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[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 237 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 237

  To increase access to health care services for individuals in rural 
                     areas, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

 Mr. LaRocco introduced the following bill; which was referred jointly 
   to the Committees on Ways and Means, Energy and Commerce, and the 
                               Judiciary

_______________________________________________________________________

                                 A BILL

 
  To increase access to health care services for individuals in rural 
                     areas, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Rural Health Care 
Access Improvement Act of 1993''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
          TITLE I--PROVISIONS RELATING TO PHYSICIANS' SERVICES

                 Subtitle A--Incentives Under Medicare

Sec. 101. Elimination of medicare payment reductions for new doctors 
                            and practitioners for services furnished in 
                            any rural area.
Sec. 102. No medicare secondary payor denial based on failure to 
                            complete questionnaire.
Sec. 103. Limitations on use of extrapolation.
Sec. 104. Limitation on carrier user fees.
Sec. 105. Including physician input in annual carrier performance 
                            reviews.
Sec. 106. Appeals of carrier violations.
Sec. 107. Review of medical necessity denials in rural areas by 
                            physicians in same specialty.
Sec. 108. Clarification of permissible substitute billing arrangements 
                            for physicians' services under the medicare 
                            and medicaid programs.
Sec. 109. Repeal of PRO precertification requirement for certain 
                            surgical procedures performed in rural 
                            areas.
 Subtitle B--Increasing Number of Physicians Practicing in Rural Areas

Sec. 111. Deduction for medical school education loan interest incurred 
                            by physicians serving in medically 
                            underserved rural areas.
Sec. 112. Determination of greatest shortage of health professionals 
                            with respect to assignment of members of 
                            National Health Service Corps.
 Subtitle C--Expansion of Exceptions to Limitations on Physician Self-
                               Referrals

Sec. 121. Changes in exceptions.
Sec. 122. Study and report on changes in costs.
Sec. 123. Effective date.
               TITLE II--PROVISIONS RELATING TO HOSPITALS

Sec. 201. Holding rural hospitals harmless from reductions in medicare 
                            payments for capital-related costs 
                            resulting from prospective payment 
                            methodology.
Sec. 202. Extension of rural referral center classification.
Sec. 203. Antitrust exemption for certain rural hospitals.
                  TITLE III--MISCELLANEOUS PROVISIONS

               Subtitle A--Administrative Simplification

Sec. 301. Requirements for health benefit plans.
Sec. 302. Requirements for health service providers.
Sec. 303. Health claims clearinghouses.
Sec. 304. Standards relating to electronic claims processing.
Sec. 305. Excise tax on premiums received on group health plans which 
                            do not meet certain requirements.
Sec. 306. Application of requirements to medicare and medicaid 
                            programs.
                      Subtitle B--Other Provisions

Sec. 311. Telecommunications demonstration program for trauma care in 
                            rural areas.
Sec. 312. Primary care nursing clinics in rural areas.
Sec. 313. Identification, assessment, and reduction of paperwork burden 
                            associated with health care services.

          TITLE I--PROVISIONS RELATING TO PHYSICIANS' SERVICES

                 Subtitle A--Incentives Under Medicare

SEC. 101. ELIMINATION OF MEDICARE PAYMENT REDUCTIONS FOR NEW DOCTORS 
              AND PRACTITIONERS FOR SERVICES FURNISHED IN ANY RURAL 
              AREA.

    (a) In General.--
            (1) Payments to physicians.--The second sentence of section 
        1848(a)(4) of the Social Security Act (42 U.S.C. 1395w-4(a)(4)) 
        is amended--
                    (A) by striking ``or services'' and inserting ``, 
                services''; and
                    (B) by inserting before the period at the end the 
                following: ``, or services furnished in a rural area 
                (as so defined) by (or under the supervision of, or 
                incident to services of) a physician described in 
                section 1861(r)(1)''.
            (2) Payments to other practitioners.--Section 
        1842(b)(4)(F)(i) of such Act (42 U.S.C. 1395u(b)(4)(F)(i)) is 
        amended--
                    (A) by striking ``and other than services'' and 
                inserting ``, services''; and
                    (B) by striking ``area)'' and inserting the 
                following: ``area, or services furnished in a rural 
                area (as so defined) by (or under the supervision of, 
                or incident to services of) a physician described in 
                section 1861(r)(1))''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to services furnished after 1993.

SEC. 102. NO MEDICARE SECONDARY PAYOR DENIAL BASED ON FAILURE TO 
              COMPLETE QUESTIONNAIRE.

    (a) In general.--Section 1862(b)(2) of the Social Security Act (42 
U.S.C. 1395y(b)(2)) is amended by adding at the end the following new 
subparagraph:
                    ``(C) Treatment of questionnaires.--The Secretary 
                shall not fail to make payment under subparagraph (A) 
                based upon the failure of an individual to complete a 
                questionnaire concerning the existence of a primary 
                plan. However, any such payment remains conditional (as 
                provided under subparagraph (B)).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

SEC. 103. LIMITATIONS ON USE OF EXTRAPOLATION.

    (a) In General.--Section 1842(c) of the Social Security Act (42 
U.S.C. 1395u(c)) is amended by adding at the end the following new 
paragraph:
    ``(4) In carrying out its contract under subsection (b)(3) with 
respect to physicians' services--
            ``(A) the carrier may use extrapolation in order to 
        identify claims for which payment may be disallowed;
            ``(B) the carrier may not recoup or offset payment amounts 
        based on extrapolation if the physician requests that 
        disallowed claims be identified individually; and
            ``(C) no refund, offset assessment, penalties, or interest 
        shall accrue with respect to a claim that is disallowed until 
        the date the administrative appeals process has been 
        completed.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

SEC. 104. LIMITATION ON CARRIER USER FEES.

    (a) In General.--Section 1842(c) of the Social Security Act (42 
U.S.C. 1395u(c)), as amended by section 103(a), is further amended by 
adding at the end the following new paragraph:
    ``(5) Neither a carrier nor the Secretary may impose a fee under 
this title--
            ``(A) for the filing of a claim relating to physicians' 
        services,
            ``(B) for an error in filing a claim relating to 
        physicians' services or for such a claim which is denied,
            ``(C) for any appeal under this title with respect to 
        physicians' services,
            ``(D) for applying for (or obtaining) a unique identifier 
        under subsection (r), or
            ``(E) for responding to inquiries respecting physicians' 
        services or for providing information with respect to medical 
        review of such services.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

SEC. 105. INCLUDING PHYSICIAN INPUT IN ANNUAL CARRIER PERFORMANCE 
              REVIEWS.

    (a) In General.--Section 1842(b)(2) of the Social Security Act (42 
U.S.C. 1395u(b)(2)) is amended--
            (1) in the second sentence of subparagraph (A), by 
        inserting ``(including the reduction of administrative burdens 
        on physicians furnishing services for which payment is made 
        under this part)'' after ``contract obligations under this 
        section'', and
            (2) by adding at the end the following new subparagraph:
    ``(D) In applying the standards and criteria established under 
subparagraph (A), the Secretary shall consider any evaluations (with 
respect to such standards and criteria) submitted by medical societies 
representing physicians who are served by the carrier.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

SEC. 106. APPEALS OF CARRIER VIOLATIONS.

