I 

117TH CONGRESS 

1ST SESSION H. R. 3337 

To require the Secretary of Health and Human Services to establish a 

Medicaid demonstration program to develop and advance innovative payment models for freestanding birth center services for women with a 

low-risk pregnancy, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 19, 2021 

Ms. CLARK of Massachusetts (for herself, Ms. HERRERA BEUTLER, Ms. ROYBAL-ALLARD, and Mrs. HINSON) introduced the following bill; which was 

referred to the Committee on Energy and Commerce 

A BILL 

To require the Secretary of Health and Human Services 

to establish a Medicaid demonstration program to develop and advance innovative payment models for freestanding birth center services for women with a lowrisk pregnancy, 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 ‘‘Birth Access Bene5 fiting Improved Essential Facility Services Act’’ or the 

6 ‘‘BABIES Act’’. 


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1 SEC. 2. MEDICAID DEMONSTRATION PROGRAM TO IM2 PROVE FREESTANDING BIRTH CENTER SERV3 ICES. 

4 Section 1903 of the Social Security Act (42 U.S.C. 

5 1396b) is amended by adding at the end the following: 

6 ‘‘(bb) DEMONSTRATION PROGRAM TO IMPROVE

7 FREESTANDING BIRTH CENTER SERVICES.— 

8 ‘‘(1) AUTHORITY.—The Secretary shall estab9 lish a demonstration program for the purpose of 

10 identifying ways to improve access to, and the qual11 ity and scope of, freestanding birth center services 

12 for women with a low-risk pregnancy. 

13 ‘‘(2) DEADLINES FOR CENTERS PARTICIPATION

14 CRITERIA, PROSPECTIVE PAYMENT SYSTEM; PLAN15 NING GRANTS.— 

16 ‘‘(A) PARTICIPATION AND PROSPECTIVE

17 PAYMENT SYSTEM DEADLINE.—Not later than 

18 one year after the date of the enactment of this 

19 subsection, the Secretary shall do the following: 

20 ‘‘(i) PUBLICATION OF PARTICIPATION

21 CRITERIA FOR FREESTANDING BIRTH CEN22 TERS.— 

23 ‘‘(I) IN GENERAL.—Publish cri24 teria for a freestanding birth center to 

25 be certified by a State for purposes of 

26 participating in a State demonstration 


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1 program conducted under this sub2 section. 

3 ‘‘(II) REQUIREMENTS.—The cri4 teria required to be published under 

5 subclause (I) shall include the fol6 lowing: 

7 ‘‘(aa) ACCREDITATION.—A 

8 freestanding birth center must 

9 have a current accreditation cre10 dential from an approved nation11 ally recognized birth center ac12 creditation body, as determined 

13 by the Secretary. 

14 ‘‘(bb) LICENSURE AND

15 OTHER REQUIREMENTS.—A free16 standing birth center shall— 

17 ‘‘(AA) be licensed, or 

18 otherwise approved, by the 

19 State to provide prenatal, 

20 labor and delivery, 

21 postpartum, newborn care, 

22 and other ambulatory serv23 ices that are included in the 

24 State Medicaid program; 

25 and 


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1 ‘‘(BB) comply with 

2 such other requirements re3 lating to the health and 

4 safety of individuals who re5 ceive services furnished by 

6 the facility as the State shall 

7 establish. 

8 ‘‘(cc) CARE COORDINA9 TION.—A freestanding birth cen10 ter shall be able to meet care co11 ordination requirements, includ12 ing requirements to coordinate 

13 care across settings and pro14 viders to ensure seamless transi15 tions for patients across the full 

16 spectrum of health services, and 

17 engage in consultation for higher 

18 level maternity care services, 

19 non-maternity care services, and 

20 behavioral health needs, and 

21 which may include plans for con22 sultation, collaboration and refer23 ral, and arrangements with the 

24 following: 


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1 ‘‘(AA) Federally-quali2 fied health centers (and as 

3 applicable, rural health clin4 ics) to provide Federally5 qualified health center serv6 ices (and as applicable, rural 

7 health clinic services) to the 

8 extent such services are not 

9 provided directly through 

10 the birth center. 

11 ‘‘(BB) Other outpatient 

12 clinics, including licensed 

13 midwifery and physician 

14 practices. 

15 ‘‘(CC) Inpatient acute 

16 care facilities with obstet17 rical care units. 

18 ‘‘(dd) SCOPE OF SERV19 ICES.—As determined by the Sec20 retary, a freestanding birth cen21 ter must be able to provide 

22 peripartum care for women with 

23 a low-risk pregnancy and for 

24 newborns, consistent with evi25 dence-based guidelines. 


