II 

114TH CONGRESS 

2D SESSION S. 3392 

To amend title XVIII of the Social Security Act in order to improve the 

process whereby Medicare Administrative Contractors issue local coverage 

determinations under the Medicare Program, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 22, 2016 

Mr. ISAKSON (for himself and Mr. CARPER) 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 in order 

to improve the process whereby Medicare Administrative 

Contractors issue local coverage determinations under 

the Medicare Program, 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 ‘‘Local Coverage Deter5 mination Clarification Act of 2016’’. 


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1 SEC. 2. IMPROVEMENTS IN THE MEDICARE LOCAL COV2 ERAGE DETERMINATION (LCD) PROCESS FOR 

3 SPECIFIED LCDS. 

4 (a) LCD DEVELOPMENT PROCESS.—Section 

5 1862(l)(5) of the Social Security Act (42 U.S.C. 

6 1395y(l)(5)) is amended by adding at the end the fol7 lowing subparagraph: 

8 ‘‘(D) PROCESS FOR ISSUING SPECIFIED

9 LOCAL COVERAGE DETERMINATIONS.— 

10 ‘‘(i) IN GENERAL.—In the case of a 

11 specified local coverage determination (as 

12 defined in clause (iv)) within an area by a 

13 fiscal intermediary or carrier that has en14 tered into a contract with the Secretary 

15 under section 1874A, such intermediary or 

16 carrier must take the following actions 

17 with respect to such determination before 

18 such determination may take effect: 

19 ‘‘(I) Publish on the public Inter20 net website of the intermediary or car21 rier a proposed version of the speci22 fied local coverage determination (in 

23 this section referred to as a ‘draft de24 termination’), a written rationale for 

25 the draft determination, and a de26 scription of all evidence relied upon 


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1 and considered by the intermediary or 

2 carrier in the development of the draft 

3 determination. 

4 ‘‘(II) Not later than 60 days 

5 after the date on which the inter6 mediary or carrier publishes the draft 

7 determination in accordance with sub8 clause (I), convene one or more open, 

9 public meetings to review the draft de10 termination, receive comments with 

11 respect to the draft determination, 

12 and secure the advice of an expert 

13 panel (such as a carrier advisory com14 mittee described in chapter 13 of the 

15 Medicare Program Integrity Manual 

16 in effect on August 31, 2015) with re17 spect to the draft determination. The 

18 intermediary or carrier shall make 

19 available means for the public to at20 tend such meetings remotely, such as 

21 via teleconference. 

22 ‘‘(III) With respect to each meet23 ing convened pursuant to subclause 

24 (II), post on the public Internet 

25 website of the intermediary or carrier, 


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1 not later than 14 days after such 

2 meeting is convened, a record of the 

3 meeting minutes for such meeting. 

4 ‘‘(IV) Provide a period for sub5 mission of written public comment on 

6 such draft determination that begins 

7 on the date on which all records re8 quired to be posted with respect to 

9 such draft determination under sub10 clause (III) are so posted and that is 

11 not fewer than 30 days in duration. 

12 ‘‘(ii) FINALIZING A SPECIFIED LOCAL

13 COVERAGE DETERMINATION.—A fiscal 

14 intermediary or carrier that has entered 

15 into a contract with the Secretary under 

16 section 1874A shall, with respect to a spec17 ified local coverage determination, post on 

18 the public Internet website of the fiscal 

19 intermediary or carrier the following infor20 mation before the specified local coverage 

21 determination (in this section referred to 

22 as the ‘final determination’) takes effect— 

23 ‘‘(I) a response the issues raised 

24 at meetings convened pursuant to 


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1 clause (i)(II) with respect to the draft 

2 determination; 

3 ‘‘(II) the rationale for the final 

4 determination; 

5 ‘‘(III) in the case that the inter6 mediary or carrier considered quali7 fying evidence in the development of 

8 the determination that was not de9 scribed in the written notice provided 

10 pursuant to clause (i)(I), a description 

11 of such qualifying evidence; and 

12 ‘‘(IV) an effective date for the 

13 final determination that is not less 

14 than 30 days after the date on which 

15 such determination is so posted. 

