I 

111TH CONGRESS 

1ST SESSION H. R. 3365 

To provide Medicare payments to Department of Veterans Affairs medical 

facilities for items and services provided to Medicare-eligible veterans 

for non-service-connected conditions. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 28, 2009 

Mr. FILNER introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Energy 

and Commerce and Veterans’ Affairs, 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 provide Medicare payments to Department of Veterans 

Affairs medical facilities for items and services provided 

to Medicare-eligible veterans for non-service-connected 

conditions. 

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 ‘‘Medicare VA Reim5 bursement Act of 2009’’. 


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1 SEC. 2. ESTABLISHMENT OF MEDICARE SUBVENTION FOR 

2 VETERANS. 

3 (a) IN GENERAL.—Section 1862 of the Social Secu4 rity Act (42 U.S.C. 1395y) is amended by adding at the 

5 end the following new subsection: 

6 ‘‘(n) MEDICARE SUBVENTION FOR VETERANS.— 

7 ‘‘(1) ESTABLISHMENT.—The Secretary of 

8 Health and Human Services, in cooperation with the 

9 Secretary of Veterans Affairs, shall establish a pro10 gram to be known as the ‘Medicare VA reimburse11 ment program’ under which the Secretary of Health 

12 and Human Services shall reimburse the Secretary 

13 of Veterans Affairs, from the Federal Hospital In14 surance Trust Fund established in section 1817 and 

15 the Federal Supplementary Medical Insurance Trust 

16 Fund established in section 1841, for an item or 

17 service that— 

18 ‘‘(A) is furnished to a Medicare-eligible 

19 veteran by a Department of Veterans Affairs 

20 medical facility for the treatment of a non-serv21 ice-connected condition; and 

22 ‘‘(B) is covered under this title or is deter23 mined to be medically necessary by the Sec24 retary of Veterans Affairs. 

25 ‘‘(2) MEMORANDUM OF UNDERSTANDING.— 


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1 ‘‘(A) IN GENERAL.—Not later than 6 

2 months after the date of the enactment of this 

3 Act, the Secretary of Health and Human Serv4 ices shall enter a memorandum of under5 standing with the Secretary of Veterans Affairs 

6 concerning the administration of the Medicare 

7 VA reimbursement program. 

8 ‘‘(B) CONTRACT ELEMENTS.—The memo9 randum of understanding under subparagraph 

10 (A) shall contain the following: 

11 ‘‘(i) FREQUENCY OF REIMBURSE12 MENT.—An agreement on how often reim13 bursements will be made by the Secretary 

14 of Health and Human Services to the Sec15 retary of Veterans Affairs. 

16 ‘‘(ii) BILLING SYSTEM.—An agree17 ment on the details of the billing system 

18 that will be used by the Secretary of Vet19 erans Affairs to make claims for reim20 bursement from the Secretary of Health 

21 and Human Services. 

22 ‘‘(iii) DATA SHARING AGREEMENT.— 

23 An agreement on data sharing, including— 

24 ‘‘(I) identification of the data ex25 changes that each Secretary will need 


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1 to develop, maintain, or provide access 

2 to, for purposes of the Medicare VA 

3 reimbursement program; and 

4 ‘‘(II) verification of data dem5 onstrating that a item or service was 

6 provided by a Department of Veterans 

7 Affairs medical facility to a Medicare8 eligible veteran for a non-service-con9 nected condition before the Secretary 

10 of Health and Human Services pro11 vides for reimbursement for such item 

12 or service under the Medicare VA re13 imbursement program. 

14 ‘‘(iv) PAYMENT RATE.—Subject to the 

15 requirements of paragraph (3), details of 

16 the payment rate to be used for reimburse17 ments made under the Medicare VA reim18 bursement program. 

19 ‘‘(v) PERFORMANCE MEASURES.—An 

20 agreement on performance measures and 

21 performance targets to be used to dem22 onstrate the impact of the Medicare VA re23 imbursement program. 


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1 ‘‘(vi) ADDITIONAL TERMS.—Any addi2 tional terms deemed necessary by the ad3 ministering Secretaries. 

4 ‘‘(C) NO MAINTENANCE OF EFFORT RE5 QUIREMENT.—For purposes of the Medicare 

6 VA reimbursement program, the Secretary of 

7 Veterans Affairs shall not be required to meet 

8 a maintenance of effort requirement (a require9 ment that the Secretary of Veterans Affairs 

10 maintain a certain level of spending in order to 

11 receive reimbursement from the Secretary of 

12 Health and Human Services). 

13 ‘‘(3) PAYMENTS BASED ON REGULAR MEDICARE

14 PAYMENT RATES.— 

15 ‘‘(A) AMOUNT.—Subject to the succeeding 

16 provisions of this paragraph, the Secretary of 

17 Health and Human Services shall reimburse the 

18 Secretary of Veterans Affairs— 

19 ‘‘(i) for an item or service that is cov20 ered under this title and is provided to a 

21 Medicare-eligible veteran by a Department 

22 of Veterans Affairs medical facility for the 

23 treatment of a non-service-connected condi24 tion, at a rate that is not less than 100 

