I

103D CONGRESS

1ST SESSION H. R. 21

To amend title XVIII of the Social Security Act to make miscellaneous

and technical changes to the medicare program.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 5, 1993

Mr. ROSTENKOWSKI (for himself and Mr. STARK) introduced the following

bill; which was referred jointly to the Committees on Ways and Means

and Energy and Commerce

A BILL

To amend title XVIII of the Social Security Act to make

miscellaneous and technical changes to the medicare program.

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 ‘‘Miscellaneous and

5 Technical Medicare Amendments of 1993’’.

6 SEC. 2. REFERENCES IN ACT.

7 (a) AMENDMENTS TO SOCIAL SECURITY ACT.—Ex8 cept as otherwise specifically provided, whenever in this

9 Act, an amendment is expressed in terms of an amend-
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1 ment to or repeal of a section or other provision, the ref2 erence shall be considered to be made to that section or

3 other provision of the Social Security Act.

4 (b) REFERENCES TO OBRA.—In this Act, the terms

5 ‘‘OBRA–1986’’, ‘‘OBRA–1987’’, ‘‘OBRA–1989’’, and

6 ‘‘OBRA–1990’’ refer to the Omnibus Budget Reconcili7 ation Act of 1986 (Public Law 99–509), the Omnibus

8 Budget Reconciliation Act of 1987 (Public Law 100–203),

9 the Omnibus Budget Reconciliation Act of 1989 (Public

10 Law 101–239), and the Omnibus Budget Reconciliation

11 Act of 1990 (Public Law 101–508), respectively.

12 (c) TABLE OF CONTENTS.—The table of contents of

13 this Act is as follows:

Sec. 1. Short title.

Sec. 2. References in Act.

TITLE I—PROVISIONS RELATING TO PART A

Sec. 101. Transition for hospital outlier thresholds.

Sec. 102. Essential access community hospital (EACH) amendments.

Sec. 103. Wage index provisions.

Sec. 104. Reauthorization of rural transition grant program.

Sec. 105. Regional referral centers.

Sec. 106. Medicare-dependent, small rural hospitals.

Sec. 107. Hemophilia pass-through.

Sec. 108. State hospital payment programs.

Sec. 109. Psychology services in hospitals.

Sec. 110. Graduate medical education provided in a hospital-owned community

health center.

Sec. 111. Uniformed services treatment facilities.

Sec. 112. Requiring hospitals and nursing facilities to notify residents of availability of hospice benefit.

Sec. 113. Skilled nursing facility wage index.

Sec. 114. DRG payment window technical clarification; miscellaneous and technical corrections.

Sec. 115. Extension of rural hospital demonstration.

TITLE II—PROVISIONS RELATING TO PART B

Subtitle A—Physicians’ Services
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Sec. 201. Separate payment for interpretation of electrocardiograms.

Sec. 202. Payments for new physicians and practitioners.

Sec. 203. Basing payments for anesthesia services on actual time.

Sec. 204. Geographic adjustment factors for medicare physicians’ services.

Sec. 205. Extra-billing limits.

Sec. 206. Relative values for pediatric services.

Sec. 207. Antigens under physician fee schedule.

Sec. 208. Administration of claims relating to physicians’ services.

Sec. 209. Miscellaneous and technical corrections.

Subtitle B—Ambulatory Surgical Services

Sec. 211. Eye or eye and ear hospitals.

Sec. 212. Extension of cap on payments for intraocular lenses.

Sec. 213. Miscellaneous and technical corrections.

Subtitle C—Durable Medical Equipment

Sec. 221. Certification of suppliers.

Sec. 222. Prohibition against carrier forum shopping.

Sec. 223. Restrictions on certain marketing and sales activities.

Sec. 224. Kickback clarification.

Sec. 225. Beneficiary liability for noncovered services.

Sec. 226. Adjustments for inherent reasonableness.

Sec. 227. Payment for parenteral and enteral nutrients, supplies, and equipment during 1993.

Sec. 228. Treatment of nebulizers and aspirators.

Sec. 229. Payment for ostomy supplies, tracheostomy supplies, urologicals, and

surgical dressings.

Sec. 230. Payments for TENS devices.

Sec. 231. Miscellaneous and technical corrections.

Subtitle D—Other Provisions

Sec. 241. Payment for medically directed certified registered nurse anesthetist

services.

Sec. 242. Extension of Alzheimer’s disease demonstration.

Sec. 243. Part B late enrollment penalty.

Sec. 244. Oral cancer drugs.

Sec. 245. Speech-language pathologists and audiologists.

Sec. 246. Extension of municipal health service demonstration projects.

Sec. 247. Treatment of certain Indian health programs and facilities as Federally-qualified health centers.

Sec. 248. Extension of influenza vaccination demonstration.

Sec. 249. Miscellaneous and technical corrections.

TITLE III—PROVISIONS RELATING TO PARTS A AND B

Sec. 301. Provisions relating to physician ownership and referral.

Sec. 302. Direct graduate medical education.

Sec. 303. End stage renal disease.

Sec. 304. Medicare secondary payer.

Sec. 305. Improved outreach for qualified medicare beneficiaries.

Sec. 306. Social health maintenance organizations.

Sec. 307. Peer review organizations.

Sec. 308. Hospice information to home health beneficiaries.

Sec. 309. Interest payments.
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Sec. 310. Clarification of judicial review rights.

Sec. 311. Adjustments to discretionary spending limits.

Sec. 312. Health maintenance organizations.

Sec. 313. Treatment of certain State health care programs.

Sec. 314. Miscellaneous and technical corrections.

TITLE IV—PROVISIONS RELATING TO MEDICARE SUPPLEMENTAL

INSURANCE POLICIES

Sec. 401. Standards for medicare supplemental insurance policies.

1 TITLE I—PROVISIONS RELATING

2 TO PART A

3 SEC. 101. TRANSITION FOR HOSPITAL OUTLIER THRESH4 OLDS.

5 The Secretary of Health and Human Services, under

6 section 1886 of the Social Security Act, shall use the day

7 outlier methodology in effect for fiscal year 1992 for pay8 ment for discharges occurring on or after April 1, 1993,

9 and before September 30, 1993. For payment for dis10 charges occurring during fiscal year 1994, the Secretary

11 shall use the day outlier methodology in effect for the first

12 6 months of fiscal year 1993.

13 SEC. 102. ESSENTIAL ACCESS COMMUNITY HOSPITAL

14 (EACH) AMENDMENTS.

15 (a) INCREASING NUMBER OF PARTICIPATING

16 STATES.—Section 1820(a)(1) (42 U.S.C. 1395i–4(a)(1))

17 is amended by striking ‘‘7’’ and inserting ‘‘9’’.

18 (b) TREATMENT OF INPATIENT HOSPITAL SERVICES

19 PROVIDED IN RURAL PRIMARY CARE HOSPITALS.—
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1 (1) IN GENERAL.—Section 1820(f)(1)(F) (42

2 U.S.C. 1395i–4(f)(1)(F)) is amended to read as fol3 lows:

4 ‘‘(F) subject to paragraph (4), provides not

5 more than 6 inpatient beds (meeting such con6 ditions as the Secretary may establish) for pro7 viding inpatient care to patients requiring sta8 bilization before discharge or transfer to a hos9 pital, except that the facility may not provide

10 any inpatient hospital services—

11 ‘‘(i) to any patient whose attending

12 physician does not certify that the patient

13 may reasonably be expected to be dis14 charged or transferred to a hospital within

15 72 hours of admission to the facility; or

16 ‘‘(ii) consisting of surgery or any

17 other service requiring the use of general

18 anesthesia (other than surgical procedures

19 specified by the Secretary under section

20 1833(i)(1)(A)), unless the attending physi21 cian certifies that the risk associated with

22 transferring the patient to a hospital for

23 such services outweighs the benefits of

24 transferring the patient to a hospital for

25 such services.’’.
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1 (2) LIMITATION ON AVERAGE LENGTH OF

2 STAY.—Section 1820(f) (42 U.S.C. 1395i–4(f)) is

3 amended by adding at the end the following new

4 paragraph:

5 ‘‘(4) LIMITATION ON AVERAGE LENGTH OF IN6 PATIENT STAYS.—The Secretary may terminate a

7 designation of a rural primary care hospital under

8 paragraph (1) if the Secretary finds that the average

9 length of stay for inpatients at the facility during

10 the previous year in which the designation was in ef11 fect exceeded 72 hours. In determining the compli12 ance of a facility with the requirement of the pre13 vious sentence, there shall not be taken into account

14 periods of stay of inpatients in excess of 72 hours

15 to the extent such periods exceed 72 hours because

16 transfer to a hospital is precluded because of inclem17 ent weather or other emergency conditions.’’.

18 (3) CONFORMING AMENDMENT.—Section

19 1814(a)(8) (42 U.S.C. 1395f(a)(8)) is amended by

20 striking ‘‘such services’’ and all that follows and in21 serting ‘‘the individual may reasonably be expected

22 to be discharged or transferred to a hospital within

23 72 hours after admission to the rural primary care

24 hospital.’’.
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1 (4) GAO REPORTS.—Not later than 2 years

2 after the date of the enactment of this Act, the

3 Comptroller General shall submit reports to Con4 gress on—

5 (A) the application of the requirements

6 under section 1820(f) of the Social Security Act

7 (as amended by this subsection) that rural pri8 mary care hospitals provide inpatient care only

9 to those individuals whose attending physicians

10 certify may reasonably be expected to be dis11 charged within 72 hours after admission and

12 maintain an average length of inpatient stay

13 during a year that does not exceed 72 hours;

14 and

15 (B) the extent to which such requirements

16 have resulted in such hospitals providing inpa17 tient care beyond their capabilities or have lim18 ited the ability of such hospitals to provide

19 needed services.

20 (c) DESIGNATION OF HOSPITALS.—

21 (1) PERMITTING DESIGNATION OF HOSPITALS

22 LOCATED IN URBAN AREAS.—

23 (A) IN GENERAL.—Section 1820 (42

24 U.S.C. 1395i–4) is amended—
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1 (i) by striking paragraph (1) of sub2 section (e) and redesignating paragraphs

3 (2) through (6) as paragraphs (1) through

4 (5); and

5 (ii) in subsection (e)(1)(A) (as redes6 ignated by subparagraph (A))—

7 (I) by striking ‘‘is located’’ and

8 inserting ‘‘except in the case of a hos9 pital located in an urban area, is lo10 cated’’,

11 (II) by striking ‘‘, (ii)’’ and in12 serting ‘‘or (ii)’’,

13 (III) by striking ‘‘or (iii)’’ and all

14 that follows through ‘‘section,’’, and

15 (IV) in subsection (i)(1)(B), by

16 striking ‘‘paragraph (3)’’ and insert17 ing ‘‘paragraph (2)’’.

18 (B) NO CHANGE IN MEDICARE PROSPEC19 TIVE PAYMENT.—Section 1886(d)(5)(D) (42

20 U.S.C. 1395ww(d)(5)(D)) is amended—

21 (i) in clause (iii)(III), by inserting ‘‘lo22 cated in a rural area and’’ after ‘‘that is’’,

23 and
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1 (ii) in clause (v), by inserting ‘‘located

2 in a rural area and’’ after ‘‘in the case of

3 a hospital’’.

4 (2) PERMITTING HOSPITALS LOCATED IN AD5 JOINING STATES TO PARTICIPATE IN STATE PRO6 GRAM.—

7 (A) IN GENERAL.—Section 1820 (42

8 U.S.C. 1395i–4) is amended—

9 (i) by redesignating subsection (k) as

10 subsection (l); and

11 (ii) by inserting after subsection (j)

12 the following new subsection:

13 ‘‘(k) ELIGIBILITY OF HOSPITALS NOT LOCATED IN

14 PARTICIPATING STATES.—Notwithstanding any other

15 provision of this section—

16 ‘‘(1) for purposes of including a hospital or fa17 cility as a member institution of a rural health net18 work, a State may designate a hospital or facility

19 that is not located in the State as an essential access

20 community hospital or a rural primary care hospital

21 if the hospital or facility is located in an adjoining

22 State and is otherwise eligible for designation as

23 such a hospital;

24 ‘‘(2) the Secretary may designate a hospital or

25 facility that is not located in a State receiving a
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1 grant under subsection (a)(1) as an essential access

2 community hospital or a rural primary care hospital

3 if the hospital or facility is a member institution of

4 a rural health network of a State receiving a grant

5 under such subsection; and

6 ‘‘(3) a hospital or facility designated pursuant

7 to this subsection shall be eligible to receive a grant

8 under subsection (a)(2).’’.

9 (B) CONFORMING AMENDMENTS.—(i) Sec10 tion 1820(c)(1) (42 U.S.C. 1395i–4(c)(1)) is

11 amended by striking ‘‘paragraph (3)’’ and in12 serting ‘‘paragraph (3) or subsection (k)’’.

13 (ii) Paragraphs (1)(A) and (2)(A) of sec14 tion 1820(i) (42 U.S.C. 1395i–4(i)) are each

15 amended—

16 (I) in clause (i), by striking ‘‘(a)(1)’’

17 and inserting ‘‘(a)(1) (except as provided

18 in subsection (k))’’, and

19 (II) in clause (ii), by striking ‘‘sub20 paragraph (B)’’ and inserting ‘‘subpara21 graph (B) or subsection (k)’’.

22 (d) SKILLED NURSING SERVICES IN RURAL PRIMARY

23 CARE HOSPITALS.—Section 1820(f)(3) (42 U.S.C. 1395i–

24 4(f)(3)) is amended by striking ‘‘because the facility’’ and

25 all that follows and inserting the following: ‘‘because, at
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1 the time the facility applies to the State for designation

2 as a rural primary care hospital, there is in effect an

3 agreement between the facility and the Secretary under

4 section 1883 under which the facility’s inpatient hospital

5 facilities are used for the furnishing of extended care serv6 ices, except that the number of beds used for the furnish7 ing of such services may not exceed the total number of

8 licensed inpatient beds at the time the facility applies to

9 the State for such designation (minus the number of inpa10 tient beds used for providing inpatient care pursuant to

11 paragraph (1)(F)). For purposes of the previous sentence,

12 the number of beds of the facility used for the furnishing

13 of extended care services shall not include any beds of a

14 unit of the facility that is licensed as a distinct-part skilled

15 nursing facility at the time the facility applies to the State

16 for designation as a rural primary care hospital.’’.

17 (e) PAYMENT FOR OUTPATIENT RURAL PRIMARY

18 CARE HOSPITAL SERVICES.—Section 1834(g)(1) (42

19 U.S.C. 1395m(g)(1)) is amended by adding at the end the

20 following:

21 ‘‘The amount of payment shall be determined under

22 either method without regard to the amount of the

23 customary or other charge.’’.

24 (f) CLARIFICATION OF PHYSICIAN STAFFING RE25 QUIREMENT FOR RURAL PRIMARY CARE HOSPITALS.—
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1 Section 1820(f)(1)(H) (42 U.S.C. 1395i–4(f)(1)(H)) is

2 amended by striking the period and inserting the follow3 ing: ‘‘, except that in determining whether a facility meets

4 the requirements of this subparagraph, subparagraphs (E)

5 and (F) of that paragraph shall be applied as if any ref6 erence to a ‘physician’ is a reference to a physician as de7 fined in section 1861(r)(1).’’.

8 (g) TECHNICAL AMENDMENTS RELATING TO PART

9 A DEDUCTIBLE, COINSURANCE, AND SPELL OF ILL10 NESS.—(1) Section 1812(a)(1) (42 U.S.C. 1395d(a)(1))

11 is amended—

12 (A) by striking ‘‘inpatient hospital services’’ the

13 first place it appears and inserting ‘‘inpatient hos14 pital services or inpatient rural primary care hos15 pital services’’;

16 (B) by striking ‘‘inpatient hospital services’’ the

17 second place it appears and inserting ‘‘such serv18 ices’’; and

19 (C) by striking ‘‘and inpatient rural primary

20 care hospital services’’.

21 (2) Sections 1813(a) and 1813(b)(3)(A) (42 U.S.C.

22 1395e(a), 1395e(b)(3)(A)) are each amended by striking

23 ‘‘inpatient hospital services’’ each place it appears and in24 serting ‘‘inpatient hospital services or inpatient rural pri25 mary care hospital services’’.
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1 (3) Section 1813(b)(3)(B) (42 U.S.C.

2 1395e(b)(3)(B)) is amended by striking ‘‘inpatient hos3 pital services’’ and inserting ‘‘inpatient hospital services,

4 inpatient rural primary care hospital services’’.

5 (4) Section 1861(a) (42 U.S.C. 1395x(a)) is amend6 ed—

7 (A) in paragraph (1), by striking ‘‘inpatient

8 hospital services’’ and inserting ‘‘inpatient hospital

9 services, inpatient rural primary care hospital serv10 ices’’; and

11 (B) in paragraph (2), by striking ‘‘hospital’’

12 and inserting ‘‘hospital or rural primary care hos13 pital’’.

14 (h) AUTHORIZATION OF APPROPRIATIONS.—Section

15 1820(k) (42 U.S.C. 1395i–4(k)) is amended by striking

16 ‘‘1990, 1991, and 1992’’ and inserting ‘‘1990 through

17 1995’’.

18 (i) EFFECTIVE DATE.—The amendments made by

19 this section shall take effect on the date of the enactment

20 of this Act.

21 SEC. 103. WAGE INDEX PROVISIONS.

22 (a) WAGE INDEX HOLD HARMLESS PROTECTION.—

23 (1) IN GENERAL.—Section 1886(d)(8)(C)(iii)

24 (42 U.S.C. 1395ww(d)(8)(C)(iii)) is amended by

25 adding at the end the following new sentence: ‘‘In
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1 the case of an urban area that has a wage index

2 below the wage index for rural areas in the State in

3 which it is located, or that is located in a State that

4 is composed of a single urban area, such an applica5 tion or decision may not result in a reduction of that

6 urban area’s wage index.’’.

7 (2) NO STANDARDIZED AMOUNT ADJUST8 MENT.—The Secretary of Health and Human Serv9 ices shall not revise the fiscal year 1993 standard10 ized amounts pursuant to subsections (d)(3)(B) and

11 (d)(8)(D) of section 1886 of the Social Security Act

12 to account for the amendment made by paragraph

13 (1).

14 (3) EFFECTIVE DATE.—The amendment made

15 by paragraph (1) shall apply to discharges occurring

16 on or after the expiration of the 30-day period that

17 begins on the date of the enactment of this Act.

18 (b) UPDATING STANDARDS FOR TREATING RURAL

19 COUNTIES AS URBAN COUNTIES BASED ON RATES OF

20 COMMUTATION.—

21 (1) IN GENERAL.—Section 1886(d)(8)(B) (42

22 U.S.C. 1395ww(d)(8)(B)) is amended—

23 (A) by striking ‘‘standards’’ each place it

24 appears and inserting ‘‘standards most recently

25 used’’, and
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1 (B) by striking ‘‘published in the Federal

2 Register on January 3, 1980’’.

3 (2) HOLD HARMLESS FOR COUNTIES CUR4 RENTLY TREATED AS URBAN.—Any hospital that is

5 treated as being located in an urban metropolitan

6 statistical area pursuant to section 1886(d)(8)(B) of

7 the Social Security Act as of the date of the enact8 ment of this Act shall continue to be so treated not9 withstanding the amendments made by paragraph

10 (1).

11 (3) EFFECTIVE DATE.—The amendments made

12 by paragraph (1) shall be effective on October 1,

13 1993.

14 (c) USE OF OCCUPATIONAL MIX IN GUIDELINES.—

15 (1) IN GENERAL.—Section 1886(d)(10)(D)(i)(I)

16 (42 U.S.C. 1395ww(d)(10)(D)(i)(I)) is amended by

17 inserting ‘‘(to the extent the Secretary determines

18 appropriate)’’ after ‘‘taking into account’’.

19 (2) EFFECTIVE DATE.—The amendment made

20 by paragraph (1) shall take effect as if included in

21 the enactment of OBRA–1989.

22 SEC. 104. REAUTHORIZATION OF RURAL TRANSITION

23 GRANT PROGRAM.

24 Section 4005(e)(9) of OBRA–1987 is amended—
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1 (1) by striking ‘‘1989 and’’ and inserting

2 ‘‘1989,’’; and

3 (2) by striking ‘‘1992’’ and inserting ‘‘1992

4 and $30,000,000 for each of fiscal years 1993

5 through 1997’’.

6 SEC. 105. REGIONAL REFERRAL CENTERS.

7 (a) EXTENSION THROUGH FISCAL YEAR 1994.—Sec8 tion 6003(d) of OBRA–1989 (42 U.S.C. 1395ww note)

9 is amended by striking ‘‘October 1, 1992’’ and inserting

10 ‘‘October 1, 1994’’.

11 (b) PERMITTING HOSPITALS TO DECLINE RECLASSI12 FICATION.—If any hospital fails to qualify as a rural refer13 ral center under section 1886(d)(5)(C) of the Social Secu14 rity Act as a result of a decision by the Medicare Geo15 graphic Classification Review Board under section

16 1886(d)(10) of such Act to reclassify the hospital as being

17 located in an urban area for fiscal year 1994, the Sec18 retary of Health and Human Services shall—

19 (1) notify such hospital of such failure to

20 qualify,

21 (2) provide an opportunity for such hospital to

22 decline such reclassification, and

23 (3) if the hospital declines such reclassification,

24 administer the Social Security Act (other than sec-
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1 tion 1886(d)(8)(D)) for fiscal year 1994 as if the

2 decision by the Review Board had not occurred.

3 SEC. 106. MEDICARE-DEPENDENT, SMALL RURAL HOS4 PITALS.

5 (a) IN GENERAL.—Section 1886(d)(5)(G) (42 U.S.C.

6 1395ww(d)(5)(G)) is amended—

7 (1) by amending clause (i) to read as follows:

8 ‘‘(i) In the case of a subsection (d) hospital which

9 is a medicare-dependent, small rural hospital, payment

10 under paragraph (1)(A) for discharges occurring before

11 October 1, 1994, shall be equal to the sum of the amount

12 determined under clause (ii) and the amount determined

13 under paragraph (1)(A)(iii).’’;

14 (2) by redesignating clauses (ii) and (iii) as

15 clauses (iii) and (iv); and

16 (3) by inserting after clause (i) the following

17 new clause:

18 ‘‘(ii) The amount determined under this clause is

19 ‘‘(I) for discharges occurring during the first 3

20 12-month cost reporting periods that begin on or

21 after April 1, 1990, the amount by which the hos22 pital’s target amount for the cost reporting period

23 (as defined in subsection (b)(3)(D)) exceeds the

24 amount determined under paragraph (1)(A)(iii); and
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1 ‘‘(II) for discharges occurring during any subse2 quent cost reporting period (or portion thereof), 50

3 percent of the amount by which the hospital’s target

4 amount for the cost reporting period (as defined in

5 subsection (b)(3)(D)) exceeds the amount deter6 mined under paragraph (1)(A)(iii).’’.

7 (b) PERMITTING HOSPITALS TO DECLINE RECLASSI8 FICATION.—If any hospital fails to qualify as a medicare9 dependent, small rural hospital under section

10 1886(d)(5)(G)(i) of the Social Security Act as a result of

11 a decision by the Medicare Geographic Classification Re12 view Board under section 1886(d)(10) of such Act to re13 classify the hospital as being located in an urban area for

14 fiscal year 1994, the Secretary of Health and Human

15 Services shall—

16 (1) notify such hospital of such failure to qual17 ify,

18 (2) provide an opportunity for such hospital to

19 decline such reclassification, and

20 (3) if the hospital declines such reclassification,

21 administer the Social Security Act (other than sec22 tion 1886(d)(8)(D)) for fiscal year 1994 as if the

23 decision by the Review Board had not occurred.
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1 SEC. 107. HEMOPHILIA PASS-THROUGH.

2 (a) IN GENERAL.—Section 6011(d) of OBRA–1989

3 is amended by striking ‘‘2 years after the date of enact4 ment of this Act’’ and inserting ‘‘September 30, 1994’’.

5 (b) EFFECTIVE DATE.—The amendment made by

6 subsection (a) shall take effect as if included in the enact7 ment of OBRA–1989.

8 SEC. 108. STATE HOSPITAL PAYMENT PROGRAMS.

9 (a) RECOUPMENT FROM NEW JERSEY HOSPITALS.—

10 (1) MORATORIUM ON RECOUPMENT.—Prior to

11 April 1, 1993, the Secretary of Health and Human

12 Services (in this section referred to as the ‘‘Sec13 retary’’) may not recoup from or otherwise reduce

14 payments to hospitals in the State of New Jersey be15 cause of alleged overpayments to such hospitals

16 under title XVIII of the Social Security Act which

17 occurred during the period of the statewide hospital

18 reimbursement demonstration project conducted in

19 that State between January 1, 1985, and December

20 31, 1988, under a waiver granted under section

21 1886(c) of the Social Security Act.

22 (2) PROVISION OF PAYMENT DATA.—The Sec23 retary may not recoup from or otherwise reduce pay24 ments to hospitals in the State of New Jersey be25 cause of alleged overpayments described in para26 graph (1) until the Secretary provides the State and
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1 hospitals located in the State with all relevant data

2 used by the Secretary to determine the amount of

3 such alleged overpayments, including (but not lim4 ited to) the cost reports submitted by the hospitals

5 to the Secretary during the period of the statewide

6 hospital reimbursement demonstration project de7 scribed in such paragraph and the methodology used

8 by the Secretary to determine payments to such hos9 pitals under title XVIII of the Social Security Act

10 during such period.

11 (b) CLARIFICATION OF PAYMENTS UNDER A MEDI12 CARE-APPROVED STATE HOSPITAL REIMBURSEMENT

13 SYSTEM.—In the case of a State hospital reimbursement

14 system that meets the requirements of section 1814(b)(3)

15 of the Social Security Act, no other provision in title

16 XVIII of such Act, no provision of title XIX of such Act,

17 no provision of the Employee Retirement Income Security

18 Act of 1974, and no provision of chapter 81 or 89 of title

19 5, United States Code, shall be construed as preventing

20 the system from providing that payment for services cov21 ered under the system be made on the basis of rates pro22 vided for under the system.

23 SEC. 109. PSYCHOLOGY SERVICES IN HOSPITALS.

24 Section 1861(e)(4) (42 U.S.C. 1395x(e)(4)) is

25 amended by striking ‘‘physician;’’ and inserting ‘‘physi-
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1 cian, except that a patient receiving qualified psychologist

2 services (as defined in subsection (ii)) may be under the

3 care of a clinical psychologist with respect to such services

4 to the extent permitted under State law;’’.

5 SEC. 110. GRADUATE MEDICAL EDUCATION PROVIDED IN A

6 HOSPITAL-OWNED COMMUNITY HEALTH CEN7 TER.

8 Section 1886(d)(5)(B)(iv) (42 U.S.C.

9 1395ww(d)(5)(B)(iv)) is amended by inserting after ‘‘the

10 hospital’’ the following: ‘‘or providing services at any en11 tity receiving a grant under section 330 of the Public

12 Health Service Act that is under the ownership or control

13 of the hospital (if the hospital incurs all, or substantially

14 all, of the costs of the services furnished to the hospital

15 by such interns and residents)’’.