    (a) In General.--Section 1842(b)(2) of the Social Security Act (42 
U.S.C. 1395u(b)(2)), as amended by section 105(a)(2), is further 
amended by adding at the end the following new subparagraph:
    ``(E) The Secretary shall provide that any individual (including a 
physician) who--
            ``(i) is aggrieved by the failure of a carrier to carry out 
        policies established under this part, whether established 
        through the carrier manual, regional office transmittals, 
        central office transmittals, or other means, and
            ``(ii) establishes that the individual has (or, in the case 
        of a failure affecting more than one individual, the 
        individuals affected by the failure have) suffered damages 
        aggregating at least $500 as a result of the failure,
may obtain a hearing before the Secretary respecting such failure. If a 
carrier is found to have such a failure, the Secretary shall order the 
carrier to compensate the aggrieved individuals for such failure.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

SEC. 107. REVIEW OF MEDICAL NECESSITY DENIALS IN RURAL AREAS BY 
              PHYSICIANS IN SAME SPECIALTY.

    Section 1842(b)(2) of the Social Security Act (42 U.S.C. 
1395u(b)(2)), as amended by sections 105(a)(2) and 106(a), is further 
amended by adding at the end the following new subparagraph:
    ``(F) In the contract under subsection (c), the Secretary shall 
require each carrier, in the case of a decision to deny payment for 
physicians' services provided in a rural area (as defined in section 
18869d)(2)(D)) under section 1862(a)(1), to provide for review of the 
decision by a physician in the same medical specialty as the medical 
specialty of the physician who provided the services.''.

SEC. 108. CLARIFICATION OF PERMISSIBLE SUBSTITUTE BILLING ARRANGEMENTS 
              FOR PHYSICIANS' SERVICES UNDER THE MEDICARE AND MEDICAID 
              PROGRAMS.

    (a) Medicare Program.--
            (1) In general.--Clause (D) of section 1842(b)(6) of the 
        Social Security Act (42 U.S.C. 1395u(b)(6)) is amended to read 
        as follows: ``(D)(i) payment may be made to a physician for 
        physicians' services (and services incident to such services) 
        to be provided by a second physician on a reciprocal basis to 
        individuals who are patients of the first physician if (I) the 
        first physician is unavailable to provide the services, (II) 
        the services are not provided by the second physician over a 
        continuous period of longer than 60 days, and (III) the claim 
        form submitted to the carrier includes the second physician's 
        unique identifier (provided under the system established under 
        subsection (r)) and indicates that the claim meets the 
        requirements of this clause for payment to the first physician; 
        and (ii) payment may be made to a physician for physicians' 
        services (and services incident to such services) which that 
        physician pays a second physician on a per diem or other fee-
        for-time basis to provide to individuals who are patients of 
        the first physician if (I) the first physician is unavailable 
        to provide the services, (II) the services are not provided by 
        the second physician over a continuous period of longer than 90 
        days (or such longer period as the Secretary may provide), and 
        (III) the claim form submitted to the carrier includes the 
        second physician's unique identifier (provided under the system 
        established under subsection (r)) and indicates that the claim 
        meets the requirements of this clause for payment to the first 
        physician''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply to services furnished on or after the first day of 
        the first month beginning more than 60 days after the date of 
        the enactment of this Act.
    (b) Medicaid Program.--
            (1) In general.--Section 1902(a)(32)(C) of the Social 
        Security Act (42 U.S.C. 1396a(a)(32)(C)) is amended to read as 
        follows:
                    ``(C) payment may be made to a physician for 
                services furnished by a substitute physician under the 
                circumstances described in subparagraph (D) of section 
                1842(b)(6), except that, for purposes of this 
                subparagraph, any reference in such subparagraph to `a 
                carrier' or `the system established under subsection 
                (r)' is deemed a reference to the State (or other 
                fiscal agent under the State plan) and to the system 
                established under subsection (x) of this section, 
                respectively.''.
            (2) Effective date.--(A) The amendment made by paragraph 
        (1) shall apply to services furnished on or after the date of 
        the enactment of this Act.
            (B) Until the first day of the first calendar quarter 
        beginning more than 60 days after the date the Secretary of 
        Health and Human Services establishes the physician identifier 
        system under section 1902(x) of the Social Security Act, the 
        requirement under section 1902(a)(32)(C) of such Act that a 
        claim form submitted must include the second physician's unique 
        identifier is deemed to be satisfied if the claim form 
        identifies (in a manner specified by the Secretary of Health 
        and Human Services) the second physician.

SEC. 109. REPEAL OF PRO PRECERTIFICATION REQUIREMENT FOR CERTAIN 
              SURGICAL PROCEDURES PERFORMED IN RURAL AREAS.

    (a) In General.--Section 1164(b) of the Social Security Act (42 
U.S.C. 1320c-13(b)) is amended by adding at the end the following new 
paragraph:
            ``(5) Exception for procedures performed in rural areas.--
        No surgical procedure performed in a rural area (as defined in 
        section 1886(d)(2)(D)) shall be covered under this section.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished on or after January 1, 1994.

 Subtitle B--Increasing Number of Physicians Practicing in Rural Areas

SEC. 111. DEDUCTION FOR MEDICAL SCHOOL EDUCATION LOAN INTEREST INCURRED 
              BY PHYSICIANS SERVING IN MEDICALLY UNDERSERVED RURAL 
              AREAS.

    (a) In General.--Paragraph (1) of section 163(h) of the Internal 
Revenue Code of 1986 (relating to disallowance of deduction for 
personal interest) is amended by striking ``and'' at the end of 
subparagraph (D), by redesignating subparagraph (E) as subparagraph 
(F), and by inserting after subparagraph (D) the following new 
subparagraph:
                    ``(E) any qualified medical education loan interest 
                (within the meaning of paragraph (5)), and''.
    (b) Qualified Medical Education Loan Interest Defined.--Subsection 
(h) of section 163 of such Code is amended by redesignating paragraph 
(5) as paragraph (6) and by inserting after paragraph (4) the following 
new paragraph:
            ``(5) Qualified medical education loan interest.--
                    ``(A) In general.--The term `qualified medical 
                education loan interest' means interest--
                            ``(i) which is on a medical education loan 
                        of a physician,
                            ``(ii) which is paid or accrued by such 
                        physician, and
                            ``(iii) which accrues during the period--
                                    ``(I) such physician is providing 
                                primary care (including internal 
                                medicine, pediatrics, obstetrics/
                                gynecology, family medicine, and 
                                osteopathy) to residents of a medically 
                                underserved rural area, and
                                    ``(II) such physician's principal 
                                place of abode is in such area.
                    ``(B) Medical education loan.--The term `medical 
                education loan' means indebtedness incurred to pay the 
                individual's--
                            ``(i) qualified tuition and related 
                        expenses (as defined in section 117(b)) 
                        incurred for the medical education of such 
                        individual, or
                            ``(ii) reasonable living expenses while 
                        away from home in order to attend an 
                        educational institution described in section 
                        170(b)(1)(A)(ii) for the medical education of 
                        such individual.
                    ``(C) Physician.--For purposes of subparagraph (A), 
                the term `physician' has the meaning given such term by 
                section 1861(r)(1) of the Social Security Act.
                    ``(D) Medically underserved rural area.--The term 
                `medically underserved rural area' means any rural area 
                which is a medically underserved area (as defined in 
                section 330(b) or 1302(7) of the Public Health Service 
                Act).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 112. DETERMINATION OF GREATEST SHORTAGE OF HEALTH PROFESSIONALS 
              WITH RESPECT TO ASSIGNMENT OF MEMBERS OF NATIONAL HEALTH 
              SERVICE CORPS.

