I

107TH CONGRESS

1ST SESSION H. R. 1128

To reduce the amount of paperwork and improve payment policies for health

care services, to prevent fraud and abuse through health care provider

education, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

MARCH 20, 2001

Mr. THORNBERRY 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 reduce the amount of paperwork and improve payment

policies for health care services, to prevent fraud and

abuse through health care provider education, and for

other purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Health Care Paper5 work Reduction and Fraud Prevention Act of 2001’’.
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1 SEC. 2. NATIONAL BIPARTISAN COMMISSION ON BILLING

2 CODES AND FORMS SIMPLIFICATION.

3 (a) ESTABLISHMENT.—There is hereby established

4 the Commission on Billing Codes and Forms Simplifica5 tion (in this section referred to as the ‘‘Commission’’).

6 (b) DUTIES.—The Commission shall make rec7 ommendations regarding the following:

8 (1) STANDARDIZED FORMS.—Standardizing

9 credentialing and billing forms respecting health

10 care claims, that all Federal Government agencies

11 would use and that the private sector is able (and

12 is encouraged, but not required) to use.

13 (2) REDUCTION IN BILLING CODES.—A signifi14 cant reduction and simplification in the number of

15 billing codes.

16 (3) REGULATORY AND APPEALS PROCESS RE17 FORM.—Reforms in the medicare regulatory and ap18 peals processes in order to ensure that the Secretary

19 of Health and Human Services provides appropriate

20 guidance to physicians, providers of services, and

21 ambulance providers that are attempting to properly

22 submit claims under the medicare program and to

23 ensure that the Secretary does not target inad24 vertent billing errors.

25 (c) MEMBERSHIP.—
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1 (1) NUMBER AND APPOINTMENT.—The Com2 mission shall be composed of 17 members, of

3 whom—

4 (A) four shall be appointed by the Presi5 dent;

6 (B) six shall be appointed by the Majority

7 Leader of the Senate, in consultation with the

8 Minority Leader of the Senate, of whom not

9 more than 4 shall be of the same political party;

10 (C) six shall be appointed by the Speaker

11 of the House of Representatives, in consultation

12 with the Minority Leader of the House of Rep13 resentatives, of whom not more than 4 shall be

14 of the same political party; and

15 (D) one, who shall serve as Chairman of

16 the Commission, appointed jointly by the Presi17 dent, Majority Leader of the Senate, and the

18 Speaker of the House of Representatives.

19 (2) APPOINTMENT.—Members of the Commis20 sion shall be appointed by not later than 90 days

21 after the date of the enactment of this Act.

22 (d) INCORPORATION OF BIPARTISAN COMMISSION

23 PROVISIONS.—The provisions of paragraphs (3) through

24 (8) of subsection (c) and subsections (d), (e), and (h) of

25 section 4021 of the Balanced Budget Act of 1997 shall
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1 apply to the Commission under this section in the same

2 manner as they applied to the National Bipartisan Com3 mission on the Future of Medicare under such section.

4 (e) REPORT.—Not later than December 31, 2001, the

5 Commission shall submit a report to the President and

6 Congress which shall contain a detailed statement of only

7 those recommendations, findings, and conclusions of the

8 Commission that receive the approval of at least 11 mem9 bers of the Commission.

10 (f) TERMINATION.—The Commission shall terminate

11 30 days after the date of submission of the report required

12 in subsection (e).

13 SEC. 3. EDUCATION OF PHYSICIANS AND PROVIDERS CON14 CERNING MEDICARE PROGRAM PAYMENTS.

15 (a) WRITTEN REQUESTS.—

16 (1) IN GENERAL.—The Secretary of Health and

17 Human Services shall establish a process under

18 which a physician may request, in writing from a

19 carrier, assistance in addressing questionable codes

20 and procedures under the medicare program under

21 title XVIII of the Social Security Act and then the

22 carrier shall respond in writing within 30 business

23 days respond with the correct billing or procedural

24 answer.

25 (2) USE OF WRITTEN STATEMENT.—
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1 (A) IN GENERAL.—Subject to subpara2 graph (B), a written statement under para3 graph (1) may be used as proof against a fu4 ture audit or overpayment under the medicare

5 program.