16 SEC. 111. UNIFORMED SERVICES TREATMENT FACILITIES.

17 (a) COVERAGE OF SERVICES PROVIDED IN CERTAIN

18 UNIFORMED SERVICES TREATMENT FACILITIES.—

19 (1) IN GENERAL.—Subject to paragraph (2),

20 the Secretary of Health and Human Services may

21 not take any action to recover amounts that were

22 paid by the United States under title XVIII of the

23 Social Security Act to the facilities described in

24 paragraph (3) (or to other individuals or entities

25 with whom such facilities had entered into agree-
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1 ments to provide services under such title) for serv2 ices provided during the period beginning October 1,

3 1986, and ending December 31, 1989.

4 (2) EXCEPTION.—The Secretary may take a

5 recoupment action for the sole purpose of securing

6 obligation of the funds provided to the Uniformed

7 Services Treatment Facilities program pursuant to

8 the Department of Defense Appropriations Act,

9 1993 to fulfill such an action.

10 (3) FACILITIES DESCRIBED.—The facilities re11 ferred to in paragraph (1) are the hospitals de12 scribed in section 248c of title 42, United States

13 Code, that are located in Boston, Massachusetts;

14 Baltimore, Maryland; and Seattle, Washington.

15 (b) STUDY OF JOINT MEDICAL FACILITIES.—

16 (1) STUDY.—The Secretary of Health and

17 Human Services, in consultation with the Secretary

18 of Defense and the Secretary of Veterans Affairs,

19 shall conduct a study of the feasibility and desirabil20 ity of establishing joint medical facilities among the

21 Department of Defense, the Department of Veterans

22 Affairs, and other public and private entities, and

23 shall include in such study an analysis of the need

24 to make changes in the medicare and medicaid pro25 grams (including facility certification standards
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1 under such programs) in order to facilitate the es2 tablishment of such joint medical facilities.

3 (2) REPORT.—Not later than October 1, 1993,

4 the Secretary of Health and Human Services shall

5 submit a report to Congress on the study conducted

6 under paragraph (1).

7 SEC. 112. REQUIRING HOSPITALS AND NURSING FACILI8 TIES TO NOTIFY RESIDENTS OF AVAILABIL9 ITY OF HOSPICE BENEFIT.

10 (a) HOSPITALS.—Section 1861(ee)(2)(D) (42 U.S.C.

11 1395x(ee)(2)(D)) is amended by inserting ‘‘, including

12 hospice services,’’ after ‘‘post-hospital services’’.

13 (b) NURSING FACILITIES.—Section 1819(c)(1)(B)

14 (42 U.S.C. 1395i–3(c)(1)(B)) is amended—

15 (1) by striking ‘‘and’’ at the end of clause (ii);

16 (2) by striking the period at the end of clause

17 (iii) and inserting ‘‘; and’’; and

18 (3) by inserting after clause (iii) the following

19 new clause:

20 ‘‘(iv) inform each resident who is enti21 tled to benefits under this title, orally and

22 in writing at the time of admission to the

23 facility, of the entitlement of individuals to

24 hospice care under section 1812(a)(4) (un25 less there is no hospice program providing
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1 hospice care for which payment may be

2 made under this title within the geographic

3 area of the facility and it is not the com4 mon practice of the facility to refer pa5 tients to hospice programs located outside

6 such geographic area).’’.

7 (c) EFFECTIVE DATE.—The amendments made by

8 subsection (a) shall apply to services furnished on or after

9 the first day of the first month beginning more than one

10 year after the date of the enactment of this Act.

11 SEC. 113. SKILLED NURSING FACILITY WAGE INDEX.

12 (a) IN GENERAL.—Within 2 years of the date of the

13 enactment of this Act, the Secretary of Health and

14 Human Services shall begin to collect data on employee

15 compensation and paid hours of employment in skilled

16 nursing facilities for the purpose of constructing a skilled

17 nursing facility wage index adjustment to the routine serv18 ice cost limits required under section 1888(a)(4) of the

19 Social Security Act.

20 (b) PROPAC REPORT.—The Prospective Payment

21 Assessment Commission shall, by March 1, 1994, study

22 and report to the Congress on the impact of applying rou23 tine cost limits for skilled nursing facilities on a regional

24 basis.
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1 SEC. 114. DRG PAYMENT WINDOW TECHNICAL CLARIFICA2 TION; MISCELLANEOUS AND TECHNICAL

3 CORRECTIONS.

4 (a) CLARIFICATION OF DRG PAYMENT WINDOW EX5 PANSION.—The first sentence of section 1886(a)(4) (42

6 U.S.C. 1395ww(a)(4)) is further amended by striking

7 ‘‘and includes’’ and inserting ‘‘and (in the case of a sub8 section (d) hospital) includes’’.

9 (b) TECHNICAL CORRECTION RELATING TO RESI10 DENT ASSESSMENT IN NURSING HOMES.—Section

11 1819(b)(3)(C)(i)(I) (42 U.S.C. 1395i–3(b)(3)(C)(i)(I)) is

12 amended by striking ‘‘not later than’’ before ‘‘14 days’’.

13 (c) CLERICAL CORRECTIONS.—(1) Section

14 1814(i)(1)(C)(i) (42 U.S.C. 1395f(i)(1)(C)(i)) is amended

15 by striking ‘‘1990,,’’ and inserting ‘‘1990,’’.

16 (2) Section 1816(f)(2)(A)(ii) (42 U.S.C.

17 1396h(f)(2)(A)(ii)) is amended by striking ‘‘such agency’’

18 and inserting ‘‘such agency’s’’.

19 (3) Section 1886(d)(1)(A)(iii) (42 U.S.C.

20 1395ww(d)(1)(A)(iii)) is amended by striking ‘‘, the sum

21 of’’ and inserting ‘‘is equal to the sum of’’.

22 SEC. 115. EXTENSION OF RURAL HOSPITAL DEMONSTRA23 TION.

24 Section 4008(i)(1) of OBRA–1990 is amended by

25 adding at the end the following new sentence: ‘‘The Sec-
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1 retary shall continue any such demonstration project until

2 at least December 31, 1995.’’.

3 TITLE II—PROVISIONS

4 RELATING TO PART B

5 Subtitle A—Physicians’ Services

6 SEC. 201. SEPARATE PAYMENT FOR INTERPRETATION OF

7 ELECTROCARDIOGRAMS.

8 (a) IN GENERAL.—Paragraph (3) of section 1848(b)

9 (42 U.S.C. 1395w–4(b)) is amended to read as follows:

10 ‘‘(3) TREATMENT OF INTERPRETATION OF

11 ELECTROCARDIOGRAMS.—The Secretary—

12 ‘‘(A) shall make separate payment under

13 this section for the interpretation of electro14 cardiograms performed or ordered to be per15 formed as part of or in conjunction with a visit

16 to or a consultation with a physician, and

17 ‘‘(B) shall adjust the relative values estab18 lished for visits and consultations under sub19 section (c) so as not to include relative value

20 units for interpretations of electrocardiograms

21 in the relative value for visits and consulta22 tions.’’.

23 (b) ASSURING BUDGET NEUTRALITY.—Section

24 1848(c)(2) (42 U.S.C. 1395w–4(c)(2)) is amended by add25 ing at the end the following new subparagraph:
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1 ‘‘(E) BUDGET NEUTRALITY ADJUST2 MENTS.—The Secretary—

3 ‘‘(i) shall reduce the relative values

4 for all services (other than anesthesia serv5 ices) established under this paragraph

6 (and, in the case of anesthesia services, the

7 conversion factor established by the Sec8 retary for such services) by such percent9 age as the Secretary determines to be nec10 essary so that, beginning in 1996, the

11 amendment made by section 201(a) of the

12 Miscellaneous and Technical Medicare

13 Amendments of 1993 would not result in

14 expenditures under this section that exceed

15 the amount of such expenditures that

16 would have been made if such amendment

17 had not been made, and

18 ‘‘(ii) shall reduce the amounts deter19 mined under subsection (a)(2)(B)(i)(I) by

20 such percentage as the Secretary deter21 mines to be required to assure that, taking

22 into account the reductions made under

23 clause (i), the amendment made by section

24 201(a) of the Miscellaneous and Technical

25 Medicare Amendments of 1993 would not
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1 result in expenditures under this section in

2 1993 that exceed the amount of such ex3 penditures that would have been made if

4 such amendment had not been made.’’.

5 (c) CONFORMING AMENDMENTS.—Section 1848 (42

6 U.S.C. 1395w–4) is amended—

7 (1) in subsection (a)(2)(B)(i)(I), by inserting

8 ‘‘and as adjusted under subsection (c)(2)(E)(ii)’’

9 after ‘‘for 1993’’;

10 (2) in subsection (c)(2)(A)(i), by adding at the

11 end the following: ‘‘Such relative values are subject

12 to adjustment under subparagraph (E)(i).’’; and

13 (3) in subsection (i)(1)(B), by adding at the

14 end ‘‘including adjustments under subsection

15 (c)(2)(E),’’.

16 (d) EFFECTIVE DATE.—The amendments made by

17 this section shall apply to services furnished on or after

18 first day of the fourth month beginning after the date of

19 the enactment of this Act.

20 SEC. 202. PAYMENTS FOR NEW PHYSICIANS AND PRACTI21 TIONERS.

22 (a) EQUAL TREATMENT OF NEW PHYSICIANS AND

23 PRACTITIONERS.—(1) Section 1848(a) (42 U.S.C.

24 1395w–4(a)) is amended by striking paragraph (4).
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1 (2) Section 1842(b)(4) (42 U.S.C. 1395u(b)(4)) is

2 amended by striking subparagraph (F).

3 (b) BUDGET NEUTRALITY ADJUSTMENT.—Notwith4 standing any other provision of law, the Secretary of

5 Health and Human Services shall reduce the following val6 ues and amounts for 1993 (to be applied for that year

7 and subsequent years) by such uniform percentage as the

8 Secretary determines to be required to assure that the

9 amendments made by subsection (a) will not result in ex10 penditures under part B of title XVIII of the Social Secu11 rity Act in 1993 that exceed the amount of such expendi12 tures that would have been made if such amendments had

13 not been made:

14 (1) The relative values established under section

15 1848(c) of such Act for services (other than anesthe16 sia services) and, in the case of anesthesia services,

17 the conversion factor established under section 1848

18 of such Act for such services.

19 (2) The amounts determined under section

20 1848(a)(2)(B)(i)(I) of such Act.

21 (3) The prevailing charges or fee schedule

22 amounts to be applied under such part for services

23 of a health care practitioner (as defined in section

24 1842(b)(4)(F)(ii)(I) of such Act, as in effect before

25 the date of the enactment of this Act).
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1 (c) CONFORMING AMENDMENTS.—Section 1848 (42

2 U.S.C. 1395w–4), as amended by section 201(c), is

3 amended—

4 (1) in subsection (a)(2)(B)(i)(I), by inserting

5 ‘‘and section 202(b) of the Miscellaneous and Tech6 nical Medicare Amendments of 1993’’ after

7 ‘‘(c)(2)(E)(ii)’’ after ‘‘for 1993’’;

8 (2) in subsection (c)(2)(A)(i), by inserting ‘‘and

9 section 202(b) of the Miscellaneous and Technical

10 Medicare Amendments of 1993’’ after ‘‘under sub11 paragraph (E)(i)’’; and

12 (3) in subsection (i)(1)(B), by inserting ‘‘and

13 section 202(b) of the Miscellaneous and Technical

14 Medicare Amendments of 1993’’ after ‘‘under sub15 section (c)(2)(E)’’.

16 (d) EFFECTIVE DATE.—The amendments made by

17 subsection (a) shall apply to services furnished on or after

18 the first day of the fourth month beginning after the date

19 of the enactment of this Act.

20 SEC. 203. BASING PAYMENTS FOR ANESTHESIA SERVICES

21 ON ACTUAL TIME.

22 (a) PHYSICIANS’ SERVICES.—Section 1848(b)(2)(B)

23 (42 U.S.C. 1395w–4(b)(2)(B)) is amended by adding at

24 the end the following: ‘‘For anesthesia services furnished

25 on or after January 1, 1993, the Secretary may not mod-
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1 ify the methodology in effect as of January 1, 1992, for

2 determining the amount of time that may be billed for

3 such services under this section.’’.

4 (b) SERVICES OF CERTIFIED REGISTERED NURSE

5 ANESTHETISTS.—Section 1833(l)(1)(B) (42 U.S.C.

6 1395l(l)(1)(B)) is amended by adding at the end the fol7 lowing: ‘‘For anesthesia services furnished on or after

8 January 1, 1993, the Secretary may not modify the meth9 odology in effect as of January 1, 1992, for determining

10 the amount of time that may be billed for such services

11 under this section.’’.

12 SEC. 204. GEOGRAPHIC ADJUSTMENT FACTORS FOR MEDI13 CARE PHYSICIANS’ SERVICES.

14 (a) REQUIRING CONSULTATION WITH REPRESENTA15 TIVES OF PHYSICIANS IN REVIEWING GEOGRAPHIC AD16 JUSTMENT FACTORS.—Section 1848(e)(1)(C) (42 U.S.C.

17 1395w–4(e)(1)(C)) is amended by striking ‘‘shall review’’

18 and inserting ‘‘shall, in consultation with appropriate rep19 resentatives of physicians, review’’.

20 (b) USE OF MOST RECENT DATA IN GEOGRAPHIC

21 ADJUSTMENT.—Section 1848(e)(1) (42 U.S.C. 1395w–

22 4(e)(1)) is amended by adding at the end the following

23 new subparagraph:

24 ‘‘(D) USE OF RECENT DATA.—In estab25 lishing indices and index values under this
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1 paragraph, the Secretary shall use the most re2 cent data available relating to practice ex3 penses, malpractice expenses, and physician

4 work effort in different fee schedule areas.’’.

5 (c) DEADLINE FOR INITIAL REVIEW AND REVI6 SION.—The Secretary of Health and Human Services

7 shall first review and revise geographic adjustment factors

8 under section 1848(e)(1)(C) of the Social Security Act by

9 not later than January 1, 1995.

10 (d) REPORT ON REVIEW PROCESS.—Not later than

11 1 year after the date of the enactment of this Act, the

12 Secretary of Health and Human Services shall study and

13 report to the Committee on Finance of the Senate and

14 the Committee on Ways and Means and the Committee

15 on Energy and Commerce of the House of Representatives

16 on—

17 (1) the data necessary to review and revise the

18 indices established under section 1848(e)(1)(A) of

19 the Social Security Act, including—

20 (A) the shares allocated to physicians’

21 work effort, practice expenses (other than mal22 practice expenses), and malpractice expenses;

23 (B) the weights assigned to the input com24 ponents of such shares; and
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1 (C) the index values assigned to such com2 ponents;

3 (2) any limitations on the availability of data

4 necessary to review and revise such indices at least

5 every three years;

6 (3) ways of addressing such limitations, with

7 particular attention to the development of alternative

8 data sources for input components for which current

9 index values are based on data collected less fre10 quently than every three years; and

11 (4) the costs of developing more accurate and

12 timely data.

13 SEC. 205. EXTRA-BILLING LIMITS.

14 (a) ENFORCEMENT AND UNIFORM APPLICATION.—

15 (1) ENFORCEMENT.—Paragraph (1) of section

16 1848(g) (42 U.S.C. 1395w–4(g)) is amended to read

17 as follows:

18 ‘‘(1) LIMITATION ON ACTUAL CHARGES.—

19 ‘‘(A) IN GENERAL.—In the case of a

20 nonparticipating physician or nonparticipating

21 supplier or other person (as defined in section

22 1842(i)(2)) who does not accept payment on an

23 assignment-related basis for a physician’s serv24 ice furnished with respect to an individual en25 rolled under this part, the following rules apply:
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1 ‘‘(i) APPLICATION OF LIMITING

2 CHARGE.—No person may bill or collect an

3 actual charge for the service in excess of

4 the limiting charge described in paragraph

5 (2) for such service.

6 ‘‘(ii) NO LIABILITY FOR EXCESS

7 CHARGES.—No person is liable for pay8 ment of any amounts billed for the service

9 in excess of such limiting charge.

10 ‘‘(iii) CORRECTION OF EXCESS

11 CHARGES.—If such a physician, supplier,

12 or other person bills, but does not collect,

13 an actual charge for a service in violation

14 of clause (i), the physician, supplier, or

15 other person shall reduce on a timely basis

16 the actual charge billed for the service to

17 an amount not to exceed the limiting

18 charge for the service.

19 ‘‘(iv) REFUND OF EXCESS COLLEC20 TIONS.—If such a physician, supplier, or

21 other person collects an actual charge for

22 a service in violation of clause (i), the phy23 sician, supplier, or other person shall pro24 vide on a timely basis a refund to the indi25 vidual charged in the amount by which the
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1 amount collected exceeded the limiting

2 charge for the service. The amount of such

3 a refund shall be reduced to the extent the

4 individual has an outstanding balance owed

5 by the individual to the physician.

6 ‘‘(B) SANCTIONS.—If a physician, supplier,

7 or other person—

8 ‘‘(i) knowingly and willfully bills or

9 collects for services in violation of subpara10 graph (A)(i) on a repeated basis,

11 ‘‘(ii) fails to comply with clause (iii)

12 or (iv) of subparagraph (A) on a timely

13 basis,

14 the Secretary may apply sanctions against the

15 physician, supplier, or other person in accord16 ance with paragraph (2) of section 1842(j). In

17 applying this subparagraph, paragraph (4) of

18 such section applies in the same manner as

19 such paragraph applies to such section and any

20 reference in such section to a physician is

21 deemed also to include a reference to a supplier

22 or other person under this subparagraph.

23 ‘‘(C) TIMELY BASIS.—For purposes of this

24 paragraph, a correction of a bill for an excess

25 charge or refund of an amount with respect to
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1 a violation of subparagraph (A)(i) in the case of

2 a service is considered to be provided ‘on a

3 timely basis’, if the reduction or refund is made

4 not later than 30 days after the date the physi5 cian, supplier, or other person is notified by the

6 carrier under this part of such violation and of

7 the requirements of subparagraph (A).’’.

8 (2) UNIFORM APPLICATION OF EXTRA-BILLING

9 LIMITS TO PHYSICIANS’ SERVICES.—

10 (A) IN GENERAL.—Section 1848(g)(2)(C)

11 (42 U.S.C. 1395w–4(g)(2)(C)) is amended by

12 inserting ‘‘or for nonparticipating suppliers or

13 other persons’’ after ‘‘nonparticipating physi14 cians’’.

15 (B) CONFORMING DEFINITION.—Section

16 1842(i)(2) (42 U.S.C. 1395u(i)(2)) is amend17 ed—

18 (i) by striking ‘‘, and the term’’ and

19 inserting ‘‘; the term’’, and

20 (ii) by inserting before the period at

21 the end the following: ‘‘; and the term

22 ‘nonparticipating supplier or other person’

23 means a supplier or other person (exclud24 ing a provider of services) that is not a
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1 participating physician or supplier (as de2 fined in subsection (h)(1))’’.

3 (3) ADDITIONAL CONFORMING AMENDMENTS.—

4 Section 1848 (42 U.S.C. 1395w–4) is amended—

5 (A) in subsection (a)(3), by inserting ‘‘AND

6 SUPPLIERS’’ after ‘‘PHYSICIANS’’, and by insert7 ing ‘‘or a nonparticipating supplier or other

8 person’’ after ‘‘nonparticipating physician’’ and

9 by adding at the end the following: ‘‘In the case

10 of physicians’ services (including services which

11 the Secretary excludes pursuant to subsection

12 (j)(3)) of a nonparticipating physician, supplier,

13 or other person for which payment is made

14 under this part on a basis other than the fee

15 schedule amount, the payment shall be based on

16 95 percent of the payment basis for such serv17 ices furnished by a participating physician, sup18 plier, or other person.’’;

19 (B) in subsection (g)(1)(A), as amended by

20 subsection (a), in the matter before clause (i),

21 by inserting ‘‘(including services which the Sec22 retary excludes pursuant to subsection (j)(3))’’

23 after ‘‘a physician’s service’’;

24 (C) in subsection (g)(2)(D), by inserting

25 ‘‘(or, if payment under this part is made on a
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1 basis other than the fee schedule under this sec2 tion, 95 percent of the other payment basis)’’

3 after ‘‘subsection (a)’’;

4 (D) in subsection (g)(3)(B)—

5 (i) by inserting after the first sentence

6 the following: ‘‘No person is liable for pay7 ment of any amounts billed for such a

8 service in violation of the previous sen9 tence.’’, and

10 (ii) in the last sentence, by striking

11 ‘‘previous sentence’’ and inserting ‘‘first

12 sentence’’;

13 (E) in subsection (h)—

14 (i) by inserting ‘‘or nonparticipating

15 supplier or other person furnishing physi16 cians’ services (as defined in section

17 1848(j)(3))’’ after ‘‘physician’’ the first

18 place it appears,

19 (ii) by inserting ‘‘, supplier, or other

20 person’’ after ‘‘physician’’ the second place

21 it appears, and

22 (iii) by inserting ‘‘, suppliers, and

23 other persons’’ after ‘‘physicians’’ the sec24 ond place it appears; and
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1 (F) in subsection (j)(3), by inserting ‘‘, ex2 cept for purposes of subsections (a)(3), (g), and

3 (h)’’ after ‘‘tests and’’.

4 (b) CLARIFICATION OF MANDATORY ASSIGNMENT

5 RULES FOR CERTAIN PRACTITIONERS.—

6 (1) IN GENERAL.—Section 1842(b) (42 U.S.C.

7 1395u(b)) is amended by adding at the end the fol8 lowing new paragraph:

9 ‘‘(19)(A) Payment for any service furnished by a

10 practitioner described in subparagraph (C) and for which

11 payment may be made under this part on a reasonable

12 charge or fee schedule basis may only be made under this

13 part on an assignment-related basis.

14 ‘‘(B) A practitioner described in subparagraph (C) or

15 other person may not bill (or collect any amount from)

16 the individual or another person for any service described

17 in subparagraph (A), except for deductible and coinsur18 ance amounts applicable under this part. No person is lia19 ble for payment of any amounts billed for such a service

20 in violation of the previous sentence. If a practitioner or

21 other person knowingly and willfully bills (or collects an

22 amount) for such a service in violation of such sentence,

23 the Secretary may apply sanctions against the practitioner

24 or other person in the same manner as the Secretary may

25 apply sanctions against a physician in accordance with
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1 section 1842(j)(2) in the same manner as such section ap2 plies with respect to a physician. Paragraph (4) of section

3 1842(j) shall apply in this subparagraph in the same man4 ner as such paragraph applies to such section.

5 ‘‘(C) A practitioner described in this subparagraph

6 is any of the following:

7 ‘‘(i) A physician assistant, nurse practitioner, or

8 clinical nurse specialist (as defined in section

9 1861(aa)(5)).

10 ‘‘(ii) A certified registered nurse anesthetist (as

11 defined in section 1861(bb)(2)).

12 ‘‘(iii) A certified nurse-midwife (as defined in

13 section 1861(gg)(2)).

14 ‘‘(iv) A clinical social worker (as defined in sec15 tion 1861(hh)(1)).

16 ‘‘(v) A clinical psychologist (as defined by the

17 Secretary for purposes of section 1861(ii)).

18 ‘‘(D) For purposes of this paragraph, a service fur19 nished by a practitioner described in subparagraph (C) in20 cludes any services and supplies furnished as incident to

21 the service as would otherwise be covered under this part

22 if furnished by a physician or as incident to a physician’s

23 service.’’.

24 (2) CONFORMING AMENDMENTS.—
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1 (A) Section 1833 (42 U.S.C. 1395l) is

2 amended—

3 (i) in subsection (l)(5), by striking

4 subparagraph (B) of subsection (l)(5) and

5 redesignating subparagraph (C) as sub6 paragraph (B);

7 (ii) by striking subsection (p); and

8 (iii) in subsection (r), by striking

9 paragraph (3) and redesignating para10 graph (4) as paragraph (3).

11 (B) Section 1842(b)(12) (42 U.S.C.

12 1395u(b)(12)) is amended by striking subpara13 graph (C).

14 (c) INFORMATION ON EXTRA-BILLING LIMITS.—

15 (1) PART OF EXPLANATION OF MEDICARE BEN16 EFITS.—Section 1842(h)(7) (42 U.S.C.

17 1395u(h)(7)) is amended—

18 (A) by striking ‘‘and’’ at the end of sub19 paragraph (B),

20 (B) in subparagraph (C), by striking ‘‘shall

21 include’’ and by striking the period at the end

22 and inserting ‘‘, and’’, and

23 (C) by adding at the end the following new

24 subparagraph:
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1 ‘‘(D) in the case of services for which the billed

2 amount exceeds the limiting charge imposed under

3 section 1848(g), information regarding such applica4 ble limiting charge (including information concern5 ing the right to a refund under section

6 1848(g)(1)(D)).’’.

7 (2) DETERMINATIONS BY CARRIERS.—Subpara8 graph (G) of section 1842(b)(3) (42 U.S.C.

9 1395u(b)(3)) is amended to read as follows:

10 ‘‘(G) will, for a service that is furnished with

11 respect to an individual enrolled under this part,

12 that is not paid on an assignment-related basis, and

13 that is subject to a limiting charge under section

14 1848(g)—

15 ‘‘(i) determine, prior to making payment,

16 whether the amount billed for such service ex17 ceeds the limiting charge applicable under sec18 tion 1848(g)(2);

19 ‘‘(ii) notify the physician, supplier, or other

20 person periodically (but not less often than once

21 every 30 days) of determinations that amounts

22 billed exceeded such applicable limiting charges;

23 and

24 ‘‘(iii) provide for prompt response to in25 quiries of physicians, suppliers, and other per-
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1 sons concerning the accuracy of such limiting

2 charges for their services;’’.

3 (d) REPORT ON CHARGES IN EXCESS OF LIMITING

4 CHARGE.—Section 1848(g)(6)(B) (42 U.S.C. 1395w–

5 4(g)(6)(B)) is amended by inserting ‘‘the extent to which

6 actual charges exceed limiting charges, the number and

7 types of services involved, and the average amount of ex8 cess charges and’’ after ‘‘report to the Congress’’.

9 (e) MISCELLANEOUS AND TECHNICAL AMEND10 MENTS.—Section 1833 (42 U.S.C. 1395l) is amended—

11 (1) in subsection (a)(1), as amended by section

12 249(e)(2)—

13 (A) by striking ‘‘and’’ before ‘‘(O)’’, and

14 (B) by inserting before the semicolon at

15 the end the following: ‘‘, and (P) with respect

16 to services described in clauses (i), (ii) and (iv)

17 of section 1861(s)(2)(K), the amounts paid are

18 subject to the provisions of section

19 1842(b)(12)’’; and

20 (2) in subsection (h)(5)(D)—

21 (A) by striking ‘‘paragraphs (2) and (3)’’

22 and by inserting ‘‘paragraph (2)’’, and

23 (B) by adding at the end the following:

24 ‘‘Paragraph (4) of such section shall apply in
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1 this subparagraph in the same manner as such

2 paragraph applies to such section.’’.