25 percent of the amounts that otherwise 


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1 would be payable under this title, on a fee2 for-service basis, for such item or service if 

3 the Department of Veterans Affairs med4 ical facility were a provider of services, 

5 were participating in the Medicare pro6 gram, and imposed charges for such item 

7 or service; and 

8 ‘‘(ii) for an item or service that is not 

9 covered under this title that is provided to 

10 a Medicare-eligible veteran by a Depart11 ment of Veterans Affairs medical facility 

12 for the treatment of a non-service-con13 nected condition, if the Secretary of Vet14 eran’s Affairs determines that such item or 

15 service is medically necessary, at a rate de16 termined by the Secretary of Health and 

17 Human Services in consultation with the 

18 Secretary of Veterans Affairs. 

19 ‘‘(B) NO ARBITRARY LIMITATION ON

20 AMOUNT.—Subject to the requirements of this 

21 subsection, the Secretary of Health and Human 

22 Services may not impose an annual cap or other 

23 limit on the amount of reimbursement made 

24 under the Medicare VA reimbursement pro25 gram. 


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1 ‘‘(C) EXCLUSION OF CERTAIN AMOUNTS.— 

2 In computing the amount of payment under 

3 subparagraph (A), the following amounts shall 

4 be excluded: 

5 ‘‘(i) DISPROPORTIONATE SHARE HOS6 PITAL ADJUSTMENT.—Any amount attrib7 utable to an adjustment under section 

8 1886(d)(5)(F). 

9 ‘‘(ii) DIRECT GRADUATE MEDICAL

10 EDUCATION PAYMENTS.—Any amount at11 tributable to a payment under section 

12 1886(h). 

13 ‘‘(iii) INDIRECT MEDICAL EDUCATION

14 ADJUSTMENT.—Any amount attributable 

15 to the adjustment under section 

16 1886(d)(5)(B). 

17 ‘‘(iv) CAPITAL PAYMENTS.—Any 

18 amounts attributable to payments for cap19 ital-related costs under section 1886(g). 

20 ‘‘(D) PERIODIC PAYMENTS FROM MEDI21 CARE TRUST FUNDS.—Reimbursements under 

22 this paragraph shall be made— 

23 ‘‘(i) on a periodic basis consistent 

24 with the periodicity of payments under this 

25 title; and 


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1 ‘‘(ii) from the Federal Hospital Insur2 ance Trust Fund established in section 

3 1817 and the Federal Supplementary Med4 ical Insurance Trust Fund established in 

5 section 1841. 

6 ‘‘(E) CREDITING OF PAYMENTS.—Any 

7 payment made to the Department of Veterans 

8 Affairs under this subsection shall be deposited 

9 in the Department of Veterans Affairs Medical 

10 Care Collections Fund established under section 

11 1729A of title 38, United States Code. 

12 ‘‘(4) COST-SHARING REQUIREMENTS.—The Sec13 retary of Health and Human Services shall reduce 

14 the amount of reimbursement to the Secretary of 

15 Veterans Affairs for items and services under the 

16 Medicare VA reimbursement program by amounts 

17 attributable to applicable deductible, coinsurance, 

18 and cost-sharing requirements under this title. 

19 ‘‘(5) WAIVER OF PROHIBITION ON PAYMENTS

20 TO FEDERAL PROVIDERS OF SERVICES.—The prohi21 bition of payments to Federal providers of services 

22 under sections 1814(c) and 1835(d) shall not apply 

23 to items and services provided under this subsection. 

24 ‘‘(6) RULES OF CONSTRUCTION.—Nothing in 

25 this subsection shall be construed— 


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1 ‘‘(A) as prohibiting the Inspector General 

2 of the Department of Health and Human Serv3 ices from investigating any matters regarding 

4 the expenditure of funds under this subsection, 

5 including compliance with the provisions of this 

6 title and all other relevant laws; 

7 ‘‘(B) as adding or requiring additional cri8 teria for eligibility for health care benefits fur9 nished to veterans by the Secretary of Veterans 

10 Affairs, as established under chapter 17 of title 

11 38, United States Code; or 

12 ‘‘(C) subject to the requirements of title 

13 38, United States Code, as limiting a veteran’s 

14 ability to access such benefits, regardless of the 

15 veteran’s status as a Medicare-eligible veteran. 

16 ‘‘(7) ANNUAL REPORTS.—Not later than one 

17 year after implementing the program under this sub18 section and annually thereafter, the administering 

19 Secretaries shall submit to the Congress a report 

20 containing the following: 

21 ‘‘(A) The number of Medicare-eligible vet22 erans who opt to receive health care at a De23 partment of Veterans Affairs medical facility. 

24 ‘‘(B) The total amount of reimbursements 

25 made from the Federal Hospital Insurance 


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1 Trust Fund established in section 1817 and the 

2 Federal Supplementary Medical Insurance 

3 Trust Fund established in section 1841 to the 

4 Department of Veterans Affairs Medical Care 

5 Collections Fund established under section 

6 1729A of title 38, United States Code. 