    (a) In General.--Section 333A(b) of the Public Health Service Act 
(42 U.S.C. 254f-1(b)) is amended by adding at the end the following 
paragraph:
            ``(3) The ratio of the estimated number of medically 
        underserved individuals residing in the health professional 
        shortage area involved to the aggregate population of all 
        health professional shortage areas.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to assignments of members of the National Health Service Corps 
that are made on or after the date of the enactment of this Act.

 Subtitle C--Expansion of Exceptions to Limitations on Physician Self-
                               Referrals

SEC. 121. CHANGES IN EXCEPTIONS.

    (a) Health Maintenance Organizations and Managed Care Plans.--
Paragraph (3) of section 1877(b) of the Social Security Act is amended 
to read as follows:
            ``(3) Health maintenance organizations and managed care 
        plans.--
                    ``(A) Health maintenance organizations.--In the 
                case of services furnished by a health maintenance 
                organization to an individual enrolled with the health 
                maintenance organization, including services furnished 
                by--
                            ``(i) an eligible organization (as defined 
                        in section 1876(b));
                            ``(ii) an organization described in section 
                        1833(a)(1)(A);
                            ``(iii) an organization receiving payments 
                        on a prepaid basis under a demonstration 
                        project under section 402(a) of the Social 
                        Security Amendments of 1967 or under section 
                        222(a) of the Social Security Amendments of 
                        1972; and
                            ``(iv) any other entity designated by the 
                        Secretary as a health maintenance organization 
                        for purposes of this subparagraph.
                    ``(B) Certain managed care plans.--In the case of 
                services furnished by a managed care plan (as defined 
                by the Secretary) to an individual enrolled under the 
                plan if--
                            ``(i) the plan selectively contracts with 
                        physicians and with providers of designated 
                        health services; and
                            ``(ii) under the plan physicians bear a 
                        significant financial risk for the cost of 
                        designated health services furnished upon 
                        referral.''.
    (b) Exception for Shared Facility Services.--Section 1877 of such 
Act is amended--
            (1) in subsection (b), by redesignating paragraphs (3), 
        (4), and (5) as paragraphs (4), (6), and (7), respectively, and 
        by inserting after paragraph (2) the following new paragraph:
            ``(3) Shared facility services.--
                    ``(A) In general.--In the case of shared facility 
                services of a shared facility--
                            ``(i) that are furnished--
                                    ``(I) personally by the referring 
                                physician who is a shared facility 
                                physician or personally by an 
                                individual supervised by such a 
                                physician or by another shared facility 
                                physician and employed under the shared 
                                facility arrangement,
                                    ``(II) by a shared facility in a 
                                building in which the referring 
                                physician furnishes physician's 
                                services unrelated to the furnishing of 
                                shared facility services, and
                                    ``(III) to a patient of a shared 
                                facility physician;
                            ``(ii) that are billed by the referring 
                        physician or by an entity that is wholly owned 
                        by such physician; and
                            ``(iii) with respect to the referral for 
                        which the disclosure requirements of 
                        subparagraph (B) are met.
                    ``(B) Conflict of interest disclosure 
                requirements.--A shared facility meets the disclosure 
                requirements of this subparagraph, with respect to a 
                referral of an individual for the furnishing of shared 
                facility services, if at the time of the referral (and 
                before the provision of shared facility services under 
                the referral) and in a form and manner specified by the 
                Secretary--
                            ``(i) the individual (I) is given 
                        information on the financial relationship 
                        between the referring physician and the shared 
                        facility, and (II) is informed that a list of 
                        alternative providers (if any) that are 
                        available to provide such services will be 
                        given upon request,
                            ``(ii) the individual is given, upon 
                        request, a list of alternative providers (if 
                        any) that are available to provide such 
                        services, and
                            ``(iii) the individual is informed that (I) 
                        the individual has the option to use any of the 
                        alternative providers and (II) the referring 
                        physician will not treat the individual 
                        differently if an alternative provider is 
                        selected to provide the designated health 
                        services.
                    ``(C) Construction.--Nothing in subparagraph (B) 
                shall be construed to limit the information that a 
                shared facility or shared facility physician may 
                provide to an individual.''; and
            (2) in subsection (h), by adding at the end the following 
        new paragraph:
            ``(8) Shared facility related definitions.--
                    ``(A) Shared facility services.--The term `shared 
                facility services' means, with respect to a shared 
                facility, a type of service which is furnished by the 
                facility to patients of shared facility physicians.
                    ``(B) Shared facility.--The term `shared facility' 
                means an entity that furnishes shared facility services 
                under a shared facility arrangement.
                    ``(C) Shared facility physician.--The term `shared 
                facility physician' means, with respect to a shared 
                facility, a physician who has a financial relationship 
                under a shared facility arrangement with the facility.
                    ``(D) Shared facility arrangement.--The term 
                `shared facility arrangement' means, with respect to 
                the provision of a type of service by a shared facility 
                in a building, a financial arrangement--
                            ``(i) which is only between physicians who 
                        are providing services (unrelated to shared 
                        facility services) in the same building,
                            ``(ii) which makes one or more of the 
                        shared facility physicians responsible for the 
                        provision of shared facility services by the 
                        facility,
                            ``(iii) in which the overhead expenses of 
                        the facility are shared, in accordance with 
                        methods previously determined by the physicians 
                        in the arrangement, among the physicians in the 
                        arrangement, and
                            ``(iv) which, in the case of a corporation, 
                        is wholly owned and controlled by shared 
                        facility physicians.''.
    (c) Exception for Valuable Community Services.--Section 1877(b) of 
such Act is further amended by inserting after paragraph (4), as 
redesignated by subsection (b)(1), the following new paragraph:
            ``(5) Valuable community services.--
                    ``(A) In general.--In the case of services 
                furnished by an entity to individuals in a community if 
                the Secretary determines that--
                            ``(i) individuals in the community will be 
                        deprived of adequate health care services 
                        without an exception under this paragraph for 
                        the entity and the services, and
                            ``(ii) the requirements of subparagraph (B) 
                        are met.
                    ``(B) Requirements.--The requirements of this 
                subparagraph for an exception under subparagraph (A), 
                for the furnishing of designated health services by an 
                entity, are as follows:
                            ``(i) Equal investment opportunity.--(I) 
                        Individuals who are not referring physicians 
                        must be given a bona fide opportunity to invest 
                        in the entity on the same terms that are 
                        offered to referring physicians.
                            ``(II) The terms on which investment 
                        interests are offered to physicians must not be 
                        related to the past or expected volume of 
                        referrals or other business from the 
                        physicians.
                            ``(III) The return on investment for 
                        interested investors must be tied to the 
                        investor's equity in the entity and not be 
                        related to the volume of referrals attributable 
                        to the investor.
                            ``(IV) There is no requirement that any 
                        interested or other investor make referrals to 
                        the entity or otherwise generate business as a 
                        condition for remaining an investor.
                            ``(V) The entity must not loan funds or 
                        guarantee a loan for interested investors or 
                        physicians in a position to refer to the 
                        entity.
                            ``(VI) The entity must not market or 
                        furnish its items or services to interested 
                        investors differently from other investors.
                            ``(ii) Prohibition of noncompetition 
                        clauses.--Investment contracts must not include 
                        a `noncompetition clause' that prevents 
                        physicians or interested investors from 
                        investing in other entities furnishing such 
                        services.
                            ``(iii) Disclosure requirements.--(I) The 
                        disclosure requirements of paragraph (3)(B) 
                        must be met.
                            ``(II) The financial relationship with the 
                        referring physician must be disclosed, when 
                        required, to any third-party payor.
                            ``(iv) Internal utilization review.--There 
                        must be in operation an internal utilization 
                        review program to ensure that physicians who 
                        are interested investors do not exploit their 
                        patients in any way through inappropriate 
                        utilization or otherwise.
                    ``(C) Review.--In the case of any exception 
                provided an entity under this paragraph, the Secretary 
                shall periodically review the entity to determine if 
                the requirements of subparagraph (B) continue to be 
                met.
                    ``(D) Termination of exception.--The Secretary 
                shall, after notice and opportunity for a hearing, 
                terminate an exception granted an entity under this 
                paragraph if the Secretary determines that--
                            ``(i) there was a misrepresentation of 
                        material fact in the application for the 
                        exception; or
                            ``(ii) the entity has failed to comply 
                        substantially with the requirements of 
                        subparagraph (B).
                    ``(E) Community defined.--In this paragraph, the 
                term `community' means--
                            ``(i) part or all of a metropolitan 
                        statistical area (or equivalent area), or
                            ``(ii) a county (or equivalent area) 
                        outside such a metropolitan statistical area 
                        (or equivalent area).''.
    (d) Exception for Hospitals.--Subparagraph (A) of subsection (d)(3) 
of such section is amended to read as follows:
                    ``(A) at the time the services are furnished, the 
                hospital has a participation agreement in effect under 
                section 1866, and''.