3 (f) EFFECTIVE DATES.—

4 (1) ENFORCEMENT AND UNIFORM APPLICA5 TION; MISCELLANEOUS AND TECHNICAL AMEND6 MENTS.—The amendments made by subsections (a)

7 and (e) shall apply to services furnished on or after

8 the date of the enactment of this Act; except that

9 the amendments made by subsection (a) shall not

10 apply to services of a nonparticipating supplier or

11 other person furnished before the first day of the

12 fourth month beginning after the date of the enact13 ment of this Act.

14 (2) PRACTITIONERS.—The amendments made

15 by subsection (b) shall apply to services furnished on

16 or after the first day of the fourth month beginning

17 after the date of the enactment of this Act.

18 (3) EOMBS.—The amendments made by sub19 section (c)(1) shall apply to explanations of benefits

20 provided on or after the first day of the fourth

21 month beginning after the date of the enactment of

22 this Act.

23 (4) CARRIER DETERMINATIONS.—The amend24 ments made by subsection (c)(2) shall apply to con-
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1 tracts as of the first day of the fourth month begin2 ning after the date of the enactment of this Act.

3 (5) REPORT.—The amendment made by sub4 section (d) shall apply to reports for years beginning

5 with 1994.

6 SEC. 206. RELATIVE VALUES FOR PEDIATRIC SERVICES.

7 (a) IN GENERAL.—The Secretary of Health and

8 Human Services shall fully develop, by not later than July

9 1, 1994, relative values for the full range of pediatric phy10 sicians’ services which are consistent with the relative val11 ues developed for other physicians’ services under section

12 1848(c) of the Social Security Act. In developing such val13 ues, the Secretary shall conduct such refinements as may

14 be necessary to produce appropriate estimates for such rel15 ative values.

16 (b) STUDY.—

17 (1) IN GENERAL.—The Secretary shall conduct

18 a study of the relative values for pediatric and other

19 services to determine whether there are significant

20 variations in the resources used in providing similar

21 services to different populations. In conducting such

22 study, the Secretary shall consult with appropriate

23 organizations representing pediatricians and other

24 physicians.
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1 (2) REPORT.—Not later than July 1, 1994, the

2 Secretary shall submit to Congress a report on the

3 study conducted under paragraph (1). Such report

4 shall include any appropriate recommendations re5 garding needed changes in coding or other payment

6 policies to ensure that payments for pediatric serv7 ices appropriately reflect the resources required to

8 provide these services.

9 SEC. 207. ANTIGENS UNDER PHYSICIAN FEE SCHEDULE.

10 (a) IN GENERAL.—Section 1848(j)(3) (42 U.S.C.

11 1395w–4(j)(3)) is amended by inserting ‘‘(2)(G),’’ after

12 ‘‘(2)(D),’’.

13 (b) EFFECTIVE DATE.—The amendment made by

14 subsection (a) shall apply to services furnished on or after

15 January 1, 1994.

16 SEC. 208. ADMINISTRATION OF CLAIMS RELATING TO PHY17 SICIANS’ SERVICES.

18 (a) LIMITATION ON CARRIER USER FEES.—Section

19 1842(c) (42 U.S.C. 1395u(c)) is amended by adding at

20 the end the following new paragraph:

21 ‘‘(4) Neither a carrier nor the Secretary may impose

22 a fee under this title—

23 ‘‘(A) for the filing of claims related to physi24 cians’ services,
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1 ‘‘(B) for an error in filing a claim relating to

2 physicians’ services or for such a claim which is de3 nied,

4 ‘‘(C) for any appeal under this title with respect

5 to physicians’ services,

6 ‘‘(D) for applying for (or obtaining) a unique

7 identifier under subsection (r), or

8 ‘‘(E) for responding to inquiries respecting phy9 sicians’ services or for providing information with re10 spect to medical review of such services.’’.

11 (b) CLARIFICATION OF PERMISSIBLE SUBSTITUTE

12 BILLING ARRANGEMENTS.—

13 (1) IN GENERAL.—Clause (D) of section

14 1842(b)(6) (42 U.S.C. 1395u(b)(6)) is amended to

15 read as follows: ‘‘(D) payment may be made to a

16 physician for physicians’ services (and services fur17 nished incident to such services) furnished by a sec18 ond physician to patients of the first physician if (i)

19 the first physician is unavailable to provide the serv20 ices; (ii) the services are furnished pursuant to an

21 arrangement between the two physicians that (I) is

22 informal and reciprocal, or (II) involves per diem or

23 other fee-for-time compensation for such services;

24 (iii) the services are not provided by the second phy25 sician over a continuous period of more than 60
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1 days; and (iv) the claim form submitted to the car2 rier for such services includes the second physician’s

3 unique identifier (provided under the system estab4 lished under subsection (r)) and indicates that the

5 claim meets the requirements of this clause for pay6 ment to the first physician’’.

7 (2) EFFECTIVE DATE.—The amendment made

8 by paragraph (1) shall apply to services furnished on

9 or after the first day of the first month beginning

10 more than 60 days after the date of the enactment

11 of this Act.

12 SEC. 209. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

13 (a) OVERVALUED PROCEDURES (SECTION 4101 OF

14 OBRA–1990).—(1) Section 1842(b)(16)(B)(iii) (42

15 U.S.C. 1395u(b)(16)(B)(iii)) is amended—

16 (A) by striking ‘‘, simple and subcutaneous’’,

17 (B) by striking ‘‘; small’’ and inserting ‘‘and

18 small’’,

19 (C) by striking ‘‘treatments;’’ the first place it

20 appears and inserting ‘‘and’’,

21 (D) by striking ‘‘lobectomy;’’,

22 (E) by striking ‘‘enterectomy; colectomy; chole23 cystectomy;’’,

24 (F) by striking ‘‘; transurerethral resection’’

25 and inserting ‘‘and resection’’, and
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1 (G) by striking ‘‘sacral laminectomy;’’.

2 (2) Section 4101(b)(2) of OBRA–1990 is amended—

3 (A) in the matter before subparagraph (A), by

4 striking ‘‘1842(b)(16)’’ and inserting

5 ‘‘1842(b)(16)(B)’’, and

6 (B) in subparagraph (B)—

7 (i) by striking ‘‘, simple and subcutane8 ous’’,

9 (ii) by striking ‘‘(HCPCS codes 19160 and

10 19162)’’ and inserting ‘‘(HCPCS code 19160)’’,

11 and

12 (iii) by striking all that follows ‘‘(HCPCS

13 codes 92250’’ and inserting ‘‘and 92260).’’.

14 (b) RADIOLOGY SERVICES (SECTION 4102 OF

15 OBRA–1990).—(1) Section 1834(b)(4) (42 U.S.C.

16 1395m(b)(4)) is amended by redesignating subparagraphs

17 (E) and (F) as subparagraphs (F) and (G), respectively.

18 (2) Section 1834(b)(4)(D) (42 U.S.C.

19 1395m(b)(4)(D)) is amended—

20 (A) in the matter before clause (i), by striking

21 ‘‘shall be determined as follows:’’ and inserting

22 ‘‘shall, subject to clause (vii), be reduced to the ad23 justed conversion factor for the locality determined

24 as follows:’’,
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1 (B) in clause (iv), by striking ‘‘LOCAL ADJUST2 MENT.—Subject to clause (vii), the conversion factor

3 to be applied to’’ and inserting ‘‘ADJUSTED CONVER4 SION FACTOR.—The adjusted conversion factor for’’,

5 (C) in clause (vii), by striking ‘‘under this sub6 paragraph’’, and

7 (D) in clause (vii), by inserting ‘‘reduced under

8 this subparagraph by’’ after ‘‘shall not be’’.

9 (3) Section 4102(c)(2) of OBRA–1990 is amended

10 by striking ‘‘radiology services’’ and all that follows and

11 inserting ‘‘nuclear medicine services’’.

12 (4) Section 4102(d) of OBRA–1990 is amended by

13 striking ‘‘new paragraph’’ and inserting ‘‘new subpara14 graph’’.

15 (5) Section 1834(b)(4)(E) (42 U.S.C.

16 1395m(b)(4)(E)) is amended by inserting ‘‘RULE FOR

17 CERTAIN SCANNING SERVICES.—’’ after ‘‘(E)’’.

18 (6) Section 1848(a)(2)(D)(iii) (42 U.S.C. 1395w–

19 4(a)(2)(D)(iii)) is amended by striking ‘‘that are subject

20 to section 6105(b) of the Omnibus Budget Reconciliation

21 Act of 1989’’ and by striking ‘‘provided under such sec22 tion’’ and inserting ‘‘provided under section 6105(b) of the

23 Omnibus Budget Reconciliation Act of 1989’’.

24 (c) ANESTHESIA SERVICES (SECTION 4103 OF

25 OBRA–1990).—(1) Section 4103(a) of OBRA–1990 is
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1 amended by striking ‘‘REDUCTION IN FEE SCHEDULE’’

2 and inserting ‘‘REDUCTION IN PREVAILING CHARGES’’.

3 (2) Section 1842(q)(1)(B) (42 U.S.C.

4 1395u(q)(1)(B)) is amended—

5 (A) in the matter before clause (i), by striking

6 ‘‘shall be determined as follows:’’ and inserting

7 ‘‘shall, subject to clause (iv), be reduced to the ad8 justed prevailing charge conversion factor for the lo9 cality determined as follows:’’, and

10 (B) in clause (iii), by striking ‘‘Subject to

11 clause (iv), the prevailing charge conversion factor to

12 be applied in’’ and inserting ‘‘The adjusted prevail13 ing charge conversion factor for’’.

14 (d) ASSISTANTS AT SURGERY (SECTION 4107 OF

15 OBRA–1990).—(1) Section 4107(c) of OBRA–1990 is

16 amended by inserting ‘‘(a)(1)’’ after ‘‘subsection’’.

17 (2) Section 4107(a)(2) of OBRA–1990 is amended

18 by adding at the end the following: ‘‘In applying section

19 1848(g)(2)(D) of the Social Security Act for services of

20 an assistant-at-surgery furnished during 1991, the recog21 nized payment amount shall not exceed the maximum

22 amount specified under section 1848(i)(2)(A) of such Act

23 (as applied under this paragraph in such year).’’.

24 (e) TECHNICAL COMPONENTS OF DIAGNOSTIC SERV25 ICES (SECTION 4108 OF OBRA–1990).—Section 1842(b)
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1 (42 U.S.C. 1395u(b)) is amended by redesignating para2 graph (18), as added by section 4108(a) of OBRA–1990,

3 as paragraph (17) and, in such paragraph, by inserting

4 ‘‘, tests specified in paragraph (14)(C)(i),’’ after ‘‘diag5 nostic laboratory tests’’.

6 (f) STATEWIDE FEE SCHEDULES (SECTION 4117 OF

7 OBRA–1990).—Section 4117 of OBRA–1990 is amend8 ed—

9 (1) in subsection (a)—

10 (A) by striking ‘‘IN GENERAL.—’’, and

11 (B) by striking ‘‘, if the’’ and all that fol12 lows through ‘‘1991, ’’; and

13 (2) by striking subsections (b), (c), and (d).

14 (g) STUDY OF AGGREGATION RULE FOR CLAIMS OF

15 SIMILAR PHYSICIAN SERVICES (SECTION 4113 OF

16 OBRA–1990).—Section 4113 of OBRA–1990 is amend17 ed—

18 (1) by inserting ‘‘of the Social Security Act’’

19 after ‘‘1869(b)(2)’’; and

20 (2) by striking ‘‘December 31, 1992’’ and in21 serting ‘‘December 31, 1993’’.

22 (h) OTHER MISCELLANEOUS AND TECHNICAL

23 AMENDMENTS.—(1) The heading of section 1834(f) (42

24 U.S.C. 1395m(f)) is amended by striking ‘‘FISCAL YEAR’’.

25 (2)(A) Section 4105(b) of OBRA–1990 is amended—
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1 (i) in paragraph (2), by striking ‘‘amendments’’

2 and inserting ‘‘amendment’’, and

3 (ii) in paragraph (3), by striking ‘‘amendments

4 made by paragraphs (1) and (2)’’ and inserting

5 ‘‘amendment made by paragraph (1)’’.

6 (B) Section 1848(f)(2)(C) (42 U.S.C. 1395w–

7 4(f)(2)(C)) is amended by inserting ‘‘PERFORMANCE

8 STANDARD RATES OF INCREASE FOR FISCAL YEAR 1991.—

9 ’’ after ‘‘(C)’’.

10 (C) Section 4105(d) of OBRA–1990 is amended by

11 inserting ‘‘PUBLICATION OF PERFORMANCE STANDARD

12 RATES.—’’ after ‘‘(d)’’.

13 (3) Section 1842(b)(4)(F) (42 U.S.C.

14 1395u(b)(4)(F)) is amended—

15 (A) in clause (i), by striking ‘‘prevailing

16 charge’’ the first place it appears and inserting

17 ‘‘customary charge’’; and

18 (B) in clause (ii)(III), by striking ‘‘second,

19 third, and fourth’’ and inserting ‘‘first, second, and

20 third’’.

21 (4) Section 1842(b)(4)(F)(ii)(I) (42 U.S.C.

22 1395u(b)(4)(F)(ii)(I)) is amended by striking ‘‘respiratory

23 therapist,’’.
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1 (5) Section 4106(c) of OBRA–1990 is amended by

2 inserting ‘‘of the Social Security Act’’ after

3 ‘‘1848(d)(1)(B)’’.

4 (6) Section 4114 of OBRA–1990 is amended by

5 striking ‘‘patients’’ the second place it appears.

6 (7) Section 1848(e)(1)(C) (42 U.S.C. 1395w–

7 4(e)(1)(C)) is amended by inserting ‘‘date of the’’ after

8 ‘‘since the’’.

9 (8) Section 4118(f)(1)(D) of OBRA–1990 is amend10 ed by striking ‘‘is amended’’.

11 (9) Section 4118(f)(1)(N)(ii) of OBRA–1990 is

12 amended by striking ‘‘subsection (f)(5)(A)’’ and inserting

13 ‘‘subsection (f)(5)(A))’’.

14 (10) Section 1845(e) (42 U.S.C. 1395w–1(e)) is

15 amended—

16 (A) by striking paragraph (2); and

17 (B) by redesignating paragraphs (3), (4), and

18 (5) as paragraphs (2), (3), and (4).

19 (11) Section 4118(j)(2) of OBRA–1990 is amended

20 by striking ‘‘In section’’ and inserting ‘‘Section’’.

21 (12)(A) Section 1848(i)(3) (42 U.S.C. 1395w–

22 4(i)(3)) is amended by striking the space before the period

23 at the end.

24 (B) Section 1834(a)(10)(B) (42 U.S.C.

25 1395m(a)(10)(B)) is amended by striking ‘‘as such provi-
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1 sions apply to physicians’ services and physicians and a

2 reasonable charge under section 1842(b)’’.

3 (i) EFFECTIVE DATE.—The amendments made by

4 this section and the provisions of this section shall take

5 effect as if included in the enactment of OBRA–1990.

6 Subtitle B—Ambulatory Surgical

7 Services

8 SEC. 211. EYE OR EYE AND EAR HOSPITALS.

9 (a) IN GENERAL.—Section 1833(i) (42 U.S.C.

10 1395l(i)) is amended—

11 (1) in subparagraph (B)(ii)—

12 (A) by striking ‘‘the last sentence of this

13 clause’’ and inserting ‘‘paragraph (4)’’, and

14 (B) by striking the last sentence; and

15 (2) by inserting after paragraph (3) the follow16 ing new paragraph:

17 ‘‘(4)(A) In the case of a hospital that—

18 ‘‘(i) makes application to the Secretary and

19 demonstrates that it specializes in eye services or eye

20 and ear services (as determined by the Secretary),

21 ‘‘(ii) receives more than 30 percent of its total

22 revenues from outpatient services, and

23 ‘‘(iii) on October 1, 1987—

24 ‘‘(I) was an eye specialty hospital or an eye

25 and ear specialty hospital, or
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1 ‘‘(II) was operated as an eye or eye and

2 ear unit (as defined in subparagraph (B)) of a

3 general acute care hospital which, on the date

4 of the application described in clause (i), oper5 ates less than 20 percent of the beds that the

6 hospital operated on October 1, 1987, and has

7 sold or otherwise disposed of a substantial por8 tion of the hospital’s other acute care oper9 ations,

10 the cost proportion and ASC proportion in effect under

11 subclauses (I) and (II) of paragraph (2)(B)(ii) for cost

12 reporting periods beginning in fiscal year 1988 shall re13 main in effect for cost reporting periods beginning on or

14 after October 1, 1988, and before January 1, 1995.

15 ‘‘(B) For purposes of this subparagraph (A)(iii)(II),

16 the term ‘eye or eye and ear unit’ means a physically sepa17 rate or distinct unit containing separate surgical suites de18 voted solely to eye or eye and ear services.’’.

19 (b) EFFECTIVE DATE.—The amendments made by

20 subsection (a) shall apply to portions of cost reporting pe21 riods beginning on or after January 1, 1994.
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1 SEC. 212. EXTENSION OF CAP ON PAYMENTS FOR INTRA2 OCULAR LENSES.

3 (a) IN GENERAL.—Section 4151(c)(3) of OBRA–

4 1990 is amended by striking ‘‘December 31, 1992’’ and

5 inserting ‘‘December 31, 1994’’.

6 (b) EFFECTIVE DATE.—The amendment made by

7 subsection (a) shall be effective as if included in the enact8 ment of OBRA–1990.

9 SEC. 213. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

10 (a) PAYMENT AMOUNTS FOR SERVICES FURNISHED

11 IN AMBULATORY SURGICAL CENTERS.—(1)(A) Section

12 1833(i)(2)(A)(i) (42 U.S.C. 1395l(i)(2)(A)(i)) is amended

13 by striking the comma at the end and inserting the follow14 ing: ‘‘, as determined in accordance with a survey (based

15 upon a representative sample of procedures and facilities)

16 taken not later than January 1, 1994, and every 5 years

17 thereafter, of the actual audited costs incurred by such

18 centers in providing such services,’’.

19 (B) Section 1833(i)(2) (42 U.S.C. 1395l(i)(2)) is

20 amended—

21 (i) in the second sentence of subparagraph (A)

22 and the second sentence of subparagraph (B), by

23 striking ‘‘and may be adjusted by the Secretary,

24 when appropriate,’’; and

25 (ii) by adding at the end the following new sub26 paragraph:
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1 ‘‘(C) Notwithstanding the second sentence of sub2 paragraph (A) or the second sentence of subparagraph

3 (B), if the Secretary has not updated amounts established

4 under such subparagraphs with respect to facility services

5 furnished during a fiscal year (beginning with fiscal year

6 1995), such amounts shall be increased by the percentage

7 increase in the consumer price index for all urban consum8 ers (U.S. city average) for the 12-month period ending

9 with March of the preceding fiscal year.’’.

10 (C) The second sentence of section 1833(i)(1) (42

11 U.S.C. 1395l(i)(1)) is amended by striking the period and

12 inserting the following: ‘‘, in consultation with appropriate

13 trade and professional organizations.’’.

14 (2) Section 4151(c)(3) of OBRA–1990 is amended

15 by striking ‘‘for the insertion of an intraocular lens’’ and

16 inserting ‘‘for an intraocular lens inserted’’.

17 (b) ADJUSTMENTS TO PAYMENT AMOUNTS FOR NEW

18 TECHNOLOGY INTRAOCULAR LENSES.—(1) Not later

19 than 1 year after the date of the enactment of this Act,

20 the Secretary of Health and Human Services (in this sub21 section referred to as the ‘‘Secretary’’) shall develop and

22 implement a process under which interested parties may

23 request review by the Secretary of the appropriateness of

24 the reimbursement amount provided under section

25 1833(i)(2)(A)(iii) of the Social Security Act with respect
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1 to a class of new technology intraocular lenses. For pur2 poses of the preceding sentence, an intraocular lens may

3 not be treated as a new technology lens unless it has been

4 approved by the Food and Drug Administration.

5 (2) In determining whether to provide an adjustment

6 of payment with respect to a particular lens under para7 graph (1), the Secretary shall take into account whether

8 use of the lens is likely to result in reduced risk of

9 intraoperative or postoperative complication or trauma,

10 accelerated postoperative recovery, reduced induced astig11 matism, improved postoperative visual acuity, more stable

12 postoperative vision, or other comparable clinical advan13 tages.

14 (3) The Secretary shall publish notice in the Federal

15 Register from time to time (but no less often than once

16 each year) of a list of the requests that the Secretary has

17 received for review under this subsection, and shall provide

18 for a 30-day comment period on the lenses that are the

19 subjects of the requests contained in such notice. The Sec20 retary shall publish a notice of his determinations with

21 respect to intraocular lenses listed in the notice within 90

22 days after the close of the comment period.

23 (4) Any adjustment of a payment amount (or pay24 ment limit) made under this subsection shall become effec25 tive not later than 30 days after the date on which the
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1 notice with respect to the adjustment is published under

2 paragraph (3).

3 (c) BLEND AMOUNTS FOR AMBULATORY SURGICAL

4 CENTER PAYMENTS.—

5 (1) IN GENERAL.—Subclauses (I) and (II) of

6 section 1833(i)(3)(B)(ii) (42 U.S.C.

7 1395l(i)(3)(B)(ii)) are each amended—

8 (A) by striking ‘‘for reporting’’ and insert9 ing ‘‘for portions of cost reporting’’; and

10 (B) by striking ‘‘and on or before’’ and in11 serting ‘‘and ending on or before’’.

12 (2) EFFECTIVE DATE.—The amendments made

13 by paragraph (1) shall take effect as if included in

14 the enactment of OBRA–1990.

15 Subtitle C—Durable Medical

16 Equipment

17 SEC. 221. CERTIFICATION OF SUPPLIERS.

18 (a) REQUIREMENTS.—

19 (1) IN GENERAL.—Section 1834 (42 U.S.C.

20 1395m) is amended by adding at the end the follow21 ing new subsection:

22 ‘‘(i) REQUIREMENTS FOR SUPPLIERS OF MEDICAL

23 EQUIPMENT AND SUPPLIES.—

24 ‘‘(1) ISSUANCE AND RENEWAL OF SUPPLIER

25 NUMBER.—
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1 ‘‘(A) PAYMENT.—Except as provided in

2 subparagraph (C), no payment may be made

3 under this part after October 1, 1993, for items

4 furnished by a supplier of medical equipment

5 and supplies unless such supplier obtains (and

6 renews at such intervals as the Secretary may

7 require) a supplier number.

8 ‘‘(B) STANDARDS FOR POSSESSING A SUP9 PLIER NUMBER.—A supplier may not obtain a

10 supplier number unless—

11 ‘‘(i) for medical equipment and sup12 plies furnished on or after October 1,

13 1993, and on or before December 31,

14 1994, the supplier meets standards pre15 scribed by the Secretary; and

16 ‘‘(ii) for medical equipment and sup17 plies furnished on or after January 1,

18 1995, the supplier meets revised standards

19 prescribed by the Secretary (in consulta20 tion with representatives of suppliers of

21 medical equipment and supplies, carriers,

22 and consumers) that shall include require23 ments that the supplier—
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1 ‘‘(I) comply with all applicable

2 State and Federal licensure and regu3 latory requirements;

4 ‘‘(II) maintain a physical facility

5 on an appropriate site;

6 ‘‘(III) have proof of appropriate

7 liability insurance; and

8 ‘‘(IV) meet such other require9 ments as the Secretary may specify.

10 ‘‘(C) EXCEPTION FOR ITEMS FURNISHED

11 AS INCIDENT TO A PHYSICIAN’S SERVICE.—

12 Subparagraph (A) shall not apply with respect

13 to medical equipment and supplies furnished as

14 an incident to a physician’s service.

15 ‘‘(D) PROHIBITION AGAINST MULTIPLE

16 SUPPLIER NUMBERS.—The Secretary may not

17 issue more than one supplier number to any

18 supplier of medical equipment and supplies un19 less the issuance of more than one number is

20 appropriate to identify subsidiary or regional

21 entities under the supplier’s ownership or con22 trol.

23 ‘‘(E) PROHIBITION AGAINST DELEGATION

24 OF SUPPLIER DETERMINATIONS.—The Sec25 retary may not delegate (other than by contract
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1 under section 1842) the responsibility to deter2 mine whether suppliers meet the standards nec3 essary to obtain a supplier number.

4 ‘‘(2) CERTIFICATES OF MEDICAL NECESSITY.—

5 ‘‘(A) STANDARDIZED CERTIFICATES.—Not

6 later than October 1, 1993, the Secretary shall,

7 in consultation with carriers under this part,

8 develop one or more standardized certificates of

9 medical necessity (as defined in subparagraph

10 (C)) for medical equipment and supplies for

11 which the Secretary determines that such a cer12 tificate is necessary.

13 ‘‘(B) PROHIBITION AGAINST DISTRIBUTION

14 BY SUPPLIERS OF CERTIFICATES OF MEDICAL

15 NECESSITY.—

16 ‘‘(i) IN GENERAL.—Except as pro17 vided in clause (ii), a supplier of medical

18 equipment and supplies may not distribute

19 to physicians or to individuals entitled to

20 benefits under this part for commercial

21 purposes any completed or partially com22 pleted certificates of medical necessity on

23 or after October 1, 1993.

24 ‘‘(ii) EXCEPTION FOR CERTAIN BILL25 ING INFORMATION.—Clause (i) shall not
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1 apply with respect to a certificate of medi2 cal necessity for any item that is not con3 tained on the list of potentially overused

4 items developed by the Secretary under

5 subsection (a)(15)(A) to the extent that

6 such certificate contains only information

7 completed by the supplier of medical equip8 ment and supplies identifying such supplier

9 and the beneficiary to whom such medical

10 equipment and supplies are furnished, a

11 description of such medical equipment and

12 supplies, any product code identifying such

13 medical equipment and supplies, and any

14 other administrative information (other

15 than information relating to the bene16 ficiary’s medical condition) identified by

17 the Secretary. In the event a supplier pro18 vides a certificate of medical necessity con19 taining information permitted under this

20 clause, such certificate shall also contain

21 the fee schedule amount and the supplier’s

22 charge for the medical equipment or sup23 plies being furnished prior to distribution

24 of such certificate to the physician.
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1 ‘‘(iii) PENALTY.—Any supplier of

2 medical equipment and supplies who know3 ingly and willfully distributes a certificate

4 of medical necessity in violation of clause

5 (i) is subject to a civil money penalty in an

6 amount not to exceed $1,000 for each such

7 certificate of medical necessity so distrib8 uted. The provisions of section 1128A

9 (other than subsections (a) and (b)) shall

10 apply to civil money penalties under this

11 subparagraph in the same manner as they

12 apply to a penalty or proceeding under sec13 tion 1128A(a).

14 ‘‘(C) DEFINITION.—For purposes of this

15 paragraph, the term ‘certificate of medical ne16 cessity’ means a form or other document con17 taining information required by the Secretary to

18 be submitted to show that a covered item is

19 reasonable and necessary for the diagnosis or

20 treatment of illness or injury or to improve the

21 functioning of a malformed body member.

