139 
Security Act (42 U.S.C. 1395ww(e)(5)(A)) for fiscal 
year 2009 one or more proposals to revise the wage 
index 
adjustment 
applied 
under 
section 
1886(d)(3)(E) 
of 
such 
Act 
(42 
U.S.C. 
1395ww(d)(3)(E)) for purposes of the Medicare pro-
spective payment system for inpatient hospital serv-
ices. Such proposal (or proposals) shall consider 
each of the following: 
(A) Problems associated with the definition 
of labor markets for purposes of such wage 
index adjustment. 
(B) The modification or elimination of geo-
graphic reclassifications and other adjustments. 
(C) The use of Bureau of Labor Statistics 
data, or other data or methodologies, to cal-
culate relative wages for each geographic area 
involved. 
(D) Minimizing variations in wage index 
adjustments between and within Metropolitan 
Statistical Areas and Statewide rural areas. 
(E) The feasibility of applying all compo-
nents of the proposal to other settings, includ-
ing home health agencies and skilled nursing 
facilities. 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00139
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
140 
(F) Methods to minimize the volatility of 
wage index adjustments, while maintaining the 
principle of budget neutrality in applying such 
adjustments. 
(G) The effect that the implementation of 
the proposal would have on health care pro-
viders and on each region of the country. 
(H) Methods for implementing the pro-
posal, including methods to phase-in such im-
plementation. 
(I) Issues relating to occupational mix, 
such as staffing practices and any evidence on 
the effect on quality of care and patient safety 
and any recommendations for alternative cal-
culations. 
(c) ELIMINATION OF UNNECESSARY REPORT.—Sec-
tion 1886 of the Social Security Act (42 U.S.C. 1395ww) 
is amended— 
(1) in subsection (d)(4)(C), by striking clause 
(iv); and 
(2) in subsection (e), by striking paragraph (3). 
SEC. 107. PAYMENT FOR BRACHYTHERAPY. 
(a) EXTENSION
OF
PAYMENT
RULE.—Section 
1833(t)(16)(C) of the Social Security Act (42 U.S.C. 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00140
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
141 
1395l(t)(16)(C)) is amended by striking ‘‘January 1, 
2007’’ and inserting ‘‘January 1, 2008’’. 
(b) 
ESTABLISHMENT
OF
SEPARATE
PAYMENT 
GROUPS.— 
(1) IN
GENERAL.—Section 1833(t)(2)(H) of 
such Act (42 U.S.C. 1395l(t)(2)(H)) is amended by 
inserting ‘‘and for stranded and non-stranded de-
vices furnished on or after July 1, 2007’’ before the 
period at the end. 
(2) 
IMPLEMENTATION.—The 
Secretary 
of 
Health and Human Services may implement the 
amendment made by paragraph (1) by program in-
struction or otherwise. 
SEC. 108. PAYMENT PROCESS UNDER THE COMPETITIVE 
ACQUISITION PROGRAM (CAP). 
(a) IN GENERAL.—Section 1847B(a)(3) of the Social 
Security Act (42 U.S.C. 1395w-3b(a)(3)) is amended— 
(1) in subparagraph (A)(iii), by striking ‘‘and 
biologicals’’ and all that follows and inserting ‘‘and 
biologicals shall be made only to such contractor 
upon receipt of a claim for a drug or biological sup-
plied by the contractor for administration to a bene-
ficiary.’’; and 
(2) by adding at the end the following new sub-
paragraph: 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00141
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
142 
‘‘(D) POST-PAYMENT REVIEW PROCESS.— 
The Secretary shall establish (by program in-
struction or otherwise) a post-payment review 
process (which may include the use of statistical 
sampling) to assure that payment is made for 
a drug or biological under this section only if 
the drug or biological has been administered to 
a beneficiary. The Secretary shall recoup, off-
set, or collect any overpayments determined by 
the Secretary under such process.’’. 
(b) CONSTRUCTION.—Nothing in this section shall be 
construed as— 
(1) requiring the conduct of any additional 
competition under subsection (b)(1) of section 
1847B of the Social Security Act (42 U.S.C. 
1395w–3b); or 
(2) requiring any additional process for elec-
tions by physicians under subsection (a)(1)(A)(ii) of 
such section or additional selection by a selecting 
physician of a contractor under subsection (a)(5) of 
such section. 