7 ‘‘(C) The number and types of items and 

8 services provided to Medicare-eligible veterans 

9 by Department of Veterans Affairs medical fa10 cilities under this subsection. 

11 ‘‘(D) An accounting of the manner in 

12 which the Department of Veterans Affairs ex13 pended funds received through reimbursements 

14 under this subsection. 

15 ‘‘(E) A detailed description of any changes 

16 made to the memorandum of understanding 

17 under paragraph (2). 

18 ‘‘(F) A comparison of the performance 

19 data with the performance targets under para20 graph (2)(B)(v). 

21 ‘‘(G) Any other data on the Medicare VA 

22 reimbursement program that the administering 

23 Secretaries determine is appropriate. 

24 ‘‘(8) DEFINITIONS.—For purposes of this sub25 section: 


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1 ‘‘(A) ADMINISTERING SECRETARIES.—The 

2 term ‘administering Secretaries’ means the Sec3 retary of Health and Human Services and the 

4 Secretary of Veterans Affairs acting jointly. 

5 ‘‘(B) MEDICARE-ELIGIBLE VETERAN.—The 

6 term ‘Medicare-eligible veteran’ means an indi7 vidual who is a veteran (as defined in section 

8 101(2) of title 38, United States Code) who is 

9 eligible for care and services under section 

10 1705(a) of title 38, United States Code and 

11 who— 

12 ‘‘(i) is entitled to, or enrolled for, ben13 efits under part A of this title; or 

14 ‘‘(ii) is enrolled for benefits under 

15 part B of this title. 

16 ‘‘(C) NON-SERVICE CONNECTED CONDI17 TION.—The term ‘non-service-connected condi18 tion’ means a disease or condition that is ‘non19 service-connected’ as such term is defined in 

20 section 101(17) of title 38, United States Code. 

21 ‘‘(D) DEPARTMENT OF VETERANS AFFAIRS

22 MEDICAL FACILITY.—The term ‘Department of 

23 Veterans Affairs medical facility’ means a ‘med24 ical facility’ as such term is defined in section 

25 8101(3) of title 38, United States Code, alone 


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1 or in conjunction with other facilities under the 

2 jurisdiction of the Secretary of Veterans Af3 fairs.’’. 

4 (b) CONFORMING AMENDMENT.—Section 1729 of 

5 title 38, United States Code is amended by adding at the 

6 end the following new subsection: 

7 ‘‘(j) In any case in which a Medicare-eligible veteran 

8 (as defined in section 1862(n)(8)(B) of the Social Security 

9 Act (42 U.S.C. 1395y(n)(8)(B))) is furnished care or serv10 ices under this chapter for a non-service-connected condi11 tion (as defined in section 1862(n)(8)(C) of such Act) the 

12 Secretary shall— 

13 ‘‘(1) seek reimbursement from the Secretary of 

14 Health and Human Services for such care and serv15 ices under section 1862(n) of such Act; and 

16 ‘‘(2) collect any applicable deductible, coinsur17 ance, or other cost-sharing amount required under 

18 title XVIII of the Social Security Act from the vet19 eran or from a third party to the extent that the vet20 eran (or the provider of the care or services) would 

21 be eligible to receive payment for such care or serv22 ices from such third party if the care or services had 

23 not been furnished by a department or agency of the 

24 United States.’’. 


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1 SEC. 3. GAO REPORT. 

2 (a) IN GENERAL.—Not later than the last day of the 

3 three-year period beginning on the date of the enactment 

4 of this Act and the last date of each subsequent three5 year period, the Comptroller General of the United States 

6 shall submit to the Congress a report on the Medicare VA 

7 reimbursement program established under section 1862(n) 

8 of the Social Security Act, as added by section 2 of this 

9 Act. 

10 (b) CONTENTS.—The report under subsection (a) 

11 shall contain an analysis of— 

12 (1) the impact of the Medicare VA reimburse13 ment program on the Federal Hospital Insurance 

14 Trust Fund established in section 1817 of the Social 

15 Security Act (42 U.S.C. 1395i) and the Federal 

16 Supplementary Medical Insurance Trust Fund es17 tablished in section 1841 of such Act (42 U.S.C. 

18 1395t); 

19 (2) whether Medicare-eligible veterans (as de20 fined in section 1862(n)(8)(B)) experience improved 

21 access to health care as a result of the program; 

22 (3) whether Medicare-eligible veterans experi23 ence a change in the quality of care that they receive 

24 as a result of this program; 

25 (4) the impact of the program on local health 

26 care providers and Medicare beneficiaries in the 


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1 communities surrounding Department of Veterans 

2 Affairs medical facilities; and 

3 (5) any additional issues deemed appropriate by 

4 the Comptroller General of the United States. 

5 SEC. 4. SENSE OF CONGRESS. 

6 It is the sense of the Congress that the amount of 

7 funds appropriated to the Department of Veterans Affairs 

8 for medical care in any fiscal year beginning on or after 

9 the date of the enactment of this Act should not be re10 duced as a result of the implementation of the Medicare 

11 VA reimbursement program under section 1862(n) of the 

12 Social Security Act, as added by section 2(a). 

Æ 


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