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1 ‘‘(ee) CAPABILITIES.—A 

2 freestanding birth center shall 

3 have the following: 

4 ‘‘(AA) The capability 

5 and equipment to provide 

6 prenatal, labor and delivery, 

7 postpartum, and newborn 

8 care for women with a low9 risk pregnancy, readiness at 

10 all times to initiate emer11 gency procedures to meet 

12 unexpected needs of such 

13 women and of newborns 

14 within the center, including 

15 at least 2 qualified staff on16 site at every birth, and the 

17 ability to facilitate transport 

18 to an acute care hospital 

19 with an obstetrical care unit 

20 when necessary. 

21 ‘‘(BB) An established 

22 transfer plan with a receiv23 ing hospital with an obstet24 rical care unit with policies 


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1 and procedures for timely 

2 transport. 

3 ‘‘(CC) Medical con4 sultation available from a li5 censed board-certified physi6 cian with admitting privi7 leges in obstetrics at a near8 by hospital. 

9 ‘‘(DD) Data collection, 

10 storage, and retrieval, in11 cluding data on intrapartum 

12 and postpartum maternal 

13 and newborn transfer rates 

14 and hospital admissions. 

15 ‘‘(EE) The ability to 

16 initiate and document qual17 ity improvement programs 

18 as required by accreditation 

19 that include efforts to maxi20 mize patient safety, such as 

21 safety checklists, validated 

22 training and competency of 

23 staff, and emergency pre24 paredness and drills. 


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1 Nothing in subitem (AA) shall be 

2 construed as affecting the State 

3 plan requirement specified under 

4 section 431.53 of title 42, Code 

5 of Federal Regulations, or any 

6 successor regulation (relating to 

7 assurance of transportation). 

8 ‘‘(ff) HEALTH CARE PRO9 VIDERS.—A freestanding birth 

10 center must employ or have care 

11 delivery arrangements with both 

12 of the following: 

13 ‘‘(AA) A physician or 

14 physicians licensed to prac15 tice within the State or ju16 risdiction of the birth center. 

17 ‘‘(BB) A midwife or 

18 midwives that meet or ex19 ceed the education and 

20 training standards of the 

21 International Confederation 

22 of Midwives and who are li23 censed to practice within the 

24 jurisdiction of the birth cen25 ter. 


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1 ‘‘(gg) NON-DUPLICATION.— 

2 In carrying out this subsection, 

3 the Secretary shall, to the great4 est extent practicable, prevent 

5 the duplication of services cov6 ered under this subsection with 

7 services otherwise covered under 

8 the State plan under this title 

9 and prevent payment under a 

10 demonstration program under 

11 paragraph (3) for services for 

12 which payment is otherwise made 

13 under the State plan under this 

14 title. 

15 ‘‘(ii) GUIDANCE ON DEVELOPMENT OF

16 PROSPECTIVE PAYMENT SYSTEM FOR

17 TESTING UNDER STATE DEMONSTRATION

18 PROGRAMS.— 

19 ‘‘(I) IN GENERAL.—The Sec20 retary shall issue guidance for States 

21 participating in a demonstration pro22 gram conducted under paragraph (3) 

23 to establish a prospective payment 

24 system that shall only apply to free25 standing birth center services that 


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1 meet the criteria established under 

2 clause (i) furnished by a freestanding 

3 birth center participating in such 

4 demonstration program. 

5 ‘‘(II) REQUIREMENTS.—The 

6 guidance issued by the Secretary 

7 under subclause (I) shall, to the 

8 greatest extent practicable, provide 

9 for— 

10 ‘‘(aa) partial facility pay11 ment based on units in the case 

12 that a pregnant woman is admit13 ted in labor and then needs to be 

14 transferred to the hospital in 

15 labor before the birth of the 

16 baby; 

17 ‘‘(bb) facility payment for 

18 observation short stays to rule 

19 out labor or for therapeutic rest; 

20 ‘‘(cc) ensuring payment for 

21 the newborn and mother as two 

22 facility payment components; 

23 ‘‘(dd) ensuring payment for 

24 nitrous oxide and hydrotherapy 

25 supplies costs for pain relief; 


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1 ‘‘(ee) ensuring payment for 

2 all professional services of health 

3 professionals involved in the de4 livery of care in a birth center 

5 which may include 3 or more of6 fice visits; observation and triage; 

7 newborn exam and care; and 

8 multiple postpartum, mother, and 

9 baby visits, as needed; 

10 ‘‘(ff) ensuring payment for 

11 partial prenatal and postpartum 

12 care episodes or for prenatal care 

13 only with planned delivery in the 

14 hospital and client returning for 

15 postpartum care in the birth cen16 ter; and 

17 ‘‘(gg) payment for services 

18 provided within— 

19 ‘‘(AA) in the case of a 

20 pregnant woman, the period 

21 that commences upon the 

22 confirmation of pregnancy 

23 when the woman is accepted 

24 into care at the freestanding 

25 birth center, continues 


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1 through prenatal care, labor 

2 and delivery, and ends 60 

3 days postpartum, inclusive 

4 of at least 2 postpartum 

5 care visits; and 

6 ‘‘(BB) in the case of a 

7 newborn, a period that con8 tinues through the first 28 

9 days of life. 