(c) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to payment for drugs and 
biologicals supplied under section 1847B of the Social Se-
curity Act (42 U.S.C. 1395w–3b)— 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00142
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
143 
(1) on or after April 1, 2007; and 
(2) on or after July 1, 2006, and before April 
1, 2007, for claims that are unpaid as of April 1, 
2007. 
SEC. 109. QUALITY REPORTING FOR HOSPITAL OUT-
PATIENT SERVICES AND AMBULATORY SUR-
GICAL CENTER SERVICES. 
(a) OUTPATIENT HOSPITAL SERVICES.— 
(1) IN GENERAL.—Section 1833(t) of the Social 
Security Act (42 U.S.C. 1395l(t)) is amended— 
(A) in paragraph (3)(C)(iv), by inserting 
‘‘subject to paragraph (17),’’ after ‘‘For pur-
poses of this subparagraph,’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(17) QUALITY REPORTING.— 
‘‘(A) REDUCTION IN UPDATE FOR FAILURE 
TO REPORT.— 
‘‘(i) IN
GENERAL.—For purposes of 
paragraph (3)(C)(iv) for 2009 and each 
subsequent year, in the case of a sub-
section (d) hospital (as defined in section 
1886(d)(1)(B)) that does not submit, to 
the Secretary in accordance with this para-
graph, data required to be submitted on 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00143
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
144 
measures selected under this paragraph 
with respect to such a year, the OPD fee 
schedule increase factor under paragraph 
(3)(C)(iv) for such year shall be reduced 
by 2.0 percentage points. 
‘‘(ii) 
NON-CUMULATIVE
APPLICA-
TION.—A reduction under this subpara-
graph shall apply only with respect to the 
year involved and the Secretary shall not 
take into account such reduction in com-
puting the OPD fee schedule increase fac-
tor for a subsequent year. 
‘‘(B) FORM
AND
MANNER
OF
SUBMIS-
SION.—Each subsection (d) hospital shall sub-
mit data on measures selected under this para-
graph to the Secretary in a form and manner, 
and at a time, specified by the Secretary for 
purposes of this paragraph. 
‘‘(C) 
DEVELOPMENT
OF
OUTPATIENT 
MEASURES.— 
‘‘(i) IN
GENERAL.—The Secretary 
shall develop measures that the Secretary 
determines to be appropriate for the meas-
urement of the quality of care (including 
medication errors) furnished by hospitals 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00144
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
145 
in outpatient settings and that reflect con-
sensus among affected parties and, to the 
extent feasible and practicable, shall in-
clude measures set forth by one or more 
national consensus building entities. 
‘‘(ii) 
CONSTRUCTION.—Nothing 
in 
this paragraph shall be construed as pre-
venting the Secretary from selecting meas-
ures that are the same as (or a subset of) 
the measures for which data are required 
to 
be 
submitted 
under 
section 
1886(b)(3)(B)(viii). 
‘‘(D) REPLACEMENT OF MEASURES.—For 
purposes of this paragraph, the Secretary may 
replace any measures or indicators in appro-
priate cases, such as where all hospitals are ef-
fectively in compliance or the measures or indi-
cators have been subsequently shown not to 
represent the best clinical practice. 
‘‘(E) AVAILABILITY OF DATA.—The Sec-
retary shall establish procedures for making 
data submitted under this paragraph available 
to the public. Such procedures shall ensure that 
a hospital has the opportunity to review the 
data that are to be made public with respect to 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00145
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
146 
the hospital prior to such data being made pub-
lic. The Secretary shall report quality measures 
of process, structure, outcome, patients’ per-
spectives on care, efficiency, and costs of care 
that relate to services furnished in outpatient 
settings in hospitals on the Internet website of 
the Centers for Medicare & Medicaid Services.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
1886(b)(3)(B)(viii)(III) of such Act (42 U.S.C. 
1395ww(b)(3)(B)(viii)(III)) is amended by inserting 
‘‘(including medication errors)’’ after ‘‘quality of 
care’’. 