SEC. 122. STUDY AND REPORT ON CHANGES IN COSTS.

    The Secretary of Health and Human Services shall conduct a study in 
order to estimate the changes in aggregate costs for designated health 
services, under the medicare program and other health plans, which will 
result from the implementation of the amendments made by this subtitle. 
Not later than 2 years after the date of the enactment of this Act the 
Secretary shall submit to Congress a report on such study.

SEC. 123. EFFECTIVE DATE.

    (a) In General.--Subject to subsection (b), the amendments made by 
this subtitle shall apply with respect to a referral by a physician 
made on or after the first day of the first month beginning 6 months 
after the date of the enactment of this Act.
    (b) Time-Limited Exception for Current Financial Relationships.--
            (1) In general.--Subject to paragraph (3), the amendments 
        made by this subtitle shall not apply in the case of a patient 
        referral with respect to which a prohibited financial 
        relationship (described in paragraph (2)) existed as of the 
        date of the enactment of this Act if, at the time of the 
        referral (and before the receipt of services under the 
        referral), the patient is provided information on the 
        prohibited financial relationship. Such information shall be 
        disclosed in the same manner information must be disclosed 
        under section 1877(b)(3)(B) of the Social Security Act (as 
        amended by this subtitle). If such information is not so 
        provided, the referral shall be subject to such amendments (as 
        provided in subsection (a)).
            (2) Prohibited financial relationship.--A prohibited 
        financial relationship described in this paragraph is a 
        financial relationship described in subsection (a)(2) of 
        section 1877 of the Social Security Act for which an exception 
        described in subsection (b), (c), (d), or (e) of such section 
        (as amended by this subtitle) does not apply.
            (3) Time limit.--Paragraph (1) shall only apply to 
        referrals made before the first day of the first month 
        beginning 4 years after the date of the enactment of this Act.

               TITLE II--PROVISIONS RELATING TO HOSPITALS

SEC. 201. HOLDING RURAL HOSPITALS HARMLESS FROM REDUCTIONS IN MEDICARE 
              PAYMENTS FOR CAPITAL-RELATED COSTS RESULTING FROM 
              PROSPECTIVE PAYMENT METHODOLOGY.

    (a) In General.--Section 1886(g)(1)(B) of the Social Security Act 
(42 U.S.C. 1395ww(g)(1)(B)) is amended--
            (1) by striking ``and'' at the end of clause (iii);
            (2) by striking the period at the end of clause (iv) and 
        inserting ``, and''; and
            (3) by adding at the end the following new clause:
            ``(v) shall provide that the amount of payment made under 
        the system in a cost reporting period to any hospital located 
        in a rural area (as defined in subsection (d)(2)(D)) shall be 
        based on reasonable costs (as defined in section 1861(v)) or on 
        the methodology used to determine the amount of payment for 
        other hospitals, as elected by the hospital, except that the 
        method elected by the hospital shall apply to at least 3 
        consecutive cost reporting periods.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to portions of cost reporting periods or discharges (as the case 
may be) occurring on or after October 1, 1991.

SEC. 202. EXTENSION OF RURAL REFERRAL CENTER CLASSIFICATION.

    (a) Extension Through Fiscal Year 1994.--Section 6003(d) of the 
Omnibus Budget Reconciliation Act of 1989 (42 U.S.C. 1395ww note) is 
amended by striking ``October 1, 1992'' and inserting ``October 1, 
1994''.
    (b) Repeal of Special Treatment for Referral Centers.--
            (1) In general.--Effective October 1, 1994, section 
        1886(d)(5) of the Social Security Act (42 U.S.C. 1395ww(d)(5)) 
        is amended by striking subparagraph (C).
            (2) Exception for determining disproportionate share 
        payments.--Section 1886(d)(5)(F)(iv) of such Act (42 U.S.C. 
        1395ww(d)(5)(F)(iv)) is amended by striking ``subparagraph 
        (C),'' each place it appears in subclauses (IV) and (V) and 
        inserting the following: ``subparagraph (C) (or, for cost 
        reporting periods beginning on or after October 1, 1994, would 
        be so classified if such subparagraph were in effect for such a 
        cost reporting period, or was so classified under such 
        subparagraph for the most recent cost reporting period before 
        such date),''.

SEC. 203. ANTITRUST EXEMPTION FOR CERTAIN RURAL HOSPITALS.

