids approved by the expert panel 
                established under section 4(b) in a timely manner;
                    (B) have training in the use of patient decision 
                aids or will participate in training for health care 
                professionals who will be involved in such use (as 
                specified by the Secretary); or
                    (C) represent high cost areas or high practice 
                variation States under the Medicare program, and the 
                District of Columbia.
    (e) Guidance.--The Secretary may, in consultation with the expert 
panel established under section 4(b), issue guidance to eligible 
providers participating in the pilot program under this section on the 
use of patient decision aids approved by the expert panel.
    (f) Requirements.--
            (1) Implementation of approved patient decision aids.--
                    (A) In general.--During phase II of the pilot 
                program under this section, an eligible provider 
                participating in the pilot program shall incorporate 1 
                or more patient decision aids approved by the expert 
                panel established under section 4(b) in furnishing 
                items and services to Medicare beneficiaries with 
                respect to 1 or more of the conditions identified in 
                subsection (g), together with ongoing support involved 
                in furnishing such items and services.
                    (B) Defined clinical process.--During each phase of 
                the pilot program under this section, the eligible 
                provider shall establish and implement a defined 
                clinical process under which, in the case of a Medicare 
                beneficiary with 1 or more of such conditions, the 
                eligible provider offers the Medicare beneficiary 
                shared decision making (supported by such a patient 
                decision aid) and collects information on the quality 
                of patient decision making with respect to the Medicare 
                beneficiary.
            (2) Follow-up counseling visit.--
                    (A) In general.--During each phase of the pilot 
                program under this section, an eligible provider 
                participating in the pilot program under this section 
                shall routinely schedule Medicare beneficiaries for a 
                counseling visit after the viewing of such a patient 
                decision aid to answer any questions the beneficiary 
                may have with respect to the medical care of the 
                condition involved and to assist the beneficiary in 
                thinking through how their preferences and concerns 
                relate to their medical care.
                    (B) Payment for follow-up counseling visit.--The 
                Secretary shall establish procedures for making 
                payments for such counseling visits provided to 
                Medicare beneficiaries during each phase of the pilot 
                program under this section. Such procedures shall 
                provide for the establishment--
                            (i) of a code (or codes) to represent such 
                        services; and
                            (ii) of a single payment amount for such 
                        service that includes the professional time of 
                        the health care provider and a portion of the 
                        reasonable costs of the infrastructure of the 
                        eligible provider.
                    (C) Limitation.--In the case of an eligible 
                provider that is a Medicare Advantage plan, such 
                eligible provider may not receive payment for such 
                services.
            (3) Waiver of coinsurance.--The Secretary shall establish 
        procedures under which an eligible provider participating in 
        the pilot program under this section may, in the case of a low-
        income Medicare beneficiary (as determined by the Secretary), 
        waive any coinsurance or copayment that would otherwise apply 
        for the follow-up counseling visit provided to such Medicare 
        beneficiary under paragraph (2).
            (4) Costs of implementation.--
                    (A) In general.--Subject to subparagraph (B), 
                during each phase of the pilot program, an eligible 
                provider participating in the pilot program shall be 
                responsible for the costs of selecting, purchasing, and 
                incorporating such patient decision aids into the group 
                practice, reporting data on quality measures selected 
                under subsection (h)(1), and recording outcomes under 
                the pilot program.
                    (B) Financial support.--During each such phase, the 
                Secretary may, in addition to payments for counseling 
                visits under paragraph (2), provide financial support 
                to an eligible provider participating in the pilot 
                program to acquire the infrastructure necessary to 
                participate in the pilot program, including the 
                development of clinical pathways to assure that 
                Medicare beneficiaries have access to high-quality 
                shared decision making, the reporting of data on 
                quality measures selected under subsection (h)(1), and 
                the recording of outcomes under the pilot program after 
                phase I of the pilot program (as determined appropriate 
                by the Secretary).
    (g) Preference Sensitive Care Described.--The patient decision aids 
approved under section 4(b)(2)(A) shall, to the extent practicable, 
include patient decision aids for medical care of the following 
conditions:
            (1) Arthritis of the hip and knee.
            (2) Chronic back pain.
            (3) Chest pain (stable angina).
            (4) Enlarged prostate (benign prostatic hypertrophy, or 
        BPH).
            (5) Early-stage prostate cancer.
            (6) Early-stage breast cancer.
            (7) End-of-life care.
            (8) Peripheral vascular disease.
            (9) Gall stones.
            (10) Threat of stroke from carotid artery disease.
