292 
hospital under paragraphs (d)(1), (e)(1), and 
(e)(4) of section 412.534 of title 42, Code of Fed-
eral Regulations, shall not be subject to any pay-
ment adjustment under such section if no more 
than 75 percent of the hospital’s Medicare dis-
charges (other than discharges described in para-
graphs (d)(2) or (e)(3) of such section) are ad-
mitted from a co-located hospital. 
(B) CO-LOCATED
LONG-TERM
CARE
HOS-
PITALS AND SATELLITE FACILITIES.— 
(i) IN GENERAL.—Payment to an ap-
plicable long-term care hospital or satellite 
facility which is co-located with another 
hospital shall not be subject to any payment 
adjustment under section 412.534 of title 
42, Code of Federal Regulations, if no more 
than 50 percent of the hospital’s Medicare 
discharges (other than discharges described 
in section 412.534(c)(3) of such title) are 
admitted from a co-located hospital. 
(ii) APPLICABLE
LONG-TERM
CARE 
HOSPITAL
OR
SATELLITE
FACILITY
DE-
FINED.—In this paragraph, the term ‘‘ap-
plicable long-term care hospital or satellite 
facility’’ means a hospital or satellite facil-
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293 
ity that is subject to the transition rules 
under section 412.534(g) of title 42, Code of 
Federal Regulations. 
(C) EFFECTIVE DATE.—Subparagraphs (A) 
and (B) shall apply to discharges occurring on 
or after October 1, 2007, and before October 1, 
2012. 
(7) NO
APPLICATION
OF
VERY
SHORT-STAY 
OUTLIER
POLICY.—The Secretary shall not apply, 
during the 5-year period beginning on the date of the 
enactment of this Act, the amendments finalized on 
May 11, 2007 (72 Federal Register 26904) made to 
the short-stay outlier payment provision for long-term 
care hospitals contained in section 412.529(c)(3)(i) of 
title 42, Code of Federal Regulations, or any similar 
provision. 
(8) NO APPLICATION OF ONE TIME ADJUSTMENT 
TO
STANDARD
AMOUNT.—The Secretary shall not, 
during the 5-year period beginning on the date of the 
enactment of this Act, make the one-time prospective 
adjustment to long-term care hospital prospective 
payment rates provided for in section 412.523(d)(3) 
of title 42, Code of Federal Regulations, or any simi-
lar provision. 
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(c) SEPARATE CLASSIFICATION FOR CERTAIN LONG- 
STAY CANCER HOSPITALS.— 
(1) IN GENERAL.—Subsection (d)(1)(B) of sec-
tion 1886 of the Social Security Act (42 U.S.C. 
1395ww) is amended— 
(A) in clause (iv)— 
(i) in subclause (I), by striking 
‘‘(iv)(I)’’ and inserting ‘‘(iv)’’ and by strik-
ing ‘‘or’’ at the end; and 
(ii) in subclause (II)— 
(I) by striking ‘‘, or’’ at the end 
and inserting a semicolon; and 
(II) by redesignating such sub-
clause as clause (vi) and by moving it 
to immediately follow clause (v); and 
(B) in clause (v), by striking the semicolon 
at the end and inserting ‘‘, or’’. 
(2) CONFORMING PAYMENT REFERENCES.—Sub-
section (b) of such section is amended— 
(A) in paragraph (2)(E)(ii), by adding at 
the end the following new subclause: 
‘‘(III) Hospitals described in clause (vi) of such 
subsection.’’; 
(B) in paragraph (3)(F)(iii), by adding at 
the end the following new subclause: 
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‘‘(VI) Hospitals described in clause (vi) of such 
subsection.’’; 
(C) in paragraphs (3)(G)(ii), (3)(H)(i), and 
(3)(H)(ii)(I), by inserting ‘‘or (vi)’’ after ‘‘clause 
(iv)’’ each place it appears; 
(D) in paragraph (3)(H)(iv), by adding at 
the end the following new subclause: 
‘‘(IV) Hospitals described in clause (vi) of such 
subsection.’’; 
(E) in paragraph (3)(J), by striking ‘‘sub-
section (d)(1)(B)(iv)’’ and inserting ‘‘clause (iv) 
or (vi) of subsection (d)(1)(B)’’; and 
(F) in paragraph (7)(B), by adding at the 
end the following new clause: 
‘‘(iv) Hospitals described in clause (vi) of such 
subsection.’’. 
