Improving the Treatment of the U.S. Territories Under Federal Health Programs Act of 2015

To amend titles XVIII and XIX of the Social Security Act to make improvements to the treatment of the United States territories under the Medicare and Medicaid programs, and for other purposes. 1. Short title; table of contents (a) Short title This Act may be cited as the Improving the Treatment of the U.S. Territories Under Federal Health Programs Act of 2015 (b) Table of contents The table of contents of this Act are as follows: Sec. 1. Short title; table of contents. Title I—Medicaid Sec. 101. Elimination of general Medicaid funding limitations ( cap Sec. 102. Elimination of specific Federal medical assistance percentage (FMAP) limitation for territories. Sec. 103. Application of Medicaid waiver authority to all of the territories. Sec. 104. Application of 100 percent Federal poverty line (FPL) limitation to territories. Sec. 105. Permitting Medicaid DSH allotments for territories. Title II—Medicare Subtitle A—Part A Sec. 201. Modification of Medicare inpatient hospital payment rate for Puerto Rico hospitals. Sec. 202. Application of Medicare HITECH payments to hospitals in Puerto Rico. Sec. 203. Calculation of Medicare DSH payments for IPPS hospitals in Puerto Rico. Subtitle B—Part B Sec. 211. Application of part B deemed enrollment process to residents of Puerto Rico; special enrollment period and limit on late enrollment penalties. Sec. 212. Puerto Rico practice expense GPCI improvement. Subtitle C—Medicare Advantage (Part C) Sec. 221. Adjustment in benchmark for low base payment counties in Puerto Rico. Subtitle D—Part D Sec. 231. Improved use of allocated prescription drug funds by territories. Sec. 232. Report on treatment of territories under Medicare part D. Title III—Miscellaneous Sec. 301. Modified treatment of territories with respect to application of ACA annual health insurance provider fees. Sec. 302. Medicaid and CHIP territory transparency and information. Sec. 303. Report on exclusion of territories from Exchanges. I Medicaid 101. Elimination of general Medicaid funding limitations ( cap (a) In general Section 1108 of the Social Security Act ( 42 U.S.C. 1308 (1) in subsection (f), in the matter before paragraph (1), by striking subsection (g) subsections (g) and (h) (2) in subsection (g)(2), in the matter before subparagraph (A), by inserting and subsection (h) paragraphs (3) and (5) (3) by adding at the end the following new subsection: (h) Sunset of Medicaid funding limitations for Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa Subsections (f) and (g) shall not apply to Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa beginning with fiscal year 2017. . (b) Conforming amendments (1) Section 1902(j) of the Social Security Act ( 42 U.S.C. 1396a(j) , the limitation in section 1108(f), (2) Section 1903(u) of the Social Security Act ( 42 U.S.C. 1396b(u) (3) Section 1323(c)(1) of the Patient Protection and Affordable Care Act ( 42 U.S.C. 18043(c)(1) 2019 2016 (c) Effective date The amendments made by this section shall apply beginning with fiscal year 2017. 102. Elimination of specific Federal medical assistance percentage (FMAP) limitation for territories Section 1905(b) of the Social Security Act ( 42 U.S.C. 1396d(b) for fiscal years before fiscal year 2017 American Samoa 103. Application of Medicaid waiver authority to all of the territories (a) In general Section 1902(j) of the Social Security Act ( 42 U.S.C. 1396a(j) (1) by striking American Samoa and the Northern Mariana Islands Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa (2) by striking American Samoa or the Northern Mariana Islands Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, or American Samoa (3) by inserting (1) (j) (4) by inserting except as otherwise provided in this subsection, Notwithstanding any other requirement of this title (5) by adding at the end the following: (2) The Secretary may not waive under this subsection the requirement of subsection (a)(10)(A)(i)(IX) (relating to coverage of adults formerly under foster care) with respect to any territory. . (b) Effective date The amendments made by this section shall apply beginning October 1, 2016. 104. Application of 100 percent Federal poverty line (FPL) limitation to territories (a) In general Section 1902(a)(10)(A)(i)(VIII) of the Social Security Act ( 42 U.S.C. 1396a(a)(10)(A)(i)(VIII) (1) by inserting (or, subject to subsection (j), 100 percent in the case of Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa) 133 percent (2) in subsection (j), as amended by section 103, by adding at the end the following new paragraph: (3) (A) Notwithstanding any other provision of law, Federal financial participation shall not be available to a territory for medical assistance for an individual whose family income exceeds 100 percent of the official poverty line for a family of the size involved, except in the case of individuals qualifying for medical assistance under subsection (a)(10)(A)(i)(IX) and except as authorized under a waiver under this subsection or section 1115. (B) The Secretary may, under paragraph (1) or section 1115, waive the limitation under subparagraph (A) but only in the case of a territory other than Puerto Rico. In carrying out this subparagraph, the Secretary shall take into account the eligibility levels established under the State plan of the territory involved before the date of the enactment of this paragraph. . (b) Not applying 5 percent disregard Subparagraph (I) of section 1902(a)(14) of the Social Security Act ( 42 U.S.C. 1396b(a)(14) The previous sentence shall only apply to a State that is one of the 50 States or the District of Columbia. . (c) Effective date The amendments made by this section shall apply with respect to eligibility determinations made with respect to items and services furnished on or after October 1, 2016. 