22 ‘‘(3) COVERAGE AND REVIEW CRITERIA.—

23 ‘‘(A) DEVELOPMENT AND ESTABLISH24 MENT.—Not later than January 1, 1995, the

25 Secretary, in consultation with representatives
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1 of suppliers of medical equipment and supplies,

2 individuals enrolled under this part, and appro3 priate medical specialty societies, shall develop

4 and establish uniform national coverage and

5 utilization review criteria for 200 items of medi6 cal equipment and supplies selected in accord7 ance with the standards described in subpara8 graph (B). The Secretary shall publish the cri9 teria as part of the instructions provided to fis10 cal intermediaries and carriers under this part

11 and no further publication, including publica12 tion in the Federal Register, shall be required.

13 ‘‘(B) STANDARDS FOR SELECTING ITEMS

14 SUBJECT TO CRITERIA.—The Secretary may se15 lect an item for coverage under the criteria de16 veloped and established under subparagraph

17 (A) if the Secretary finds that—

18 ‘‘(i) the item is frequently purchased

19 or rented by beneficiaries;

20 ‘‘(ii) the item is frequently subject to

21 a determination that such item is not

22 medically necessary; or

23 ‘‘(iii) the coverage or utilization cri24 teria applied to the item (as of the date of
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1 the enactment of this subsection) is not

2 consistent among carriers.

3 ‘‘(C) ANNUAL REVIEW AND EXPANSION OF

4 ITEMS SUBJECT TO CRITERIA.—The Secretary

5 shall annually review the coverage and utiliza6 tion of items of medical equipment and supplies

7 to determine whether items not included among

8 the items selected under subparagraph (A)

9 should be made subject to uniform national cov10 erage and utilization review criteria, and, if ap11 propriate, shall develop and apply such criteria

12 to such additional items.

13 ‘‘(4) DEFINITION.—The term ‘medical equip14 ment and supplies’’ means—

15 ‘‘(A) durable medical equipment (as de16 fined in section 1861(n));

17 ‘‘(B) prosthetic devices (as described in

18 section 1861(s)(8));

19 ‘‘(C) orthotics and prosthetics (as de20 scribed in section 1861(s)(9));

21 ‘‘(D) surgical dressings (as described in

22 section 1861(s)(5));

23 ‘‘(E) such other items as the Secretary

24 may determine; and
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1 ‘‘(F) for purposes of paragraphs (1) and

2 (3)—

3 ‘‘(i) home dialysis supplies and equip4 ment (as described in section

5 1861(s)(2)(F)), and

6 ‘‘(ii) immunosuppressive drugs (as de7 scribed in section 1861(s)(2)(J)).’’.

8 (2) CONFORMING AMENDMENT.—Effective October

9 1, 1993, paragraph (16) of section 1834(a) (42 U.S.C.

10 1395m(a)) is repealed.

11 (b) REPORT ON EFFECT OF UNIFORM CRITERIA ON

12 UTILIZATION OF ITEMS.—Not later than July 1, 1995, the

13 Secretary shall submit a report to the Committee on Ways

14 and Means and the Committee on Energy and Commerce

15 of the House of Representatives and the Committee on

16 Finance of the Senate analyzing the impact of the uniform

17 criteria established under section 1834(i)(3)(A) of the So18 cial Security Act (as added by subsection (a)) on the utili19 zation of items of medical equipment and supplies by indi20 viduals enrolled under part B of the medicare program.

21 (c) USE OF COVERED ITEMS BY DISABLED BENE22 FICIARIES.—

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

24 Human Services, in consultation with representa25 tives of suppliers of durable medical equipment
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1 under part B of the medicare program and individ2 uals entitled to benefits under such program on the

3 basis of disability, shall conduct a study of the ef4 fects of the methodology for determining payments

5 for items of such equipment under such part on the

6 ability of such individuals to obtain items of such

7 equipment, including customized items.

8 (2) REPORT.—Not later than May 1, 1994, the

9 Secretary shall submit a report to Congress on the

10 study conducted under paragraph (1), and shall in11 clude in the report such recommendations as the

12 Secretary considers appropriate to assure that dis13 abled medicare beneficiaries have access to items of

14 durable medical equipment.

15 (d) CRITERIA FOR TREATMENT OF ITEMS AS PROS16 THETICS DEVICES OR ORTHOTICS AND PROSTHETICS.—

17 Not later than July 1, 1994, the Secretary of Health and

18 Human Services shall submit a report to the Committees

19 on Ways and Means and Energy and Commerce of the

20 House of Representatives and the Committee on Finance

21 of the Senate describing prosthetic devices or orthotics

22 and prosthetics covered under part B of the medicare pro23 gram that do not require individualized or custom fitting

24 and adjustment to be used by a patient. Such report shall

25 include recommendations for an appropriate methodology
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1 for determining the amount of payment for such items

2 under such program.

3 SEC. 222. PROHIBITION AGAINST CARRIER FORUM SHOP4 PING.

5 (a) IN GENERAL.—Section 1834(a)(12) (42 U.S.C.

6 1395m(a)(12)) is amended to read as follows:

7 ‘‘(12) USE OF CARRIERS TO PROCESS

8 CLAIMS.—

9 ‘‘(A) DESIGNATION OF REGIONAL CAR10 RIERS.—The Secretary may designate, by regu11 lation under section 1842, one carrier for one

12 or more entire regions to process all claims

13 within the region for covered items under this

14 section.

15 ‘‘(B) PROHIBITION AGAINST CARRIER

16 SHOPPING.—(i) No supplier of a covered item

17 may present or cause to be presented a claim

18 for payment under this part unless such claim

19 is presented to the appropriate regional carrier

20 (as designated by the Secretary).

21 ‘‘(ii) For purposes of clause (i), the term

22 ‘appropriate regional carrier’ means the carrier

23 having jurisdiction over the geographic area

24 that includes the permanent residence of the

25 patient to whom the item is furnished.’’.
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1 (b) EFFECTIVE DATE.—The amendment made by

2 subsection (a) shall apply to items furnished on or after

3 October 1, 1993.

4 (c) CLARIFICATION OF AUTHORITY TO DESIGNATE

5 CARRIERS FOR OTHER ITEMS AND SERVICES.—Nothing

6 in this subsection or the amendment made by this sub7 section may be construed to restrict the authority of the

8 Secretary of Health and Human Services to designate re9 gional carriers or modify claims jurisdiction rules with re10 spect to items or services under part B of the medicare

11 program that are not covered items under section 1834(a)

12 of the Social Security Act or prosthetic devices or orthotics

13 and prosthetics under section 1834(h) of such Act.

14 SEC. 223. RESTRICTIONS ON CERTAIN MARKETING AND

15 SALES ACTIVITIES.

16 (a) PROHIBITING UNSOLICITED TELEPHONE CON17 TACTS FROM SUPPLIERS OF DURABLE MEDICAL EQUIP18 MENT TO MEDICARE BENEFICIARIES.—

19 (1) IN GENERAL.—Section 1834(a) (42 U.S.C.

20 1395m(a)) is amended by adding at the end the fol21 lowing new paragraph:

22 ‘‘(17) PROHIBITION AGAINST UNSOLICITED

23 TELEPHONE CONTACTS BY SUPPLIERS.—

24 ‘‘(A) IN GENERAL.—A supplier of a cov25 ered item under this subsection may not contact
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1 an individual enrolled under this part by tele2 phone regarding the furnishing of a covered

3 item to the individual (other than a covered

4 item the supplier has already furnished to the

5 individual) unless—

6 ‘‘(i) the individual gives permission to

7 the supplier to make contact by telephone

8 for such purpose; or

9 ‘‘(ii) the supplier has furnished a cov10 ered item under this subsection to the indi11 vidual during the 15-month period preced12 ing the date on which the supplier contacts

13 the individual for such purpose.

14 ‘‘(B) PROHIBITING PAYMENT FOR ITEMS

15 FURNISHED SUBSEQUENT TO UNSOLICITED

16 CONTACTS.—If a supplier knowingly contacts

17 an individual in violation of subparagraph (A),

18 no payment may be made under this part for

19 any item subsequently furnished to the individ20 ual by the supplier.

21 ‘‘(C) EXCLUSION FROM PROGRAM FOR

22 SUPPLIERS ENGAGING IN PATTERN OF UNSO23 LICITED CONTACTS.—If a supplier knowingly

24 contacts individuals in violation of subpara25 graph (A) to such an extent that the supplier’s
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1 conduct establishes a pattern of contacts in vio2 lation of such subparagraph, the Secretary shall

3 exclude the supplier from participation in the

4 programs under this Act, in accordance with

5 the procedures set forth in subsections (c), (f),

6 and (g) of section 1128.’’.

7 (2) REQUIRING REFUND OF AMOUNTS COL8 LECTED FOR DISALLOWED ITEMS.—Section 1834(a)

9 (42 U.S.C. 1395m(a)), as amended by paragraph

10 (1), is amended by adding at the end the following

11 new paragraph:

12 ‘‘(18) REFUND OF AMOUNTS COLLECTED FOR

13 CERTAIN DISALLOWED ITEMS.—

14 ‘‘(A) IN GENERAL.—If a nonparticipating

15 supplier furnishes to an individual enrolled

16 under this part a covered item for which no

17 payment may be made under this part by rea18 son of paragraph (17)(B), the supplier shall re19 fund on a timely basis to the patient (and shall

20 be liable to the patient for) any amounts col21 lected from the patient for the item, unless—

22 ‘‘(i) the supplier establishes that the

23 supplier did not know and could not rea24 sonably have been expected to know that
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1 payment may not be made for the item by

2 reason of paragraph (17)(B), or

3 ‘‘(ii) before the item was furnished,

4 the patient was informed that payment

5 under this part may not be made for that

6 item and the patient has agreed to pay for

7 that item.

8 ‘‘(B) SANCTIONS.—If a supplier knowingly

9 and willfully fails to make refunds in violation

10 of subparagraph (A), the Secretary may apply

11 sanctions against the supplier in accordance

12 with section 1842(j)(2).

13 ‘‘(C) NOTICE.—Each carrier with a con14 tract in effect under this part with respect to

15 suppliers of covered items shall send any notice

16 of denial of payment for covered items by rea17 son of paragraph (17)(B) and for which pay18 ment is not requested on an assignment-related

19 basis to the supplier and the patient involved.

20 ‘‘(D) TIMELY BASIS DEFINED.—A refund

21 under subparagraph (A) is considered to be on

22 a timely basis only if—

23 ‘‘(i) in the case of a supplier who does

24 not request reconsideration or seek appeal

25 on a timely basis, the refund is made with-
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1 in 30 days after the date the supplier re2 ceives a denial notice under subparagraph

3 (C), or

4 ‘‘(ii) in the case in which such a re5 consideration or appeal is taken, the re6 fund is made within 15 days after the date

7 the supplier receives notice of an adverse

8 determination on reconsideration or ap9 peal.’’.

10 (b) CONFORMING AMENDMENT.—Section 1834(h)(3)

11 (42 U.S.C. 1395m(h)(3)) is amended by striking ‘‘Para12 graph (12)’’ and inserting ‘‘Paragraphs (12) and (17)’’.

13 (c) EFFECTIVE DATE.—The amendments made by

14 subsections (a) and (b) shall apply to items furnished after

15 the expiration of the 60-day period that begins on the date

16 of the enactment of this Act.

17 SEC. 224. KICKBACK CLARIFICATION.

18 (a) IN GENERAL.—Section 1128B(b)(3)(B) (42

19 U.S.C. 1320a–7b(b)(3)(B)) is amended by inserting be20 fore the semicolon ‘‘(except that in the case of a contract

21 supply arrangement between any entity and a supplier of

22 medical supplies and equipment (as defined in section

23 1834(i)(4), but not including items described in subpara24 graph (F) of such section), such employment shall not be

25 considered bona fide to the extent that it includes tasks
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1 of a clerical and cataloging nature in transmitting to sup2 pliers assignment rights of individuals eligible for benefits

3 under part B of title XVIII, or performance of

4 warehousing or stock inventory functions)’’.

5 (b) EFFECTIVE DATE.—The amendment made by

6 subsection (a) shall apply with respect to services fur7 nished on or after the first day of the first month that

8 begins after the expiration of the 60-day period beginning

9 on the date of the enactment of this Act.

10 SEC. 225. BENEFICIARY LIABILITY FOR NONCOVERED

11 SERVICES.

12 (a) IN GENERAL.—Section 1879 (42 U.S.C. 1395pp)

13 is amended by adding at the end the following new sub14 section:

15 ‘‘(h) If a supplier of medical equipment and supplies

16 (as defined in section 1834(i)(4))—

17 ‘‘(1) furnishes an item or service to a bene18 ficiary for which no payment may be made by reason

19 of section 1834(i)(1);

20 ‘‘(2) furnishes an item or service to a bene21 ficiary for which payment is denied in advance under

22 section 1834(a)(15); or

23 ‘‘(3) furnishes an item or service to a bene24 ficiary for which payment is denied under section

25 1862(a)(1);
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1 any expenses incurred for items and services furnished to

2 an individual by such a supplier on an unassigned basis

3 shall be the responsibility of such supplier. The individual

4 shall have no financial responsibility for such expenses and

5 the supplier shall refund on a timely basis to the individual

6 (and shall be liable to the individual for) any amounts col7 lected from the individual for such items or services. The

8 provisions of section 1834(a)(18) shall apply to refunds

9 required under the previous sentence in the same manner

10 as such provisions apply to refunds under such section.’’.

11 (b) EFFECTIVE DATE.—The amendment made by

12 subsection (a) shall apply to items or services furnished

13 on or after October 1, 1993.

14 SEC. 226. ADJUSTMENTS FOR INHERENT REASONABLE15 NESS.

16 (a) ADJUSTMENTS MADE TO FINAL PAYMENT

17 AMOUNTS.—

18 (1) IN GENERAL.—Section 1834(a)(10)(B) (42

19 U.S.C. 1395m(a)(10)(B)) is amended by adding at

20 the end the following: ‘‘In applying such provisions

21 to payments for an item under this subsection, the

22 Secretary shall make adjustments to the payment

23 basis for the item described in paragraph (1)(B) if

24 the Secretary determines (in accordance with such

25 provisions and on the basis of prices and costs appli-
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1 cable at the time the item is furnished) that such

2 payment basis is not inherently reasonable.’’.

3 (2) EFFECTIVE DATE.—The amendment made

4 by paragraph (1) shall take effect on the date of the

5 enactment of this Act.

6 (b) ADJUSTMENT REQUIRED FOR CERTAIN ITEMS.—

7 (1) IN GENERAL.—In accordance with section

8 1834(a)(10)(B) of the Social Security Act (as

9 amended by subsection (a)), the Secretary of Health

10 and Human Services shall determine whether the

11 payment amounts for the items described in para12 graph (2) are not inherently reasonable, and shall

13 adjust such amounts in accordance with such section

14 if the amounts are not inherently reasonable.

15 (2) ITEMS DESCRIBED.—The items referred to

16 in paragraph (1) are decubitus care equipment,

17 transcutaneous electrical nerve stimulators, and any

18 other items considered appropriate by the Secretary.

19 SEC. 227. PAYMENT FOR PARENTERAL AND ENTERAL NU20 TRIENTS, SUPPLIES, AND EQUIPMENT DUR21 ING 1993.

22 In determining the amount of payment under part

23 B of title XVIII of the Social Security Act during 1994,

24 the charges determined to be reasonable with respect to

25 parenteral and enteral nutrients, supplies, and equipment
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1 may not exceed the charges determined to be reasonable

2 with respect to such nutrients, supplies, and equipment

3 during 1993.

4 SEC. 228. TREATMENT OF NEBULIZERS AND ASPIRATORS.

5 (a) IN GENERAL.—Section 1834(a)(3)(A) (42 U.S.C.

6 1395m(a)(3)(A)) is amended by striking ‘‘ventilators, as7 pirators, IPPB machines, and nebulizers’’ and inserting

8 ‘‘ventilators and IPPB machines’’.

9 (b) PAYMENT FOR ACCESSORIES RELATING TO

10 NEBULIZERS AND ASPIRATORS.—Section 1834(a) (42

11 U.S.C. 1395m(a)), as amended by section 221(a)(2), is

12 amended by inserting after paragraph (15) the following

13 new paragraph:

14 ‘‘(16) PAYMENT FOR ACCESSORIES RELATING

15 TO NEBULIZERS AND ASPIRATORS.—In the case of

16 accessories to be used in conjunction with a

17 nebulizer or aspirator for which payment is made

18 under this subsection, payment shall be made in ac19 cordance with paragraph (2) of this subsection.’’.

20 (c) EFFECTIVE DATE.—The amendments made by

21 this section shall apply to items furnished on or after Jan22 uary 1, 1994.
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1 SEC. 229. PAYMENT FOR OSTOMY SUPPLIES, TRACHE2 OSTOMY SUPPLIES, UROLOGICALS, AND SUR3 GICAL DRESSINGS.

4 (a) OSTOMY SUPPLIES, TRACHEOSTOMY SUPPLIES,

5 AND UROLOGICALS.—

6 (1) IN GENERAL.—Section 1834(h)(1) (42

7 U.S.C. 1395m(h)(1)) is amended by adding at the

8 end the following new subparagraph:

9 ‘‘(E) EXCEPTION FOR CERTAIN ITEMS.—

10 Payment for ostomy supplies, tracheostomy

11 supplies, and urologicals shall be made in ac12 cordance with subparagraphs (B) and (C) of

13 section 1834(a)(2).’’.

14 (2) CONFORMING AMENDMENT.—Section

15 1834(h)(1)(B) (42 U.S.C. 1395m(h)(1)(B)) is

16 amended by striking ‘‘subparagraph (C),’’ and in17 serting ‘‘subparagraphs (C) and (E),’’.

18 (3) EFFECTIVE DATE.—The amendments made

19 by this subsection shall apply to items furnished on

20 or after January 1, 1994.

21 (b) SURGICAL DRESSINGS.—

22 (1) IN GENERAL.—Section 1834 (42 U.S.C.

23 1395m), as amended by section 221(a), is amended

24 by adding at the end the following new subsection:

25 ‘‘(j) PAYMENT FOR SURGICAL DRESSINGS.—
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1 ‘‘(1) IN GENERAL.—Payment under this sub2 section for surgical dressings (described in section

3 1861(s)(5)) shall be made in a lump sum amount

4 for the purchase of the item in an amount equal to

5 80 percent of the lesser of—

6 ‘‘(A) the actual charge for the item; or

7 ‘‘(B) a payment amount determined in ac8 cordance with the methodology described in

9 subparagraphs (B) and (C) of subsection (a)(2)

10 (except that in applying such methodology, the

11 national limited payment amount referred to in

12 such subparagraphs shall be initially computed

13 based on local payment amounts using average

14 reasonable charges for the 12-month period

15 ending December 31, 1992, increased by the

16 covered item updates described in such sub17 section for 1993 and 1994)

18 ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not

19 apply to surgical dressings that are—

20 ‘‘(A) furnished as an incident to a physi21 cian’s professional service; or

22 ‘‘(B) furnished by a home health agency.’’.

23 (2) CONFORMING AMENDMENT.—Section

24 1833(a)(1) (42 U.S.C. 1395l(a)(1)), as amended by

25 sections 249(e)(2) and 205(e)(1), is amended—
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1 (A) by striking ‘‘and’’ before ‘‘(P)’’, and

2 (B) by inserting before the semicolon at

3 the end the following: ‘‘, and (Q) with respect

4 to surgical dressings, the amounts paid shall be

5 the amounts determined under section

6 1834(j);’’.

7 (3) EFFECTIVE DATE.—The amendments made

8 by this subsection shall apply to items furnished on

9 or after January 1, 1994.

10 SEC. 230. PAYMENTS FOR TENS DEVICES.

11 (a) IN GENERAL.—Section 1834(a)(1)(D) (42 U.S.C.

12 1395m(a)(1)(D)) is amended by striking ‘‘15 percent’’ the

13 second place it appears and inserting ‘‘45 percent’’.

14 (b) EFFECTIVE DATE.—The amendment made by

15 subsection (a) shall apply to items furnished on or after

16 January 1, 1994.

17 SEC. 231. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

18 (a) UPDATES TO PAYMENT AMOUNTS.—Subpara19 graph (A) of section 1834(a)(14) (42 U.S.C.

20 1395m(a)(14)) is amended to read as follows:

21 ‘‘(A) for 1991 and 1992, the percentage

22 increase in the consumer price index for all

23 urban consumers (U.S. city average) for the 12-

24 month period ending with June of the previous

25 year reduced by 1 percentage point; and’’.
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1 (b) TREATMENT OF POTENTIALLY OVERUSED ITEMS

2 AND ADVANCED DETERMINATIONS OF COVERAGE.—(1)

3 Effective on the date of the enactment of this Act, section

4 1834(a)(15) (42 U.S.C. 1395m(a)(15)) is amended to

5 read as follows:

6 ‘‘(15) SPECIAL TREATMENT FOR POTENTIALLY

7 OVERUSED ITEMS.—

8 ‘‘(A) DEVELOPMENT OF LIST OF ITEMS BY

9 SECRETARY.—The Secretary shall develop and

10 periodically update a list of items for which

11 payment may be made under this subsection

12 that are potentially overused, and shall include

13 in such list seat-lift mechanisms, transcutane14 ous electrical nerve stimulators, motorized

15 scooters, decubitus care mattresses, and any

16 such other item determined by the Secretary to

17 be potentially overused on the basis of any of

18 the following criteria—

19 ‘‘(i) the item is marketed directly to

20 potential patients;

21 ‘‘(ii) the item is marketed with an

22 offer to potential patients to waive the

23 costs of coinsurance associated with the

24 item or is marketed as being available at

25 no cost to policyholders of a medicare sup-
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1 plemental policy (as defined in section

2 1882(g)(1));

3 ‘‘(iii) the item has been subject to a

4 consistent pattern of overutilization; or

5 ‘‘(iv) a high proportion of claims for

6 payment for such item under this part may

7 not be made because of the application of

8 section 1862(a)(1).

9 ‘‘(B) ITEMS SUBJECT TO SPECIAL CARRIER

10 SCRUTINY.—Payment may not be made under

11 this part for any item contained in the list de12 veloped by the Secretary under subparagraph

13 (A) unless the carrier has subjected the claim

14 for payment for the item to special scrutiny or

15 has followed the procedures described in para16 graph (11)(C) with respect to the item.’’.

17 (2) Effective January 1, 1994, section 1834(a)(11)

18 (42 U.S.C. 1395m(a)) is amended by adding at the end

19 the following new subparagraph:

20 ‘‘(C) CARRIER DETERMINATIONS FOR CER21 TAIN ITEMS IN ADVANCE.—A carrier shall de22 termine in advance whether payment for an

23 item may not be made under this subsection be24 cause of the application of section 1862(a)(1)

25 if—
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1 ‘‘(i) the item is a customized item

2 (other than inexpensive items specified by

3 the Secretary); or

4 ‘‘(ii) the item is a specified covered

5 item under subparagraph (B).’’.

6 (3) Effective for standards applied for contract years

7 beginning after the date of the enactment of this Act, sec8 tion 1842(c) (42 U.S.C. 1395u(c)), as amended by section

9 208(a), is amended by adding at the end the following new

10 paragraph:

11 ‘‘(5) Each contract under this section which provides

12 for the disbursement of funds, as described in subsection

13 (a)(1)(B), shall require the carrier to meet criteria devel14 oped by the Secretary to measure the timeliness of carrier

15 responses to requests for payment of items described in

16 section 1834(a)(11)(C).’’.

17 (4) Section 1834(h)(3) (42 U.S.C. 1395m(h)(3)) is

18 amended by striking ‘‘paragraph (10) and paragraph

19 (11)’’ and inserting ‘‘paragraphs (10) and (11)’’.

20 (c) STUDY OF VARIATIONS IN DURABLE MEDICAL

21 EQUIPMENT SUPPLIER COSTS.—

22 (1) COLLECTION AND ANALYSIS OF SUPPLIER

23 COST DATA.—The Administration of the Health

24 Care Financing Administration shall, in consultation

25 with appropriate organizations, collect data on sup-
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1 plier costs of durable medical equipment for which

2 payment may be made under part B of the medicare

3 program, and shall analyze such data to determine

4 the proportions of such costs attributable to the

5 service and product components of furnishing such

6 equipment and the extent to which such proportions

7 vary by type of equipment and by the geographic re8 gion in which the supplier is located.

9 (2) DEVELOPMENT OF GEOGRAPHIC ADJUST10 MENT INDEX; REPORTS.—Not later than January 1,

11 1995—

12 (A) the Administrator shall submit a re13 port to the Committees on Energy and Com14 merce and Ways and Means of the House of

15 Representatives and the Committee on Finance

16 of the Senate on the data collected and the

17 analysis conducted under paragraph (1), and

18 shall include in such report the Administrator’s

19 recommendations for a geographic cost adjust20 ment index for suppliers of durable medical

21 equipment under the medicare program and an

22 analysis of the impact of such proposed index

23 on payments under the medicare program; and

24 (B) the Comptroller General shall submit a

25 report to the Committees on Energy and Com-
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1 merce and Ways and Means of the House of

2 Representatives and the Committee on Finance

3 of the Senate analyzing on a geographic basis

4 the supplier costs of durable medical equipment

5 under the medicare program.

6 (d) OXYGEN RETESTING.—Section 1834(a)(5)(E)

7 (42 U.S.C. 1395m(a)(5)(E)) is amended by striking ‘‘55’’

8 and inserting ‘‘56’’.

9 (e) OTHER MISCELLANEOUS AND TECHNICAL

10 AMENDMENTS.—(1) Section 4152(a)(3) of OBRA–1990

11 is amended by striking ‘‘amendment made by subsection

12 (a)’’ and inserting ‘‘amendments made by this sub13 section’’.

14 (2) Section 4152(c)(2) of OBRA–1990 is amended

15 by striking ‘‘1395m(a)(7)(A)’’ and inserting

16 ‘‘1395m(a)(7)’’.

17 (3) Section 1834(a)(7)(A)(iii)(II) (42 U.S.C.

18 1395m(a)(7)(A)(iii)(II)) is amended by striking ‘‘clause

19 (v)’’ and inserting ‘‘clause (vi)’’.

20 (4) Section 1834(a)(7)(C)(i) (42 U.S.C.

21 1395m(a)(7)(C)(i)) is amended by striking ‘‘or paragraph

22 (3)’’.

23 (5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is

24 amended by striking subparagraph (D).
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1 (6) Section 4153(c)(1) of OBRA–1990 is amended

2 by striking ‘‘1834(a)’’ and inserting ‘‘1834(h)’’.

3 (7) Section 4153(d)(2) of OBRA–1990 is amended

4 by striking ‘‘Reconiliation’’ and inserting ‘‘Reconcili5 ation’’.

6 (8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is

7 amended by striking paragraph (6).