10 ‘‘(B) PLANNING GRANTS.— 

11 ‘‘(i) IN GENERAL.—Not later than 18 

12 months after the date of the enactment of 

13 this subsection, the Secretary shall award 

14 planning grants to States for the purpose 

15 of developing proposals to conduct a dem16 onstration program described in paragraph 

17 (3). 

18 ‘‘(ii) USE OF FUNDS.—A State award19 ed a planning grant under this subpara20 graph shall use the funds awarded under 

21 such grant to— 

22 ‘‘(I) solicit input with respect to 

23 the development of the demonstration 

24 program from patients, providers (inVerDate Sep 11 2014 00:37 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H3337.IH H3337

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1 cluding certified nurse-midwives and 

2 physicians) and other stakeholders; 

3 ‘‘(II) secure participation of free4 standing birth centers that meet the 

5 criteria established under subpara6 graph (A)(i), including by providing 

7 support for such centers to meet that 

8 criteria in order to maximize the num9 ber of freestanding birth centers par10 ticipating in the demonstration pro11 gram; and 

12 ‘‘(III) in accordance with the 

13 guidance issued under subparagraph 

14 (A)(ii), establish a prospective pay15 ment system which States must use 

16 for making payments to freestanding 

17 birth centers participating in the dem18 onstration program. 

19 ‘‘(3) STATE DEMONSTRATION PROGRAMS.— 

20 ‘‘(A) IN GENERAL.—Not later than 24 

21 months after the date of the enactment of this 

22 subsection, from among the States awarded a 

23 planning grant under paragraph (2)(B), the 

24 Secretary shall select not more than 6 such 


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1 States to conduct demonstration programs that 

2 meet the requirements of this paragraph. 

3 ‘‘(B) APPLICATION REQUIREMENTS.— 

4 ‘‘(i) IN GENERAL.—The Secretary 

5 shall solicit applications to conduct a dem6 onstration program under this subsection 

7 from States awarded planning grants 

8 under paragraph (2)(B). 

9 ‘‘(ii) REQUIRED INFORMATION.—A 

10 State application to conduct a demonstra11 tion program under this paragraph shall 

12 include the following: 

13 ‘‘(I) A description of the target 

14 Medicaid population to be served 

15 under the demonstration program. 

16 ‘‘(II) A list of the participating 

17 freestanding birth centers in the 

18 State. 

19 ‘‘(III) Verification that each par20 ticipating freestanding birth center 

21 meets the participation criteria estab22 lished in paragraph (2)(A)(i). 

23 ‘‘(IV) A description of the scope 

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1 icaid program for women with a low2 risk pregnancy that will be paid for 

3 under the prospective payment system 

4 tested in the demonstration program. 

5 ‘‘(V) Verification that the State 

6 has agreed to pay for such services at 

7 the rate established under the pro8 spective payment system. 

9 ‘‘(VI) An assurance that the 

10 State will require freestanding birth 

11 centers to submit to the State, and 

12 that the State will submit to the Sec13 retary, such information and data as 

14 the State or Secretary may require re15 lating to the demonstration program 

16 or an episode of care for such a preg17 nant woman or newborn. 

18 ‘‘(VII) Such other information as 

19 the Secretary may require relating to 

20 the demonstration program, including 

21 with respect to determining the 

22 soundness of the proposed prospective 

23 payment system. 

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1 onstration program under this paragraph shall 

2 conduct the program for a 4-year period. 

3 ‘‘(D) REQUIREMENTS FOR SELECTING

4 DEMONSTRATION PROGRAMS.—In selecting 

5 States to conduct demonstration programs 

6 under this paragraph, the Secretary shall— 

7 ‘‘(i) ensure States meet the criteria 

8 described in paragraph (2)(A)(i)(II); 

9 ‘‘(ii) ensure that the States represent 

10 a diverse selection of geographic areas, in11 cluding rural and underserved areas; and 

12 ‘‘(iii) give preference to States that 

13 demonstrate the potential to expand the 

14 availability of and access to maternity care 

15 services in a demonstration area and in16 crease the quality of services provided by 

17 freestanding birth centers without increas18 ing net Federal spending. 