    (a) In General.--The antitrust laws shall not apply with respect 
to--
            (1) the combination of, or the attempt to combine, 2 or 
        more hospitals,
            (2) a contract entered into solely by 2 or more hospitals 
        to allocate hospital services, or
            (3) the attempt by only 2 or more hospitals to enter into a 
        contract to allocate hospital services,
if each of such hospitals satisfies all of the requirements of 
subsection (b) at the time such hospitals engage in the conduct 
described in paragraph (1), (2), or (3), as the case may be.
    (b) Requirements Described.--The requirements referred to in 
subsection (a) are as follows:
            (1) The hospital is located outside of a city, or in a city 
        that has less than 125,000 inhabitants, as determined in 
        accordance with the most recent data available from the Bureau 
        of the Census.
            (2) In the most recently concluded calendar year, the 
        hospital received more than 40 percent of its gross revenue 
        from payments made under Federal programs.
            (3) There is in effect with respect to the hospital a 
        certificate issued by the Health Care Financing Administration 
        specifying that such Administration has determined that Federal 
        expenditures would be reduced, and consumer costs would not 
        increase, if the 2 or more hospitals that request such 
        certificate merge, or allocate the hospital services specified 
        in such request, as the case may be.
    (c) Definition.--For purposes of this section, the term ``antitrust 
laws'' has the meaning given such term in subsection (a) of the first 
section of the Clayton Act (15 U.S.C. 12), except that such term 
includes section 5 of the Federal Trade Commission Act (15 U.S.C. 45) 
to the extent that such section 5 applies with respect to unfair 
methods of competition.

                  TITLE III--MISCELLANEOUS PROVISIONS

               Subtitle A--Administrative Simplification

SEC. 301. REQUIREMENTS FOR HEALTH BENEFIT PLANS.

    (a) In General.--Each health benefit plan (as defined in subsection 
(b)) shall, with respect to individuals entitled to benefits under the 
plan--
            (1) issue to each such individual who is residing in the 
        United States a health claims card that meets the requirements 
        of section 304(a);
            (2) provide to the health claims clearinghouse assigned to 
        each such individual under section 303(c)(1) information, in an 
        electronic form consistent with standards established under 
        section 304(b), on--
                    (A) the eligibility of the individual for benefits 
                under the plan, and
                    (B) the benefits of the individual under the plan; 
                and
            (3) accept the determinations of clean claims made by the 
        health claims clearinghouse under section 303(e) for the 
        individual.
    (b) Health Benefit Plan Defined.--
            (1) In general.--In this subtitle, the term ``health 
        benefit plan'' means, except as provided in paragraphs (2) 
        through (4), any public or private entity or program that 
        provides for payments for health care services, including--
                    (A) a group health plan (as defined in section 605 
                of the Employee Retirement Income Security Act of 
                1974), a health plan of a multiple employer welfare 
                association, and a health plan of trustees of a fund 
                established by one or more employers or labor 
                organizations (or combination thereof), and
                    (B) any other health insurance arrangement, 
                including any arrangement consisting of a hospital or 
                medical expense incurred policy or certificate, 
                hospital or medical service plan contract, or health 
                maintenance organization subscriber contract.
            (2) Plans excluded.--Such term does not include--
                    (A) accident-only, credit, or disability income 
                insurance;
                    (B) coverage issued as a supplement to liability 
                insurance;
                    (C) an individual making payment on the 
                individual's own behalf (or on behalf of a relative or 
                other individual) for deductibles, coinsurance, or 
                services not covered under a health benefit plan; and
                    (D) such other plans as the Secretary may 
                determine, because of the limitation of benefits to a 
                single type or kind of health care, such as dental 
                services or hospital indemnity plans, or other reasons 
                should not be subject to the requirements of this 
                section.
            (3) Plans included.--Such term includes--
                    (A) worker's compensation or similar insurance, and
                    (B) automobile medical-payment insurance.
    (c) Other Definitions.--In this subtitle:
            (1) Clean claim.--The term ``clean claim'' means a request 
        for payment under a health benefits plan if the request has no 
        defect or impropriety (including any lack of any required 
        substantiating documentation) or particular circumstance 
        requiring special treatment that prevents timely payment from 
        being made on the request under the plan.
            (2) Health claims clearinghouse.--The terms ``health claims 
        clearinghouse'' and ``clearinghouse'' mean an entity with a 
        contract under section 303 to perform functions as a 
        clearinghouse under that section.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (4) United states.--The term ``United States'' means the 50 
        States and the District of Columbia.
    (d) Effective Date.--The requirements of subsection (a) shall apply 
to plans as of a date specified by the Secretary, which date shall be 
not later than 27 months after the date of the enactment of this Act.

SEC. 302. REQUIREMENTS FOR HEALTH SERVICE PROVIDERS.

    (a) Submission of Claims.--
            (1) In general.--Each health service provider which 
        furnishes services in the United States for which payment may 
        be made under a health benefit plan shall submit any claim for 
        payment for such services--
                    (A) only to the health claims clearinghouse to 
                which it is assigned, and
                    (B) only in a form and manner consistent with 
                standards established under section 304(b).
            (2) Enforcement.--
                    (A) Civil money penalty.--
                            (i) In general.--In the case of a health 
                        service provider that submits a claim in 
                        violation of paragraph (1), the provider is 
                        subject to a civil money penalty of not to 
                        exceed $100 (or, if greater, the amount of the 
                        claim) for each such violation. The provisions 
                        of section 1128A of the Social Security Act 
                        (other than the first and second sentences of 
                        subsection (a) and subsection (b)) shall apply 
                        to a civil money penalty under this 
                        subparagraph in the same manner as such 
                        provisions apply to a penalty or proceeding 
                        under section 1128A(a) of such Act.
                            (ii) Sunset.--No civil money penalty may be 
                        imposed under clause (i) for submission of any 
                        claim on or after the date that is 63 months 
                        after the date of the enactment of this Act.
                    (B) Denial of payment under medicare and medicaid 
                programs.--In the case of a health service provider 
                that submits a claim for services furnished under the 
                medicare program or medicaid program in violation of 
                paragraph (1), no payment shall be made under such 
                program for such services.
            (3) Health service provider defined.--In this subsection, 
        the term ``health service provider'' includes a provider of 
        services (as defined in section 1861(u) of the Social Security 
        Act), physicians, suppliers, and other persons furnishing 
        health care services for which benefits may be made available 
        under a health benefit plan.
            (4) Effective date.--The requirements of paragraph (1) 
        shall apply to providers for claims submitted on or after a 
        date specified by the Secretary, which date shall be not later 
        than 27 months after the date of the enactment of this Act.
    (b) Uniform Hospital Reporting.--Each hospital, as a requirement 
under a participation agreement under section 1866(a) of the Social 
Security Act for each cost reporting period beginning during or after 
fiscal year 1994, shall provide for the reporting of information to the 
Secretary with respect to any hospital care provided in a uniform 
manner consistent with standards established by the Secretary to carry 
out section 4007(c) of the Omnibus Budget Reconciliation Act of 1987.

SEC. 303. HEALTH CLAIMS CLEARINGHOUSES.