105. Permitting Medicaid DSH allotments for territories Section 1923(f) of the Social Security Act ( 42 U.S.C. 1396 (1) in paragraph (6), by adding at the end the following new subparagraph: (C) Territories (i) Fiscal year 2017 For fiscal year 2017, the DSH allotment for Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa shall bear the same ratio to $150,000,000 as the ratio of the number of individuals who are low-income or uninsured and residing in such respective territory (as estimated from time to time by the Secretary) bears to the sums of the number of such individuals residing in all of the territories. (ii) Subsequent fiscal year For each subsequent fiscal year, the DSH allotment for each such territory is subject to an increase in accordance with paragraph (2). ; and (2) in paragraph (9), by inserting before the period at the end the following: , and includes, beginning with fiscal year 2017, Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa II Medicare A Part A 201. Modification of Medicare inpatient hospital payment rate for Puerto Rico hospitals Section 1886(d)(9)(E) of the Social Security Act 42 U.S.C. 1395ww(d)(9)(E) (1) by striking and (2) in clause (iv)— (A) by inserting and before October 1, 2015, 2004, (B) by striking the period at the end and inserting ; and (3) by adding at the end the following new clause: (v) on or after October 1, 2015, the applicable Puerto Rico percentage is 0 percent and the applicable Federal percentage is 100 percent. . 202. Application of Medicare HITECH payments to hospitals in Puerto Rico (a) In general Subsection (n)(6)(B) of section 1886 of the Social Security Act ( 42 U.S.C. 1395ww subsection (d) hospital hospital that is a subsection (d) hospital or a subsection (d) Puerto Rico hospital (b) Conforming amendments (1) Subsection (b)(3)(B)(ix) of section 1886 of the Social Security Act ( 42 U.S.C. 1395ww (A) in subclause (I), by striking (n)(6)(A) (n)(6)(B) (B) in subclause (II), by striking a subsection (d) hospital an eligible hospital (2) Paragraphs (2) and (4)(A) of section 1853(m) of the Social Security Act ( 42 U.S.C. 1395w–23(m) 1886(n)(6)(A) 1886(n)(6)(B) (c) Implementation Notwithstanding any other provision of law, the Secretary of Health and Human Services may implement the amendments made by this section by program instruction or otherwise. (d) Effective date The amendments made by this section shall apply as if included in the enactment of the American Recovery and Reinvestment Act of 2009 ( Public Law 111–5 203. Calculation of Medicare DSH payments for IPPS hospitals in Puerto Rico Section 1886(d)(9)(D)(iii) of the Social Security Act ( 42 U.S.C. 1395ww(d)(9)(D)(iii) (iii) Subparagraph (F) (relating to disproportionate share payments), including application of subsection (r), except that for this purpose— (I) the sum described in clause (ii) of this subparagraph shall be substituted for the sum referred to in paragraph (5)(F)(ii)(I); and (II) for discharges occurring on or after October 1, 2015, subclause (I) of paragraph (5)(F)(vi) shall be applied by substituting for the numerator described in such subclause the number of subsection (d) Puerto Rico hospital’s patient days for the cost reporting period involved which were made up of patients who (for such days) were entitled to benefits under part A of this title and were— (aa) entitled to supplementary security income benefits (excluding any State supplementation) under title XVI of this Act; (bb) eligible for medical assistance under a State plan under title XIX; or (cc) receiving aid or assistance under any plan of the State approved under title I, X, XIV, or XVI. . B Part B 211. Application of part B deemed enrollment process to residents of Puerto Rico; special enrollment period and limit on late enrollment penalties (a) Application of part B deemed enrollment process to residents of Puerto Rico Section 1837(f)(3) of the Social Security Act ( 42 U.S.C. 1395p(f)(3) , exclusive of Puerto Rico (b) Effective date The amendment made by subsection (a) shall apply to individuals whose initial enrollment period under section 1837(d) of the Social Security Act begins on or after the first day of the effective month, specified by the Secretary of Health and Human Services under section 1839(j)(1)(C) of such Act, as added by subsection (c)(2). (c) Transition providing special enrollment period and limit on late enrollment penalties for certain Medicare beneficiaries Section 1839 of the Social Security Act ( 42 U.S.C. 1395r (1) in the first sentence of subsection (b), by inserting subject to section 1839(j)(2), subsection (i)(4) or (l) of section 1837, (2) by adding at the end the following new subsection: (j) Special rules for certain residents of Puerto Rico (1) Special enrollment period, coverage period for residents who are eligible but not enrolled (A) In general In the case of a transition individual (as defined in paragraph (3)) who is not enrolled under this part as of the day before the first day of the effective month (as defined in subparagraph (C)), the Secretary shall provide for a special enrollment period under section 1837 of 7 months beginning with such effective month during which the individual may be enrolled under this part. (B) Coverage period In the case of such an individual who enrolls during such special enrollment period, the coverage period under section 1838 shall begin on the first day of