16 ‘‘(iii) LIMITATION ON DETERMINA17 TIONS ACROSS JURISDICTIONS.—Notwith18 standing any plan under section 

19 1862(l)(5)(A), in the case of a contract 

20 with a fiscal intermediary or carrier under 

21 section 1874A, such intermediary or car22 rier may not finalize a specified local cov23 erage determination pursuant to clause (ii) 

24 with respect to a geographic area that ap25 plies, or has the effect of applying, outside 


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1 such area. In the case that such an inter2 mediary or carrier wishes to adopt, with 

3 respect to a specific geographic area a 

4 specified local coverage determination de5 veloped for a different geographic area, 

6 such intermediary or carrier may not so 

7 adopt such determination unless, prior to 

8 so adopting such determination, such inter9 mediary or carrier independently evaluates 

10 and considers the qualifying evidence sup11 porting the determination as applicable to 

12 such specific geographic area and makes a 

13 local coverage determination for such area 

14 in accordance with this subparagraph. 

15 ‘‘(iv) SPECIFIED LOCAL COVERAGE

16 DETERMINATION DEFINED.—For purposes 

17 of this subparagraph, the term ‘specified 

18 local coverage determination’ means, with 

19 respect to a geographic area— 

20 ‘‘(I) a new local coverage deter21 mination (regardless of whether such 

22 determination made by a fiscal inter23 mediary or carrier that has entered 

24 into a contract with the Secretary 

25 under section 1874A and is based 


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1 upon a specified local coverage deter2 mination that previously has been 

3 made with respect to another geo4 graphic area, or by another such 

5 intermediary or carrier); 

6 ‘‘(II) a revised local coverage de7 termination for such geographic area 

8 that restricts one or more existing 

9 coverage criteria for such area (such 

10 as by adding noncovered indications 

11 to an existing local coverage deter12 mination or by deleting previously cov13 ered ICD–9 or ICD–10 codes); 

14 ‘‘(III) a revised local coverage de15 termination that makes a substantive 

16 revision to one or more existing local 

17 coverage determinations; and 

18 ‘‘(IV) any other local coverage 

19 determination specified by the Sec20 retary pursuant to regulations. 

21 ‘‘(v) QUALIFYING EVIDENCE DE22 FINED.—For purposes of this subpara23 graph, the term ‘qualifying evidence’ 

24 means either of the following: 


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1 ‘‘(I) Scientific evidence published 

2 in peer-reviewed medical literature, 

3 such as randomized clinical trials or 

4 other studies. 

5 ‘‘(II) A general consensus of the 

6 applicable medical community (such 

7 as a consensus evinced through a rec8 ognized standard of practice in such 

9 medical community) that is supported 

10 by information provided by a recog11 nized medical authority, such as a 

12 professional medical society.’’. 

13 (b) LCD RECONSIDERATION PROCESS.—Section 

14 1869(f) of the Social Security Act (42 U.S.C. 1395ff(f)) 

15 is amended— 

16 (1) in paragraph (2)(A), by inserting ‘‘(and, as 

17 applicable, the limitations under paragraphs (8) and 

18 (9))’’ before the colon; 

19 (2) in paragraph (5), by inserting ‘‘(other than 

20 under paragraphs (8) and (9))’’ after ‘‘this sub21 section’’; 

22 (3) by redesignating paragraph (8) as para23 graph (12); and 

24 (4) by inserting after paragraph (7) the fol25 lowing new paragraphs: 


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1 ‘‘(8) CARRIER OR FISCAL INTERMEDIARY RE2 CONSIDERATION PROCESS FOR SPECIFIED LOCAL

3 COVERAGE DETERMINATIONS.—For purposes of 

4 paragraph (2)(A), the limitations described in this 

5 paragraph are that, upon the filing of a request by 

6 an interested party with respect to a specified local 

7 coverage determination by a fiscal intermediary or 

8 carrier that has entered into a contract with the 

9 Secretary under section 1874A, the intermediary or 

10 carrier shall reconsider such determination in ac11 cordance with the following process: 

12 ‘‘(A) Not later than 30 days after such a 

13 request is filed with the fiscal intermediary or 

14 carrier by the interested party with respect to 

15 such determination, the intermediary or carrier 

16 shall— 

17 ‘‘(i) determine whether the request is 

18 an applicable request; and 

19 ‘‘(ii) in the case that the request is 

20 not an applicable request, inform the inter21 ested party of the reasons why such re22 quest is not an applicable request. 

