entity to use evidence-based guidelines to in-
form clinical care decisions made with respect 
to individuals who have selected the entity 
under paragraph (4)(A). 
‘‘(4) SELECTION AND CHANGE OF SELECTION 
OF PAC COORDINATORS BY INDIVIDUAL.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
establish a process for the selection and change 
of selection of a PAC coordinator by an indi-
vidual who is receiving inpatient hospital serv-
ices and whose discharge has been or is likely 
to be classified as a qualifying discharge. 
‘‘(B) LIMITATION ON SELECTION DUE TO 
NETWORK ADEQUACY.—The process established 
under subparagraph (A) may not allow an indi-
vidual to select (or to change a selection to) a 
PAC coordinator in a PAC area unless the PAC 
coordinator has entered into PAC network 
agreements with such PAC providers in such 
PAC area such that the PAC coordinator has a 
sufficient number and range of health care pro-
fessionals and providers willing to provide serv-
ices under the terms of the PAC agreement. 
‘‘(C) LIMITATION ON SELECTION IMPOSED 
BY DISCHARGING HOSPITAL.— 
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‘‘(i) IN GENERAL.—Subject to clause 
(ii), the process established under subpara-
graph (A) shall allow the hospital in which 
the individual receives the acute care inpa-
tient hospital services described in sub-
section (b)(10) to limit the selection of a 
PAC coordinator by the individual to such 
PAC coordinators as the hospital identifies 
(such as through the adoption, by the hos-
pital, of additional standards that a PAC 
coordinator must meet in order for such an 
individual to select the PAC coordinator). 
‘‘(ii) MINIMUM
SELECTION
STAND-
ARDS.—With respect to an individual de-
scribed in clause (i), a hospital described in 
such clause may not, in identifying PAC 
coordinators under such clause from which 
the individual may make a selection de-
scribed in subparagraph (A), do either of 
the following: 
‘‘(I) Identify less than two PAC 
coordinators. 
‘‘(II) Identify only PAC coordina-
tors that have a governance or finan-
cial relationship with the hospital. 
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‘‘(D) ASSIGNMENT IN CASE OF NO SELEC-
TION BY INDIVIDUAL.—In the case that an indi-
vidual described in subparagraph (A) does not 
select a PAC coordinator through the process 
established under such subparagraph, the Sec-
retary shall assign a PAC coordinator to the in-
dividual. For purposes of this section, an as-
signment described in the preceding sentence 
shall be considered to be a selection by the indi-
vidual under subparagraph (A). 
‘‘(5) CONSTRUCTION RELATING TO PAC COOR-
DINATORS OFFERING NON-PAC SERVICES.—Nothing 
in this section shall be construed as prohibiting PAC 
providers from offering, either directly or indirectly, 
services that contribute to patient care, safety, and 
readmission avoidance (such as medication manage-
ment, telehealth technologies, home environment 
services, and transportation services) that are not 
PAC services. 
‘‘(6) CONSTRUCTION REGARDING FLEXIBILITY 
IN THE DELIVERY OF PAC SERVICES.—Nothing in 
this section shall be construed to prevent a PAC net-
work agreement from permitting a PAC provider to 
subcontract for the furnishing of PAC services that 
the PAC provider is otherwise obligated to provide 
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under the agreement so long as the subcontractor 
meets the same terms and conditions in furnishing 
such services as would apply if the PAC provider 
were to provide such services. 
‘‘(d) PAYMENT AMOUNTS.— 
‘‘(1) CLASSIFICATION OF CONDITIONS BY CRGS; 
METHODOLOGY
FOR
CLASSIFICATION.—The Sec-
retary shall use standardized post-acute care assess-
ment data reported pursuant to section 1899B to es-
tablish a classification of the conditions of individ-
uals receiving a PAC bundle by CRG and a method-
ology for classifying specific PAC bundles within 
these groups. The methodology shall, to the extent 
feasible, classify such bundles through the use of the 
PAC assessment tool. 
‘‘(2) COMPUTATION OF BASE RATE.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
compute an average payment rate for PAC bun-
dles classified in each CRG and furnished dur-
ing a PAC period ending in the base year se-
lected under subparagraph (B). 
‘‘(B) BASE YEAR SELECTION.—The Sec-
retary shall select as a base year the most re-
cent year ending before the date of the enact-
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ment of this section for which data are available 
to carry out this section. 
‘‘(C) BUDGET-NEUTRAL
COMPUTATION.— 
The average payment rate for a PAC bundle 
classified in a CRG shall be computed in a 
manner so that, if it had been applied in the 
base year, the aggregate payments for PAC 
bundles classified in such CRG and furnished 
during a PAC period ending in such year would 
be equivalent to the aggregate payments under 
this title for such bundles. 