8 (B) Section 1834(a) (42 U.S.C. 1395m(a)) is amend9 ed—

10 (i) in subparagraphs (A) and (B) of paragraph

11 (1), by striking ‘‘(2) through (7)’’ each place it ap12 pears and inserting ‘‘(2) through (5) and (7)’’;

13 (ii) in paragraph (7), by striking ‘‘(2) through

14 (6)’’ and inserting ‘‘(2) through (5)’’;

15 (iii) in paragraph (8), by striking ‘‘paragraphs

16 (6) and (7)’’ each place it appears in the matter pre17 ceding subparagraph (A) and in subparagraph (C)

18 and inserting ‘‘paragraph (7)’’; and

19 (iv) in paragraph (8)(A)(i), by striking ‘‘de20 scribed—’’ and all that follows and inserting ‘‘de21 scribed in paragraph (7) equal to the average of the

22 purchase prices on the claims submitted on an as23 signment-related basis for the unused item supplied

24 during the 6-month period ending with December

25 1986.’’.
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1 (9) The amendments made by this subsection shall

2 take effect as if included in the enactment of OBRA–1990.

3 Subtitle D—Other Provisions

4 SEC. 241. PAYMENT FOR MEDICALLY DIRECTED CERTIFIED

5 REGISTERED NURSE ANESTHETIST SERV6 ICES.

7 (a) IN GENERAL.—Section 1833(l)(4)(B) (42 U.S.C.

8 1395l(l)(4)(B)) is amended to read as follows:

9 ‘‘(B) Except as provided in subparagraph (D), the

10 conversion factor used to determine the amount paid

11 under the fee schedule under this subsection for services

12 furnished by a certified registered nurse anesthetist who

13 is medically directed—

14 ‘‘(i) in a year after 1993 and before 1997, shall

15 be $10.75, or

16 ‘‘(ii) in a subsequent calendar year, shall be the

17 previous year’s conversion factor increased by the

18 update determined under section 1848(d)(3) for

19 physician anesthesia services for that year.’’.

20 (b) EFFECTIVE DATE.—The amendment made by

21 subsection (a) shall apply to services furnished on or after

22 January 1, 1994.
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1 SEC. 242. EXTENSION OF ALZHEIMER’S DISEASE DEM2 ONSTRATION.

3 Section 9342 of OBRA–1986, as amended by section

4 4164(a)(2) of OBRA–1990, is amended—

5 (1) in subsection (c)(1), by striking ‘‘4 years’’

6 and inserting ‘‘5 years’’; and

7 (2) in subsection (f), —

8 (A) by striking ‘‘$55,000,000’’ and insert9 ing ‘‘$58,000,000’’, and

10 (B) by striking ‘‘$3,000,000’’ and insert11 ing ‘‘$5,000,000’’.

12 SEC. 243. PART B LATE ENROLLMENT PENALTY.

13 (a) LIMITATION ON MEDICARE PART B LATE EN14 ROLLMENT PENALTY.—

15 (1) IN GENERAL.—Section 1839 (42 U.S.C.

16 1395r) is amended by adding at the end the follow17 ing new subsection:

18 ‘‘(g) The percent increase in premiums under sub19 section (b) due to late enrollment under this part shall

20 not exceed 25 percent in the case of an individual who

21 is annuitant described in subparagraph (A) or (B) of sec22 tion 8901(3) of title 5, United States Code, for a month

23 if—

24 ‘‘(1) during the individual’s initial enrollment

25 period under section 1837(d)—
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1 ‘‘(A) the individual was enrolled in a group

2 health plan (as defined in section

3 1862(b)(1)(A)(v)) that provided coverage of

4 items and services for which payment may be

5 made under this part, and

6 ‘‘(B) the individual elected not to enroll (or

7 to be deemed enrolled) under this section, and

8 ‘‘(2) due to a change of coverage under such

9 plan, there is no coverage during the month under

10 such plan with respect to items and services for

11 which payment may be made under this part unless

12 the individual is enrolled under this part.’’.

13 (2) EFFECTIVE DATE.—The amendment made

14 by paragraph (1) shall apply to premiums for

15 months beginning with January 1992.

16 (b) PAYMENT OF PART B PREMIUM LATE ENROLL17 MENT PENALTIES BY STATES.—Section 1839 (42 U.S.C.

18 1395r), as amended by subsection (a), is further amended

19 by adding at the end the following new subsection:

20 ‘‘(h)(1) Upon the request of a State, the Secretary

21 may enter into an agreement with the State under which

22 the State agrees to pay on a quarterly or other periodic

23 basis to the Secretary (to be deposited in the Treasury

24 to the credit of the Federal Supplementary Medical Insur25 ance Trust Fund) an amount equal to the amount of the
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1 part B late enrollment premium increases with respect to

2 the premiums for eligible individuals (as defined in para3 graph (3)(A)).

4 ‘‘(2) No part B late enrollment premium increase

5 shall apply to an eligible individual for premiums for

6 months for which the amount of such an increase is pay7 able under an agreement under paragraph (1).

8 ‘‘(3) In this subsection:

9 ‘‘(A) The term ‘eligible individual’ means an in10 dividual who is enrolled under this part B and who

11 is within a class of individuals specified in the agree12 ment under paragraph (1).

13 ‘‘(B) The term ‘part B late enrollment premium

14 increase’ means any increase in a premium as a re15 sult of the application of subsection (b).’’.

16 SEC. 244. ORAL CANCER DRUGS.

17 (a) COVERAGE OF CERTAIN SELF-ADMINISTERED

18 ANTICANCER DRUGS.—Section 1861(s)(2) (42 U.S.C.

19 1395(s)(2)), as amended by section 249(f)(8)(B), is

20 amended—

21 (1) by striking ‘‘and’’ at the end of subpara22 graph (N);

23 (2) by adding ‘‘and’’ at the end of subpara24 graph (O); and
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1 (3) by adding at the end the following new sub2 paragraph:

3 ‘‘(P) an oral drug (which is approved by the

4 Federal Food and Drug Administration) prescribed

5 for use as an anticancer chemotherapeutic agent for

6 a given indication, and containing an active ingredi7 ent (or ingredients), which is the same indication

8 and active ingredient (or ingredients) as a drug

9 which the carrier determines would be covered pur10 suant to subparagraph (A) or (B) if the drug could

11 not be self-administered;’’.

12 (b) EFFECTIVE DATE.—The amendments made by

13 this section shall apply to items furnished on or after Jan14 uary 1, 1994.

15 SEC. 245. SPEECH-LANGUAGE PATHOLOGISTS AND

16 AUDIOLOGISTS.

17 (a) SERVICES DEFINED.—Section 1861 (42 U.S.C.

18 1395x), as amended by section 249(f)(8)(E), is amended

19 by inserting after subsection (kk) the following new sub20 section:

21 ‘‘Speech-Language Pathology Services; Audiology

22 Services

23 ‘‘(ll)(1) The term ‘speech-language pathology serv24 ices’ means such speech, language, and related function

25 assessment and rehabilitation services furnished by a
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1 qualified speech-language pathologist as the speech-lan2 guage pathologist is legally authorized to perform under

3 State law (or the State regulatory mechanism provided by

4 State law) as would otherwise be covered if furnished by

5 a physician.

6 ‘‘(2) The term ‘audiology services’ means such hear7 ing and balance assessment services furnished by a quali8 fied audiologist as the audiologist is legally authorized to

9 perform under State law (or the State regulatory mecha10 nism provided by State law).

11 ‘‘(3) In this subsection:

12 ‘‘(A) The term ‘qualified speech-language pa13 thologist’ means an individual with a master’s or

14 doctoral degree in speech-language pathology who

15 has performed not less than 9 months of supervised

16 full-time speech-language pathology services after

17 obtaining such degree and who—

18 ‘‘(i) is licensed (or is otherwise certified) as

19 a speech-language pathologist by the State in

20 which the individual furnishes such services, or

21 ‘‘(ii) in the case of an individual who fur22 nishes services in a State which does not pro23 vide for the licensing (or other form of certifi24 cation) of speech-language pathologists, has

25 successfully completed a national clinical com-
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1 petency examination in speech-language pathol2 ogy approved by the Secretary.

3 ‘‘(B) The term ‘qualified audiologist’ means an

4 individual with a master’s or doctoral degree in

5 audiology who has performed not less than 9 months

6 of supervised full-time audiology services after ob7 taining such degree and who—

8 ‘‘(i) is licensed (or is otherwise certified) as

9 an audiologist by the State in which the individ10 ual furnishes such services, or

11 ‘‘(ii) in the case of an individual who fur12 nishes services in a State which does not pro13 vide for the licensing (or other form of certifi14 cation) of audiologists, has successfully com15 pleted a national clinical competency examina16 tion in audiology approved by the Secretary.’’.

17 (b) CONFORMING AMENDMENTS RELATING TO MED18 ICARE TREATMENT OF SPEECH AND LANGUAGE SERV19 ICES.—

20 (1) EXTENDED CARE SERVICES.—Section

21 1861(h)(3) (42 U.S.C. 1395x(h)(3)) is amended by

22 striking ‘‘, occupational, or speech therapy’’ and in23 serting ‘‘or occupational therapy or speech-language

24 pathology services’’.
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1 (2) HOME HEALTH SERVICES.—Section

2 1861(m)(2) (42 U.S.C. 1395x(m)(2)) is amended by

3 striking ‘‘, occupational, or speech therapy’’ and in4 serting ‘‘or occupational therapy or speech-language

5 pathology services’’.

6 (3) OUTPATIENT PHYSICAL THERAPY SERV7 ICES.—The fourth sentence of section 1861(p) (42

8 U.S.C. 1395x(p)) is amended by striking ‘‘speech

9 pathology services’’ and inserting ‘‘speech-language

10 pathology services’’.

11 (4) COMPREHENSIVE OUTPATIENT REHABILITA12 TION FACILITY SERVICES.—Section 1861(cc)(1)(B)

13 (42 U.S.C. 1395x(cc)(1)(B)) is amended by striking

14 ‘‘speech pathology services’’ and inserting ‘‘speech15 language pathology services’’.

16 (5) HOSPICE CARE.—Section 1861(dd)(1)(B)

17 (42 U.S.C. 1395x(dd)(1)(B)) is amended by striking

18 ‘‘therapy or speech-language pathology’’ and insert19 ing ‘‘therapy, or speech-language pathology serv20 ices’’.

21 (c) EFFECTIVE DATE.—The amendments made by

22 this section shall apply to services furnished on or after

23 January 1, 1994.
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1 SEC. 246. EXTENSION OF MUNICIPAL HEALTH SERVICE

2 DEMONSTRATION PROJECTS.

3 Section 9215 of the Consolidated Omnibus Budget

4 Reconciliation Act of 1985, as amended by section 6135

5 of OBRA–1989, is amended—

6 (1) by striking ‘‘December 31, 1993’’ and in7 serting ‘‘December 31, 1997’’, and

8 (2) in the second sentence, by inserting after

9 ‘‘beneficiary costs,’’ the following: ‘‘costs to the med10 icaid program and other payors, access to care, out11 comes, beneficiary satisfaction, utilization differences

12 among the different populations served by the

13 projects,’’.

14 SEC. 247. TREATMENT OF CERTAIN INDIAN HEALTH PRO15 GRAMS AND FACILITIES AS FEDERALLY16 QUALIFIED HEALTH CENTERS.

17 (a) IN GENERAL.—Section 1861(aa)(4) (42 U.S.C.

18 1395x(aa)(4)) is amended—

19 (1) by striking ‘‘or’’ at the end of subparagraph

20 (B);

21 (2) by striking the period at the end of sub22 paragraph (C) and inserting ‘‘; or’’; and

23 (3) by adding at the end the following new sub24 paragraph:

25 ‘‘(D) is an outpatient health program or facility

26 operated by a tribe or tribal organization under the
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1 Indian Self-Determination Act or by an urban In2 dian organization receiving funds under title V of

3 the Indian Health Care Improvement Act.’’.

4 (b) EFFECTIVE DATE.—The amendment made by

5 subsection (a) shall take effect as if included in the enact6 ment of section 4161(a)(2)(C) of OBRA–1990.

7 SEC. 248. EXTENSION OF INFLUENZA VACCINATION DEM8 ONSTRATION.

9 (a) IN GENERAL.—Section 4071(b)(1) of OBRA–

10 1987 is amended by striking the period at the end and

11 inserting the following: ‘‘, except that the reference in

12 clause (ii) of paragraph (2)(B) of such subsection to ‘24

13 months’ shall be deemed to be a reference to ‘30

14 months’.’’.

15 (b) LIMITATION ON USE OF AMOUNTS.—The second

16 sentence of section 4071(b)(2) of OBRA–1987 is amended

17 by striking ‘‘and evaluate’’ and inserting ‘‘and (during fis18 cal years other than fiscal year 1993) evaluate’’.

19 SEC. 249. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

20 (a) REVISION OF INFORMATION ON PART B CLAIMS

21 FORMS.—Section 1833(q)(1) (42 U.S.C. 1395l(q)(1)) is

22 amended—

23 (1) by striking ‘‘provider number’’ and inserting

24 ‘‘unique physician identification number’’; and
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1 (2) by striking ‘‘and indicate whether or not the

2 referring physician is an interested investor (within

3 the meaning of section 1877(h)(5))’’.

4 (b) CONSULTATION FOR SOCIAL WORKERS.—Effec5 tive with respect to services furnished on or after January

6 1, 1991, section 6113(c) of OBRA–1989 is amended—

7 (1) by inserting ‘‘and clinical social worker

8 services’’ after ‘‘psychologist services’’; and

9 (2) by striking ‘‘psychologist’’ the second and

10 third place it appears and inserting ‘‘psychologist or

11 clinical social worker’’.

12 (c) REPORTS ON HOSPITAL OUTPATIENT PAY13 MENT.—(1) OBRA–1989 is amended by striking section

14 6137.

15 (2) Section 1135(d) (42 U.S.C. 1320b–5(d)) is

16 amended—

17 (A) by striking paragraph (6); and

18 (B) in paragraph (7)—

19 (i) by striking ‘‘systems’’ each place it ap20 pears and inserting ‘‘system’’; and

21 (ii) by striking ‘‘paragraphs (1) and (6)’’

22 and inserting ‘‘paragraph (1)’’.

23 (d) RADIOLOGY AND DIAGNOSTIC SERVICES PRO24 VIDED IN HOSPITAL OUTPATIENT DEPARTMENTS.—(1)

25 Effective as if included in the enactment of OBRA–1989,
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1 section 1833(n)(1)(B)(i)(II) (42 U.S.C.

2 1395l(n)(1)(B)(i)(II)) is amended—

3 (A) by striking ‘‘1989’’ and inserting ‘‘1989

4 and for services described in subsection (a)(2)(E)(ii)

5 furnished on or after January 1, 1992’’; and

6 (B) by striking ‘‘1842(b)’’ and inserting

7 ‘‘1842(b) (or, in the case of services furnished on or

8 after January 1, 1992, under section 1848)’’.

9 (2) Effective as if included in the enactment of

10 OBRA–1989, section 1833(n)(1)(B)(i)(II) (42 U.S.C.

11 1395l(n)(1)(B)(i)(II)) is amended by striking ‘‘January 1,

12 1989’’ and inserting ‘‘April 1, 1989’’.

13 (e) PAYMENTS TO NURSE PRACTITIONERS IN RURAL

14 AREAS (SECTION 4155 OF OBRA–1990).—(1) Section

15 1861(s)(2)(K)(iii) (42 U.S.C. 1395x(s)(2)(K)(iii)) is

16 amended—

17 (A) by striking ‘‘subsection (aa)(3)’’ and insert18 ing ‘‘subsection (aa)(5)’’; and

19 (B) by striking ‘‘subsection (aa)(4)’’ and insert20 ing ‘‘subsection (aa)(6)’’.

21 (2) Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is

22 amended—

23 (A) by striking ‘‘and’’ before ‘‘(N)’’; and

24 (B) with respect to the matter inserted by sec25 tion 4155(b)(2)(B) of OBRA–1990—
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1 (i) by striking ‘‘(M)’’ and inserting ‘‘, and

2 (O)’’, and

3 (ii) by transferring and inserting it (as

4 amended) immediately before the semicolon at

5 the end.

6 (3) Section 1833(r)(1) (42 U.S.C. 1395l(r)(1)) is

7 amended—

8 (A) by striking ‘‘ambulatory’’ each place it ap9 pears and inserting ‘‘or ambulatory’’; and

10 (B) by striking ‘‘center,’’ and inserting ‘‘cen11 ter’’.

12 (4) Section 1833(r)(2)(A) (42 U.S.C. 1395l(r)(2)(A))

13 is amended by striking ‘‘subsection (a)(1)(M)’’ and insert14 ing ‘‘subsection (a)(1)(O)’’.

15 (5) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is

16 amended by striking ‘‘subsection (s)(2)(K)(i)’’ and insert17 ing ‘‘clauses (i) or (iii) of subsection (s)(2)(K)’’.

18 (6) Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is

19 amended by striking ‘‘this Act’’ and inserting ‘‘this title’’.

20 (7) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is

21 amended by striking ‘‘1861(s)(2)(K)(i)’’ and inserting

22 ‘‘1861(s)(2)(K)(i) or 1861(s)(2)(K)(iii)’’.

23 (8) Section 1866(a)(1)(H) (42 U.S.C.

24 1395cc(a)(1)(H)) is amended by striking
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1 ‘‘1861(s)(2)(K)(i)’’ and inserting ‘‘1861(s)(2)(K)(i) or

2 1861(s)(2)(K)(iii)’’.

3 (f) OTHER MISCELLANEOUS AND TECHNICAL

4 AMENDMENTS.—

5 (1) IMMEDIATE ENROLLMENT IN PART B BY IN6 DIVIDUALS COVERED BY AN EMPLOYMENT-BASED

7 PLAN.—(A) Subparagraphs (A) and (B) of section

8 1837(i)(3) (42 U.S.C. 1395p(i)(3)) are each amend9 ed—

10 (i) by striking ‘‘beginning with the first

11 day of the first month in which the individual

12 is no longer enrolled’’ and inserting ‘‘including

13 each month during any part of which the indi14 vidual is enrolled’’; and

15 (ii) by striking ‘‘and ending seven months

16 later’’ and inserting ‘‘ending with the last day

17 of the eighth consecutive month in which the in18 dividual is at no time so enrolled’’.

19 (B) Paragraphs (1) and (2) of section 1838(e)

20 (42 U.S.C. 1395q(e)) are amended to read as fol21 lows:

22 ‘‘(1) in any month of the special enrollment pe23 riod in which the individual is at any time enrolled

24 in a plan (specified in subparagraph (A) or (B), as

25 applicable, of section 1837(i)(3)) or in the first
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1 month following such a month, the coverage period

2 shall begin on the first day of the month in which

3 the individual so enrolls (or, at the option of the in4 dividual, on the first day of any of the following

5 three months), or

6 ‘‘(2) in any other month of the special enroll7 ment period, the coverage period shall begin on the

8 first day of the month following the month in which

9 the individual so enrolls.’’.

10 (C) The amendments made by subparagraphs

11 (A) and (B) shall take effect on the first day of the

12 first month that begins after the expiration of the

13 120-day period that begins on the date of the enact14 ment of this Act.

15 (2) BLEND AMOUNTS FOR AMBULATORY SUR16 GICAL CENTER PAYMENTS.—Subclauses (I) and (II)

17 of section 1833(i)(3)(B)(ii) (42 U.S.C.

18 1395l(i)(3)(B)(ii)) are each amended—

19 (A) by striking ‘‘for reporting’’ and insert20 ing ‘‘for portions of cost reporting’’; and

21 (B) by striking ‘‘and on or before’’ and in22 serting ‘‘and ending on or before’’.

23 (3) CLINICAL DIAGNOSTIC LABORATORY TESTS

24 (SECTION 4154 OF OBRA–1990).—Section 4154(e)(5)
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1 of OBRA–1990 is amended by striking ‘‘(1)(A)’’ and

2 inserting ‘‘(1)(A),’’.

3 (4) SEPARATE PAYMENT UNDER PART B FOR

4 CERTAIN SERVICES (SECTION 4157 OF OBRA–1990).—

5 Section 4157(a) of OBRA–1990 is amended by

6 striking ‘‘(a) SERVICES OF’’ and all that follows

7 through ‘‘Section’’ and inserting ‘‘(a) TREATMENT

8 OF SERVICES OF CERTAIN HEALTH PRACTITION9 ERS.—Section’’.

10 (5) CERTIFIED REGISTERED NURSE ANES11 THETISTS (SECTION 4160 OF OBRA–1990).—Section

12 1833(l)(4)(B)(ii)(VII) (42 U.S.C.

13 1395l(l)(4)(B)(ii)(VII)) is amended by striking

14 ‘‘1997’’ and inserting ‘‘1996’’.

15 (6) COMMUNITY HEALTH CENTERS AND RURAL

16 HEALTH CLINICS (SECTION 4161 OF OBRA–1990).—

17 (A) The fourth sentence of section 1861(aa)(2) (42

18 U.S.C. 1395x(aa)(2)) is amended—

19 (i) by striking ‘‘certification’’ the first

20 place it appears and inserting ‘‘approval’’; and

21 (ii) by striking ‘‘the Secretary’s approval

22 or disapproval of the certification’’ and insert23 ing ‘‘Secretary’s approval or disapproval’’.
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1 (B) Section 4161(a)(7)(B) of OBRA–1990 is

2 amended by inserting ‘‘and to the Committee on Fi3 nance of the Senate’’ after ‘‘Representatives’’.

4 (7) SCREENING MAMMOGRAPHY (SECTION 4163

5 OF OBRA–1990).—Section 4163 of OBRA–1990 is

6 amended—

7 (A) by adding at the end of subsection (d)

8 the following new paragraph:

9 ‘‘(3) The amendment made by paragraph

10 (2)(A)(iv) shall apply to screening pap smears per11 formed on or after July 1, 1990.’’; and

12 (B) in subsection (e), by striking ‘‘The

13 amendments’’ and inserting ‘‘Except as pro14 vided in subsection (d)(3), the amendments.’’.

15 (8) INJECTABLE DRUGS FOR TREATMENT OF

16 OSTEOPOROSIS.—

17 (A) CLARIFICATION OF DRUGS COV18 ERED.—The section 1861(jj) (42 U.S.C.

19 1395x(jj)) inserted by section 4156(a)(2) of

20 OBRA–1990 is amended—

21 (i) in the matter preceding paragraph

22 (1), by striking ‘‘a bone fracture related

23 to’’; and

24 (ii) in paragraph (1), by striking ‘‘pa25 tient’’ and inserting ‘‘individual has suf-
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1 fered a bone fracture related to post-meno2 pausal osteoporosis and that the individ3 ual’’.

4 (B) LIMITING COVERAGE TO DRUGS PRO5 VIDED BY HOME HEALTH AGENCIES.—(i) The

6 section 1861(jj) (42 U.S.C. 1395x(jj)) inserted

7 by section 4156(a)(2) of OBRA–1990 is

8 amended by striking ‘‘if’’ and inserting ‘‘by a

9 home health agency if’’.

10 (ii) Section 1861(m)(5) (42 U.S.C.

11 1395x(m)(5)) is amended by striking ‘‘but ex12 cluding’’ and inserting ‘‘and a covered

13 osteoporosis drug (as defined in subsection

14 (kk), but excluding other’’.

15 (iii) Section 1861(s)(2) (42 U.S.C.

16 1395x(s)(2)) is amended—

17 (I) by adding ‘‘and’’ at the end of

18 subparagraph (N), and

19 (II) by striking subparagraph (O) and

20 redesignating subparagraph (P) as sub21 paragraph (O).

22 (C) PAYMENT BASED ON REASONABLE

23 COST.—Section 1833(a)(2) (42 U.S.C.

24 1395l(a)(2)) is amended—
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1 (i) in subparagraph (A), by striking

2 ‘‘health services’’ and inserting ‘‘health

3 services (other than covered osteoporosis

4 drug (as defined in section 1861(kk)))’’;

5 (ii) by striking ‘‘and’’ at the end of

6 subparagraph (D);

7 (iii) by striking the semicolon at the

8 end and inserting ‘‘; and’’; and

9 (iv) by adding at the end the following

10 new subparagraph:

11 ‘‘(F) with respect to covered osteoporosis

12 drug (as defined in section 1861(kk)) furnished

13 by a home health agency, 80 percent of the rea14 sonable cost of such service, as determined

15 under section 1861(v);’’.

16 (D) APPLICATION OF PART B DEDUCT17 IBLE.—Section 1833(b)(2) (42 U.S.C.

18 1395l(b)(2)) is amended by striking ‘‘services’’

19 and inserting ‘‘services (other than covered

20 osteoporosis drug (as defined in section

21 1861(kk)))’’.

22 (E) COVERED OSTEOPOROSIS DRUG (SEC23 TION 4156 OF OBRA–1990).—Section 1861 (42

24 U.S.C. 1395x) is amended, in the subsection

25 (jj) inserted by section 4156(a)(2) of OBRA–
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1 1990, by striking ‘‘(jj) The term’’ and inserting

2 ‘‘(kk) The term’’.

3 (9) OTHER MISCELLANEOUS AND TECHNICAL

4 CORRECTIONS (SECTION 4164 OF OBRA–1990).—

5 (A) OWNERSHIP DISCLOSURE REQUIRE6 MENTS.—(i) Section 1124A(a)(2)(A) (42

7 U.S.C. 1320a–3a(a)(2)(A)) is amended by

8 striking ‘‘of the Social Security Act’’.

9 (ii) Section 4164(b)(4) of OBRA–1990 is

10 amended by striking ‘‘paragraph’’ and inserting

11 ‘‘paragraphs’’.

12 (B) DIRECTORY OF UNIQUE PHYSICIAN

13 IDENTIFIER NUMBERS.—Section 4164(c) of

14 OBRA–1990 is amended by striking ‘‘publish’’

15 and inserting ‘‘publish, and shall periodically

16 update,’’.

17 (g) EFFECTIVE DATE.—Except as otherwise provided

18 in this section, the amendments made by this section shall

19 take effect as if included in the enactment of OBRA–1990.

20 TITLE III—PROVISIONS

21 RELATING TO PARTS A AND B

22 SEC. 301. PROVISIONS RELATING TO PHYSICIAN OWNER23 SHIP AND REFERRAL.

24 (a) MULTIPLE LOCATIONS FOR GROUP PRAC25 TICES.—Section 1877(b)(2)(A)(ii)(II) (42 U.S.C.
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1 1395nn(b)(2)(A)(ii)(II)) is amended by striking ‘‘central2 ized provision’’ and inserting ‘‘provision of some or all’’.