(b) APPLICATION TO AMBULATORY SURGICAL CEN-
TERS.—Section 1833(i) of such Act (42 U.S.C. 1935l(i)) 
is amended— 
(1) in paragraph (2)(D), by redesignating 
clause (iv) as clause (v) and by inserting after clause 
(iii) the following new clause: 
‘‘(iv) The Secretary may implement such system in 
a manner so as to provide for a reduction in any annual 
update for failure to report on quality measures in accord-
ance with paragraph (7).’’; and 
(2) by adding at the end the following new 
paragraph: 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00146
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
147 
‘‘(7)(A) For purposes of paragraph (2)(D)(iv), the 
Secretary may provide, in the case of an ambulatory sur-
gical center that does not submit, to the Secretary in ac-
cordance with this paragraph, data required to be sub-
mitted on measures selected under this paragraph with re-
spect to a year, any annual increase provided under the 
system established under paragraph (2)(D) for such year 
shall be reduced by 2.0 percentage points. A reduction 
under this subparagraph shall apply only with respect to 
the year involved and the Secretary shall not take into 
account such reduction in computing any annual increase 
factor for a subsequent year. 
‘‘(B) Except as the Secretary may otherwise provide, 
the provisions of subparagraphs (B), (C), (D), and (E) 
of paragraph (17) of section 1833(t) shall apply with re-
spect to services of ambulatory surgical centers under this 
paragraph in a similar manner to the manner in which 
they apply under such paragraph and, for purposes of this 
subparagraph, any reference to a hospital, outpatient set-
ting, or outpatient hospital services is deemed a reference 
to an ambulatory surgical center, the setting of such a 
center, or services of such a center, respectively.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to payment for services furnished 
on or after January 1, 2009. 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00147
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
148 
SEC. 110. REPORTING OF ANEMIA QUALITY INDICATORS 
FOR MEDICARE PART B CANCER ANTI-ANE-
MIA DRUGS. 
(a) IN GENERAL.—Section 1842 of the Social Secu-
rity Act (42 U.S.C. 1395u) is amended by adding at the 
end the following new subsection: 
‘‘(u) Each request for payment, or bill submitted, for 
a drug furnished to an individual for the treatment of ane-
mia in connection with the treatment of cancer shall in-
clude (in a form and manner specified by the Secretary) 
information on the hemoglobin or hematocrit levels for the 
individual.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to drugs furnished on or after 
January 1, 2008. The Secretary of Health and Human 
Services shall address the implementation of such amend-
ment in the rulemaking process under section 1848 of the 
Social Security Act (42 U.S.C. 1395w–4) for payment for 
physicians’ services for 2008, consistent with the previous 
sentence. 
SEC. 111. CLARIFICATION OF HOSPICE SATELLITE DES-
IGNATION. 
Notwithstanding any other provision of law, for pur-
poses of calculating the hospice aggregate payment cap for 
2004, 2005, and 2006 for a hospice program under sec-
tion 1814(i)(2)(A) of the Social Security Act (42 U.S.C. 
VerDate Aug 31 2005 
04:12 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00148
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS
149 
1395f(i)(2)(A)) for hospice care provided on or after No-
vember 1, 2003, and before December 27, 2005, Medicare 
provider number 29–1511 is deemed to be a multiple loca-
tion of Medicare provider number 29–1500. 
TITLE II—MEDICARE 
BENEFICIARY PROTECTIONS 
SEC. 201. EXTENSION OF EXCEPTIONS PROCESS FOR MEDI-
CARE THERAPY CAPS. 
Section 1833(g)(5) of the Social Security Act (42 
U.S.C. 1395l(g)(5)) is amended by striking ‘‘2006’’ and 
inserting ‘‘the period beginning on January 1, 2006, and 
ending on December 31, 2007,’’. 
SEC. 202. PAYMENT FOR ADMINISTRATION OF PART D VAC-
CINES. 
(a) TRANSITION FOR 2007.—Notwithstanding any 
other provision of law, in the case of a vaccine that is a 
covered part D drug under section 1860D–2(e) of the So-
cial Security Act (42 U.S.C. 1395w–102(e)) and that is 
administered during 2007, the administration of such vac-
cine shall be paid under part B of title XVIII of such Act 
as if it were the administration of a vaccine described in 
section 
1861(s)(10)(B) 
of 
such 
Act 
(42 
U.S.C. 
1395w(s)(10)(B)). 
(b) ADMINISTRATION INCLUDED IN COVERAGE OF 
COVERED PART D DRUGS BEGINNING IN 2008.—Section 
VerDate Aug 31 2005 
06:00 Dec 08, 2006
Jkt 059200
PO 00000
Frm 00149
Fmt 6652
Sfmt 6201
E:\BILLS\H6408.IH
H6408
hmoore on PROD1PC68 with HMBILLS