23 ‘‘(B) In the case that the intermediary or 

24 carrier determines under subparagraph (A) that 

25 the request described in such subparagraph is 


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1 an applicable request, the intermediary or car2 rier shall, not later than 90 days after the date 

3 on which the request was filed with the inter4 mediary or carrier, take the actions described in 

5 subparagraphs (C), (D), and (E) with respect 

6 to the determination. 

7 ‘‘(C) The action described in this subpara8 graph is the action of specifying whether any of 

9 the following statements is applicable to the de10 termination: 

11 ‘‘(i) The determination did not apply, 

12 or inaccurately applied, qualifying evidence 

13 relevant to such determination. 

14 ‘‘(ii) The determination used language 

15 that exceeded the scope of the intended 

16 purpose of the determination. 

17 ‘‘(iii) The determination was incorrect 

18 in its determination of whether such item 

19 or service is reasonable and necessary for 

20 the diagnosis or treatment of illness or in21 jury under section 1862(a)(1)(A). 

22 ‘‘(iv) The determination failed to de23 scribe, with respect to such an item or 

24 service, the clinical conditions to be used 

25 for purposes of determining whether such 


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1 item or service is reasonable and necessary 

2 for the diagnosis or treatment of illness or 

3 injury under section 1862(a)(1)(A). 

4 ‘‘(v) The determination does not apply 

5 with respect to items or services to which 

6 it was intended to apply. 

7 ‘‘(vi) The determination is erroneous 

8 for another reason that the intermediary or 

9 carrier identifies. 

10 ‘‘(D) The action described in this subpara11 graph, with respect to the determination, is the 

12 action of taking, based on the specification 

13 under subparagraph (C) of whether any of the 

14 statements in such subparagraph applied to 

15 such determination, one or more of the fol16 lowing actions: 

17 ‘‘(i) Making no change in the deter18 mination. 

19 ‘‘(ii) Rescinding a part of the deter20 mination (including, as applicable, the en21 tire determination). 

22 ‘‘(iii) Modifying the determination to 

23 restrict the coverage provided under this 

24 title for an item or service that is subject 

25 to the determination. 


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1 ‘‘(iv) Modifying the determination to 

2 expand the coverage provided under this 

3 title for an item or service that is subject 

4 to the determination. 

5 ‘‘(E) The action described in this subpara6 graph is the action of making publicly available 

7 a written description of the action taken under 

8 subparagraph (D) with respect to the deter9 mination. 

10 ‘‘(9) AGENCY EVALUATION OF RECONSIDER11 ATION DECISION.—For purposes of paragraph 

12 (2)(A), the limitations described in this paragraph 

13 are that, in the case that an interested party that 

14 filed an applicable request under paragraph (8) with 

15 respect to a specified local coverage determination 

16 files with the Secretary, on a date that is not later 

17 than 120 days after the date on which an inter18 mediary or carrier takes an action described under 

19 paragraph (8)(D) with respect to such determina20 tion, an appeal with respect to such decision in such 

21 form and manner as the Secretary may require, the 

22 Secretary shall, not later than 30 days after such 

23 appeal is filed— 


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1 ‘‘(A) specify which, if any, of the state2 ments in subparagraph (C) of paragraph (8) is 

3 applicable to the determination; and 

4 ‘‘(B) based on such specification, take one 

5 of the actions described in subparagraph (D) of 

6 such paragraph with respect to the determina7 tion. 

8 The Secretary shall apply subparagraph (A) as 

9 though the reference to ‘the intermediary or carrier’ 

10 in clause (vi) of paragraph (8)(D) were a reference 

11 to the Secretary. 