(3) ADDITIONAL
CONFORMING
AMENDMENTS.— 
The second sentence of subsection (d)(1)(B) of such 
section is amended— 
(A) by inserting ‘‘(as in effect as of such 
date)’’ after ‘‘clause (iv)’’; and 
(B) by inserting ‘‘(or, in the case of a hos-
pital classified under clause (iv)(II), as so in ef-
fect, shall be classified under clause (vi) on and 
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296 
after the effective date of such clause)’’ after ‘‘so 
classified’’. 
(4) TRANSITION RULE.—In the case of a hospital 
that is classified under clause (iv)(II) of section 
1886(d)(1)(B) of the Social Security Act immediately 
before the date of the enactment of this Act and which 
is classified under clause (vi) of such section after 
such date of enactment, payments under section 1886 
of such Act for cost reporting periods beginning after 
the date of the enactment of this Act shall be based 
upon payment rates in effect for the cost reporting pe-
riod for such hospital beginning during fiscal year 
2001, increased for each succeeding cost reporting pe-
riod (beginning before the date of the enactment of 
this Act) by the applicable percentage increase under 
section 1886(b)(3)(B)(ii) of such Act. 
(5) CLARIFICATION
OF
TREATMENT
OF
SAT-
ELLITE
FACILITIES
AND
REMOTE
LOCATIONS.—A 
long-stay 
cancer 
hospital 
described 
in 
section 
1886(d)(1)(B)(vi) of the Social Security Act, as des-
ignated under paragraph (1), shall include satellites 
or remote site locations for such hospital established 
before or after the date of the enactment of this Act 
if the provider-based requirements under section 
413.65 of title 42, Code of Federal Regulations, appli-
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297 
cable certification requirements under title XVIII of 
the Social Security, and such other applicable State 
licensure and certificate of need requirements are met 
with respect to such satellites or remote site locations. 
SEC. 504. INCREASING THE DSH ADJUSTMENT CAP. 
Section 1886(d)(5)(F)(xiv) of the Social Security Act 
(42 U.S.C. 1395ww(d)(5)(F)(xiv)) is amended— 
(1) in subclause (II), by striking ‘‘12 percent’’ 
and inserting ‘‘the percent specified in subclause 
(III)’’; and 
(2) by adding at the end the following new sub-
clause: 
‘‘(III) The percent specified in this subclause is, in the 
case of discharges occurring— 
‘‘(a) before October 1, 2007, 12 percent; 
‘‘(b) during fiscal year 2008, 16 percent; 
‘‘(c) during fiscal year 2009, 18 percent; and 
‘‘(d) on or after October 1, 2009, 12 percent.’’. 
SEC. 505. PPS-EXEMPT CANCER HOSPITALS. 
(a) AUTHORIZING REBASING FOR PPS-EXEMPT CAN-
CER HOSPITALS.—Section 1886(b)(3)(F) of the Social Se-
curity Act (42 U.S.C. 1395ww(b)(3)(F)) is amended by 
adding at the end the following new clause: 
‘‘(iv) In the case of a hospital (or unit 
described in the matter following clause (v) 
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of subsection (d)(1)(B)) that received pay-
ment under this subsection for inpatient 
hospital services furnished during cost re-
porting periods beginning before October 1, 
1999, that is within a class of hospital de-
scribed in clause (iii) (other than subclause 
(IV), relating to long-term care hospitals, 
and that requests the Secretary (in a form 
and manner specified by the Secretary) to 
effect a rebasing under this clause for the 
hospital, the Secretary may compute the 
target amount for the hospital’s 12-month 
cost reporting period beginning during fis-
cal year 2008 as an amount equal to the 
average described in clause (ii) but deter-
mined as if any reference in such clause to 
‘the date of the enactment of this subpara-
graph’ were a reference to ‘the date of the 
enactment of this clause’.’’. 