‘‘(3) CALCULATION
OF
PAYMENT
AMOUNT 
BASED ON BASE RATE.—Subject to the succeeding 
provisions of this subsection, the amount of the sin-
gle payment described in this paragraph, with re-
spect to a PAC bundle classified within a CRG and 
furnished to an individual during a PAC period end-
ing— 
‘‘(A) in 2020, is the base average payment 
rate for such bundle computed under paragraph 
(2), increased by such percentage as the Sec-
retary estimates is the average rate of increase 
in payments under this title for such bundle be-
tween the base year and 2020; and 
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‘‘(B) in a subsequent year, is the amount 
of the single payment for such bundle computed 
under this paragraph for the previous year, in-
creased, subject to paragraph (4), by such per-
centage as the Secretary estimates is the aver-
age rate of increase in payments under this title 
for such bundle between such previous year and 
such subsequent year. 
‘‘(4) CALCULATION OF ANNUAL PERCENTAGE 
INCREASE.—In calculating the percentage increases 
applied under paragraph (3)(B), the Secretary shall 
ensure that total expenditures for all PAC bundles 
provided in accordance with this section over the 8- 
fiscal year period beginning with fiscal year 2020 do 
not exceed 96 percent of the expenditures that would 
have been made over such period but for the applica-
tion of this section. 
‘‘(5) ADJUSTMENT FOR READMISSIONS DURING 
PAC PERIOD.—The amount paid to a PAC coordi-
nator under this subsection for a PAC bundle in a 
PAC period that includes a PAC readmission shall 
be reduced by an amount equal to the aggregate 
amount of payments made for such PAC readmis-
sion of such individual. 
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‘‘(6) ADJUSTMENT
FOR
GEOGRAPHIC, RISK, 
AND
SOCIO-ECONOMIC
AND
DEMOGRAPHIC
FAC-
TORS.—The Secretary shall adjust the amount of 
payment described in paragraph (3) with respect to 
services furnished to an individual in a PAC area in 
a budget-neutral manner for a year— 
‘‘(A) by an appropriate factor that reflects 
variations in costs for the furnishing of PAC 
bundles among different geographic areas; 
‘‘(B) by an appropriate factor that ac-
counts for variations in costs for the furnishing 
of such PAC services to the individual based 
upon the health status of the individual; and 
‘‘(C) by an appropriate factor that ac-
counts for variations in socioeconomic and de-
mographic characteristics of the individual, 
such as whether the individual is both eligible 
for benefits under title XVIII and eligible under 
a State plan for medical assistance under title 
XIX, and whether the individual has a willing 
and able caregiver. 
‘‘(7) ADJUSTMENT IN CASE OF CHANGE OF SE-
LECTION BY INDIVIDUAL.—In the case of a change 
of selection of PAC coordinator by the individual 
under subsection (c)(4) during a PAC period, the 
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Secretary shall adjust the amount of payment de-
scribed in paragraph (3) in order to provide appro-
priate partial payments to be paid to the PAC coor-
dinator selected initially by the individual and to the 
PAC coordinator selected under the change of selec-
tion by the individual. The method of calculating the 
respective amounts of such appropriate partial pay-
ments shall be based on the method used for the 
Home Health Partial Episode Payment adjustment. 
‘‘(8) ADJUSTMENT IN CASE OF DEATH OF INDI-
VIDUAL.—In the case of the death of an individual 
during a PAC period who has selected a PAC coor-
dinator under subsection (c)(4), the Secretary shall 
adjust the amount of payment described in para-
graph (3) to the PAC coordinator in a manner that 
reduces such payment by a proportion equal to the 
proportion by which the 90-day PAC period of the 
individual was reduced by the death of the indi-
vidual. 
‘‘(9) USE OF PAC ASSESSMENT TOOL FOR PUR-
POSES OF ADJUSTMENT FOR RISK FACTORS.—In de-
termining an appropriate factor under paragraph 
(6)(B) with respect to an individual, the Secretary 
shall take into account an assessment of the indi-
vidual conducted using the PAC assessment tool. 
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‘‘(e) PHASE-IN.— 
‘‘(1) DETERMINATION OF PAC EXPENDITURES 
BY CRG.—Based on the most recent data available, 
the Secretary shall determine the aggregate amount 
of expenditures under this title for PAC services fur-
nished during the PAC period for each CRG (as de-
fined in paragraph (b)(11)). 
