I 
113TH CONGRESS 
2D SESSION 
H. R. 5732 
To amend title XVIII of the Social Security Act to crack down on fraud 
in the Medicare program to protect seniors, people with disabilities, 
and taxpayers. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 18, 2014 
Mr. DEUTCH (for himself and Mr. ROSKAM) introduced the following bill; 
which was referred to the Committee on Energy and Commerce, and in 
addition to the Committee on Ways and Means, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To amend title XVIII of the Social Security Act to crack 
down on fraud in the Medicare program to protect sen-
iors, people with disabilities, and taxpayers. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Stop Schemes and 
Crimes Against Medicare and Seniors (Stop SCAMS) 
Act’’. 
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SEC. 2. ENSURING THAT NEW MEDICAL CODING SYSTEMS 
DO NOT COMPROMISE FRAUD PREVENTION 
EFFORTS. 
(a) IN GENERAL.—Section 1173(c) of the Social Se-
curity Act (42 U.S.C. 1320d–2(c)) is amended— 
(1) in paragraph (1)— 
(A) in subparagraph (A), by striking ‘‘; 
or’’ and inserting ‘‘or, if no code sets for such 
data elements have been developed, establish 
code sets for the data elements;’’; and 
(B) by striking subparagraph (B) and add-
ing the following new subparagraphs: 
‘‘(B) ensure that any entity producing and 
transmitting valid transactions that include 
code sets are subject to a consistent, industry- 
wide framework that supports a seamless tran-
sition to new and modified code sets; and 
‘‘(C) establish, by a rule promulgated after 
notice and an opportunity for a hearing on the 
record, an end-to-end testing procedure for new 
and modified code sets that shall require the 
participation of any entity producing and trans-
mitting valid transactions that use such new or 
modified code set.’’; and 
(2) by adding at the end the following para-
graphs: 
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‘‘(3) ADOPTING
NEW
AND
MODIFIED
CODE 
SETS.—The Secretary shall not adopt a new or 
modified code set unless the Secretary— 
‘‘(A) assesses the impact of the code set on 
fraud prevention and pre-payment review, de-
termines that anti-fraud edits work as intended, 
and confirms that a plan is in place to ensure 
continuing effective detection of fraud following 
the adoption of the code set; 
‘‘(B) ensures that the end-to-end testing 
procedure established by the Secretary under 
paragraph (1) has been completed; and 
‘‘(C) completes end-to-end testing with any 
Federal Government entity that produces and 
transmits valid transactions that include the 
code set with private sector tracking partners. 
‘‘(4) ROUTINE
UPDATES
TO
EXISTING
CODE 
SETS.—Paragraph (3) shall not apply to routine, 
regularly scheduled updates to existing code sets.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall be effective as of October 1, 2015. 
SEC. 3. VERIFICATION OF PROVIDER OWNERSHIP INTER-
ESTS. 
(a) IN GENERAL.—Section 1124(c) of the Social Se-
curity Act (42 U.S.C. 1320a–3(c)) is amended— 
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(1) by redesignating paragraph (5) as para-
graph (6); and 
(2) by inserting after paragraph (4) the fol-
lowing paragraph: 
‘‘(5) VERIFICATION OF INFORMATION.— 
‘‘(A) IN GENERAL.—With respect to infor-
mation supplied by a disclosing entity under 
subsections (a) and (b), the Secretary shall— 
‘‘(i) verify such information by com-
paring it to available data on the provider 
collected through disclosures made to the 
Secretary under section 1128G(a)(2), or, 
in the case of a disclosing entity to which 
section 1128G(a)(2) does not apply, verify 
such information through comparison with 
at least one other public or private data-
base which contains information as to the 
identity of each person with an ownership 
or control interest in the entity; and 
‘‘(ii) confirm the accuracy of any so-
cial security account number or employer 
identification number supplied under sub-
section (a) by verifying— 
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‘‘(I) each social security account 
number with the Commissioner of So-
cial Security; and 
‘‘(II) each employer identification 
number with the Secretary of the 
Treasury. 
‘‘(B) DISCREPANCIES.—If the comparison 
described in subparagraph (A)(i) reveals a dis-
crepancy between information supplied by a dis-
closing entity under subsections (a) and (b) and 
available data on the provider collected through 
disclosures made to the Secretary under section 
1128G(a)(2), the Secretary shall independently 
verify the accuracy of such data collected under 
section 1128G(a)(2) before taking any action 
against a provider based on such discrepancy.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall be effective as of the date that is 1 year 
after the date of enactment of this Act. 
SEC. 4. SUPPORTING PUBLIC AND PRIVATE INFORMATION 
SHARING TO PREVENT HEALTH CARE FRAUD. 
(a) DEFINITIONS.—In this section: 
(1) HEALTHCARE
FRAUD
PREVENTION
PART-
NERSHIP; PARTNERSHIP.—The terms ‘‘Healthcare 
Fraud Prevention Partnership’’ and ‘‘Partnership’’ 
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mean the information sharing partnership estab-
lished between the Department of Health and 
Human Services, the Department of Justice, and 
other public and private stakeholders, including pri-
vate insurers, under the authority of section 
1128C(a)(2) of the Social Security Act (42 U.S.C. 