(b) ADDITIONAL CANCER HOSPITAL PROVISIONS.— 
(1) IN GENERAL.—Section 1886(d)(1) of the So-
cial Security Act (42 U.S.C. 1395ww(d)(1)) is 
amended— 
(A) in subparagraph (B)(v)— 
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(i) by striking ‘‘or’’ at the end of sub-
clause (II); and 
(ii) by adding at the end the following: 
‘‘(IV) a hospital that is a nonprofit corporation, 
the sole member of which is affiliated with a univer-
sity that has been the recipient of a cancer center sup-
port grant from the National Cancer Institute of the 
National Institutes of Health, and which sole member 
(or its predecessors or such university) was recognized 
as a comprehensive cancer center by the National 
Cancer Institute of the National Institutes of Health 
as of April 20, 1983, if the hospital’s articles of incor-
poration specify that at least 50 percent of its total 
discharges have a principal finding of neoplastic dis-
ease (as defined in subparagraph (E)) and if, of De-
cember 31, 2005, the hospital was licensed for less 
than 150 acute care beds, or 
‘‘(V) a hospital (aa) that the Secretary has deter-
mined to be, at any time on or before December 31, 
2011, a hospital involved extensively in treatment for, 
or research on, cancer, (bb) that is (as of the date of 
such determination) a free-standing facility, (cc) for 
which the hospital’s predecessor provider entity was 
University Hospitals of Cleveland with medicare pro-
vider number 36-0137;’’; and 
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(B) in subparagraph (B), by inserting after 
clause 
(vi), 
as 
redesignated 
by 
section 
503(c)(1)(A)(ii)(II), the following new clause: 
‘‘(vii) a hospital that— 
‘‘(I) is located in a State which ranks (ac-
cording to the National Cancer Institute’s statis-
tics published in May of 2005) among the top 
ten States in the incidence of non-Hodgkins 
lymphoma, ovarian cancer, thyroid cancer, and 
cervical cancer and among the top ten States 
with the highest death rate for breast cancer and 
uterine cancer; 
‘‘(II) is located in a State that as of Decem-
ber 31, 2006, had only one center under section 
414 of the Public Health Service Act that has 
been designated by the National Cancer Institute 
as a comprehensive center currently serving all 
21 counties in the most densely populated State 
in the nation (U.S. Census estimate for 2005: 
8,717,925 persons; 1,134.5 persons per square 
mile), serving more than 70,000 patient visits 
annually; 
‘‘(III) as of December 31, 2006, served as 
the teaching and clinical care, research and 
training hospital for the Center described in sub-
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301 
clause (II), providing significant financial and 
operational support to such Center; 
‘‘(IV) as of December 31, 2006, served as a 
core and essential element in such Center which 
conducts more than 130 clinical trial activities, 
national cooperative group studies, investigator- 
initiated and peer review studies and has re-
ceived as of 2005 at least $93,000,000 in re-
search grant awards; 
‘‘(V) as of December 31, 2006, can dem-
onstrate that it has been a unique and an inte-
gral component of such Center since such Cen-
ter’s inception; 
‘‘(VI) as of December 31, 2006, includes 
dedicated patient care units organized primarily 
for the treatment of and research on cancer with 
approximately 125 beds, 75 percent of which are 
dedicated to cancer patients, and contains a ra-
diation oncology department as well as special-
ized emergency services for oncology patients; 
‘‘(VII) as of December 31, 2004, is identi-
fied as the focus of the Center’s inpatient activi-
ties in the Center’s application as a NCI-des-
ignated comprehensive cancer center and shares 
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the NCI comprehensive cancer designation with 
the Center; and 
‘‘(VIII) as of December 31, 2006, has been 
recognized with a certificate of approval with 
commendation by the American College of Sur-
geons Commission on Cancer;’’; and 
(D) in subparagraph (E)— 
(i) by striking ‘‘subclauses (II) and 
(III)’’ and inserting ‘‘subclauses (II), (III), 
and (IV)’’; and 
(ii) by inserting ‘‘and subparagraph 
(B)(vi)’’ after ‘‘subparagraph (B)(v)’’. 
(2) EFFECTIVE DATES; PAYMENTS.— 
(A) APPLICATION TO COST REPORTING PE-
RIODS.— 
(i) Any classification by reason of sec-
tion 1886(d)(1)(B)(vi) of the Social Secu-
rity Act (42 U.S.C. 1395ww(d)(1)(B)(vi)), 
as inserted by paragraph (1), shall apply to 
cost reporting periods beginning on or after 
January 1, 2006. 
(ii) 
The 
provisions 
of 
section 
1886(d)(1)(B)(v)(IV) of the Social Security 
Act, as added by paragraph (1), shall take 
effect on January 1, 2008. 
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303 
(B) 
BASE
TARGET
AMOUNT.—Notwith-
standing subsection (b)(3)(E) of section 1886 of 
the Social Security Act (42 U.S.C. 1395ww), in 
the case of a hospital described in subsection 
(d)(1)(B)(vi) of such section, as inserted by 
paragraph (1)— 
(i) the hospital shall be permitted to 
resubmit the 2006 Medicare 2552 cost re-
port incorporating a cancer hospital sub- 
provider number and to apply the Medicare 
ratio-of-cost-to-charge 
settlement 
method-
ology for outpatient cancer services; and 
(ii) the hospital’s target amount under 
subsection (b)(3)(E)(i) of such section for 
the first cost reporting period beginning on 
or after January 1, 2006, shall be the allow-
able operating costs of inpatient hospital 
services (referred to in subclause (I) of such 
subsection) for such first cost reporting pe-
riod. 