            (11) Any other condition the Secretary identifies as 
        appropriate.
    (h) Quality Measures.--
            (1) Selection.--
                    (A) In general.--During each phase of the pilot 
                program, the Secretary shall measure the quality and 
                implementation of shared decision making. For purposes 
                of making such measurements, the Secretary shall 
                select, from among those quality measures recommended 
                by the expert panel under section 4(b)(2)(C), 
                consensus-based quality measures that assess Medicare 
                beneficiaries' knowledge of the options for medical 
                treatment relevant to their medical condition, as well 
                as the benefits and drawbacks of those medical 
                treatment options, and the Medicare beneficiaries' 
                goals and concerns regarding their medical care.
                    (B) Risk adjustment.--In order to ensure accurate 
                measurement across quality measures and eligible 
                providers, the Secretary may risk adjust the quality 
                measures selected under this paragraph to control for 
                external factors, such as cognitive impairment, 
                dementia, and literacy.
            (2) Reporting data on measures.--During each such phase, an 
        eligible provider participating in the pilot program shall 
        report to the Secretary data on quality measures selected under 
        paragraph (1) in accordance with procedures established by the 
        Secretary.
            (3) Feedback on measures.--During each such phase, the 
        Secretary shall provide confidential reports to eligible 
        providers participating in the pilot program on the performance 
        of the eligible provider on quality measures selected by the 
        Secretary under paragraph (1), the aggregate performance of all 
        eligible providers participating in the pilot program, and any 
        improvements in such performance.
    (i) Evaluations and Reports.--
            (1) Independent evaluation.--The Secretary shall enter into 
        a contract with an entity that has knowledge of shared decision 
        making programs and demonstrated experience in the evaluation 
        of such programs for the conduct of an independent evaluation 
        of each phase of the pilot program under this section.
            (2) Reports by entity conducting independent evaluation.--
                    (A) Interim report.--Not later than 2 years after 
                the implementation of phase I of the pilot program, the 
                entity with a contract under paragraph (1) shall submit 
                to the Secretary a report on the initial results of the 
                independent evaluation conducted under such paragraph.
                    (B) Final report.--Not later then 4 years after the 
                implementation of phase II of the pilot program, such 
                entity shall submit to the Secretary a report on the 
                final results of such independent evaluation.
                    (C) Contents of report.--Each report submitted 
                under this paragraph shall--
                            (i) include an assessment of--
                                    (I) quality measures selected under 
                                subsection (h)(1);
                                    (II) Medicare beneficiary and 
                                health care provider satisfaction under 
                                the applicable phase of the pilot 
                                program;
                                    (III) utilization of medical 
                                services for Medicare beneficiaries 
                                with 1 or more of the conditions 
                                described in subsection (g) and other 
                                Medicare beneficiaries as determined 
                                appropriate by the Secretary;
                                    (IV) appropriate utilization of 
                                shared decision making by eligible 
                                providers under the applicable phase of 
                                the pilot program;
                                    (V) savings to the Medicare program 
                                under title XVIII of the Social 
                                Security Act; and
                                    (VI) the costs to eligible 
                                providers participating in the pilot 
                                program of selecting, purchasing, and 
                                incorporating approved patient decision 
                                aids and meeting reporting requirements 
                                under the applicable phase of the pilot 
                                program; and
                            (ii) identify the characteristics of 
                        individual eligible providers that are most 
                        effective in implementing shared decision 
                        making under the applicable phase of the pilot 
                        program.
            (3) Report by the secretary.--Not later than 12 months 
        after the completion of phase II of the pilot program, the 
        Secretary shall submit to Congress a report on the pilot 
        program that includes--
                    (A) the results of the independent evaluation 
                conducted under paragraph (2);
                    (B) an evaluation of the impact of the pilot 
                program under this section, including the impact--
                            (i) of the use of patient decision aids 
                        approved by the expert panel established under 
                        section 4(b) for the medical care of the 
                        conditions described in subsection (g);
                            (ii) on expenditures for such conditions 
                        under the Medicare program, including a 
                        comparison of such expenditures for such 
                        conditions where such patient decision aids 
                        were used to such expenditures for such 
                        conditions where such patient decision aids 
                        were not used; and
                            (iii) on Medicare beneficiaries, including 
                        the understanding by beneficiaries of the 
                        options for medical care presented, concordance 
                        between beneficiary values and the medical care 
                        received, the mode of approved patient decision 
                        aid used (such as Internet, videos, and 
                        pamphlets), the timing of the delivery of such 
                        approved patient decision aid (such as the date 
                        of the initial diagnosis), and beneficiary and 
                        health care provider satisfaction with the 
                        shared decision making process;
                    (C) an evaluation of which eligible providers are 
                most effective at implementing patient decision aids 
                and assisting Medicare beneficiaries in making informed 
                decisions on medical care; and
                    (D) recommendations for such legislation and 
                administrative action as the Secretary determines 
                appropriate.