6 (B) LIMIT ON APPLICATION.—Subpara7 graph (A) shall not apply retroactively and shall

8 not apply to cases of fraudulent billing.

9 (b) RESTORATION OF TOLL-FREE HOTLINE.—

10 (1) IN GENERAL.—The Administrator of the

11 Health Care Financing Administration shall restore

12 the toll-free telephone hotline so that physicians may

13 call for information and questions about the medi14 care program.

15 (2) AUTHORIZATION OF APPROPRIATIONS.—

16 There are authorized to be appropriated such sums

17 as may be necessary to carry out paragraph (1).

18 (c) DEFINITIONS.—For purposes of this section:

19 (1) PHYSICIAN.—The term ‘‘physician’’ has the

20 meaning given such term in section 1861(r) of the

21 Social Security Act (42 U.S.C. 1395x(r)).

22 (2) CARRIER.—The term ‘‘carrier’’ means a

23 carrier (as defined in section 1842(f) of the Social

24 Security Act (42 U.S.C. 1395u(f))) with a contract
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1 under title XVIII of such Act to administer benefits

2 under part B of such title.

3 SEC. 4. POLICY DEVELOPMENT REGARDING E&M GUIDE4 LINES UNDER THE MEDICARE PROGRAM.

5 (a) IN GENERAL.—HCFA may not implement any

6 new evaluation and management guidelines (in this section

7 referred to as ‘‘E&M guidelines’’) under the medicare pro8 gram, unless HCFA—

9 (1) has provided for an assessment of the pro10 posed guidelines by physicians;

11 (2) has established a plan that contains specific

12 goals, including a schedule, for improving participa13 tion of physicians;

14 (3) has carried out a minimum of 4 pilot

15 projects consistent with subsection (b) in at least 4

16 different HCFA regions (to be specified by the Sec17 retary) to test such guidelines; and

18 (4) finds that the objectives described in sub19 section (c) will be met in the implementation of such

20 guidelines.

21 (b) PILOT PROJECTS.—

22 (1) LENGTH AND CONSULTATION.—Each pilot

23 project under this subsection shall—

24 (A) be of sufficient length to allow for pre25 paratory physician and carrier education, anal-
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1 ysis, and use and assessment of potential E&M

2 guidelines; and

3 (B) be conducted, throughout the planning

4 and operational stages of the project, in con5 sultation with national and State medical soci6 eties.

7 (2) PEER REVIEW AND RURAL PILOT

8 PROJECTS.—Of the pilot projects conducted under

9 this subsection—

10 (A) at least one shall focus on a peer re11 view method by physicians which evaluates

12 medical record information for statistical outlier

13 services relative to definitions and guidelines

14 published in the CPT book, instead of an ap15 proach using the review of randomly selected

16 medical records using non-clinical personnel;

17 and

18 (B) at least one shall be conducted for

19 services furnished in a rural area.

20 (3) STUDY OF IMPACT.—Each pilot project

21 shall examine the effect of the E&M guidelines on—

22 (A) different types of physician practices,

23 such as large and small groups; and

24 (B) the costs of compliance, and patient

25 and physician satisfaction.
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1 (4) REPORT ON HOW MET OBJECTIVES.—

2 HCFA shall submit a report to the Committees on

3 Commerce and Ways and Means of the House of

4 Representatives, the Committee on Finance of the

5 Senate, and the Practicing Physicians Advisory

6 Council, six months after the conclusion of the pilot

7 projects. Such report shall include the extent to

8 which the pilot projects met the objectives specified

9 in subsection (c).

10 (c) OBJECTIVES FOR E&M GUIDELINES.—The objec11 tives for E&M guidelines specified in this subsection are

12 as follows (relative to the E&M guidelines and review poli13 cies in effect as of the date of the enactment of this Act):

14 (1) Enhancing clinically relevant documentation

15 needed to accurately code and assess coding levels

16 accurately.

17 (2) Reducing administrative burdens.

18 (3) Decreasing the level of non-clinically perti19 nent and burdensome documentation time and con20 tent in the record.