(C) DEADLINE FOR PAYMENTS.—Any pay-
ments owed to a hospital as a result of this sub-
section for periods occurring before the date of 
the enactment of this Act shall be made expedi-
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304 
tiously, but in no event later than 1 year after 
such date of enactment. 
(3) APPLICATION TO CERTAIN HOSPITALS.— 
(A) INAPPLICABILITY OF CERTAIN REQUIRE-
MENTS.—The provisions of section 412.22(e) of 
title 42, Code of Federal Regulations, shall not 
apply to a hospital described in section 
1886(d)(1)(B)(v)(V) of the Social Security Act, 
as added by paragraph (1). 
(B) APPLICATION TO COST REPORTING PE-
RIODS.—If the Secretary makes a determination 
that 
a 
hospital 
is 
described 
in 
section 
1886(d)(1)(B)(v)(V) of the Social Security Act, 
as added by paragraph (1), such determination 
shall apply as of the first cost reporting period 
beginning on or after the date of such determina-
tion. 
(C) BASE
PERIOD.—Notwithstanding the 
provisions of section 1886(b)(3)(E) of the Social 
Security Act (42 U.S.C. 1395ww(b)(3)(E)) or 
any other provision of law, the base cost report-
ing period for purposes of determining the target 
amount for any hospital for which a determina-
tion described in subparagraph (B) has been 
made shall be the first full 12-month cost report-
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ing period beginning on or after the date of such 
determination. 
(D) RULE.—A hospital described in sub-
clause (V) of section 1886(b)(1)(B)(v) of the So-
cial Security Act, as added by paragraph (1), 
shall not qualify as a hospital described in such 
subclause for any cost reporting period in which 
less than 50 percent of its total discharges have 
a principal finding of neoplastic disease. With 
respect to the first cost reporting period for 
which a determination described in subpara-
graph (B) has been made, the Secretary shall ac-
cept a self-certification by the hospital, which 
shall be applicable to such first cost reporting pe-
riod, that the hospital intends to have total dis-
charges during such first cost reporting period of 
which 50 percent or more have a principal find-
ing of neoplastic disease. 
(c) MEDPAC REPORT ON PPS-EXEMPT CANCER HOS-
PITALS.—Not later than March 1, 2009, the Medicare Pay-
ment Advisory Commission (established under section 1805 
of the Social Security Act (42 U.S.C. 1395b–6)) shall sub-
mit to the Secretary and Congress a report evaluating the 
following: 
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(1) Measures of payment adequacy and Medicare 
margins for PPS-exempt cancer hospitals, as estab-
lished under section 1886(d)(1)(B)(v) of the Social 
Security Act (42 U.S.C. 1395ww(d)(1)(B)(v)). 
(2) To the extent a PPS-exempt cancer hospital 
was previously affiliated with another hospital, the 
margins of the PPS-exempt hospital and the other 
hospital as separate entities and the margins of such 
hospitals that existed when the hospitals were pre-
viously affiliated. 
(3) Payment adequacy for cancer discharges 
under the Medicare inpatient hospital prospective 
payment system. 
SEC. 506. SKILLED NURSING FACILITY PAYMENT UPDATE. 
(a) IN GENERAL.—Section 1888(e)(4)(E)(ii) of the So-
cial Security Act (42 U.S.C. 1395yy(e)(4)(E)(ii)) is amend-
ed— 
(1) in subclause (III), by striking ‘‘and’’ at the 
end; 
(2) by redesignating subclause (IV) as subclause 
(VI); and 
(3) by inserting after subclause (III) the fol-
lowing new subclauses: 
‘‘(IV) for each of fiscal years 
2004, 2005, 2006, and 2007, the rate 
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307 
computed for the previous fiscal year 
increased by the skilled nursing facility 
market basket percentage change for 
the fiscal year involved; 
‘‘(V) for fiscal year 2008, the rate 
computed for the previous fiscal year; 
and’’. 
(b) 
DELAYED
EFFECTIVE
DATE.—Section 
1888(e)(4)(E)(ii)(V) of the Social Security Act, as inserted 
by subsection (a)(3), shall not apply to payment for days 
before January 1, 2008. 
SEC. 507. REVOCATION OF UNIQUE DEEMING AUTHORITY 
OF THE JOINT COMMISSION FOR THE AC-
CREDITATION OF HEALTHCARE ORGANIZA-
TIONS. 