    (j) Savings.--
            (1) In general.--Subject to paragraph (2), not later than 2 
        years after the implementation of phase I of the pilot program, 
        and annually thereafter for the duration of phase I and the 
        first 2 years of phase II, the Secretary shall determine if 
        there were any savings to the Medicare program as a result of 
        such implementation during the preceding year (or years, if 
        applicable). In the case where the Secretary determines there 
        were such savings, the Secretary shall use such savings as 
        follows:
                    (A) Fifty percent of such savings shall be used to 
                provide bonus payments to eligible providers 
                participating in the pilot program who achieve high 
                quality shared decision making (as measured by the 
                level of participation of Medicare beneficiaries in the 
                shared decision making process and high scores by the 
                eligible provider on quality measures selected under 
                subsection (h)(1)).
                    (B) Twenty-five percent of such savings shall be 
                placed in a Shared Decision Making Trust Fund 
                established by the Secretary, which shall be used to 
                expand participation in the pilot program to providers 
                of services and suppliers in additional settings (as 
                determined appropriate by the Secretary) by--
                            (i) providing financial assistance under 
                        subsection (c); and
                            (ii) providing for the development of 
                        quality measures not already selected under 
                        subsection (h)(1) to assess the impact of 
                        shared decision making on the quality of 
                        patient care or the improvement of such quality 
                        measures already selected.
                    (C) Twenty-five percent of such savings shall be 
                retained by the Medicare program.
            (2) Retention of savings by the medicare program.--In the 
        case where the Secretary determines there are savings to the 
        Medicare program as a result of the implementation of the pilot 
        program during a year (beginning with the third year of phase 
        II), 100 percent of such savings shall be retained by the 
        Medicare program.
    (k) Waiver.--The Secretary may waive such provisions of titles XI 
and XVIII of the Social Security Act as may be necessary to carry out 
the pilot program under this section.
    (l) Funding.--For purposes of carrying out section 4(a), 
implementing the pilot program under this section (including costs 
incurred in conducting the evaluation under subsection (i)), and 
carrying out section 1890(b)(1)(A)(iv) of the Social Security Act, as 
added by section 4(c), the Secretary shall provide for the transfer 
from the Federal Hospital Insurance Trust Fund established under 
section 1817 of the Social Security Act (42 U.S.C. 1395i) to the 
Centers for Medicare & Medicaid Services Program Management Account of 
$300,000,000 for the period of fiscal years 2010 through 2017.

SEC. 6. ESTABLISHMENT OF SHARED DECISION MAKING STANDARDS AND 
              REQUIREMENTS IN MEDICARE.

    Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is 
amended by adding at the end the following new section:

  ``establishment of shared decision making standards and requirements

    ``Sec. 1899.  (a) In General.--Based on the findings of phases I 
and II of the pilot program under section 5 of the Empowering Medicare 
Patient Choices Act the Secretary shall promulgate regulations that--
            ``(1) specify for which preference sensitive conditions 
        beneficiaries should, subject to the succeeding provisions of 
        this section, participate in shared decision making;
            ``(2) require providers of services and suppliers to make 
        sure that beneficiaries receive patient decision aids as 
        appropriate; and
            ``(3) specify a process for beneficiaries to elect not to 
        use such patient decision aids.
    ``(b) Penalty for Not Using Shared Decision Making.--
Notwithstanding any other provision of this title, the Secretary shall 
promulgate such regulations and issue such guidance as may be necessary 
to reduce by 20 percent the amount of payment under this title that 
would otherwise apply to an item or service specified by the Secretary 
if the patient does not receive a patient decision aid prior to such 
item or service being furnished (except in the case where the 
beneficiary has elected not to use such patient decision aid under the 
process specified under subsection (a)(3)).
    ``(c) Secretarial Authority To Waive Application of This Section.--
The Secretary may waive the application of this section to an item or 
service under this title if the Secretary determines either of the 
following:
            ``(1) Medical societies and others have established 
        evidence-based transparent standards incorporating patient 
        decision aids and shared decision making into the standard of 
        patient care for preference sensitive conditions.
            ``(2) Shared decision making is not in the best interest of 
        beneficiaries.''.
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