the second month after the month in which the individual enrolls. (C) Effective month defined In this section, the term effective month (2) Reduction in late enrollment penalties for current enrollees and individuals enrolling during transition (A) In general In the case of a transition individual who is enrolled under this part as of the day before the first day of the effective month or who enrolls under this part on or after the date of the enactment of this subsection but before the end of the special enrollment period under paragraph (1)(A), the amount of the late enrollment penalty imposed under section 1839(b) shall be recalculated by reducing the penalty to 15 percent of the penalty otherwise established. (B) Application Subparagraph (A) shall be applied in the case of a transition individual who— (i) is enrolled under this part as of the month before the effective month, for premiums for months beginning with such effective month; or (ii) enrolls under this part on or after the date of the enactment of this Act and before the end of the special enrollment period under paragraph (1)(A), for premiums for months during the coverage period under this part which occur during or after the effective month. (C) Loss of reduction if individual terminates enrollment Subparagraph (A) shall not apply to a transition individual if the individual terminates enrollment under this part after the end of the special enrollment period under paragraph (1). (3) Transition individual defined In this section, the term transition individual . 212. Puerto Rico practice expense GPCI improvement Section 1848(e)(1) of the Social Security Act ( 42 U.S.C. 1395w–4(e)(1) (1) in subparagraph (A), by striking and (I) (I), and (J) (2) by adding at the end the following new subparagraph: (J) Floor for practice expense index for services furnished in Puerto Rico (i) In general For purposes of payment for services furnished in Puerto Rico in a year (beginning with 2016), after calculating the practice expense index in subparagraph (A)(i) for Puerto Rico, if such index is below the reference index (as defined in clause (ii)) for the year, the Secretary shall increase such index for Puerto Rico to equal the value of the reference index for the year. The preceding sentence shall not be applied in a budget neutral manner. (ii) Reference index defined In this subparagraph, the term reference index . C Medicare Advantage (Part C) 221. Adjustment in benchmark for low base payment counties in Puerto Rico Section 1853(n) of the Social Security Act ( 42 U.S.C. 1395w–103(n) (1) in paragraph (1), by striking and (5) , (5), and (6) (2) in paragraph (4), by striking In no case Subject to paragraph (6), in no case (3) by adding at the end the following new paragraph: (6) Special rules for blended benchmark amount for territories (A) In general Subject to paragraph (2), the blended benchmark amount for an area in a territory for a year (beginning with 2016) shall not be less than 80 percent of the national average of the base payment amounts specified in subparagraph (2)(E) for such year for areas within the 50 States and the District of Columbia. (B) Limitation In no case shall the blended benchmark amount for an area in a territory for a year under subparagraph (A) exceed the lowest blended benchmark amount for any area within the 50 States and the District of Columbia for such year. . D Part D 231. Improved use of allocated prescription drug funds by territories Section 1935(e) of the Social Security Act ( 42 U.S.C. 1396u–5(e) (5) Improved use of funds for low-income part D eligible individuals This subsection shall be applied beginning with fiscal year 2016 as follows, notwithstanding any other provision of this title: (A) Clarifying State flexibility to cover non-dual-eligible individuals In this title, the term medical assistance (B) 100 percent FMAP to reflect no State matching required for part D low income subsidies The Federal medical assistance percentage applicable to the assistance furnished under this subsection is 100 percent. (C) Limited funding for special rules Subparagraphs (A) and (B), and the provision of medical assistance for covered part D drugs to low-income part D eligible individuals for a State and period under this subsection, is limited to the amount specified in paragraph (3) for such State and period, without regard to the application of subsection (f) or (g) of section 1108. . 232. Report on treatment of territories under Medicare part D Paragraph (4) of section 1935(e) of the Social Security Act ( 42 U.S.C. 1396u–5(e) (4) Report on application of subsection (A) In general Not later than February 1, 2018, the Secretary shall submit to Congress a report on the application of this subsection during the period beginning fiscal year 2006 and ending fiscal year 2017. (B) Information to be included in report Such report shall include— (i) program guidance issued by the Secretary to implement this subsection; (ii) for each territory, information on the increased amount under paragraph (3) and how the territory has applied such amount, including the territory’s program design, expenditures, and number of individuals (and dual-eligible individuals) assisted; and (iii) differences between how such territories are treated under part D of title XVIII and under this title compared with the treatment of the 50 States and the District of Columbia under such part and this title for different fiscal years within the period covered under the report. (C) Recommendations Such report shall include recommendations for improving prescription drug coverage for low-income individuals in each territory, including