(a) REVOCATION.—Section 1865 of the Social Security 
Act (42 U.S.C. 1395bb) is amended— 
(1) by striking subsection (a); and 
(2) by redesignating subsections (b), (c), (d), and 
(e) as subsections (a), (b), (c), and (d), respectively. 
(b) CONFORMING AMENDMENTS.—(1) Such section is 
further amended— 
(A) in subsection (a)(1), as so redesignated, 
by striking ‘‘In addition, if’’ and inserting ‘‘If’’; 
(B) in subsection (b), as so redesignated— 
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308 
(i) by striking ‘‘released to him by the 
Joint Commission on Accreditation of Hos-
pitals,’’ and inserting ‘‘released to the Sec-
retary by’’; and 
(ii) by striking the comma after ‘‘Asso-
ciation’’; 
(C) in subsection (c), as so redesignated, by 
striking ‘‘pursuant to subsection (a) or (b)(1)’’ 
and inserting ‘‘pursuant to subsection (a)(1)’’; 
and 
(D) in subsection (d), as so redesignated, by 
striking ‘‘pursuant to subsection (a) or (b)(1)’’ 
and inserting ‘‘pursuant to subsection (a)(1)’’. 
(2) Section 1861(e) of such Act (42 U.S.C. 
1395x(e)) is amended in the fourth sentence by strik-
ing ‘‘and (ii) is accredited by the Joint Commission 
on Accreditation of Hospitals, or is accredited by or 
approved by a program of the country in which such 
institution is located if the Secretary finds the accred-
itation or comparable approval standards of such 
program to be essentially equivalent to those of the 
Joint Commission on Accreditation of Hospitals.’’ 
and inserting ‘‘and (ii) is accredited by a national 
accreditation body recognized by the Secretary under 
section 1865(a), or is accredited by or approved by a 
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309 
program of the country in which such institution is 
located if the Secretary finds the accreditation or 
comparable approval standards of such program to be 
essentially equivalent to those of such a national ac-
creditation body.’’. 
(3) Section 1864(c) of such Act (42 U.S.C. 
1395aa(c)) is amended by striking ‘‘pursuant to sub-
section (a) or (b)(1) of section 1865’’ and inserting 
‘‘pursuant to section 1865(a)(1)’’. 
(4) Section 1875(b) of such Act (42 U.S.C. 
1395ll(b)) is amended by striking ‘‘the Joint Commis-
sion on Accreditation of Hospitals,’’ and inserting 
‘‘national 
accreditation 
bodies 
under 
section 
1865(a)’’. 
(5) Section 1834(a)(20)(B) of such Act (42 
U.S.C. 1395m(a)(20)(B)) is amended by striking 
‘‘section 1865(b)’’ and inserting ‘‘section 1865(a)’’. 
(6) Section 1852(e)(4)(C) of such Act (42 U.S.C. 
1395w–22(e)(4)(C)) is amended by striking ‘‘section 
1865(b)(2)’’ and inserting ‘‘section 1865(a)(2)’’. 
(c) AUTHORITY TO RECOGNIZE JCAHO AS A NA-
TIONAL ACCREDITATION BODY.—The Secretary of Health 
and Human Services may recognize the Joint Commission 
on Accreditation of Healthcare Organizations as a national 
accreditation body under section 1865 of the Social Secu-
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310 
rity Act (42 U.S.C. 1395bb), as amended by this section, 
upon such terms and conditions, and upon submission of 
such information, as the Secretary may require. 
(d) EFFECTIVE DATE; TRANSITION RULE.—(1) Sub-
ject to paragraph (2), the amendments made by this section 
shall apply with respect to accreditations of hospitals grant-
ed on or after the date that is 18 months after the date 
of the enactment of this Act. 
(2) For purposes of title XVIII of the Social Security 
Act (42 U.S.C. 1395 et seq.), the amendments made by this 
section shall not effect the accreditation of a hospital by 
the Joint Commission on Accreditation of Healthcare Orga-
nizations, or under accreditation or comparable approval 
standards found to be essentially equivalent to accreditation 
or approval standards of the Joint Commission on Accredi-
tation of Healthcare Organizations, for the period of time 
applicable under such accreditation. 
SEC. 508. TREATMENT OF MEDICARE HOSPITAL RECLASSI-
FICATIONS. 
(a) EXTENDING CERTAIN MEDICARE HOSPITAL WAGE 
INDEX
RECLASSIFICATIONS
THROUGH
FISCAL
YEAR 
2009.— 
(1) IN GENERAL.—Section 106(a) of the Medi-
care Improvements and Extension Act of 2006 (divi-
sion B of Public Law 109–432) is amended by strik-
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bajohnson on PROD1PC69 with BILLS
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ing ‘‘September 30, 2007’’ and inserting ‘‘September 
30, 2009’’. 