    (a) Designation of Clearinghouse Areas.--For purposes of carrying 
out this section, the Secretary shall designate within the continental 
United States areas encompassing approximately 5 million residents 
each. To the extent practicable, the areas shall be reasonably 
contiguous with State boundaries. Each such area, and each of the 
States of Alaska and Hawaii, is referred to in this section as a 
``clearinghouse area''.
    (b) Contracts with Health Claims Clearinghouses.--
            (1) In general.--Taking into account the considerations 
        listed in paragraph (2), the Secretary shall enter into a 
        contract with a public or private organization to perform the 
        functions of a health claims clearinghouse described in 
        subsections (d) and (e) for residents and providers in each 
        clearinghouse area. The Secretary shall enter into a single and 
        separate contract with respect to each such area. The Secretary 
        shall first enter into such contracts by not later than 2 years 
        after the date of the enactment of this Act.
            (2) Considerations.--In selecting among organizations to 
        perform the functions of a health claims clearinghouse in an 
        area, the Secretary shall consider at least the following:
                    (A) The price to be charged by the organization for 
                services performed by the organization under the 
                contract, including the price per claim processed.
                    (B) The organization's ability to process, and 
                experience in processing, claims on a timely and 
                accurate basis and to perform other functions of such a 
                clearinghouse.
                    (C) The organization's experience in processing 
                claims with respect to the various health service 
                providers in the area.
            (3) Terms of contracts.--
                    (A) In general.--Contracts under this subsection 
                shall be for a period, not to exceed 3 years, specified 
                by the Secretary. The Secretary may terminate such 
                contract, at any time after appropriate notice and 
                opportunity for correction, if the Secretary determines 
                that the organization has substantially failed to carry 
                out the contract.
                    (B) Charges for services.--A health claims 
                clearinghouse may impose reasonable charges, consistent 
                with the terms of its contract and subsections (d) and 
                (e), for the performance of required functions under 
                such subsections.
    (c) Assignment of Residents and Providers to Health Claims 
Clearinghouses.--For purposes of carrying out this subtitle--
            (1) Residents.--Each individual entitled to benefits under 
        a health benefits plan and who has a principal residence in a 
        geographic area shall be assigned to the clearinghouse for that 
        area.
            (2) Providers.--Each health service provider shall be 
        assigned to the clearinghouse for the area in which the 
        provider is located or provides services.
            (3) Exceptions.--The Secretary may permit individuals and 
        health service providers to be assigned to clearinghouses other 
        than those otherwise provided under this subsection in such 
        cases as the Secretary may specify.
            (4) Effective date.--Individuals and providers shall first 
        be assigned to clearinghouses under this subsection by not 
        later than 2 years after the date of the enactment of this Act.
    (d) Clearinghouse Required Functions Relating to Eligibility and 
Benefit Verification.--
            (1) Eligibility and benefit verification.--
                    (A) In general.--As set forth in its contract with 
                the Secretary, each health claims clearinghouse for an 
                area shall verify, with respect to residents assigned 
                to the clearinghouse, inquiries from health service 
                providers who have furnished or are furnishing health 
                services to such residents concerning--
                            (i) the health benefit plan (or plans) 
                        under which the residents are covered, and
                            (ii) the benefits under such a plan.
                    (B) Inter-clearinghouse verification process.--In 
                addition, in the case of a service furnished to an 
                individual assigned to another clearinghouse--
                            (i) the clearinghouse serving the provider 
                        shall forward inquiries described in 
                        subparagraph (A) on behalf of the provider to 
                        the clearinghouse serving the individual, and
                            (ii) the clearinghouse serving the 
                        individual shall respond to the inquiry through 
                        the clearinghouse serving the provider.
                The Secretary may provide for such inter-clearinghouse 
                electronic network as may expedite activities under 
                this subparagraph.
            (2) Form of inquiry.--Each clearinghouse shall be capable 
        of accepting inquiries under this subsection in a variety of 
        electronic and other forms, including--
                    (A) through electronic transmission of information 
                on the uniform health claims card (in a manner similar 
                to that for verification of credit card purchases),
                    (B) through the use of a touch-tone telephone line, 
                and
                    (C) through the use of a computer modem.
        The clearinghouse shall also provide, for an additional fee, 
        for the acceptance of inquiries in a nonelectronic form.
            (3) Form of response.--Each clearinghouse shall be capable 
        of responding to such inquiries under this subsection in a 
        variety of electronic and other forms, including--
                    (A) through modem transmission of information,
                    (B) through computer synthesized voice 
                communication, and
                    (C) through transmission of information to a 
                facsimile (fax) machine.
        The clearinghouse shall also provide, for an additional fee, 
        for the response to inquiries in a nonelectronic form.
            (4) Limitation on fees.--A clearinghouse may not impose a 
        fee for the acceptance or response to an inquiry under this 
        subsection except where the acceptance or response is in a 
        nonelectronic form.
    (e) Clearinghouse Required Functions Relating to Receipt and 
Processing of Claims for Benefits.--
            (1) Processing of claims.--
                    (A) In general.--As set forth in its contract with 
                the Secretary, each clearinghouse serving residents of 
                an area shall--
                            (i) receive claims for benefits under 
                        health benefit plans for such residents;
                            (ii) process the claims to determine if 
                        they are clean claims (as defined in section 
                        301(c)(1));
                            (iii) if a claim is not a clean claim, 
                        notify the person submitting the claim (I) that 
                        payment is not authorized for the claim, (II) 
                        of the reasons for the denial, and (III) 
                        concerning the process available for the appeal 
                        of such determination; and
                            (iv) if a claim is a clean claim--
                                    (I) notify the person submitting 
                                the claim that payment may be made for 
                                the claim and the amount that is 
                                payable under the plan and the amount 
                                that is payable by the beneficiary as 
                                cost-sharing with respect to the 
                                provider and service, and
                                    (II) notify the plan (or plans) 
                                liable for payment with respect to the 
                                claim, of the submission and approval 
                                of the claim (and provide the plan with 
                                such additional information with 
                                respect to the person submitting the 
                                claim and the services under the claim 
                                as may be required for payment to be 
                                made on the claim).
                    (B) Inter-clearinghouse verification process.--In 
                addition, in the case of a service furnished to an 
                individual assigned to another clearinghouse--
                            (i) the clearinghouse serving the provider 
                        shall forward claims described in subparagraph 
                        (A) on behalf of the provider to the 
                        clearinghouse serving the individual for 
                        processing, and
                            (ii) the clearinghouse serving the 
                        individual shall respond to the claim through 
                        the clearinghouse serving the provider.
                The Secretary may provide for such inter-clearinghouse 
                electronic network as may expedite activities under 
                this subparagraph.
            (2) Form of claim.--Each clearinghouse shall be capable of 
        accepting claims under this subsection in an electronic form, 
        including through electronic modem transmission. Each 
        clearinghouse also shall provide, for an additional fee, for 
        the acceptance of claims submitted on a uniform nonelectronic 
        claims form.
            (3) Processing of claim.--For each claim submitted by 
        health service provider for care furnished to an individual, 
        the clearinghouse shall determine--
                    (A) if the claim is in proper form and the 
                individual is covered under a health benefit plan,
                    (B) if so, whether under such plan the individual 
                is entitled to benefits with respect to that provider 
                and that care, and
                    (C) any preconditions, such as prior authorization, 
                that may exist for payment to be made for such care 
                and, to the extent specified by the Secretary, whether 
                such preconditions have been met.
            (4) Response.--Each clearinghouse shall be capable of 
        responding to such inquiries in a variety of electronic forms, 
        including--
                    (A) through modem transmission of information, and
                    (B) through transmission of information to a 
                facsimile (fax) machine.
        The clearinghouse also shall provide, for an additional fee, 
        for the response to claims in a nonelectronic form.
    (f) Optional Payment Functions.--
            (1) In general.--Under a contractual arrangement between a 
        health benefit plan and a clearinghouse, each clearinghouse may 
        make payment of cleans claims received by the clearinghouse for 
        beneficiaries under the plan in return for payment from the 
        plan. Any such contract shall be made only on commercially 
        reasonable terms, including (if appropriate for non-Federal 
        health plans) the provision of a bonds or other assurances of 
        payment of the clearinghouse by the health benefit plan. If the 
        clearinghouse enters into such a contractual arrangement with a 
        health benefit plan, the clearinghouse may not refuse to enter 
        into such an arrangement with other health benefit plans that 
        can meet the same (or comparable) commercial terms as under the 
        previous arrangement.
            (2) Authorization.--The Secretary is authorized to enter 
        into contractual arrangements with clearinghouses to carry out 
        the activities described in paragraph (1) with respect to the 
        medicare program.