1320a–7c(a)(2)) for the purpose of detecting and 
preventing health care fraud. 
(2) PRIVATE INSURER.—The term ‘‘private in-
surer’’ has the meaning given the term ‘‘health in-
surance issuer’’ under section 2791(b)(2) of the 
Public Health Service Act (42 U.S.C. 300GG– 
91(b)(2)). 
(b) SAFE HARBOR FOR THE SHARING OF INFORMA-
TION.— 
(1) GENERAL IMMUNITY.— 
(A) IN
GENERAL.—A non-governmental 
entity participating in the Partnership (includ-
ing a private insurer) that— 
(i) provides data or information de-
scribed in clause (i) or (ii) of subparagraph 
(B) to the Department of Health and 
Human Services, the Department of Jus-
tice, any other Federal or State law en-
forcement agency, any contractor of such 
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Department or agency, or another entity 
participating in the Partnership (including 
a private insurer); or 
(ii) uses such data or information as 
permitted by this subsection, 
shall be immune from civil liability with respect 
to the provision or authorized use of such data 
or information. 
(B) DATA OR INFORMATION.— 
(i) DATA.—The data described in this 
clause is aggregated claims data or other 
information described in clause (ii) that 
does not include individually identifiable 
information with respect to any health care 
provider, supplier, or beneficiary, whether 
or not analysis of such information results 
in the identification of a health care pro-
vider, supplier, or other person or organi-
zation as having committed fraud or hav-
ing committed acts suspected of being 
fraudulent. 
(ii) INFORMATION.—The information 
described in this clause is information con-
cerning fraud or suspected fraudulent acts 
that identifies a specific health care pro-
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knowledge of, and without reckless disregard 
for, its falsity. 
(3) USE OF PARTNERSHIP DATA OR INFORMA-
TION.—For purposes of this subsection, data or in-
formation relating to a specific provider or supplier 
received by a private insurer solely through the 
Partnership shall be used, with respect to such pro-
vider or supplier, only for the purpose of informing 
decisionmaking by the private insurer related to 
fraud investigations, including whether to conduct 
such an investigation. Nothing in the preceding sen-
tence shall prevent a private insurer or other entity 
participating in the Partnership from taking other 
actions, not specific to such provider or supplier, 
based on such data or information. 
(c) REPORT.—Not later than October 1 of each cal-
endar year that begins after the date of enactment of this 
Act, the Secretary of Health and Human Services shall 
submit to the Special Committee on Aging, the Committee 
on Finance, and the Committee on Homeland Security 
and Governmental Affairs of the Senate, and the Com-
mittee on Ways and Means and the Committee on Energy 
and Commerce of the House of Representatives, a report 
that describes the activities of the Healthcare Fraud Pre-
vention Partnership. Such report shall include— 
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(1) a description of how input was obtained 
from private insurers regarding the appropriate 
usage of data shared through the Healthcare Fraud 
Prevention Partnership; and 
(2) plans for the Partnership to be expanded to 
encompass a representative sample of national pri-
vate insurers and to include health care provider or-
ganizations. 
SEC. 5. MEDPAC STUDY AND REPORT. 
(a) STUDY.—The Medicare Payment Advisory Com-
mission shall conduct a study on administrative efforts to 
strengthen program integrity in the Medicare program. 
Such study may include— 
(1) an evaluation of ways to detect fraudulent 
claims before payment is made; 
(2) a review of the efficiency and effectiveness 
of post-payment recovery methods; 
(3) analysis by the Centers for Medicare & 
Medicaid Services and public reporting of claims and 
spending patterns; and 
(4) a review of the organizational structure and 
resources of the Centers for Medicare & Medicaid 
Services as they relate to program integrity. 
(b) REPORT.—Not later than June 15, 2016, the 
Medicare Payment Advisory Commission shall submit to 
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Congress a report on the study conducted under sub-
section (a), together with recommendations for such legis-
lative and administrative action as the Commission deter-
mines appropriate. 
SEC. 6. ABILITY TO MEASURE FRAUD PREVENTION EF-
FORTS. 
Section 4241 of the Small Business Jobs Act of 2010 
(42 U.S.C. 1320a–7m) is amended— 
(1) in subsection (b)(4), by inserting ‘‘and on 
civil recoveries, administrative actions, and criminal 
convictions for fraud’’ after ‘‘reimbursement’’; and 
(2) in subsection (c), by adding at the end the 
following paragraph: 
‘‘(7) IMPLEMENTATION OF AMENDMENTS.—The 
Secretary shall implement amendments made to this 
subsection by the Stop Schemes and Crimes Against 
Medicare and Seniors (Stop SCAMS) Act not later 
than 6 months after the date of enactment of such 
Act. If the Secretary determines that new technology 
or data processing systems are required to carry out 
such amendments, the Secretary shall issue a re-
quest for proposals to carry out such amendments 
not later than 6 months after the enactment of such 
Act, and the contractors selected under such request 
for proposal shall implement such amendments not 
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later than 12 months after the date of enactment of 
such Act.’’. 
Æ 
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