(2) SPECIAL EXCEPTION RECLASSIFICATIONS.— 
The Secretary of Health and Human Services shall 
extend for discharges occurring through September 30, 
2009, the special exception reclassification made 
under the authority of section 1886(d)(5)(I)(i) of the 
Social Security Act (42 U.S.C. 1395ww(d)(5)(I)(i)) 
and contained in the final rule promulgated by the 
Secretary in the Federal Register on August 11, 2004 
(69 Fed. Reg. 49105, 49107). 
(b) DISREGARDING SECTION 508 HOSPITAL RECLASSI-
FICATIONS
FOR
PURPOSES
OF
GROUP
RECLASSIFICA-
TIONS.—Section 508 of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003 (Public Law 
108–173, 42 U.S.C. 1395ww note) is amended by adding 
at the end the following new subsection: 
‘‘(g) DISREGARDING HOSPITAL RECLASSIFICATIONS 
FOR PURPOSES OF GROUP RECLASSIFICATIONS.—For pur-
poses of the reclassification of a group of hospitals in a geo-
graphic area under section 1886(d), a hospital reclassified 
under this section (including any such reclassification 
which is extended under section 106(a) of the Medicare Im-
provements and Extension Act of 2006) shall not be taken 
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into account and shall not prevent the other hospitals in 
such area from establishing such a group for such purpose.’’. 
(c) APPLICATION
OF MEDICARE RURAL MINIMUM 
HOSPITAL WAGE INDEX OF NON-LOCATION STATES TO 
HOSPITALS RECLASSIFIED
TO URBAN AREAS
IN SUCH 
STATES.—Section 1886(d)(8)(C) of the Social Security Act 
(42 U.S.C. 1395ww(d)(8)(C)) is amended— 
(1) by redesignating clause (v) as clause (vi); 
and 
(2) by inserting after clause (iv) the following 
new clause: 
‘‘(v) Notwithstanding the previous provisions of this 
subparagraph, in the case that the application of subpara-
graph (B) or a decision of the Medicare Geographic Classi-
fication Review Board or the Secretary under paragraph 
(10) results in the redesignation of a rural hospital that 
is classified as a rural referral center under paragraph 
(5)(C) and sole community hospital under paragraph 
(5)(D)(iii) and that has at least 250 beds to an urban area 
that is in a non-location State, for which the combined av-
erage hourly wage of all hospitals located in such area is 
less than the combined average hourly wage of all hospitals 
located in the rural area of such State, and which was not 
reclassified under section 508 of the Medicare Prescription 
Drug, Improvement, and Modernization Act of 2003, the 
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313 
wage index applicable to such hospital may not be less than 
the area wage index otherwise applicable to a hospital lo-
cated in the rural area in the non-location State (or, if the 
non-location State has no rural area, the minimum wage 
index that the Secretary establishes for such State). For 
purposes of this clause, the term ‘non-location State’ means, 
with respect to a hospital, a State other than the State in 
which the hospital is located.’’. 
(d) APPLICATION OF FLOOR ON AREA WAGE INDEX IN 
CASE OF RECLASSIFIED HOSPITALS.— 
(1) IN GENERAL.—Section 4410 of the Balanced 
Budget Act of 1997 (Public Law 105-33) is amended 
by adding at the end the following new subsection: 
‘‘(d) APPLICATION TO RECLASSIFIED HOSPITALS.—In 
the case of a hospital that is reclassified based on wages 
under paragraph (8) or (10) of section 1886(d) of the Social 
Security Act into an area the area wage index for which 
is increased under subsection (a), such increased area wage 
index shall also apply to such hospital.’’. 
(2) EFFECTIVE DATE.—The amendment made by 
paragraph (1) shall apply to payments for discharges 
occurring on or after October 1, 2008. 
(e) OTHER
HOSPITAL
RECLASSIFICATION
PROVI-
SIONS.—Notwithstanding any other provision of law— 
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314 
(1) In the case of a subsection (d) hospital (as 
defined for purposes of section 1886 of the Social Se-
curity Act (42 U.S.C. 1395ww)) located in Putnam 
County, Tennessee with respect to which a reclassi-
fication of its wage index for purposes of such section 
would (but for this subsection) expire on September 
30, 2007, such reclassification of such hospital shall 
be extended through September 30, 2008. 
(2) For purposes of making payments under sec-
tion 1886(d) of the Social Security Act (42 U.S.C. 