3 (b) TREATMENT OF COMPENSATION ARRANGE4 MENTS.—

5 (1) RENTAL OF OFFICE SPACE AND EQUIP6 MENT.—Paragraph (1) of section 1877(e) (42

7 U.S.C. 1395nn(e)) is amended to read as follows:

8 ‘‘(1) RENTAL OF OFFICE SPACE; RENTAL OF

9 EQUIPMENT.—

10 ‘‘(A) OFFICE SPACE.—Payments made by

11 a lessee to a lessor for the use of premises if—

12 ‘‘(i) the lease is set out in writing,

13 signed by the parties, and specifies the

14 premises covered by the lease,

15 ‘‘(ii) the aggregate space rented or

16 leased is reasonable and necessary for the

17 legitimate business purposes of the lease or

18 rental,

19 ‘‘(iii) the lease provides for a term of

20 rental or lease for at least one year,

21 ‘‘(iv) in the case of a lease that is in22 tended to provide the lessee with access to

23 the premises for periodic intervals of time,

24 rather than on a full-time basis, the lease

25 specifies exactly the schedule of such inter-
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1 vals, their length, and the rent for such in2 tervals,

3 ‘‘(v) the rental charges over the term

4 of the lease are set in advance, are consist5 ent with fair market value, and are not de6 termined in a manner that takes into ac7 count the volume or value of any referrals

8 or other business generated between the

9 parties,

10 ‘‘(vi) the lease would be commercially

11 reasonable even if no referrals were made

12 between the parties, and

13 ‘‘(vii) the compensation arrangement

14 meets such other requirements as the Sec15 retary may impose by regulation as needed

16 to protect against program or patient

17 abuse.

18 ‘‘(B) EQUIPMENT.—Payments made by a

19 lessee of equipment to the lessor of the equip20 ment for the use of the equipment if—

21 ‘‘(i) the lease is set out in writing,

22 signed by the parties, and specifies the

23 equipment covered by the lease,
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1 ‘‘(ii) the equipment rented or leased is

2 reasonable and necessary for the legitimate

3 business purposes of the lease or rental,

4 ‘‘(iii) the lease provides for a term of

5 rental or lease of at least one year,

6 ‘‘(iv) in the case of a lease that is in7 tended to provide the lessee with use of the

8 equipment for periodic intervals of time,

9 rather than on a full-time basis, the lease

10 specifies exactly the schedule of such inter11 vals, their length, and the rent for such in12 tervals,

13 ‘‘(v) the rental charges over the term

14 of the lease are set in advance, are consist15 ent with fair market value, and are not de16 termined in a manner that takes into ac17 count the volume or value of any referrals

18 or other business generated between the

19 parties,

20 ‘‘(vi) the lease would be commercially

21 reasonable even if no referrals were made

22 between the parties, and

23 ‘‘(vii) the compensation arrangement

24 meets such other requirements as the Sec25 retary may impose by regulation as needed
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1 to protect against program or patient

2 abuse.’’.

3 (2) BONA FIDE EMPLOYMENT RELATION4 SHIPS.—Paragraph (2) of such section is amended—

5 (A) by striking ‘‘WITH HOSPITALS’’,

6 (B) by striking ‘‘An arrangement’’ and all

7 that follows through ‘‘if’’ and inserting ‘‘Any

8 amount paid by an employer to an employee

9 who has a bona fide employment relationship

10 with the employer for employment, or paid by

11 a hospital pursuant to an arrangement with a

12 physician (or immediate family member) for the

13 provision of administrative services, if’’,

14 (C) in subparagraphs (A), (B), and (D), by

15 striking ‘‘arrangement’’ and inserting ‘‘employ16 ment relationship or arrangement’’, and

17 (D) in subparagraph (C), by striking ‘‘to

18 the hospital’’.

19 (3) ADDITIONAL EXCEPTIONS.—Such sub20 section is further amended by adding at the end the

21 following new paragraphs:

22 ‘‘(7) PAYMENTS TO A PHYSICIAN FOR OTHER

23 ITEMS OR SERVICES.—

24 ‘‘(A) IN GENERAL.—Payments made by an

25 entity to a physician (or family member) who is
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1 not employed by the entity as compensation for

2 services specified in subparagraph (B), if—

3 ‘‘(i) the compensation agreement is

4 set out in writing and specifies the services

5 to be provided by the parties, the com6 pensation for each unit of service provided

7 under the agreement, and the schedule for

8 the provision of such services,

9 ‘‘(ii) the compensation paid over the

10 term of the agreement is consistent with

11 fair market value and is not determined in

12 a manner that takes into account the vol13 ume or value of any referrals or other busi14 ness generated between the parties,

15 ‘‘(iii) the compensation is provided

16 pursuant to an agreement which would be

17 commercially reasonable even if no refer18 rals were made to the entity, and

19 ‘‘(iv) the compensation arrangement

20 meets such other requirements as the Sec21 retary may impose by regulation as needed

22 to protect against program or patient

23 abuse.
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1 ‘‘(B) SPECIFIED SERVICES.—For purposes

2 of subparagraph (A), the services specified in

3 this subparagraph are any of the following:

4 ‘‘(i) Consultative services that—

5 ‘‘(I) relate to test results that

6 have been obtained that are outside

7 established parameters, or are specifi8 cally requested by the referring physi9 cian on a specified patient,

10 ‘‘(II) are furnished by a physi11 cian other than the referring physi12 cian (or by another physician who is

13 a member of the same group prac14 tice), and

15 ‘‘(III) for which the physician

16 furnishes a written report for that pa17 tient.

18 ‘‘(ii) Interpretation of tissue pathology

19 or Pap smear slides or the provision of

20 other cytology services.

21 ‘‘(iii) Phlebotomy services for pater22 nity or toxicology testing where the serv23 ices are furnished by a physician other

24 than the physician referring the individual

25 for such testing (or by another physician
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1 who is a member of the same group prac2 tice).

3 ‘‘(iv) Employment-related health care

4 services, including a payment by a self-in5 sured employer for services rendered to

6 employee applicants, employees, or their

7 families under the terms of a health bene8 fit plan.

9 ‘‘(v) Services as a clinical consultant

10 to the entity as required for certification of

11 the provider under section 353 of the Pub12 lic Health Service Act.

13 ‘‘(vi) Services required by local, State,

14 or Federal licensure, accreditation, or

15 other health and safety provisions.

16 ‘‘(vii) Services billed in the name of a

17 group practice provided by a physician

18 under contract to the group practice for

19 services not otherwise available directly

20 through a physician who is a member of

21 the group.

22 ‘‘(8) PAYMENTS BY A PHYSICIAN FOR ITEMS

23 AND SERVICES.—Payments made by a physician—

24 ‘‘(A) to a laboratory in exchange for the

25 provision of clinical laboratory services, or
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1 ‘‘(B) to an entity as compensation for

2 other items or services if the items or services

3 are furnished at a price that is consistent with

4 fair market value and are generally available to

5 referrors and non-referrors alike on similar

6 terms and conditions.

7 ‘‘(9) PAYMENTS FOR PATHOLOGY SERVICES OF

8 A GROUP PRACTICE.—Payments made to a group

9 practice for pathology services under an agreement

10 if—

11 ‘‘(A) the agreement is set out in writing

12 and specifies the services to be provided by the

13 parties and the compensation for services pro14 vided under the agreement;

15 ‘‘(B) the compensation paid over the

16 term of the agreement is consistent with

17 fair market value and is not determined in

18 a manner that takes into account the vol19 ume or value of any referrals or other busi20 ness generated between the parties,

21 ‘‘(C) the compensation is provided

22 pursuant to an agreement which would be

23 commercially reasonable even if no refer24 rals were made to the entity; and
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1 ‘‘(D) the compensation arrangement be2 tween the parties meets such other require3 ments as the Secretary may impose by regula4 tion as needed to protect against program or

5 patient abuse.’’.

6 (c) TREATMENT OF GROUP PRACTICE LABORA7 TORIES.—

8 (1) USE OF BILLING NUMBERS, ETC.—Section

9 1877 is amended—

10 (A) in subsection (b)(2)(B), by inserting

11 ‘‘under a billing number assigned to the group

12 practice’’ after ‘‘member’’,

13 (B) in subsection (h)(4)(B), by inserting

14 ‘‘and under a billing number assigned to the

15 group’’ after ‘‘in the name of the group’’, and

16 (C) in subsection (h)(4)(C), by striking

17 ‘‘by members of the group’’.

18 (2) TREATMENT OF SERVICES UNDER AR19 RANGEMENTS BETWEEN HOSPITALS AND GROUP

20 PRACTICES.—

21 (A) IN GENERAL.—Section 1877(h)(4) is

22 amended—

23 (i) in subparagraph (B) (as amended

24 by paragraph (1)(B)), by inserting ‘‘(or

25 are billed in the name of a hospital for
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1 which the group provides clinical labora2 tory services pursuant to an arrangement

3 that meets the requirements of subpara4 graph (B))’’ after ‘‘assigned to the group’’;

5 (ii) by redesignating subparagraphs

6 (A) through (D) as clauses (i) through

7 (iv), respectively;

8 (iii) by inserting ‘‘(A)’’ after ‘‘.—’’;

9 and

10 (iv) by adding at the end the following

11 new subparagraph:

12 ‘‘(B) The requirements of this subparagraph,

13 with respect to an arrangement for clinical labora14 tory services provided by the laboratory of a group

15 and billed in the name of a hospital, are that—

16 ‘‘(i) with respect to services provided to an

17 inpatient of the hospital, the arrangement is

18 pursuant to the provision of inpatient hospital

19 services under section 1861(b)(3);

20 ‘‘(ii) the arrangement began before Decem21 ber 19, 1989, and has continued in effect with22 out interruption since such date;

23 ‘‘(iii) the laboratory provides substantially

24 all of the clinical laboratory services to the hos25 pital’s patients;
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1 ‘‘(iv) the arrangement is pursuant to an

2 agreement that is set out in writing and that

3 specifies the services to be provided by the par4 ties and the compensation for services provided

5 under the agreement;

6 ‘‘(v) the compensation paid over the term

7 of the agreement is consistent with fair market

8 value and the compensation per unit of services

9 is fixed in advance and is not determined in a

10 manner that takes into account the volume or

11 value of any referrals or other business gen12 erated between the parties,

13 ‘‘(vi) the compensation is provided pursu14 ant to an agreement which would be commer15 cially reasonable even if no referrals were made

16 to the entity; and

17 ‘‘(vii) the arrangement between the parties

18 meets such other requirements as the Secretary

19 may impose by regulation as needed to protect

20 against program or patient abuse.’’.

21 (B) CONFORMING AMENDMENT.—Section

22 1877(b)(2)(B) is amended by inserting ‘‘(or by

23 a hospital for which such a group practice pro24 vides clinical laboratory services pursuant to an

25 arrangement that meets the requirements of
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1 subsection (h)(4)(B))’’ after ‘‘by a group prac2 tice of which such physician is a member’’.

3 (3) TREATMENT OF CERTAIN FACULTY PRAC4 TICE PLANS.—The last sentence of section

5 1877(h)(4)(A), as redesignated by paragraph (1)(A),

6 is amended by inserting ‘‘, institution of higher edu7 cation, or medical school’’ after ‘‘hospital’’.

8 (d) EXPANDING RURAL PROVIDER EXCEPTION TO

9 COVER COMPENSATION ARRANGEMENTS.—

10 (1) IN GENERAL.—Section 1877(b) is further

11 amended—

12 (A) by redesignating paragraph (5) as

13 paragraph (7), and

14 (B) by inserting after paragraph (4) the

15 following new paragraph:

16 ‘‘(5) RURAL PROVIDERS.—In the case of clini17 cal laboratory services if—

18 ‘‘(A) the laboratory furnishing the services

19 is in a rural area (as defined in section

20 1886(d)(2)(D)), and

21 ‘‘(B) substantially all of the services fur22 nished by the laboratory to individuals entitled

23 to benefits under this title are furnished to such

24 individuals who reside in such a rural area.’’.
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1 (2) CONFORMING AMENDMENTS.—Section

2 1877(d) is amended—

3 (A) by striking paragraph (2), and

4 (B) by redesignating paragraph (3) as

5 paragraph (2).

6 (e) EXCEPTION FOR SHARED FACILITY SERVICES.—

7 (1) IN GENERAL.—Section 1877 is amended—

8 (A) in subsection (b), as amended by sub9 section (d)(1), by inserting after paragraph (5)

10 the following new paragraph:

11 ‘‘(6) SHARED FACILITY SERVICES.—

12 ‘‘(A) IN GENERAL.—In the case of shared

13 facility services of a shared facility—

14 ‘‘(i) that are furnished—

15 ‘‘(I) personally by the referring

16 physician who is a shared facility phy17 sician or personally by an individual

18 supervised by such a physician or by

19 another shared facility physician and

20 employed under the shared facility ar21 rangement,

22 ‘‘(II) by a shared facility in a

23 building in which the referring physi24 cian furnishes physician’s services un-
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1 related to the furnishing of shared fa2 cility services, and

3 ‘‘(III) to a patient of a shared fa4 cility physician; and

5 ‘‘(ii) that are billed by the referring

6 physician or by an entity that is wholly

7 owned by such physician.

8 ‘‘(B) LIMITATION.—The exception under

9 this paragraph shall only apply to a shared fa10 cility only if the facility and the shared facility

11 arrangement were established as of June 26,

12 1992.’’; and

13 (B) in subsection (h), by adding at the end

14 the following new paragraph:

15 ‘‘(8) SHARED FACILITY RELATED DEFINI16 TIONS.—

17 ‘‘(A) SHARED FACILITY SERVICES.—The

18 term ‘shared facility services’ means, with re19 spect to a shared facility, clinical laboratory

20 services furnished by the facility to patients of

21 shared facility physicians.

22 ‘‘(B) SHARED FACILITY.—The term

23 ‘shared facility’ means an entity that furnishes

24 shared facility services under a shared facility

25 arrangement.
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1 ‘‘(C) SHARED FACILITY PHYSICIAN.—The

2 term ‘shared facility physician’ means, with re3 spect to a shared facility, a physician who has

4 a financial relationship under a shared facility

5 arrangement with the facility.

6 ‘‘(D) SHARED FACILITY ARRANGEMENT.—

7 The term ‘shared facility arrangement’ means,

8 with respect to the provision of shared facility

9 services in a building, a financial arrange10 ment—

11 ‘‘(i) which is only between physicians

12 who are providing services (unrelated to

13 shared facility services) in the same build14 ing,

15 ‘‘(ii) in which the overhead expenses

16 of the facility are shared, in accordance

17 with methods previously determined by the

18 physicians in the arrangement, among the

19 physicians in the arrangement, and

20 ‘‘(iii) which, in the case of a corpora21 tion, is wholly owned and controlled by

22 shared facility physicians.’’.

23 (2) GAO STUDY OF SHARED FACILITY AR24 RANGEMENTS.—
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1 (A) IN GENERAL.—The Comptroller Gen2 eral shall analyze the effect on the utilization of

3 health services of shared facility arrangements

4 for which an exception is provided under the

5 amendments made by paragraph (1). The anal6 ysis shall include a review of the effect of the

7 limitation, described in section 1877(b)(6)(B) of

8 the Social Security Act (as added by paragraph

9 (1)), with respect to such exception and on the

10 availability of services (including hematology

11 services).

12 (B) REPORT.—Not later than January 1,

13 1994, the Comptroller General shall submit a

14 report to Congress on the analysis conducted

15 under subparagraph (A). The report shall in16 clude recommendations with respect to chang17 ing the limitation.

18 (f) EXEMPTION OF COMPENSATION ARRANGEMENTS

19 INVOLVING CERTAIN TYPES OF REMUNERATION.—Sec20 tion 1877(h)(1) (42 U.S.C. 1395nn(h)(1)) is amended—

21 (1) by striking subparagraph (B);

22 (2) in subparagraph (A), by inserting before the

23 period the following: ‘‘(other than an arrangement

24 involving only remuneration described in subpara25 graph (B))’’; and
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1 (3) by adding at the end the following new sub2 paragraph:

3 ‘‘(B) Remuneration described in this subpara4 graph is any remuneration consisting of any of the

5 following:

6 ‘‘(i) The forgiveness of amounts owed for

7 inaccurate tests, mistakenly performed tests, or

8 the correction of minor billing errors.

9 ‘‘(ii) The provision of items, devices, or

10 supplies of minor value that are used to—

11 ‘‘(I) collect, transport, process, or

12 store specimens for the entity providing

13 the item, device, or supply, or

14 ‘‘(II) communicate the results of tests

15 for such entity.

16 ‘‘(iii) The furnishing by an entity of lab17 oratory services to a group practice affiliated

18 with the entity, if the entity provides all or sub19 stantially all of the clinical laboratory services

20 of the group practice.’’.

21 (g) MISCELLANEOUS AND TECHNICAL CORREC22 TIONS.—Section 1877 (42 U.S.C. 1395nn) is amended—

23 (1) in the fourth sentence of subsection (f)—

24 (A) by striking ‘‘provided’’ and inserting

25 ‘‘furnished’’, and
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1 (B) by striking ‘‘provides’’ and inserting

2 ‘‘furnish’’;

3 (2) in the fifth sentence of subsection (f)—

4 (A) by striking ‘‘providing’’ each place it

5 appears and inserting ‘‘furnishing’’,

6 (B) by striking ‘‘with respect to the provid7 ers’’ and inserting ‘‘with respect to the enti8 ties’’, and

9 (C) by striking ‘‘diagnostic imaging serv10 ices of any type’’ and inserting ‘‘magnetic reso11 nance imaging, computerized axial tomography

12 scans, and ultrasound services’’; and

13 (3) in subsection (a)(2)(B), by striking ‘‘sub14 section (h)(1)(A)’’ and inserting ‘‘subsection (h)(1)’’.

15 (h) EFFECTIVE DATE.—The amendments made by

16 this section shall apply to referrals made on or after Janu17 ary 1, 1992.

18 SEC. 302. DIRECT GRADUATE MEDICAL EDUCATION.

19 (a) ADJUSTMENT IN GME BASE-YEAR COSTS OF

20 FEDERAL INSURANCE CONTRIBUTIONS ACT.—

21 (1) IN GENERAL.—In determining the amount

22 of payment to be made under section 1886(h) of the

23 Social Security Act in the case of a hospital de24 scribed in subsection (b) for cost reporting periods

25 beginning on or after October 1, 1992, the Secretary
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1 of Health and Human Services shall redetermine the

2 approved FTE resident amount to reflect the

3 amount that would have been paid the hospital if,

4 during the hospital’s base cost reporting period, the

5 hospital had been liable for FICA taxes or for con6 tributions to the retirement system of a State, a po7 litical subdivision of a State, or an instrumentality

8 of such a State or political subdivision with respect

9 to interns and residents in its medical residency

10 training program.

11 (2) HOSPITALS AFFECTED.—A hospital de12 scribed in this subsection is a hospital that did not

13 pay FICA taxes with respect to interns and resi14 dents in its medical residency training program dur15 ing the hospital’s base cost reporting period, but is

16 required to pay FICA taxes or make contributions to

17 a retirement system described in paragraph (1) with

18 respect to such interns and residents because of the

19 amendments made by section 11332(b) of OBRA–

20 1990.

21 (3) DEFINITIONS.—In this subsection:

22 (A) the ‘‘base cost reporting period’’ for a

23 hospital is the hospital’s cost reporting period

24 that began during fiscal year 1984.
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1 (B) The term ‘‘FICA taxes’’ means, with

2 respect to a hospital, the taxes under section

3 3111 of the Internal Revenue Code of 1986.

4 (b) PUBLICLY-FUNDED FAMILY PRACTICE RESI5 DENCY PROGRAMS.—

6 (1) IN GENERAL.—Section 1886(h)(5) (42

7 U.S.C. 1395ww(h)(5)) is amended by adding at the

8 end the following new subparagraph:

9 ‘‘(H) ADJUSTMENTS FOR CERTAIN FAMILY

10 PRACTICE RESIDENCY PROGRAMS.—

11 ‘‘(i) IN GENERAL.—In the case of an

12 approved medical residency training pro13 gram (meeting the requirements of clause

14 (ii)) of a hospital which received payments

15 from the United States, a State, or a polit16 ical subdivision of a State or an instrumen17 tality of such a State or political subdivi18 sion (other than payments under this title

19 or a State plan under title XIX) for the

20 program during the cost reporting period

21 that began during fiscal year 1984, the

22 Secretary shall—

23 ‘‘(I) provide for an average

24 amount under paragraph (2)(A) that

25 takes into account the Secretary’s es-
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1 timate of the amount that would have

2 been recognized as reasonable under

3 this title if the hospital had not re4 ceived such payments, and

5 ‘‘(II) reduce the payment amount

6 otherwise provided under this sub7 section in an amount equal to the pro8 portion of such program payments

9 during the cost reporting period in10 volved that is allocable to this title.

11 ‘‘(ii) ADDITIONAL REQUIREMENTS.—

12 A hospital’s approved medical residency

13 program meets the requirements of this

14 clause if—

15 ‘‘(I) the program is limited to

16 training for family and community

17 medicine;

18 ‘‘(II) the program is the only ap19 proved medical residency program of

20 the hospital; and

21 ‘‘(III) the average amount deter22 mined under paragraph (2)(A) for the

23 hospital (as determined without re24 gard to the increase in such amount
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1 described in clause (i)(I)) does not ex2 ceed $10,000.’’.

3 (2) EFFECTIVE DATE.—The amendment made

4 by paragraph (1) shall apply to payments under sec5 tion 1886(h) of the Social Security Act for cost re6 porting periods beginning on or after October 1,

7 1990.

8 (c) PREVENTIVE CARE SERVICES AS PART OF INI9 TIAL RESIDENCY PERIOD.—

10 (1) ELIGIBILITY OF PREVENTIVE CARE RESI11 DENCY PROGRAMS FOR EXPANDED INITIAL RESI12 DENCY PERIODS.—Section 1886(h)(5)(F)(ii) (42

13 U.S.C. 1395ww(h)(5)(F)(ii)) is amended by insert14 ing after ‘‘fellowship program’’ the following: ‘‘or a

15 preventive care residency or fellowship program’’.

16 (2) EFFECTIVE DATE.—The amendment made

17 by paragraph (1) shall apply to cost reporting peri18 ods beginning on or after October 1, 1993.

19 SEC. 303. END STAGE RENAL DISEASE.

20 (a) COVERAGE OF IMMUNOSUPPRESSIVE DRUGS.—

21 (1) IN GENERAL.—Section 1861(s)(2)(J) (42

22 U.S.C. 1395x(s)(2)(J)) is amended by striking

23 ‘‘title, within’’ and all that follows and inserting the

24 following: ‘‘title, but only in the case of drugs fur25 nished—
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1 ‘‘(i) before 1994, within 12 months after

2 the date of the transplant procedure,

3 ‘‘(ii) during 1994, within 18 months after

4 the date of the transplant procedure,

5 ‘‘(iii) during 1995, within 24 months after

6 the date of the transplant procedure,

7 ‘‘(iv) during 1996, within 30 months after

8 the date of the transplant procedure, and

9 ‘‘(v) during any year after 1997, within 36

10 months after the date of the transplant proce11 dure;’’.

12 (2) EFFECTIVE DATE.—The amendment made

13 by paragraph (1) shall take effect on the date of the

14 enactment of this section.

15 (b) PAYMENT FOR ERYTHROPOIETIN.—

16 (1) IN GENERAL.—Section

17 1881(b)(11)(B)(ii)(I) (42 U.S.C.

18 1395rr(b)(11)(B)(ii)(I)) is amended—

19 (A) by striking ‘‘1991’’ and inserting

20 ‘‘1994’’; and

21 (B) by striking ‘‘$11’’ and inserting

22 ‘‘$10’’.

23 (2) EFFECTIVE DATE.—The amendments made

24 by paragraph (1) shall apply to erythropoietin fur25 nished on or after January 1, 1994.
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1 (c) HOME DIALYSIS DEMONSTRATION TECHNICAL

2 CORRECTION.—

3 (1) IN GENERAL.—Section 4202 of OBRA–

4 1990 is amended—

5 (A) in subsection (b)(1)(A), by striking

6 ‘‘home hemodialysis staff assistant’’ and insert7 ing ‘‘qualified home hemodialysis staff assistant

8 (as described in subsection (d))’’;

9 (B) in subsection (b)(2)(B)(ii)(I), by strik10 ing ‘‘(as adjusted to reflect differences in area

11 wage levels);

12 (C) in subsection (c)(1)(A), by striking

13 ‘‘skilled’’; and

14 (D) in subsection (c)(1)(E), by striking

15 ‘‘(b)(4)’’ and inserting ‘‘(b)(2)’’.

16 (2) EFFECTIVE DATE.—The amendments made

17 by paragraph (1) shall take effect as if included in

18 the enactment of OBRA–1990.

19 SEC. 304. MEDICARE SECONDARY PAYER.

20 (a) SECONDARY PAYER EXEMPTION FOR MEMBERS

21 OF RELIGIOUS ORDERS.—Effective as if included in the

22 enactment of OBRA–1989, section 6202(e)(2) of such Act

23 is amended by adding at the end the following: ‘‘Such

24 amendment also shall apply to items and services fur25 nished before such date with respect to secondary payor
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1 cases which the Secretary of Health and Human Services

2 had not identified as of such date.’’.

3 (b) IMPROVING IDENTIFICATION OF MEDICARE SEC4 ONDARY PAYER SITUATIONS.—

5 (1) SURVEY OF BENEFICIARIES.—

6 (A) IN GENERAL.—Section 1862(b)(5) (42

7 U.S.C. 1395y(b)(5)) is amended by adding at

8 the end the following new subparagraph:

9 ‘‘(D) OBTAINING INFORMATION FROM

10 BENEFICIARIES.—Before an individual applies

11 for benefits under part A or enrolls under part

12 B, the Administrator shall mail the individual a

13 questionnaire to obtain information on whether

14 the individual is covered under a primary plan

15 and the nature of the coverage provided under

16 the plan, including the name, address, and iden17 tifying number of the plan.’’.

18 (B) DISTRIBUTION OF QUESTIONNAIRE BY

19 CONTRACTOR.—The Secretary of Health and

20 Human Services shall enter into an agreement

21 with an entity not later than November 1,

22 1993, to distribute the questionnaire described

23 in section 1862(b)(5)(D) of the Social Security

24 Act (as added by subparagraph (A)).
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1 (C) NO MEDICARE SECONDARY PAYOR DE2 NIAL BASED ON FAILURE TO COMPLETE QUES3 TIONNAIRE.—Section 1862(b)(2) (42 U.S.C.

4 1395y(b)(2)) is amended by adding at the end

5 the following new subparagraph:

6 ‘‘(C) TREATMENT OF QUESTIONNAIRES.—

7 The Secretary may not fail to make payment

8 under subparagraph (A) solely on the ground

9 that an individual failed to complete a question10 naire concerning the existence of a primary

11 plan.’’.

12 (2) MANDATORY SCREENING BY PROVIDERS

13 AND SUPPLIERS UNDER PART B.—

14 (A) IN GENERAL.—Section 1862(b) (42

15 U.S.C. 1395y(b)) is amended by adding at the

16 end the following new paragraph:

17 ‘‘(6) SCREENING REQUIREMENTS FOR PROVID18 ERS AND SUPPLIERS.—

19 ‘‘(A) IN GENERAL.—Notwithstanding any

20 other provision of this title, no payment may be

21 made for any item or service furnished under

22 part B unless the entity furnishing such item or

23 service completes (to the best of its knowledge

24 and on the basis of information obtained from

25 the individual to whom the item or service is
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1 furnished) the portion of the claim form relat2 ing to the availability of other health benefit

3 plans.