recommendations regarding each of the following alternative approaches: (i) Adjusting the aggregate amount specified in paragraph (3)(B). (ii) Allowing residents of the territories to be subsidy eligible individuals under section 1860D–14, notwithstanding subsection (a)(3)(F) of such section, or providing substantially equivalent low-income prescription drug subsidies to such residents. . III Miscellaneous 301. Modified treatment of territories with respect to application of ACA annual health insurance provider fees Section 9010 of the Patient Protection and Affordable Care Act ( 26 U.S.C. 4001 (1) in subsection (b)(1), by inserting subject to subsection (j)(1), With respect to each covered entity, (2) by striking subsection (j) and inserting the following: (j) Special rules for treatment of territories (1) In general In applying this section with respect to United States health risks located outside of the 50 States or the District of Columbia for years beginning with 2016— (A) the amount of the fee under subsection (b) shall be 50 percent of the amount of the fee otherwise determined; (B) the Secretary shall deposit the amount of such fees collected for each territory into a separate account; and (C) amounts in such an account for a territory for a year are appropriated and shall be available to the territory in accordance with paragraph (2). (2) Availability of funds Amounts made available to a territory under paragraph (1)(C) with respect to a territory for a year shall be made available to the territory, upon application of the territory to the Secretary of Health and Human Services, only for the following purposes, as elected by the territory in such application: (A) Increased prescription drug assistance for low-income part D eligible individuals For increasing the amount of funds made available to the territory under section 1935(e)(3) of the Social Security Act ( 42 U.S.C. 1396u–5(e)(3) (B) Satisfying State Medicaid matching requirement For purposes of the territory meeting non-Federal matching requirements imposed with respect to obtaining Federal financial participation under title XIX of the Social Security Act. . 302. Medicaid and CHIP territory transparency and information (a) Publication of information on Federal expenditures under Medicaid and CHIP in the territories Not later than 180 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall publish, and periodically update, on the Internet site of the Centers for Medicare & Medicaid Services information on Medicaid and CHIP carried out in the territories of the United States. Such information shall include, with respect to each such territory— (1) the income levels established by the territory for purposes of eligibility of an individual to receive medical assistance under Medicaid or child health assistance under CHIP; (2) the number of individuals enrolled in Medicaid and CHIP in such territory; (3) any State plan amendments in effect to carry out Medicaid or CHIP in such territory; (4) any waiver of the requirements of title XIX or title XXI issued by the Secretary to carry out Medicaid or CHIP in the territory, including a waiver under section 1115 of the Social Security Act ( 42 U.S.C. 1315 (5) the amount of the Federal and non-Federal share of expenditures under Medicaid and CHIP in such territory; (6) the systems in place for the furnishing of health care items and services under Medicaid and CHIP in such territory; (7) the design of CHIP in such territory; and (8) other information regarding the carrying out of Medicaid and CHIP in the territory that is published on such Internet site with respect to carrying out Medicaid and CHIP in each State and the District of Columbia. (b) Definitions In this section: (1) CHIP The term CHIP (2) Medicaid The term Medicaid (3) Territory The term territory of the United States 303. Report on exclusion of territories from Exchanges (a) In general Not later than February 1, 2018, the Secretary of Health and Human Services shall submit to Congress a report that details the adverse impacts in each territory from the practical exclusion of the territories from the provisions of part II of subtitle D of title I of the Patient Protection and Affordable Care Act insofar as such provisions provide for the establishment of an American Health Benefit Exchange or the administration of a federally facilitated Exchange in each State and in the District of Columbia for the purpose of making health insurance more affordable and accessible for individuals and small businesses. (b) Information in report The report shall include information on the following: (1) An estimate of the total number of uninsured and underinsured individuals residing in each territory with respect to health insurance coverage. (2) A description of the number of health insurance issuers in each territory and the health insurance plans these issuers offer. (3) An estimate of the number of individuals residing in each territory who are denied premium and cost-sharing assistance that would otherwise be available to them for obtaining health insurance coverage through an Exchange if they resided in one of the 50 States or in the District of Columbia. (4) An estimate of the amount of Federal assistance described in paragraph (3) that is not being made available to residents of each territory. (5) An estimate of the number of small employers in each territory that would be eligible to purchase health insurance coverage through a Small Business Health Options Program (SHOP) Marketplace that would operate as part of an Exchange if the employers were in one of the 50 States or in the District of Columbia.