1395ww(d)), the Secretary of Health and Human 
Services shall classify any hospital located in Orange 
County, New York that was reclassified under the au-
thority of section 508 of the the Medicare Prescription 
Drug, Improvement and Modernization Act of 2003 
(Public Law 108-173) as being located in the New 
York-White Plains-Wayne, NY-NJ Core Based Statis-
tical Area. Any reclassification under this subsection 
shall be treated as a reclassification under section 
1886(d)(8) of such Act. 
(3) For purposes of making payments under sec-
tion 1886(d) of the Social Security Act (42 U.S.C. 
1395ww(d)), the large urban area of New York, New 
York is deemed to include hospitals, required by State 
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315 
law enacted prior to June 30, 2007, to join under a 
single unified governance structure if— 
(A) such hospitals are located in a city with 
a population of no less than 20,000 and no than 
30,000; and 
(B) such hospitals are less than 3/4 miles 
apart. 
(4) For purposes of making payments under sec-
tion 1886(d) of the Social Security Act (42 U.S.C. 
1395ww(d)) the large urban area of Buffalo-Niagara 
Falls, New York is deemed to include Chautauqua 
County, New York. Notwithstanding paragraph (6), 
in no case shall there be a reduction in the hospital 
wage index for Erie County, New York, or any ad-
joining county, as a result of the application of this 
section (other than as a result of a general reduction 
required to carry out paragraph (8)(D) of that sec-
tion). 
(5) For purposes of making payments under sec-
tion 1886(d) of the Social Security Act (42 U.S.C. 
1395ww(d)) a hospital shall be reclassified into the 
New York-White Plains-Wayne, New York-New Jersey 
core based statistical area (CBSA code 35644) if the 
hospital is a subsection (d) hospital (as defined in 
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316 
section 1886(d)(1)(B) of the Social Security Act (42 
U.S.C. 1395ww(d)(1)(B)) that— 
(A) is licensed by the State in which it is 
located as a specialty hospital; 
(B) specializes in the treatment of cardiac, 
vascular, and pulmonary diseases; 
(C) provides at least 100 beds; and 
(D) is located in Burlington County, New 
Jersey. 
(6)(A) Any hospital described in subparagraph 
(B) shall be treated as located in the core based statis-
tical area described in subparagraph (C) for purposes 
of making payments under section 1886(d) of the So-
cial Security Act (42 U.S.C. 1395ww(d)). 
(B) A hospital described in this subparagraph is 
any hospital that— 
(i) is located in a core based statistical area 
(CBSA) that— 
(I) had a population (as reported in 
the decennial census for the year 2000) of at 
least 500,000, but not more than 750,000; 
(II) had a population (as reported in 
such census) that was at least 10,000 below 
the population for the area as reported in 
the previous decennial census; and 
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317 
(III) has as of January 1, 2006, at 
least 5, and no more than 7, subsection (d) 
hospitals; and 
(ii) demonstrates that its average hourly 
wage amount (as determined consistent with sec-
tion 1886(d)(10)(D)(vi) of the Social Security 
Act is not less than 96 percent of such average 
hourly wage amount rate for all subsection (d) 
hospitals located in same core base statistical 
area of the hospital. 
(C) The area described in this subparagraph, 
with respect to a hospital described in subparagraph 
(B), is the core based statistical area that— 
(i) is within the same State as, and is adja-
cent to, the core based statistical area in which 
the hospital is located; and 
(ii) has an average hourly wage amount 
(described in subparagraph (B)(ii)) that is clos-
est to (but does not exceed) such average hourly 
wage amount of the hospital. 
(7) For purposes of making payments under sec-
tion 1886(d) of the Social Security Act (42 U.S.C. 
1395ww(d)), the large urban area of Hartford, Con-
necticut is deemed to include Albany, Schenectady, 
and Rensselaer Counties, New York. 
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(8) For purposes of the previous provisions of 
this subsection (other than paragraph (1))— 
(A) any reclassification effected under such 
provisions shall be treated as a decision of the 
Medicare 
Geographic 
Classification 
Review 
Board under section 1886(d) of the Social Secu-
rity Act and subject to budget neutrality under 
paragraph (8)(D) of such section.; and 
(B) such provisions shall only apply to dis-
charges occurring on or after October 1, 2008, 
during the 3-year reclassification period begin-
ning on such date. 
SEC. 509. MEDICARE CRITICAL ACCESS HOSPITAL DESIGNA-
TIONS. 