21 (4) Increased accuracy by carrier reviewers.

22 (5) Education of both physicians and reviewers.

23 (6) Appropriate use of E&M codes by physi24 cians and their staffs.
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1 (7) The extent to which the tested E&M docu2 mentation guidelines substantially adhere to the

3 CPT coding rules.

4 (d) DEFINITIONS.—For purposes of this section and

5 sections 5 and 6:

6 (1) PHYSICIAN.—The term ‘‘physician’’ has the

7 meaning given such term in section 1861(r) of the

8 Social Security Act (42 U.S.C. 1395x(r)).

9 (2) CARRIER.—The term ‘‘carrier’’ means a

10 carrier (as defined in section 1842(f) of the Social

11 Security Act (42 U.S.C. 1395u(f))) with a contract

12 under title XVIII of such Act to administer benefits

13 under part B of such title.

14 (3) SECRETARY.—The term ‘‘Secretary’’ means

15 the Secretary of Health and Human Services.

16 (4) HCFA.—The term ‘‘HCFA’’ means the

17 Health Care Financing Administration.

18 (5) MEDICARE PROGRAM.—The term ‘‘medicare

19 program’’ means the program under title XVIII of

20 the Social Security Act.

21 SEC. 5. OVERPAYMENTS UNDER THE MEDICARE PROGRAM.

22 (a) INDIVIDUALIZED NOTICE.—If a carrier proceeds

23 with a post-payment audit of a physician under the medi24 care program, the carrier shall provide the physician with

25 an individualized notice of billing problems, such as a per-
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1 sonal visit or carrier-to-physician telephone conversation

2 during normal working hours, within 3 months of initi3 ating such audit. The notice should include suggestions

4 to the physician on how the billing problem may be rem5 edied.

6 (b) REPAYMENT OF OVERPAYMENTS WITHOUT PEN7 ALTY.—The Secretary shall permit physicians to repay

8 medicare overpayments within 3 months without penalty

9 or interest and without threat of denial of other claims

10 based upon extrapolation. If a physician should discover

11 an overpayment before a carrier notifies the physician of

12 the error, the physician may reimburse the medicare pro13 gram without penalty and the Secretary may not audit or

14 target the physician on the basis of such repayment, un15 less other evidence of fraudulent billing exists.

16 (c) TREATMENT OF FIRST-TIME BILLING ERRORS.—

17 If a physician’s medicare billing error was a first-time

18 error and the physician has not previously been the subject

19 of a post-payment audit, the carrier may not assess a fine

20 through extrapolation of such an error to other claims,

21 unless the physician has submitted a fraudulent claim.

22 (d) TIMELY NOTICE OF PROBLEM CLAIMS BEFORE

23 USING EXTRAPOLATION.—A carrier may seek reimburse24 ment or penalties against a physician based on extrapo25 lation of a medicare claim only if the carrier has informed
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1 the physician of potential problems with the claim within

2 one year after the date the claim was submitted for reim3 bursement.

4 (e) SUBMISSION OF ADDITIONAL INFORMATION.—A

5 physician may submit additional information and docu6 mentation to dispute a carrier’s charges of overpayment

7 without waiving the physician’s right to a hearing by an

8 administrative law judge.

9 (f) LIMITATION ON DELAY IN PAYMENT.—Following

10 a post-payment audit, a carrier that is conducting a pre11 payment screen on a physician service under the medicare

12 program may not delay reimbursements for more than one

13 month and as soon as the physician submits a corrected

14 claim, the carrier shall eliminate application of such a pre15 payment screen.

16 SEC. 6. ENFORCEMENT PROVISIONS UNDER THE MEDI17 CARE PROGRAM.

18 If a physician is suspected of fraud or wrongdoing

19 in the medicare program, inspectors associated with the

20 Office of Inspector General of the Department of Health

21 and Human Services—

22 (1) may not enter the physician’s private office

23 with a gun or deadly weapon to make an arrest; and
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1 (2) may not make such an arrest without a

2 valid warrant of arrest, unless the physician is flee3 ing or deemed dangerous.

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