12 ‘‘(10) DEFINITIONS APPLICABLE TO PARA13 GRAPHS (8) AND (9).—For purposes of paragraphs 

14 (8) and (9): 

15 ‘‘(A) The term ‘applicable request’ means 

16 a request that is submitted in fiscal year 2018 

17 or a subsequent fiscal year, that is solely with 

18 respect to a specified local coverage determina19 tion, and that includes a description of the ra20 tionale for such request and any evidence sup21 porting such request. For purposes of the pre22 ceding sentence, the Secretary may not require, 

23 as a condition of treating a request with respect 

24 to such a determination as an applicable re25 quest, that the request contain qualifying eviVerDate Sep 11 2014 03:24 Sep 24, 2016 Jkt 059200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S3392.IS S3392

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1 dence that was not considered in the develop2 ment of such determination. 

3 ‘‘(B) The term ‘interested party’ means, 

4 with respect to a specified local coverage deter5 mination within an area by a fiscal inter6 mediary or carrier that has entered into a con7 tract with the Secretary under section 1874A— 

8 ‘‘(i) a provider of services or supplier 

9 that, in such area, furnishes, provides, or 

10 supplies items or services that are subject 

11 to such determination; or 

12 ‘‘(ii) an organization that represents 

13 such a provider of services or supplier. 

14 ‘‘(C) The term ‘qualifying evidence’ has 

15 the meaning given such term by clause (v) of 

16 section 1862(l)(5)(D). 

17 ‘‘(D) The term ‘specified local coverage de18 termination’ has the meaning given such term 

19 by clause (iv) of such section. 

20 ‘‘(11) APPOINTMENT OF OMBUDSMAN.— 

21 ‘‘(A) IN GENERAL.—The Secretary shall, 

22 within the Centers for Medicare & Medicaid 

23 Services, appoint a Medicare Reviews and Ap24 peals Ombudsman (referred to in this para25 graph as the ‘Ombudsman’). 


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1 ‘‘(B) DUTIES.—The Ombudsman shall, 

2 with respect to specified local coverage deter3 minations, carry out the following duties: 

4 ‘‘(i) Provide interested parties (as de5 fined in paragraph (10)(B)) with adminis6 trative and technical assistance in filing re7 quests under paragraph (8) and appeals 

8 under paragraph (9). 

9 ‘‘(ii) Make publicly available in a uni10 form, consistent, and easily understood for11 mat the following information for each 12- 

12 month period: 

13 ‘‘(I) The number of requests filed 

14 with fiscal intermediaries and carriers 

15 under paragraph (8), and of appeals 

16 filed with the Secretary under para17 graph (9), during such period. 

18 ‘‘(II) With respect to such re19 quests during such period, the number 

20 of times that intermediaries and car21 riers took, with respect to the actions 

22 described subparagraph (A)(iv) of 

23 such paragraph, each such action. 

24 ‘‘(III) With respect to such ap25 peals during such period, the number 


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1 of times that the Secretary took each 

2 such action. 

3 ‘‘(IV) With respect to the num4 bers made available under subclauses 

5 (I), (II), and (III), the number of 

6 each such number that is attributable 

7 to— 

8 ‘‘(aa) each fiscal inter9 mediary or carrier; and 

10 ‘‘(bb) each interested party 

11 (as defined in paragraph 

12 (10)(B)). 

13 ‘‘(V) Measures of the responsive14 ness of fiscal intermediaries and car15 riers with respect to requests filed 

16 with such intermediaries and carriers 

17 under paragraph (8). 

18 ‘‘(VI) Recommendations to the 

19 Secretary with respect to ways to im20 prove— 

21 ‘‘(aa) the efficacy and effi22 ciency of the process described in 

23 paragraph (8); and 

24 ‘‘(bb) communication with 

25 individuals entitled to benefits 


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1 under part A or enrolled under 

2 part B, providers of services, and 

3 suppliers regarding such proc4 ess.’’. 

5 SEC. 3. PROMULGATION OF REGULATIONS; APPLICATION 

6 DATE. 

7 The Secretary of Health and Human Services shall 

8 promulgate regulations to carry out paragraph (5)(D) of 

9 section 1862(l) of the Social Security Act (42 U.S.C. 

10 1395y(l)), as added by subsection (a), and paragraphs (8) 

11 and (9) of section 1869(f) of such Act (42 U.S.C. 

12 1395ff(f)), as inserted by subsection (b), in such a manner 

13 as to ensure that the processes described in such para14 graphs are fully implemented by October 1, 2017. 

Æ 


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