4 ‘‘(B) PENALTIES.—An entity that know5 ingly, willfully, and repeatedly fails to complete

6 a claim form in accordance with subparagraph

7 (A) or provides inaccurate information relating

8 to the availability of other health benefit plans

9 on a claim form under such subparagraph shall

10 be subject to a civil money penalty of not to ex11 ceed $2,000 for each such incident. The provi12 sions of section 1128A (other than subsections

13 (a) and (b)) shall apply to a civil money penalty

14 under the previous sentence in the same man15 ner as such provisions apply to a penalty or

16 proceeding under section 1128A(a).’’.

17 (B) EFFECTIVE DATE.—The amendment

18 made by subparagraph (A) shall apply with re19 spect to items and services furnished on or

20 after July 1, 1993.

21 (c) IMPROVEMENTS IN RECOVERY OF PAYMENTS

22 FROM PRIMARY PAYERS.—

23 (1) SUBMISSION OF REPORTS ON EFFORTS TO

24 RECOVER ERRONEOUS PAYMENTS.—
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1 (A) FISCAL INTERMEDIARIES UNDER PART

2 A.—Section 1816 (42 U.S.C. 1396h) is amend3 ed by adding at the end the following new sub4 section:

5 ‘‘(k) An agreement with an agency or organization

6 under this section shall require that such agency or orga7 nization submit an annual report to the Secretary describ8 ing the steps taken to recover payments made for items

9 or services for which payment has been or could be made

10 under a primary plan (as defined in section

11 1862(b)(2)(A)).’’.

12 (B) CARRIERS UNDER PART B.—Section

13 1842(b)(3) (42 U.S.C. 1395u(b)(3)) is amend14 ed—

15 (i) by striking ‘‘and’’ at the end of

16 subparagraphs (G) and (H); and

17 (ii) by inserting after subparagraph

18 (H) the following new subparagraph:

19 ‘‘(I) will submit annual reports to the Secretary

20 describing the steps taken to recover payments made

21 under this part for items or services for which pay22 ment has been or could be made under a primary

23 plan (as defined in section 1862(b)(2)(A)).’’.

24 (2) REQUIREMENTS UNDER CARRIER PERFORM25 ANCE EVALUATION PROGRAM.—
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1 (A) FISCAL INTERMEDIARIES UNDER PART

2 A.—Section 1816(f)(1)(A) (42 U.S.C.

3 1396h(f)(1)(A)) is amended by striking ‘‘proc4 essing’’ and inserting ‘‘processing (including the

5 agency’s or organization’s success in recovering

6 payments made under this title for services for

7 which payment has been or could be made

8 under a primary plan (as defined in section

9 1862(b)(2)(A)))’’.

10 (B) CARRIERS UNDER PART B.—Section

11 1842(b)(2) (42 U.S.C. 1395u(b)(2)) is amended

12 by adding at the end the following new sub13 paragraph:

14 ‘‘(D) In addition to any other standards and criteria

15 established by the Secretary for evaluating carrier per16 formance under this paragraph relating to avoiding erro17 neous payments, the Secretary shall establish standards

18 and criteria relating to the carrier’s success in recovering

19 payments made under this part for items or services for

20 which payment has been or could be made under a pri21 mary plan (as defined in section 1862(b)(2)(A)).’’.

22 (3) DEADLINE FOR REIMBURSEMENT BY PRI23 MARY PLANS.—

24 (A) IN GENERAL.—Section

25 1862(b)(2)(B)(i) (42 U.S.C. 1395y(b)(2)(B)(i))
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1 is amended by adding at the end the following

2 sentence: ‘‘If reimbursement is not made to the

3 appropriate Trust Fund before the expiration of

4 the 60-day period that begins on the date such

5 notice or other information is received, the Sec6 retary may charge interest (beginning with the

7 date on which the notice or other information

8 is received) on the amount of the reimburse9 ment until reimbursement is made (at a rate

10 determined by the Secretary in accordance with

11 regulations of the Secretary of the Treasury ap12 plicable to charges for late payments).’’.

13 (B) CONFORMING AMENDMENT.—The

14 heading of clause (i) of section 1862(b)(2)(B) is

15 amended to read as follows: ‘‘REPAYMENT RE16 QUIRED.—’’.

17 (C) EFFECTIVE DATE.—The amendments

18 made by this paragraph shall apply to payments

19 for items and services furnished on or after the

20 date of the enactment of this Act.

21 (4) EFFECTIVE DATE.—The amendments made

22 by paragraphs (1) and (2) shall apply to contracts

23 with fiscal intermediaries and carriers under title

24 XVIII of the Social Security Act for years beginning

25 with 1993.
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1 (d) MISCELLANEOUS AND TECHNICAL CORREC2 TIONS.—

3 (1) The sentence in section 1862(b)(1)(C)

4 added by section 4203(c)(1)(B) of OBRA–1990 is

5 amended—

6 (A) by striking ‘‘on or before January 1,

7 1996,’’ and inserting ‘‘before January 1,

8 1996’’; and

9 (B) by striking ‘‘clauses (i) and (ii)’’ and

10 inserting ‘‘this subparagraph’’.

11 (2) Effective as if included in the enactment of

12 OBRA–1989, section 1862(b)(1) is amended—

13 (A) in subparagraphs (A)(v) and

14 (B)(iv)(II), by inserting ‘‘, without regard to

15 section 5000(d) of such Code’’ before the period

16 at the end of each subparagraph;

17 (B) in subparagraph (A)(iii), by striking

18 ‘‘current calendar year or the preceding cal19 endar year’’ and inserting ‘‘current calendar

20 year and the preceding calendar year’’; and

21 (C) in the matter in subparagraph (C)

22 after clause (ii), by striking ‘‘taking into ac23 count that’’ and inserting ‘‘paying benefits sec24 ondary to this title when’’.
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1 (3) Section 4203(c)(2) of OBRA–1990 is

2 amended—

3 (A) by striking ‘‘the application of clause

4 (iii)’’ and inserting ‘‘the second sentence’’;

5 (B) by striking ‘‘on individuals’’ and all

6 that follows through ‘‘section 226A of such

7 Act’’;

8 (C) in clause (ii), by striking ‘‘clause’’ and

9 inserting ‘‘sentence’’;

10 (D) in clause (v), by adding ‘‘and’’ at the

11 end; and

12 (E) in clause (vi)—

13 (i) by inserting ‘‘of such Act’’ after

14 ‘‘1862(b)(1)(C)’’, and

15 (ii) by striking the period at the end

16 and inserting the following: ‘‘, without re17 gard to the number of employees covered

18 by such plans.’’.

19 (4) Section 4203(d) of OBRA–1990 is amended

20 by striking ‘‘this subsection’’ and inserting ‘‘this sec21 tion’’.

22 (5) Except as provided in paragraph (2), the

23 amendments made by this subsection shall be effec24 tive as if included in the enactment of OBRA–1990.
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1 SEC. 305. IMPROVED OUTREACH FOR QUALIFIED MEDI2 CARE BENEFICIARIES.

3 The Secretary of Health and Human Services shall

4 establish and implement a method for obtaining informa5 tion from newly eligible medicare beneficiaries that may

6 be used to determine whether such beneficiaries may be

7 eligible for medical assistance for medicare cost-sharing

8 under State medicaid plans as qualified medicare bene9 ficiaries, and for transmitting such information to the

10 State in which such a beneficiary resides.

11 SEC. 306. SOCIAL HEALTH MAINTENANCE ORGANIZATIONS.

12 (a) EXTENSION OF CURRENT WAIVERS.—Section

13 4018(b) of OBRA–1987, as amended by OBRA–1990, is

14 amended—

15 (1) in paragraph (1) by striking ‘‘December 31,

16 1995’’ and inserting ‘‘December 31, 1997’’; and

17 (2) in paragraph (4) by striking ‘‘March 31,

18 1996’’ and inserting ‘‘March 31, 1998’’.

19 (b) EXPANSION OF DEMONSTRATIONS.—Section

20 2355 of the Deficit Reduction Act of 1984 is amended—

21 (1) in the last sentence of subsection (a) by

22 striking ‘‘12 months’’ and inserting ‘‘36 months’’;

23 and

24 (2) in subsection (b)(1)(B)—

25 (A) by striking ‘‘or’’ at the end of clause

26 (iii); and
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1 (B) by redesignating clause (iv) as clause

2 (v) and inserting after clause (iii) the following

3 new clause:

4 ‘‘(iv) integrating acute and chronic

5 care management for patients with end6 stage renal disease through expanded com7 munity care case management services

8 (and for purposes of a demonstration

9 project conducted under this clause, any

10 requirement under a waiver granted under

11 this section that a project disenroll individ12 uals who develop end-stage renal disease

13 shall not apply); or’’.

14 (c) EXPANSION OF NUMBER OF MEMBERS PER

15 SITE.—The Secretary of Health and Human Services may

16 not impose a limit of less than 12,000 on the number of

17 individuals that may participate in a project conducted

18 under section 2355 of the Deficit Reduction Act of 1984.

19 (d) MISCELLANEOUS AND TECHNICAL CORREC20 TIONS.—

21 (1) The section following section 4206 of

22 OBRA–1990 is amended by striking ‘‘SEC. 4027.’’

23 and inserting ‘‘SEC. 4207.’’, and in this subtitle is

24 referred to as section 4207 of OBRA–1990.
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1 (2) Section 2355(b)(1)(B) of the Deficit Reduc2 tion Act of 1984, as amended by section

3 4207(b)(4)(B)(ii) of OBRA–1990, is amended—

4 (A) by striking ‘‘12907(c)(4)(A)’’ and in5 serting ‘‘4207(b)(4)(B)(i)’’, and

6 (B) by striking ‘‘feasibilitly’’ and inserting

7 ‘‘feasibility’’.

8 (3) Section 4207(b)(4)(B)(iii)(III) of OBRA–

9 1990 is amended by striking the period at the end

10 and inserting a semicolon.

11 (4) Subsections (c)(3) and (e) of section 2355

12 of the Deficit Reduction Act of 1984, as amended by

13 section 4207(b)(4)(B) of OBRA–1990, are each

14 amended by striking ‘‘12907(c)(4)(A)’’ each place it

15 appears and inserting ‘‘4207(b)(4)(B)’’.

16 (5) Section 4207(c)(2) of OBRA–1990 is

17 amended by striking ‘‘the Committee on Ways and

18 Means’’ each place it appears and inserting ‘‘the

19 Committees on Ways and Means and Energy and

20 Commerce’’.

21 (6) Section 4207(d) of OBRA–1990 is amended

22 by redesignating the second paragraph (3) (relating

23 to effective date) as paragraph (4).

24 (7) Section 4207(i)(2) of OBRA–1990 is

25 amended—
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1 (A) by striking the period at the end of

2 clause (iii) and inserting a semicolon, and

3 (B) in clause (v), by striking ‘‘residents’’

4 and inserting ‘‘patients’’.

5 (8) Section 4207(j) of OBRA–1990 is amended

6 by striking ‘‘title’’ each place it appears and insert7 ing ‘‘subtitle’’.

8 (e) EFFECTIVE DATE.—The amendments made by

9 this section shall take effect as if included in the enact10 ment of OBRA–90.

11 SEC. 307. PEER REVIEW ORGANIZATIONS.

12 (a) REPEAL OF PRO PRECERTIFICATION REQUIRE13 MENT FOR CERTAIN SURGICAL PROCEDURES.—

14 (1) IN GENERAL.—Section 1164 (42 U.S.C.

15 1320c–13) is repealed.

16 (2) CONFORMING AMENDMENTS.—

17 (A) Section 1154 (42 U.S.C. 1320c–3) is

18 amended—

19 (i) in subsection (a), by striking para20 graph (12), and

21 (ii) in subsection (d), by striking

22 ‘‘(and except as provided in section

23 1164)’’.

24 (B) Section 1833 (42 U.S.C. 1395l) is

25 amended—
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1 (i) in subsection (a)(1)(D)(i), by strik2 ing ‘‘, or for tests furnished in connection

3 with obtaining a second opinion required

4 under section 1164(c)(2) (or a third opin5 ion, if the second opinion was in disagree6 ment with the first opinion)’’;

7 (ii) in subsection (a)(1), by striking

8 clause (G);

9 (iii) in subsection (a)(2)(A), by strik10 ing ‘‘to items and services (other than clin11 ical diagnostic laboratory tests) furnished

12 in connection with obtaining a second opin13 ion required under section 1164(c)(2) (or a

14 third opinion, if the second opinion was in

15 disagreement with the first opinion),’’;

16 (iv) in subsection (a)(2)(D)(i)—

17 (I) by striking ‘‘basis,’’ and in18 serting ‘‘basis or’’, and

19 (II) by striking ‘‘, or for tests

20 furnished in connection with obtaining

21 a second opinion required under sec22 tion 1164(c)(2) (or a third opinion, if

23 the second opinion was in disagree24 ment with the first opinion))’’;
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1 (v) in subsection (a)(3), by striking

2 ‘‘and for items and services furnished in

3 connection with obtaining a second opinion

4 required under section 1164(c)(2), or a

5 third opinion, if the second opinion was in

6 disagreement with the first opinion)’’; and

7 (vi) in the first sentence of subsection

8 (b)—

9 (I) by striking ‘‘(3)’’ and insert10 ing ‘‘and (3)’’, and

11 (II) by striking ‘‘, and (4)’’ and

12 all that follows up to the period at the

13 end.

14 (C) Section 1834(g)(1)(B) (42 U.S.C.

15 1395m(g)(1)(B)) is amended by striking ‘‘and

16 for items and services furnished in connection

17 with obtaining a second opinion required under

18 section 1164(c)(2), or a third opinion, if the

19 second opinion was in disagreement with the

20 first opinion)’’.

21 (D) Section 1862(a) (42 U.S.C. 1395y(a))

22 is amended—

23 (i) by adding ‘‘or’’ at the end of para24 graph (14),
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1 (ii) by striking ‘‘; or’’ at the end of

2 paragraph (15) and inserting a period, and

3 (iii) by striking paragraph (16).

4 (E) The third sentence of section

5 1866(a)(2)(A) (42 U.S.C. 1395w(a)(2)(A)) is

6 amended by striking ‘‘, with respect to items

7 and services furnished in connection with ob8 taining a second opinion required under section

9 1164(c)(2) (or a third opinion, if the second

10 opinion was in disagreement with the first opin11 ion),’’.

12 (3) EFFECTIVE DATE.—The amendments made

13 by this subsection shall apply to services provided on

14 or after the date of the enactment of this Act.

15 (b) MISCELLANEOUS AND TECHNICAL CORREC16 TIONS.—(1) The third sentence of section 1156(b)(1) (42

17 U.S.C. 1320c–5(b)(1)) is amended by striking ‘‘whehter’’

18 and inserting ‘‘whether’’.

19 (2) Section 1154(a)(9)(B) (42 U.S.C. 1320c–

20 3(a)(9)(B)) is amended by striking ‘‘this subsection’’ and

21 inserting ‘‘section 1156(a)’’.

22 (3) Section 4205(d)(2)(B) of OBRA–1990 is

23 amended by striking ‘‘amendments’’ and inserting

24 ‘‘amendment’’.
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1 (4) Section 1160(d) (42 U.S.C. 1320c–9(d)) is

2 amended by striking ‘‘subpena’’ and inserting ‘‘subpoena’’.

3 (5) Section 4205(e)(2) of OBRA–1990 is amended

4 by striking ‘‘amendments’’ and inserting ‘‘amendment’’

5 and by striking ‘‘all’’.

6 (6)(A) Except as provided in subparagraph (B), the

7 amendments made by this subsection shall take effect as

8 if included in the enactment of OBRA–1990.

9 (B) The amendment made by paragraph (2) (relating

10 to the requirement on reporting of information to State

11 licensing boards) shall take effect on the date of the enact12 ment of this Act.

13 SEC. 308. HOSPICE INFORMATION TO HOME HEALTH BENE14 FICIARIES.

15 (a) IN GENERAL.—Section 1891(a)(1) (42 U.S.C.

16 1395bbb(a)(1)) is amended by adding at the end the fol17 lowing new subparagraph:

18 ‘‘(H) The right, in the case of a resident

19 who is entitled to benefits under this title, to be

20 fully informed orally and in writing (at the time

21 of coming under the care of the agency) of the

22 entitlement of individuals to hospice care under

23 section 1812(a)(4) (unless there is no hospice

24 program providing hospice care for which pay25 ment may be made under this title within the
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1 geographic area of the facility and it is not the

2 common practice of the agency to refer patients

3 to hospice programs located outside such geo4 graphic area).’’.

5 (b) EFFECTIVE DATE.—The amendment made by

6 subsection (a) shall apply to services furnished on or after

7 the first day of the first month beginning more than one

8 year after the date of the enactment of this Act.

9 SEC. 309. INTEREST PAYMENTS.

10 (a) IN GENERAL.—Sections 1816(c)(2)(B)(ii)(IV)

11 and 1842(c)(2)(B)(ii)(IV) of the Social Security Act shall

12 be applied with respect to claims received in the 12-month

13 period beginning October 1, 1992, by substituting ‘‘30 cal14 endar days’’ for ‘‘24 calendar days’’ and ‘‘17 calendar

15 days’’.

16 (b) EFFECTIVE DATE.—Subsection (a) shall be in ef17 fect during the period that begins on the date of the enact18 ment of this Act and ends on September 30, 1993.

19 SEC. 310. CLARIFICATION OF JUDICIAL REVIEW RIGHTS.

20 (a) IN GENERAL.—Section 1869(b) (42 U.S.C.

21 1395ff(b)) is amended by adding at the end the following

22 new paragraph:

23 ‘‘(6) Nothing in this subsection (including paragraph

24 (5)) shall be construed as requiring a person to file a claim

25 with, or obtain findings or a decision of, the Secretary
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1 prior to seeking judicial review of an issue under this sub2 section, if the issue involves no material issues of fact in

3 dispute and involves a challenge to the validity of a regula4 tion or instruction which relates to a method for determin5 ing the amount of payment under part B.’’.

6 (b) EFFECTIVE DATE.—The amendment made by

7 subsection (a) shall apply as if included in the enactment

8 of section 9313 of OBRA–1986.

9 SEC. 311. ADJUSTMENTS TO DISCRETIONARY SPENDING

10 LIMITS.

11 (a) ADJUSTMENTS.—Section 251(b)(2) of the Bal12 anced Budget and Emergency Deficit Control Act of 1985

13 is amended by redesignating subparagraphs (E) and (F)

14 as subparagraphs (F) and (G), respectively, and by insert15 ing after subparagraph (D) the following new subpara16 graph:

17 ‘‘(E) MEDICARE ADMINISTRATIVE

18 COSTS.—To the extent that appropriations are

19 enacted that provide additional new budget au20 thority (as compared with a base level of

21 $1,526,000,000 for new budget authority) for

22 the administration of the Medicare program by

23 fiscal intermediaries and carriers pursuant to

24 sections 1816 and 1842(a) of title XVIII of the

25 Social Security Act, the adjustment for that
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1 year shall be that amount, but shall not ex2 ceed—

3 ‘‘(i) for fiscal year 1994,

4 $198,000,000 in new budget authority and

5 $198,000,000 in outlays; and

6 ‘‘(ii) for fiscal year 1995,

7 $220,000,000 in new budget authority and

8 $220,000,000 in outlays; and

9 the prior-year outlays resulting from these appro10 priations of budget authority and additional adjust11 ments equal to the sum of the maximum adjust12 ments that could have been made in preceding fiscal

13 years under this subparagraph.’’.

14 (b) CONFORMING AMENDMENTS.—

15 (1) Section 603(a) of the Congressional Budget

16 Act of 1974 is amended by striking ‘‘section

17 251(b)(2)(E)(i)’’ and inserting ‘‘section

18 251(b)(2)(F)(i)’’.

19 (2) Section 606(d) of the Congressional Budget

20 Act of 1974 is amended—

21 (A) in paragraph (1)(A) by striking ‘‘sec22 tion 251(b)(2)(E)(i)’’ and inserting ‘‘section

23 251(b)(2)(F)(i)’’; and

24 (B) in paragraph (2), by inserting

25 ‘‘251(b)(2)(E),’’ after ‘‘251(b)(2)(D),’’.
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1 SEC. 312. HEALTH MAINTENANCE ORGANIZATIONS.

2 (a) ADJUSTMENT IN MEDICARE CAPITATION PAY3 MENTS TO ACCOUNT FOR REGIONAL VARIATIONS IN AP4 PLICATION OF SECONDARY PAYOR PROVISIONS.—

5 (1) IN GENERAL.—Section 1876(a)(4) (42

6 U.S.C. 1395mm(a)(4)) is amended by adding at the

7 end the following new sentence: ‘‘In establishing the

8 adjusted average per capita cost for a geographic

9 area, the Secretary shall take into account the dif10 ferences between the proportion of individuals in the

11 area with respect to whom there is a group health

12 plan that is a primary payor (within the meaning of

13 section 1862(b)(2)(A)) compared to the proportion

14 of all such individuals with respect to whom there is

15 such a group health plan.’’.

16 (2) EFFECTIVE DATE.—The amendment made

17 by paragraph (1) shall apply to contracts entered

18 into for years beginning with 1994.

19 (b) REVISIONS IN THE PAYMENT METHODOLOGY

20 FOR RISK CONTRACTORS.—Section 4204(b) of OBRA–

21 1990 is amended to read as follows:

22 ‘‘(b) REVISIONS IN THE PAYMENT METHODOLOGY

23 FOR RISK CONTRACTORS.—(1)(A) Not later than July 1,

24 1993, the Secretary of Health and Human Services (in

25 this subsection referred to as the ‘‘Secretary’’) shall sub26 mit a proposal to the Congress that provides for revisions
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1 to the payment method to be applied in years beginning

2 with 1995 for organizations with a risk-sharing contract

3 under section 1876(g) of the Social Security Act.

4 ‘‘(B) In proposing the revisions required under sub5 paragraph (A) the Secretary shall consider—

6 ‘‘(i) the difference in costs associated with med7 icare beneficiaries with differing health status and

8 demographic characteristics; and

9 ‘‘(ii) the effects of using alternative geographic

10 classifications on the determinations of costs associ11 ated with beneficiaries residing in different areas.

12 ‘‘(2) Not later than October 1, 1993, the Comptroller

13 General shall review the proposal made pursuant to para14 graph (1), and shall report to Congress on the appro15 priateness of the proposed modifications.’’.

16 (c) MISCELLANEOUS AND TECHNICAL CORREC17 TIONS.—(1) Section 1876(a)(3) (42 U.S.C.

18 1395mm(a)(3)) is amended by striking ‘‘subsection

19 (c)(7)’’ and inserting ‘‘subsections (c)(2)(B)(ii) and

20 (c)(7)’’.

21 (2) Section 4204(c)(3) of OBRA–1990 is amended

22 by striking ‘‘for 1991’’ and inserting ‘‘for years beginning

23 with 1991’’.

24 (3) Section 4204(d)(2) of OBRA–1990 is amended

25 by striking ‘‘amendment’’ and inserting ‘‘amendments’’.
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1 (4) Section 1876(a)(1)(E)(ii)(I) (42 U.S.C.

2 1395mm(a)(1)(E)(ii)(I)) is amended by striking the

3 comma after ‘‘contributed to’’.

4 (5) Section 4204(e)(2) of OBRA–1990 is amended

5 by striking ‘‘(which has a risk-sharing contract under sec6 tion 1876 of the Social Security Act)’’.

7 (6) Section 4204(f)(4) of OBRA–1990 is amended by

8 striking ‘‘final’’.

9 (7) Section 1862(b)(3)(C) (42 U.S.C.

10 1395y(b)(3)(C)) is amended—

11 (A) in the heading, by striking ‘‘PLAN’’ and in12 serting ‘‘PLAN OR A LARGE GROUP HEALTH PLAN’’;

13 (B) by striking ‘‘group health plan’’ and insert14 ing ‘‘group health plan or a large group health

15 plan’’;

16 (C) by striking ‘‘, unless such incentive is also

17 offered to all individuals who are eligible for cov18 erage under the plan’’; and

19 (D) by striking ‘‘the first sentence of subsection

20 (a) and other than subsection (b)’’ and inserting

21 ‘‘subsections (a) and (b)’’.

22 (8) The amendments made by this subsection shall

23 take effect as if included in the enactment of OBRA–1990.
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1 SEC. 313. TREATMENT OF CERTAIN STATE HEALTH CARE

2 PROGRAMS.

3 Section 514(b)(5) of the Employee Retirement In4 come Security Act of 1974 (29 U.S.C. 1144(b)(5)) is

5 amended to read as follows:

6 ‘‘(5)(A) Except as provided in subparagraphs

7 (B) and (C), subsection (a) shall not apply to the

8 Hawaii Prepaid Health Care Act (Haw. Rev. Stat.

9 § § 393–1 through 393–51).

10 ‘‘(B) Nothing in subparagraph (A) shall be con11 strued to exempt from subsection (a) any State tax

12 law relating to employee benefits plans.

13 ‘‘(C) If the Secretary of Labor notifies the Gov14 ernor of the State of Hawaii that as the result of

15 an amendment to the Hawaii Prepaid Health Care

16 Act enacted after October 5, 1992—

17 ‘‘(i) the proportion of the population with

18 health care coverage under such Act is less than

19 such proportion on such date, or

20 ‘‘(ii) the level of benefit coverage provided

21 under such Act is less than the actuarial equiv22 alent of such level of coverage on such date,

23 subparagraph (A) shall not apply with respect to the

24 application of such amendment to such Act after the

25 date of such notification.’’.
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1 SEC. 314. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

2 (a) SURVEY AND CERTIFICATION REQUIREMENTS.—

3 (1) Section 1864 (42 U.S.C. 1395aa) is amended—

4 (A) in subsection (e), by striking ‘‘title’’ and in5 serting ‘‘title (other than any fee relating to section

6 353 of the Public Health Service Act)’’; and

7 (B) in the first sentence of subsection (a), by

8 striking ‘‘1861(s) or’’ and all that follows through

9 ‘‘Service Act,’’ and inserting ‘‘1861(s),’’.

10 (2) An agreement made by the Secretary of Health

11 and Human Services with a State under section 1864(a)

12 of the Social Security Act may include an agreement that

13 the services of the State health agency or other appro14 priate State agency (or the appropriate local agencies) will

15 be utilized by the Secretary for the purpose of determining

16 whether a laboratory meets the requirements of section

17 353 of the Public Health Service Act.

18 (b) OTHER MISCELLANEOUS AND TECHNICAL PRO19 VISIONS.—(1) Section 1833 (42 U.S.C. 1395l) is amended

20 by redesignating the subsection (r) added by section

21 4206(b)(2) of OBRA–1990 as subsection (s).

22 (2) Section 1866(f)(1) (42 U.S.C. 1395cc(f)(1)) is

23 amended by striking ‘‘1833(r)’’ and inserting ‘‘1833(s)’’.

24 (3) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is

25 amended by moving subparagraph (O), as redesignated by
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1 section 10149(f)(8)(B)(iii)(II) of this title, two ems to the

2 left.

3 (4) Section 1881(b)(1)(C) (42 U.S.C.

4 1395rr(b)(1)(C)) is amended by striking ‘‘1861(s)(2)(Q)’’

5 and inserting ‘‘1861(s)(2)(P)’’.