19 ‘‘(E) PAYMENT FOR SERVICES PROVIDED

20 BY FREESTANDING BIRTH CENTERS.— 

21 ‘‘(i) IN GENERAL.—Amounts ex22 pended by a State to conduct a demonstra23 tion program under this paragraph shall be 

24 treated as medical assistance for purposes 

25 of subsection (a) of this section. Under a 


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1 demonstration program conducted under 

2 this paragraph by a State, payments shall 

3 be made by the State for freestanding 

4 birth center services that meet the criteria 

5 established under paragraph (2)(A)(i) fur6 nished by a freestanding birth center in ac7 cordance with the prospective payment sys8 tem for such services established pursuant 

9 to the guidance issued under paragraph 

10 (2)(A)(ii). 

11 ‘‘(ii) LIMITATIONS.—Payments shall 

12 be made under this subparagraph to a 

13 State only for freestanding birth center 

14 services that are— 

15 ‘‘(I) described in the demonstra16 tion program application submitted by 

17 the State and approved by the Sec18 retary; and 

19 ‘‘(II) provided to an individual 

20 who is eligible for medical assistance 

21 under the State Medicaid program. 

22 ‘‘(iii) PROHIBITED PAYMENTS.—Un23 less included as part of a payment pro24 vided under a prospective payment system 

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1 tion program pursuant to the guidance 

2 issued under paragraph (2)(A(ii), no pay3 ment shall be made under this subpara4 graph for inpatient care or other non-am5 bulatory services, as determined by the 

6 Secretary. 

7 ‘‘(F) WAIVER OF STATEWIDENESS RE8 QUIREMENT.—The Secretary shall waive section 

9 1902(a)(1) (relating to statewideness) as may 

10 be necessary for a State to conduct a dem11 onstration program in accordance with the re12 quirements of this paragraph. 

13 ‘‘(G) ANNUAL REPORTS.— 

14 ‘‘(i) IN GENERAL.—Not later than 2 

15 years after the date on which the first 

16 State is selected to conduct a demonstra17 tion program under this paragraph, and 

18 annually thereafter, based on information 

19 and data submitted by States in accord20 ance with the assurance provided under 

21 subparagraph (B)(ii)(VI), the Secretary 

22 shall submit to Congress an annual report 

23 on all State demonstration programs con24 ducted under this paragraph. Each such 


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1 report shall include with respect to each 

2 such State demonstration program— 

3 ‘‘(I) an assessment of clinical 

4 outcomes for maternity services pro5 vided by freestanding birth centers 

6 participating in the demonstration 

7 program compared to outcomes for 

8 low-risk pregnancy Medicaid patients 

9 in comparable demographic and geo10 graphic areas, including with respect 

11 to the number of births and data on 

12 intrapartum and postpartum maternal 

13 and newborn transfer rates and hos14 pital admissions; and 

15 ‘‘(II) an assessment of the im16 pact of all the State demonstration 

17 programs conducted under this para18 graph on the Federal and State costs 

19 relating to providing freestanding 

20 birth center services for women with a 

21 low-risk pregnancy (including with re22 spect to the provision of inpatient, 

23 emergency, and ambulatory services) 

24 and newborn care, compared to the 

25 Federal and State costs related to the 


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1 provision of freestanding birth center 

2 services by freestanding birth centers 

3 outside of such demonstration pro4 grams. 

5 ‘‘(ii) RECOMMENDATIONS.—Not later 

6 than the end of the third year of the dem7 onstration program established under this 

8 subsection, the Secretary shall submit to 

9 Congress recommendations concerning 

10 whether the demonstration programs under 

11 this paragraph should be continued, ex12 panded, modified, or terminated. 

13 ‘‘(4) FUNDING.— 

14 ‘‘(A) IN GENERAL.—Out of any funds in 

15 the Treasury not otherwise appropriated, there 

16 is appropriated to the Secretary— 

17 ‘‘(i) for purposes of carrying out para18 graph (2)(B), $2,000,000; and 

19 ‘‘(ii) for purposes of carrying out the 

20 demonstration programs under paragraph 

21 (3), $25,000,000. 

22 ‘‘(B) AVAILABILITY.—Funds appropriated 

23 under subparagraph (A) shall remain available 

24 until expended. 

25 ‘‘(5) DEFINITIONS.—In this subsection: 


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1 ‘‘(A) FREESTANDING BIRTH CENTER

2 SERVICES.—The term ‘freestanding birth center 

3 services’ has the meaning given that term under 

4 section 1905(l)(3)(A) and includes such other 

5 services as the Secretary shall determine for 

6 purposes of the demonstration programs con7 ducted under paragraph (3). 

8 ‘‘(B) LOW-RISK PREGNANCY.—The term 

9 ‘low-risk pregnancy’ means an uncomplicated 

10 singleton term pregnancy with a vertex presen11 tation with an expected uncomplicated birth.’’. 

Æ 


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