‘‘(2) RANKING OF CRGS BY VOLUME OF EX-
PENDITURE.—The Secretary shall rank the CRGs in 
order based on the aggregate amount of expendi-
tures for PAC services described in clause (i) for 
each CRG. 
‘‘(3) GROUPING OF CRGS.—The Secretary shall 
group CRGs into four groups as follows: 
‘‘(A) FIRST GROUP.—The first group con-
sists of the CRGs that have the highest rank 
under clause (ii) and that collectively account 
for 25 percent of the aggregate amount of ex-
penditures for PAC services described in clause 
(i). 
‘‘(B) SECOND GROUP.—The second group 
consists of the CRGs that have the next highest 
rank under clause (ii) after the first group in 
subclause (I) and that collectively account for 
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25 percent of the aggregate amount of expendi-
tures for PAC services described in clause (i). 
‘‘(C) THIRD GROUP.—The third group con-
sists of the CRGs that have the next highest 
rank under clause (ii) after the second group in 
subclause (II) and that collectively account for 
25 percent of the aggregate amount of expendi-
tures for PAC services described in clause (i). 
‘‘(D) FOURTH GROUP.—The fourth group 
consists of the CRGs that are not included in 
the first, second, or third group under this 
clause. 
‘‘(4) PHASE-IN BY CRG GROUPING.—In apply-
ing this section for discharges in— 
‘‘(A) 2020, only discharges that are classi-
fied within the first group under subclause (I) 
of clause (iii) shall be included; 
‘‘(B) 2021, only discharges that are classi-
fied within the first or second group under sub-
clause (I) or (II) of clause (iii) shall be in-
cluded; 
‘‘(C) 2022, only discharges that are classi-
fied within the first, second, or third group 
under subclause (I), (II), or (III) of clause (iii) 
shall be included; and 
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‘‘(D) 2023 and subsequent years, dis-
charges that are classified within any group of 
CRGs shall be included.’’. 
SEC. 4. STUDY AND REPORT ON INTEGRATION OF POST- 
ACUTE CARE PAYMENTS WITH ACUTE CARE 
PAYMENTS. 
(a) STUDY.—The Secretary of Health and Human 
Services shall conduct a study to examine the feasibility 
of integrating (or ‘‘bundling’’) all payments under the 
Medicare program for post acute care services under sec-
tion 1866F of the Social Security Act, as added by section 
3, with payments for acute care inpatient hospital services 
(as defined by the Secretary pursuant to subsection 
(b)(10) of such section 1866F) in a subsection (d) hospital 
(as defined in section 1886(d)(1)(B) of such Act (42 
U.S.C. 1395ww(d)(1)(B))), including an examination of 
the anticipated timing and impact of such integration. 
(b) REPORT.—Not later than January 1, 2020, the 
Secretary shall submit a report to the Committees on 
Ways and Means and on Energy and Commerce in the 
House of Representatives, and to the Committee on Fi-
nance in the Senate, on the results of the study conducted 
under subsection (a). 
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SEC. 5. MORATORIUM ON IPPS PAYMENT RATE IN CERTAIN 
CASES. 
Section 1886(m)(6) of the Social Security Act (42 
U.S.C. 1395ww(m)(6)) is amended in— 
(1) subparagraph (A)(i), by striking ‘‘2015’’ 
and inserting ‘‘2021’’; 
(2) subparagraph (B)(i)(I), by striking ‘‘2016’’ 
and ‘‘2017’’ and inserting ‘‘2022’’ and ‘‘2023’’, re-
spectively; 
(3) subparagraph (B)(i)(II), by striking ‘‘2018’’ 
and inserting ‘‘2024’’; 
(4) subparagraph (C)(i), by striking ‘‘2016’’ 
and inserting ‘‘2022’’; 
(5) subparagraph (C)(ii), by striking ‘‘2020’’ 
and inserting ‘‘2026’’; and 
(6) subparagraph (C)(iv), by striking ‘‘2020’’ 
and inserting ‘‘2026’’. 
SEC. 6. TRANSITIONAL CARE MANAGEMENT PAYMENTS 
FOR PHYSICIANS. 
For purposes of encouraging transitional care man-
agement by PAC physicians (as defined in section 
1866F(b)(5) of the Social Security Act), in carrying out 
section 1848(e) of the Social Security Act (42 U.S.C. 
1395w–4(e)), the Secretary of Health and Human Serv-
ices shall establish a new Transitional Care Management 
(TCM) code to pay for care management by such a PAC 
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physician or revise and expand the use of existing TCM 
codes 99495 and 99494. 
Æ 
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