6 (5) Section 4201(d)(2) of OBRA–1990 is amended

7 by striking ‘‘(B) by striking’’, ‘‘(C) by striking’’, and ‘‘(3)

8 by adding’’ and inserting ‘‘(i) by striking’’, ‘‘(ii) by strik9 ing’’, and ‘‘(B) by adding’’, respectively.

10 (6)(A) Section 4207(a)(1) of OBRA–1990 is amend11 ed by adding closing quotation marks and a period after

12 ‘‘such review.’’.

13 (B) Section 4207(a)(4) of OBRA–1990 is amended

14 by striking ‘‘this subsection’’ and inserting ‘‘paragraphs

15 (2) and (3)’’.

16 (C) Section 4207(b)(1) of OBRA–1990 is amended

17 by striking ‘‘section 3(7)’’ and inserting ‘‘section

18 601(a)(1)’’.

19 (c) EFFECTIVE DATE.—The amendments made by

20 this section shall take effect as if included in the enact21 ment of OBRA–1990.
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1 TITLE IV—PROVISIONS RELAT2 ING TO MEDICARE SUPPLE3 MENTAL INSURANCE POLI4 CIES

5 SEC. 401. STANDARDS FOR MEDICARE SUPPLEMENTAL IN6 SURANCE POLICIES.

7 (a) SIMPLIFICATION OF MEDICARE SUPPLEMENTAL

8 POLICIES.—

9 (1) Section 4351 of OBRA–1990 is amended by

10 striking ‘‘(a) IN GENERAL.—’’.

11 (2) Section 1882(p) (42 U.S.C. 1395ss(p)) is

12 amended—

13 (A) in paragraph (1)(A)—

14 (i) by striking ‘‘promulgates’’ and in15 serting ‘‘changes the revised NAIC Model

16 Regulation (described in subsection (m)) to

17 incorporate’’,

18 (ii) by striking ‘‘(such limitations, lan19 guage, definitions, format, and standards

20 referred to collectively in this subsection as

21 ‘NAIC standards’)’’, and

22 (iii) by striking ‘‘included a reference

23 to the NAIC standards’’ and inserting

24 ‘‘were a reference to the revised NAIC

25 Model Regulation as changed under this
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1 subparagraph (such changed regulation re2 ferred to in this section as the ‘1991 NAIC

3 Model Regulation’)’’;

4 (B) in paragraph (1)(B)—

5 (i) by striking ‘‘promulgate NAIC

6 standards’’ and inserting ‘‘make the

7 changes in the revised NAIC Model Regu8 lation’’,

9 (ii) by striking ‘‘limitations, language,

10 definitions, format, and standards de11 scribed in clauses (i) through (iv) of such

12 subparagraph (in this subsection referred

13 to collectively as ‘Federal standards’)’’ and

14 inserting ‘‘a regulation’’, and

15 (iii) by striking ‘‘included a reference

16 to the Federal standards’’ and inserting

17 ‘‘were a reference to the revised NAIC

18 Model Regulation as changed by the Sec19 retary under this subparagraph (such

20 changed regulation referred to in this sec21 tion as the ‘1991 Federal Regulation’)’’;

22 (C) in paragraph (1)(C)(i), by striking

23 ‘‘NAIC standards or the Federal standards’’

24 and inserting ‘‘1991 NAIC Model Regulation or

25 1991 Federal Regulation’’;
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1 (D) in paragraphs (1)(C)(ii)(I), (1)(E),

2 (2), and (9)(B), by striking ‘‘NAIC or Federal

3 standards’’ and inserting ‘‘1991 NAIC Model

4 Regulation or 1991 Federal Regulation’’;

5 (E) in paragraph (2)(C), by striking

6 ‘‘(5)(B)’’ and inserting ‘‘(4)(B)’’;

7 (F) in paragraph (4)(A)(i), by inserting

8 ‘‘or paragraph (6)’’ after ‘‘(B)’’;

9 (G) in paragraph (4), by striking ‘‘applica10 ble standards’’ each place it appears and insert11 ing ‘‘applicable 1991 NAIC Model Regulation

12 or 1991 Federal Regulation’’;

13 (H) in paragraph (6), by striking ‘‘in re14 gard to the limitation of benefits described in

15 paragraph (4)’’ and inserting ‘‘described in

16 clauses (i) through (iii) of paragraph (1)(A)’’;

17 (I) in paragraph (7), by striking ‘‘policy18 holder’’ and inserting ‘‘policyholders’’;

19 (J) in paragraph (8), by striking ‘‘after the

20 effective date of the NAIC or Federal standards

21 with respect to the policy, in violation of the

22 previous requirements of this subsection’’ and

23 inserting ‘‘on and after the effective date speci24 fied in paragraph (1)(C) (but subject to para25 graph (10)), in violation of the applicable 1991
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1 NAIC Model Regulation or 1991 Federal Regu2 lation insofar as such regulation relates to the

3 requirements of subsection (o) or (q) or clause

4 (i), (ii), or (iii) of paragraph (1)(A)’’;

5 (K) in paragraph (9), by adding at the end

6 the following new subparagraph:

7 ‘‘(D) Subject to paragraph (10), this paragraph shall

8 apply to sales of policies occurring on or after the effective

9 date specified in paragraph (1)(C).’’; and

10 (L) in paragraph (10), by striking ‘‘this

11 subsection’’ and inserting ‘‘paragraph

12 (1)(A)(i)’’.

13 (b) GUARANTEED RENEWABILITY.—Section 1882(q)

14 (42 U.S.C. 1395ss(q)) is amended—

15 (1) in paragraph (2), by striking ‘‘paragraph

16 (2)’’ and inserting ‘‘paragraph (4)’’, and

17 (2) in paragraph (4), by striking ‘‘the succeed18 ing issuer’’ and inserting ‘‘issuer of the replacement

19 policy’’.

20 (c) ENFORCEMENT OF STANDARDS.—

21 (1) Section 1882(a)(2) (42 U.S.C.

22 1395ss(a)(2)) is amended—

23 (A) in subparagraph (A), by striking

24 ‘‘NAIC standards or the Federal standards’’
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1 and inserting ‘‘1991 NAIC Model Regulation or

2 1991 Federal Regulation’’, and

3 (B) by striking ‘‘after the effective date of

4 the NAIC or Federal standards with respect to

5 the policy’’ and inserting ‘‘on and after the ef6 fective date specified in subsection (p)(1)(C)’’.

7 (2) The sentence in section 1882(b)(1) added

8 by section 4353(c)(5) of OBRA–1990 is amended—

9 (A) by striking ‘‘The report’’ and inserting

10 ‘‘Each report’’,

11 (B) by inserting ‘‘and requirements’’ after

12 ‘‘standards’’,

13 (C) by striking ‘‘and’’ after ‘‘compliance,’’,

14 and

15 (D) by striking the comma after ‘‘Commis16 sioners’’.

17 (3) Section 1882(g)(2)(B) (42 U.S.C.

18 1395ss(g)(2)(B)) is amended by striking ‘‘Panel’’

19 and inserting ‘‘Secretary’’.

20 (4) Section 1882(b)(1) (42 U.S.C.

21 1395ss(b)(1)) is amended by striking ‘‘the the Sec22 retary’’ and inserting ‘‘the Secretary’’.

23 (d) PREVENTING DUPLICATION.—

24 (1) Section 1882(d)(3)(A) (42 U.S.C.

25 1395ss(d)(3)(A)) is amended—
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1 (A) by amending the first sentence to read

2 as follows:

3 ‘‘(i) It is unlawful for a person to sell or issue to an

4 individual entitled to benefits under part A or enrolled

5 under part B of this title—

6 ‘‘(I) a health insurance policy with knowledge

7 that the policy duplicates health benefits to which

8 the individual is otherwise entitled under this title or

9 title XIX,

10 ‘‘(II) a medicare supplemental policy with

11 knowledge that the individual is entitled to benefits

12 under another medicare supplemental policy, or

13 ‘‘(III) a health insurance policy (other than a

14 medicare supplemental policy) with knowledge that

15 the policy duplicates health benefits to which the in16 dividual is otherwise entitled, other than benefits to

17 which the individual is entitled under a requirement

18 of State or Federal law.’’;

19 (B) by designating the second sentence as

20 clause (ii) and, in such clause, by striking ‘‘the

21 previous sentence’’ and inserting ‘‘clause (i)’’;

22 (C) by designating the third sentence as

23 clause (iii) and, in such clause—

24 (i) by striking ‘‘the previous sentence’’

25 and inserting ‘‘clause (i) with respect to
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1 the sale of a medicare supplemental pol2 icy’’, and

3 (ii) by striking ‘‘and the statement’’

4 and all that follows up to the period at the

5 end; and

6 (D) by striking the last sentence.

7 (2) Section 1882(d)(3)(B) (42 U.S.C.

8 1395ss(d)(3)(B)) is amended—

9 (A) in clause (ii)(II), by striking ‘‘65 years

10 of age or older’’,

11 (B) in clause (iii)(I), by striking ‘‘another

12 medicare’’ and inserting ‘‘a medicare’’,

13 (C) in clause (iii)(I), by striking ‘‘such a

14 policy’’ and inserting ‘‘a medicare supplemental

15 policy’’,

16 (D) in clause (iii)(II), by striking ‘‘another

17 policy’’ and inserting ‘‘a medicare supplemental

18 policy’’, and

19 (E) by amending subclause (III) of clause

20 (iii) to read as follows:

21 ‘‘(III) If the statement required by clause (i) is ob22 tained and indicates that the individual is entitled to any

23 medical assistance under title XIX, the sale of the policy

24 is not in violation of clause (i) (insofar as such clause re25 lates to such medical assistance), if a State medicaid plan
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1 under such title pays the premiums for the policy, or, in

2 the case of a qualified medicare beneficiary described in

3 section 1905(p)(1), if the State pays less than the full

4 amount of medicare cost-sharing as described in subpara5 graphs (B), (C), and (D) of section 1905(p)(3) for such

6 individual.’’.

7 (3)(A) Section 1882(d)(3)(C) (42 U.S.C.

8 1395ss(d)(3)(C)) is amended—

9 (i) by striking ‘‘the selling’’ and inserting

10 ‘‘(i) the sale or issuance’’, and

11 (ii) by inserting before the period at the

12 end the following: ‘‘, (ii) the sale or issuance of

13 a policy or plan described in subparagraph

14 (A)(i)(I) (other than a medicare supplemental

15 policy to an individual entitled to any medical

16 assistance under title XIX) under which all the

17 benefits are fully payable directly to or on be18 half of the individual without regard to other

19 health benefit coverage of the individual but

20 only if (for policies sold or issued more than 60

21 days after the date the statements are pub22 lished or promulgated under subparagraph (D))

23 there is disclosed in a prominent manner as

24 part of (or together with) the application the

25 applicable statement (specified under subpara-
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1 graph (D)) of the extent to which benefits pay2 able under the policy or plan duplicate benefits

3 under this title, or (iii) the sale or issuance of

4 a policy or plan described in subparagraph

5 (A)(i)(III) under which all the benefits are fully

6 payable directly to or on behalf of the individual

7 without regard to other health benefit coverage

8 of the individual’’.

9 (B) Section 1882(d)(3) (42 U.S.C.

10 1395ss(d)(3)) is amended by adding at the end the

11 following:

12 ‘‘(D)(i) If—

13 ‘‘(I) within the 90-day period beginning on the

14 date of the enactment of this subparagraph, the Na15 tional Association of Insurance Commissioners devel16 ops (after consultation with consumer and insurance

17 industry representatives) and submits to the Sec18 retary a statement for each of the types of health in19 surance policies (other than medicare supplemental

20 policies and including, as separate types of policies,

21 policies paying directly to the beneficiary fixed, cash

22 benefits) which are sold to persons entitled to health

23 benefits under this title, of the extent to which bene24 fits payable under the policy or plan duplicate bene25 fits under this title, and
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1 ‘‘(II) the Secretary approves all the statements

2 submitted as meeting the requirements of subclause

3 (I),

4 each such statement shall be (for purposes of subpara5 graph (C)) the statement specified under this subpara6 graph for the type of policy involved. The Secretary shall

7 review and approve (or disapprove) all the statements sub8 mitted under subclause (I) within 30 days after the date

9 of their submittal. Upon approval of such statements, the

10 Secretary shall publish such statements.

11 ‘‘(ii) If the Secretary does not approve the statements

12 under clause (i) or the statements are not submitted with13 in the 90-day period specified in such clause, the Secretary

14 shall promulgate (after consultation with consumer and

15 insurance industry representatives and not later than 90

16 days after the date of disapproval or the end of such 90-

17 day period (as the case may be)) a statement for each

18 of the types of health insurance policies (other than medi19 care supplemental policies and including, as separate types

20 of policies, policies paying directly to the beneficiary fixed,

21 cash benefits) which are sold to persons entitled to health

22 benefits under this title, of the extent to which benefits

23 payable under the policy or plan duplicate benefits under

24 this title, and each such statement shall be (for purposes
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1 of subparagraph (C)) the statement specified under this

2 subparagraph for the type of policy involved.’’.

3 (C) The requirement of a disclosure under sec4 tion 1882(d)(3)(C)(ii) of the Social Security Act

5 shall not apply to an application made for a policy

6 or plan before 60 days after the date of the Sec7 retary of Health and Human Services publishes or

8 promulgates all the statements under section

9 1882(d)(3)(D) of such Act.

10 (4) Subparagraphs (A) and (B) of section

11 1882(q)(5)(A) are amended by striking ‘‘of the So12 cial Security Act’’.

13 (5) The second subsection (b) of section 4354

14 of OBRA–1990 (relating to effective date) is amend15 ed by redesignating such subsection as subsection

16 (c).

17 (e) LOSS RATIOS AND REFUNDS OF PREMIUMS.—

18 (1) Section 1882(r) (42 U.S.C. 1395ss(r)) is

19 amended—

20 (A) in paragraph (1), by striking ‘‘or sold’’

21 and inserting ‘‘or renewed (or otherwise provide

22 coverage after the date described in subsection

23 (p)(1)(C))’’;
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1 (B) in paragraph (1)(A), by inserting ‘‘for

2 periods after the effective date of these provi3 sions’’ after ‘‘the policy can be expected’’;

4 (C) in paragraph (1)(A), by striking

5 ‘‘Commissioners,’’ and inserting ‘‘Commis6 sioners)’’;

7 (D) in paragraph (1)(B), by inserting be8 fore the period at the end the following: ‘‘,

9 treating policies of the same type as a single

10 policy for each standard package’’;

11 (E) by adding at the end of paragraph (1)

12 the following: ‘‘For the purpose of calculating

13 the refund or credit required under paragraph

14 (1)(B) for a policy issued before the date speci15 fied in subsection (p)(1)(C), the refund or cred16 it calculation shall be based on the aggregate

17 benefits provided and premiums collected under

18 all such policies issued by an insurer in a State

19 (separated as to individual and group policies)

20 and shall be based only on aggregate benefits

21 provided and premiums collected under such

22 policies after the date specified in section

23 401(m)(4) of the Miscellaneous and Technical

24 Medicare Amendments of 1993.’’;
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1 (F) in the first sentence of paragraph

2 (2)(A), by striking ‘‘by policy number’’ and in3 serting ‘‘by standard package’’;

4 (G) by striking the second sentence of

5 paragraph (2)(A) and inserting the following:

6 ‘‘Paragraph (1)(B) shall not apply to a policy

7 until 12 months following issue.’’;

8 (H) in the last sentence of paragraph

9 (2)(A), by striking ‘‘in order’’ and all that fol10 lows through ‘‘are effective’’;

11 (I) by adding at the end of paragraph

12 (2)(A), the following new sentence: ‘‘In the case

13 of a policy issued before the date specified in

14 subsection (p)(1)(C), paragraph (1)(B) shall

15 not apply until 1 year after the date specified

16 in section 401(m)(4) of the Miscellaneous and

17 Technical Medicare Amendments of 1993.’’;

18 (J) in paragraph (2), by striking ‘‘policy

19 year’’ each place it appears and inserting ‘‘cal20 endar year’’;

21 (K) in paragraph (4), by striking ‘‘‘Feb22 ruary’’, ‘‘disllowance’’, ‘‘loss-ratios’’ each place

23 it appears, and ‘‘loss-ratio’’ and inserting ‘‘Oc24 tober’’, ‘‘disallowance’’, ‘‘loss ratios’’, and ‘‘loss

25 ratio’’, respectively;
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1 (L) in paragraph (6)(A), by striking ‘‘is2 sues a policy in violation of the loss ratio re3 quirements of this subsection’’ and ‘‘such viola4 tion’’ and inserting ‘‘fails to provide refunds or

5 credits as required in paragraph (1)(B)’’ and

6 ‘‘policy issued for which such failure occurred’’,

7 respectively; and

8 (M) in paragraph (6)(B), by striking ‘‘to

9 policyholders’’ and inserting ‘‘to the policy10 holder or, in the case of a group policy, to the

11 certificate holder’’.

12 (2) Section 1882(b)(1) (42 U.S.C.

13 1395ss(b)(1)) is amended, in the matter after sub14 paragraph (H), by striking ‘‘subsection (F)’’ and in15 serting ‘‘subparagraph (F)’’.

16 (3) Section 4355(d) of OBRA–1990 is amended

17 by striking ‘‘sold or issued’’ and all that follows and

18 inserting ‘‘issued or renewed (or otherwise providing

19 coverage after the date described in section

20 1882(p)(1)(C) of the Social Security Act) on or after

21 the date specified in section 1882(p)(1)(C) of such

22 Act.’’.

23 (f) TREATMENT OF HMO’S.—

24 (1) Section 1882(g)(1) (42 U.S.C.

25 1395ss(g)(1)) is amended by striking ‘‘a health
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1 maintenance organization or other direct service or2 ganization’’ and all that follows through ‘‘1833’’ and

3 inserting ‘‘an eligible organization (as defined in sec4 tion 1876(b)) if the policy or plan provides benefits

5 pursuant to a contract under section 1876 or an ap6 proved demonstration project described in section

7 603(c) of the Social Security Amendments of 1983,

8 section 2355 of the Deficit Reduction Act of 1984,

9 or section 9412(b) of the Omnibus Budget Reconcili10 ation Act of 1986 or, during the period beginning on

11 the date specified in subsection (p)(1)(C) and ending

12 on December 31, 1993, a policy or plan of an orga13 nization if the policy or plan provides benefits pursu14 ant to an agreement under section 1833(a)(1)(A)’’.

15 (2) Section 4356(b) of OBRA–1990 is amended

16 by striking ‘‘on the date of the enactment of this

17 Act’’ and inserting ‘‘on the date specified in section

18 1882(p)(1)(C) of the Social Security Act’’.

19 (g) PRE-EXISTING CONDITION LIMITATIONS.—Sec20 tion 1882(s) (42 U.S.C. 1395ss(s)) is amended—

21 (1) in paragraph (2)(A), by striking ‘‘for which

22 an application is submitted’’ and inserting ‘‘in the

23 case of an individual for whom an application is sub24 mitted prior to or’’,
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1 (2) in paragraph (2)(A), by striking ‘‘in which

2 the individual (who is 65 years of age or older) first

3 is enrolled for benefits under part B’’ and inserting

4 ‘‘as of the first day on which the individual is 65

5 years of age or older and is enrolled for benefits

6 under part B’’, and

7 (3) in paragraph (2)(B), by striking ‘‘before it’’

8 and inserting ‘‘before the policy’’.

9 (h) MEDICARE SELECT POLICIES.—

10 (1) Section 1882(t) (42 U.S.C. 1395ss(t)) is

11 amended—

12 (A) in paragraph (1), by inserting ‘‘medi13 care supplemental’’ after ‘‘If a’’,

14 (B) in paragraph (1), by striking ‘‘NAIC

15 Model Standards’’ and inserting ‘‘1991 NAIC

16 Model Regulation or 1991 Federal Regulation’’,

17 (C) in paragraph (1)(A), by inserting ‘‘or

18 agreements’’ after ‘‘contracts’’,

19 (D) in subparagraphs (E)(i) and (F) of

20 paragraph (1), by striking ‘‘NAIC standards’’

21 and inserting ‘‘standards in the 1991 NAIC

22 Model Regulation or 1991 Federal Regulation’’,

23 and
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1 (E) in paragraph (2), by inserting ‘‘the is2 suer’’ before ‘‘is subject to a civil money pen3 alty’’.

4 (2) Section 1154(a)(4)(B) (42 U.S.C. 1320c–

5 3(a)(4)(B)) is amended—

6 (A) by inserting ‘‘that is’’ after ‘‘(or’’, and

7 (B) by striking ‘‘1882(t)’’ and inserting

8 ‘‘1882(t)(3)’’.

9 (i) HEALTH INSURANCE COUNSELING.—Section

10 4360 of OBRA–1990 is amended—

11 (1) in subsection (b)(2)(A)(ii), by striking

12 ‘‘Act’’ and inserting ‘‘Act)’’;

13 (2) in subsection (b)(2)(D), by striking ‘‘serv14 ices’’ and inserting ‘‘counseling’’;

15 (3) in subsection (b)(2)(I), by striking ‘‘assist16 ance’’ and inserting ‘‘referrals’’;

17 (4) in subsection (c)(1), by striking ‘‘and that

18 such activities will continue to be maintained at such

19 level’’;

20 (5) in subsection (d)(3), by striking ‘‘to the

21 rural areas’’ and inserting ‘‘eligible individuals resid22 ing in rural areas’’;

23 (6) in subsection (e)—

24 (A) by striking ‘‘subsection (c) or (d)’’ and

25 inserting ‘‘this section’’,
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1 (B) by striking ‘‘and annually thereafter,

2 issue an annual report’’ and inserting ‘‘and an3 nually thereafter during the period of the grant,

4 issue a report’’,

5 (C) in paragraph (1), by striking ‘‘State6 wide’’, and

7 (D) in subsection (f), by striking para8 graph (2) and by redesignating paragraphs (3)

9 through (5) as paragraphs (2) through (4), re10 spectively; and

11 (7) by redesignating the second subsection (f)

12 (relating to authorization of appropriations for

13 grants) as subsection (g).

14 (j) TELEPHONE INFORMATION SYSTEM.—

15 (1) Section 1804 (42 U.S.C. 1395b–2) is

16 amended—

17 (A) by adding at the end of the heading

18 the following: ‘‘; MEDICARE AND MEDIGAP IN19 FORMATION’’,

20 (B) by inserting ‘‘(a)’’ after ‘‘1804.’’, and

21 (C) by adding at the end the following new

22 subsection:

23 ‘‘(b) The Secretary shall provide information via a

24 toll-free telephone number on the programs under this

25 title.’’.
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1 (2) Section 1882(f) (42 U.S.C. 1395ss(f)) is

2 amended by adding at the end the following new

3 paragraph:

4 ‘‘(3) The Secretary shall provide information via a

5 toll-free telephone number on medicare supplemental poli6 cies (including the relationship of State programs under

7 title XIX to such policies).’’.

8 (3) Section 1889 is repealed.

9 (k) MAILING OF POLICIES.—Section 1882(d)(4) (42

10 U.S.C. 1395ss(d)(4)) is amended—

11 (1) in subparagraph (D), by striking ‘‘, if such

12 policy’’ and all that follows up to the period at the

13 end, and

14 (2) by adding at the end the following new sub15 paragraph:

16 ‘‘(E) Subparagraph (A) shall not apply in the case

17 of an issuer who mails or causes to be mailed a policy,

18 certificate, or other matter solely to comply with the re19 quirements of subsection (q).’’.

20 (l) EFFECTIVE DATE.—The amendments made by

21 this section shall be effective as if included in the enact22 ment of OBRA–1990; except that—

23 (1) the amendments made by subsection (d)(1)

24 shall take effect on the date of the enactment of this

25 Act, but no penalty shall be imposed under section
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1 1882(d)(3)(A) of the Social Security Act (for an ac2 tion occurring after the effective date of the amend3 ments made by section 4354 of OBRA–1990 and be4 fore the date of the enactment of this Act) with re5 spect to the sale or issuance of a policy which is not

6 unlawful under section 1882(d)(3)(A)(i)(II) of the

7 Social Security Act (as amended by this section);

8 (2) the amendments made by subsection

9 (d)(2)(A) and by subparagraphs (A), (B), and (E)

10 of subsection (e)(1) shall be effective on the date

11 specified in subsection (m)(4); and

12 (3) the amendment made by subsection (g)(2)

13 shall take effect on July 1, 1993, and shall apply to

14 individuals who attain 65 years of age or older on

15 or after the effective date of section 1882(s)(2) of

16 the Social Security Act (and, in the case of individ17 uals who attained 65 years of age after such effec18 tive date and before July 1, 1993, and who were not

19 covered under such section before July 1, 1993, the

20 6-month period specified in that section shall begin

21 July 1, 1993).

22 (m) TRANSITION PROVISIONS.—

23 (1) IN GENERAL.—If the Secretary of Health

24 and Human Services identifies a State as requiring

25 a change to its statutes or regulations to conform its
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1 regulatory program to the changes made by this sec2 tion, the State regulatory program shall not be con3 sidered to be out of compliance with the require4 ments of section 1882 of the Social Security Act due

5 solely to failure to make such change until the date

6 specified in paragraph (4).

7 (2) NAIC STANDARDS.—If, within 6 months

8 after the date of the enactment of this Act, the Na9 tional Association of Insurance Commissioners (in

10 this subsection referred to as the ‘‘NAIC’’) modifies

11 its 1991 NAIC Model Regulation (adopted in July

12 1991) to conform to the amendments made by this

13 section and to delete from section 15C the exception

14 which begins with ‘‘unless’’, such modifications shall

15 be considered to be part of that Regulation for the

16 purposes of section 1882 of the Social Security Act.

17 (3) SECRETARY STANDARDS.—If the NAIC

18 does not make the modifications described in para19 graph (2) within the period specified in such para20 graph, the Secretary of Health and Human Services

21 shall make the modifications described in such para22 graph and such modifications shall be considered to

23 be part of that Regulation for the purposes of sec24 tion 1882 of the Social Security Act.

25 (4) DATE SPECIFIED.—
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1 (A) IN GENERAL.—Subject to subpara2 graph (B), the date specified in this paragraph

3 for a State is the earlier of—

4 (i) the date the State changes its stat5 utes or regulations to conform its regu6 latory program to the changes made by

7 this section, or

8 (ii) 1 year after the date the NAIC or

9 the Secretary first makes the modifications

10 under paragraph (2) or (3), respectively.

11 (B) ADDITIONAL LEGISLATIVE ACTION RE12 QUIRED.—In the case of a State which the Sec13 retary identifies as—

14 (i) requiring State legislation (other

15 than legislation appropriating funds) to

16 conform its regulatory program to the

17 changes made in this section, but

18 (ii) having a legislature which is not

19 scheduled to meet in 1994 in a legislative

20 session in which such legislation may be

21 considered,

22 the date specified in this paragraph is the first

23 day of the first calendar quarter beginning after

24 the close of the first legislative session of the

25 State legislature that begins on or after Janu-
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1 ary 1, 1994. For purposes of the previous sen2 tence, in the case of a State that has a 2-year

3 legislative session, each year of such session

4 shall be deemed to be a separate regular session

5 of the State legislature.

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