Summary: Improving the Treatment of the U.S. Territories Under Federal Health Programs Act of 2015 This bill amends title XIX (Medicaid) the Social Security Act (SSAct) to terminate the limitations on general Medicaid funding, as well as the specific federal medical assistance percentage (FMAP, or matching rate), beginning FY2017 for Puerto Rico, the Virgin Islands of the United States, Guam, the Northern Mariana Islands, and American Samoa (territories). The authority to waive or modify Medicaid requirements (except certain requirements for coverage of adults formerly under foster care) in American Samoa and the Northern Mariana Islands shall now extend as well to Puerto Rico, the U.S. Virgin Islands, and Guam. Federal financial participation shall not be available to a territory, however, for medical assistance (with certain exceptions) for an individual whose family income exceeds 100% percent of the official poverty line for a family of the size involved. A formula is prescribed for Medicaid disproportionate share hospital (DSH) payments to the territories beginning FY2017. This bill also amends SSAct title XVIII (Medicare) to revise the formula for the Medicare inpatient hospital services payment rate for hospitals in Puerto Rico to: (1) reduce the applicable Puerto Rico percentage from 25% to zero, and (2) increase the applicable federal percentage from 75% to 100%. Medicare HITECH (Health Information Technology for Economic and Clinical Health Act) payments shall now apply to subsection (d) hospitals in Puerto Rico to allow them to qualify for incentives for adoption and meaningful use of certified electronic health record technology. (Generally, a subsection [d] hospital is an acute care hospital, particularly one that receives payments under Medicare's inpatient prospective payment system when providing covered inpatient services to eligible beneficiaries.) A formula element is revised for calculating Medicare DSH payments under the inpatient prospective payment system for subsection (d) hospitals in Puerto Rico. The exclusion of residents of Puerto Rico from deemed enrollment under part B (Supplementary Medical Insurance Benefits) is repealed and they may now be deemed to be so enrolled. The Department of Health and Human Services (HHS) shall provide a special seven-month enrollment period for such residents. The late enrollment penalty shall be recalculated to 15% of the usual penalty for residents of Puerto Rico who are current enrollees or who enroll during a specified transition period. HHS shall increase the geographic adjustment practice expense index for Puerto Rico to equal 0.800 or, if less, the lowest practice expense index value for the year for any area in the 50 states or the District of Columbia) for the year. The blended benchmark component of payments to Medicare + Choice organizations for an area in a territory under SSAct title XVIII part C (Medicare+Choice) shall be, beginning with 2016, at least 80% of the national average of specified base payment amounts for the year (but never more than the lowest blended benchmark amount) for any area within the 50 States and the District of Columbia. HHS shall treat as medical assistance under the Medicaid program, with a 100% FMAP, any financial assistance a territory furnishes to individuals eligible for prescription drugs under SSAct title XVIII part D (Voluntary Prescription Drug Benefit Program) who, if they were residing in one of the 50 States or the District of Columbia, would qualify as low-income subsidy eligible individuals, without regard to whether they otherwise qualify for Medicaid. HHS shall report to Congress on the treatment of territories under Medicare part D. This bill amends the Patient Protection and Affordable Care Act (PPACA) to reduce by 50% the annual fee imposed on health insurance providers for U.S. health risks in the territories. Funds from such fees shall be available to a territory only to assist low-income part D eligible individuals to obtain part D-covered drugs. HHS shall publish and update periodically, on the Internet site of the Centers for Medicare and Medicaid Services, information on the programs under SSAct titles XIX (Medicaid) and XXI (Children's Health Insurance Program, or CHIP) that are carried out in the U.S. territories. HHS shall report to Congress on the adverse impacts in each territory from their practical exclusion under PPACA from the establishment of American Health Benefit Exchanges or the administration of a federally facilitated Exchange.