SEC. 304. STANDARDS RELATING TO ELECTRONIC CLAIMS PROCESSING.

    (a) Uniform Health Claims Cards.--
            (1) In general.--The Secretary shall establish standards 
        consistent with this subsection respecting the form and 
        information to be contained on uniform health claims cards (for 
        purposes of section 301(a)(1)).
            (2) Electronic.--
                    (A) In general.--Subject to subparagraph (B), the 
                card shall be in a form similar to that of credit cards 
                and shall have, encoded in electronic form--
                            (i) the identity of the individual (using 
                        the Social Security account number of the 
                        individual or, in the case of an infant or 
                        other individual to whom such a number has not 
                        been issued, such a Social Security account 
                        number of a parent or guardian or other number 
                        as the Secretary shall specify), and
                            (ii) the health claims clearinghouse to 
                        which the individual is assigned under section 
                        303(c).
                    (B) Use of electronic read-and-write cards.--The 
                Secretary may provide for cards in a electronic form 
                that permit information on the card to be readily 
                changed. Such information may include information 
                relating to the health coverage status of the 
                individual and the medical history of the individual.
            (3) Additional information.--The card shall include such 
        additional information, in electronic or other form, as the 
        Secretary may require to carry out the purposes of this 
        subtitle. In addition, the health benefit plan issuing the card 
        may include such additional information on the card as the plan 
        desires, subject to such limitations as the Secretary may 
        provide.
            (4) Assuring confidentiality of information.--In 
        establishing standards under this subsection, the Secretary 
        shall include a requirement that, to the greatest extent 
        possible, information on an individual's medical condition or 
        medical history shall be treated in a confidential manner.
    (b) Uniform Claims Data Set.--
            (1) In general.--The Secretary shall establish standards 
        with respect to the type and form of substantiating 
        documentation that--
                    (A) health claims clearinghouse may require in 
                order for a claim for benefits to be accepted for 
                processing, and
                    (B) claims for benefits under such plans may be 
                required to provide in order to be treated as clean 
                claims and to obtain payment.
            (2) Scope of data set.--The standards under this subsection 
        are intended to cover substantially most claims that are filed 
        under health benefit plans. Such data set need not include all 
        elements that may potentially be required to be reported under 
        utilization review provisions of plans.
            (3) Consistency with electronic medical records.--In 
        establishing standards under this subsection, the Secretary 
        shall assure that the standards--
                    (A) are consistent with standards being developed 
                for the maintenance of electronic medical records, and
                    (B) would permit data elements from such medical 
                records to be the elements which are transmitted for 
                purposes of electronic submission of claims.
            (4) Uniform, unique provider identification codes.--In 
        establishing standards under this subsection, the Secretary 
        shall provide for a unique identifier for each health service 
        provider (as defined in section 302(a)(3)) that submits claims 
        for payment to health benefit plans.
            (5) Uniform diagnostic and procedure codes.--In 
        establishing standards under this subsection, the Secretary 
        shall develop a single, uniform coding system for diagnostic 
        and procedure codes.
    (c) Free Software to Providers.--The Secretary shall provide for 
the development, and shall make available without charge to health 
service providers, such computer software as will enable the 
providers--
            (1) to make inquiries, and receive responses, 
        electronically respecting the eligibility and benefits of an 
        individual under health benefit plans,
            (2) to submit claims and to receive verification of claims 
        status electronically, and
            (3) in the case of hospitals to submit uniform reports.
    (d) Adjustments for Rural Providers.--In establishing standards 
under this section, the Secretary shall provide for such exceptions and 
adjustments as are necessary to take into account the circumstances 
faced by health service providers in rural areas and the need to ensure 
the availability of health services to individuals residing in such 
areas.
    (e) Deadline.--The Secretary shall first provide for the standards 
for uniform health claims cards under subsection (a) and for the 
standards for uniform claims data set under subsection (b) and shall 
develop (and make available) the software under subsection (c) by not 
later than 18 months after the date of the enactment of this Act.

SEC. 305. EXCISE TAX ON PREMIUMS RECEIVED ON GROUP HEALTH PLANS WHICH 
              DO NOT MEET CERTAIN REQUIREMENTS.

    (a) In General.--Chapter 47 of the Internal Revenue Code of 1986 
(relating to taxes on group health plans) is amended by adding at the 
end thereof the following new section:

``SEC. 5000A. FAILURE TO SATISFY CERTAIN STANDARDS FOR GROUP HEALTH 
              PLANS.

    ``(a) In General.--
            ``(1) Tax.--In the case of any group health plan, there is 
        hereby imposed a tax on the failure of such person to meet at 
        any time during any taxable year the applicable requirements of 
        section 301 of the Rural Health Care Access Improvement Act of 
        1993.
            ``(2) Determination of violations.--The Secretary of Health 
        and Human Services shall determine whether any person meets the 
        requirements of such section.
            ``(3) Sunset.--
                    ``(A) In general.--No tax may be imposed under this 
                subsection for--
                            ``(i) a violation of section 301(a)(1) of 
                        the Rural Health Care Access Improvement Act of 
                        1993 with respect to individuals who first 
                        become entitled to benefits under the group 
                        health plan on or after the sunset date (as 
                        defined in subparagraph (B));
                            ``(ii) a failure to provide under section 
                        301(a)(2) of such Act information on or after 
                        the sunset date; and
                            ``(iii) a failure to accept under section 
                        301(a)(3) of such Act a determination of a 
                        health claims clearinghouse made on or after 
                        the sunset date.
                    ``(B) Sunset date.--For purposes of subparagraph 
                (A), the term `sunset date' means the date that is 63 
                months after the date of the enactment of this section.
    ``(b) Amount of Tax.--
            ``(1) In general.--The amount of tax imposed by subsection 
        (a) by reason of 1 or more failures during a taxable year shall 
        be equal to 25 percent of the gross premiums received during 
        such taxable year with respect to all group health plans issued 
        by the person on whom such tax is imposed.
            ``(2) Gross premiums.--For purposes of paragraph (1), gross 
        premiums shall include any consideration received with respect 
        to any group health plan.
            ``(3) Controlled groups.--For purposes of paragraph (1)--
                    ``(A) Controlled group of corporations.--All 
                corporations which are members of the same controlled 
                group of corporations shall be treated as 1 person. For 
                purposes of the preceding sentence, the term 
                `controlled group of corporations' has the meaning 
                given to such term by section 1563(a), except that--
                            ``(i) `more than 50 percent' shall be 
                        substituted for `at least 80 percent' each 
                        place it appears in section 1563(a)(1), and
                            ``(ii) the determination shall be made 
                        without regard to subsections (a)(4) and 
                        (e)(3)(C) of section 1563.
                    ``(B) Partnerships, proprietorships, etc., which 
                are under common control.--Under regulations prescribed 
                by the Secretary, all trades or business (whether or 
                not incorporated) which are under common control shall 
                be treated as 1 person. The regulations prescribed 
                under this subparagraph shall be based on principles 
                similar to the principles which apply in the case of 
                subparagraph (A).
    ``(c) Limitation on Tax.--
            ``(1) Tax not to apply where failure not discovered 
        exercising reasonable diligence.--No tax shall be imposed by 
        subsection (a) with respect to any failure for which it is 
        established to the satisfaction of the Secretary that the 
        person on whom the tax is imposed did not know, and exercising 
        reasonable diligence would not have known, that such failure 
        existed.
            ``(2) Tax not to apply where failures corrected within 30 
        days.--No tax shall be imposed by subsection (a) with respect 
        to any failure if--
                    ``(A) such failure was due to reasonable cause and 
                not to willful neglect, and
                    ``(B) such failure is corrected during the 30-day 
                period beginning on the 1st date any of the persons on 
                whom the tax is imposed knew, or exercising reasonable 
                diligence would have known, that such failure existed.
            ``(3) Waiver by secretary.--In the case of a failure which 
        is due to reasonable cause and not to willful neglect, the 
        Secretary may waive part or all of the tax imposed by 
        subsection (a) to the extent that the payment of such tax would 
        be excessive relative to the failure involved.
    ``(d) Group Health Plan Defined.--For purposes of this section, the 
term `group health plan' has the meaning given such term in section 
5000(b)(1).''.
    (b) Nondeductibility of Tax.--Paragraph (6) of section 275(a) of 
such Code (relating to nondeductibility of certain taxes) is amended by 
inserting ``47,'' after ``46,''.
    (c) Clerical Amendments.--The table of sections for such chapter 47 
is amended by adding at the end thereof the following new item:

                              ``Sec. 5000A. Failure to satisfy certain 
                                        standards for group health 
                                        plans.''.
    (d) Effective Dates.--
            (1) In general.--The amendments made by subsections (a) and 
        (c) shall take effect on the date of the enactment of this Act.
            (2) Nondeductibility of tax.--The amendment made by 
        subsection (b) shall apply to taxable years beginning after 
        December 31, 1994.

SEC. 306. APPLICATION OF REQUIREMENTS TO MEDICARE AND MEDICAID 
              PROGRAMS.

    (a) Application to Medicare Program.--The Secretary shall provide, 
in regulations promulgated to carry out title XVIII of the Social 
Security Act, that identification cards issued under that title and the 
claims process provided under that title are modified to the extent 
required to conform to the requirements of section 304 for health 
benefits plans as of the applicable effective dates under this 
subtitle, so that hospitals, and other providers of services, as well 
as physicians and other providers of medical and other services need 
not maintain a separate billing system in order to submit claims under 
the medicare program.
    (b) Application to State Medicaid Plans.--As a condition for the 
approval of State plans under title XIX of the Social Security Act, 
effective as of the applicable effective dates under this subtitle, 
each such plan shall provide, in accordance with regulations of the 
Secretary, that identification cards issued under the plan and the 
claims process provided under the plan are modified to the extent 
required to conform to the requirements of section 304 for health 
benefits plans, so that hospitals, and other providers of services, as 
well as physicians and other providers of medical and other services 
need not maintain a separate billing system in order to submit claims 
under the medicaid program.

                      Subtitle B--Other Provisions

SEC. 311. TELECOMMUNICATIONS DEMONSTRATION PROGRAM FOR TRAUMA CARE IN 
              RURAL AREAS.

    Section 1204 of the Public Health Service Area (42 U.S.C. 300d-3) 
is amended--
            (1) by redesignating subsection (c) as subsection (d); and
            (2) by inserting after subsection (b) the following new 
        subsection:
    ``(c) Demonstration Program Regarding Telecommunications.--
            ``(1) Linkages for rural facilities.--Projects under 
        subsection (a)(1) shall include demonstration projects to 
        establish telecommunications between rural medical facilities 
        and medical facilities that have expertise or equipment that 
        can be utilized by the rural facilities through the 
        telecommunications.
            ``(2) Modes of communications.--The Secretary shall ensure 
        that the telecommunications technologies demonstrated under 
        paragraph (1) include interactive video telecommunications, 
        static video imaging transmitted through the telephone system, 
        and facsimiles transmitted through such system.''.

SEC. 312. PRIMARY CARE NURSING CLINICS IN RURAL AREAS.

    Part C of title VII of the Public Health Service Act (42 U.S.C. 
293j et seq.) is amended--
            (1) by redesignating section 752 as section 753; and
            (2) by inserting after section 751 the following new 
        section:

    ``Subpart VII--Provision of Primary Care Services in Rural Areas

``SEC. 752. PROVISION OF PRIMARY CARE SERVICES IN RURAL AREAS.

    ``(a) Authorization to Use Amounts.--The Secretary may use not to 
exceed $5,000,000, out of amounts appropriated to carry out programs 
under this part, in each of the fiscal years 1994 through 1996 to award 
grants to public or private schools of nursing for the establishment of 
clinics that shall be administered by such schools.
    ``(b) Application.--A school desiring to receive a grant under 
subsection (a) shall prepare and submit to the Secretary, an 
application at such time, in such form, and containing such information 
as the Secretary may require.
    ``(c) Use of Grants.--Amounts received under grants awarded under 
subsection (a) shall be used to--
            ``(1) establish clinics, to be run and staffed by the 
        faculty and students of such grantee school, to provide primary 
        care services in medically underserved rural areas or in areas 
        on or within 50 miles of Indian country (as defined in section 
        1151 of title 18, United States Code);
            ``(2) provide for all aspects of clinical training program 
        development, faculty enhancement and student scholarships in a 
        manner that would benefit the clinic established under 
        paragraph (1); and
            ``(3) carry out any other activities determined appropriate 
        by the Secretary.
    ``(d) Design.--The clinics established under subsection (c)(1) 
shall be designed to provide nursing students with a structured 
clinical experience that is similar in nature to that provided by 
residency training programs for physicians.''.

SEC. 313. IDENTIFICATION, ASSESSMENT, AND REDUCTION OF PAPERWORK BURDEN 
              ASSOCIATED WITH HEALTH CARE SERVICES.

    Section 3505 of title 44, United States Code, is amended--
            (1) by striking ``and'' at the end of paragraph (5);
            (2) by striking the period at the end of paragraph (6) and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(7) within 6 months after the date of the enactment of 
        the Rural Health Care Access Improvement Act of 1993, in 
        consultation with the Secretary of Health and Human Services, 
        shall--
                    ``(A) identify, inventory, and assess the burden of 
                federally conducted or sponsored information collection 
                requests associated with the delivery of health care 
                services; and
                    ``(B) for each of the fiscal years 1994, 1995, 
                1996, 1997, 1998, and 1999, establish a goal for 
                reducing the burden described in subparagraph (A) 
                existing at the end of the preceding fiscal year by not 
                less than 5 percent through more effective use of 
                information resources management, regulatory 
                flexibility, and other means.''.

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