(a) IN GENERAL.— 
(1) Section 405(h) of the Medicare Prescription 
Drug, Improvement, and Modernization Act of 2003 
(Public Law 108–173; 117 Stat. 2269) is amended by 
adding at the end the following new paragraph: 
‘‘(3) EXCEPTION.— 
‘‘(A) IN GENERAL.—The amendment made 
by paragraph (1) shall not apply to the certifi-
cation by the State of Minnesota on or after Jan-
uary 1, 2006, under section 1820(c)(2)(B)(i)(II) 
of the Social Security Act (42 U.S.C. 1395i– 
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319 
4(c)(2)(B)(i)(II)) of one hospital that meets the 
criteria described in subparagraph (B) and is lo-
cated in Cass County, Minnesota, as a necessary 
provider of health care services to residents in 
the area of the hospital. 
‘‘(B) CRITERIA
DESCRIBED.—A hospital 
meets the criteria described in this subparagraph 
if the hospital 
‘‘(i) has been granted an exception by 
the State to an otherwise applicable statu-
tory restriction on hospital construction or 
licensing prior to the date of enactment of 
this subparagraph; and 
‘‘(ii) is located on property which the 
State has approved for conveyance to a 
county within the State prior to such date 
of enactment.’’. 
(2) Section 1820(c)(2)(B)(i)(I) of the Social Se-
curity Act (42 U.S.C. 1395i-4(c)(2)(B)(i)(I)) is 
amended by striking ‘‘or,’’ and inserting ‘‘or, in the 
case of a hospital that is located in the county seat 
of Butler, Alabama, a 32-mile drive, or,’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a)(2) shall apply to cost reporting periods begin-
ning on or after the date of the enactment of this Act. 
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320 
TITLE VI—OTHER PROVISIONS 
RELATING TO MEDICARE PART B 
Subtitle A—Payment and Coverage 
Improvements 
SEC. 601. PAYMENT FOR THERAPY SERVICES. 
(a) EXTENSION OF EXCEPTIONS PROCESS FOR MEDI-
CARE THERAPY CAPS.—Section 1833(g)(5) of the Social Se-
curity Act (42 U.S.C. 1395l(g)(5)), as amended by section 
201 of the Medicare Improvements and Extension Act of 
2006 (division B of Public Law 109–432), is amended by 
striking ‘‘2007’’ and inserting ‘‘2009’’. 
(b) STUDY AND REPORT.— 
(1) STUDY.—The Secretary of Health and 
Human Services, in consultation with appropriate 
stakeholders, shall conduct a study on refined and al-
ternative payment systems to the Medicare payment 
cap under section 1833(g) of the Social Security Act 
(42 U.S.C. 1395l(g)) for physical therapy services and 
speech-language pathology services, described in para-
graph (1) of such section and occupational therapy 
services described in paragraph (3) of such section. 
Such study shall consider, with respect to payment 
amounts under Medicare, the following: 
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321 
(A) The creation of multiple payment caps 
for such services to better reflect costs associated 
with specific health conditions. 
(B) The development of a prospective pay-
ment system, including an episode-based system 
of payments, for such services. 
(C) The data needed for the development of 
a system of multiple payment caps (or an alter-
native payment methodology) for such services 
and the availability of such data. 
(2) REPORT.—Not later than January 1, 2009, 
the Secretary shall submit to Congress a report on the 
study conducted under paragraph (1). 
SEC. 602. MEDICARE SEPARATE DEFINITION OF OUT-
PATIENT 
SPEECH-LANGUAGE 
PATHOLOGY 
SERVICES. 
(a) IN GENERAL.—Section 1861(ll) of the Social Secu-
rity Act (42 U.S.C. 1395x(ll)) is amended— 
(1) by redesignating paragraphs (2) and (3) as 
paragraphs (3) and (4), respectively; and 
(2) by inserting after paragraph (1) the fol-
lowing new paragraph: 
‘‘(2) The term ‘outpatient speech-language pathology 
services’ has the meaning given the term ‘outpatient phys-
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322 
ical therapy services’ in subsection (p), except that in ap-
plying such subsection— 
‘‘(A) ‘speech-language pathology’ shall be sub-
stituted for ‘physical therapy’ each place it appears; 
and 
‘‘(B) ‘speech-language pathologist’ shall be sub-
stituted for ‘physical therapist’ each place it ap-
pears.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1832(a)(2)(C) of the Social Security 
Act (42 U.S.C. 1395k(a)(2)(C)) is amended— 
(A) by striking ‘‘and outpatient’’ and in-
serting ‘‘, outpatient’’; and 
(B) by inserting before the semicolon at the 
end the following: ‘‘, and outpatient speech-lan-
guage pathology services (other than services to 
which the second sentence of section 1861(p) ap-
plies 
through 
the 
application 
of 
section 
1861(ll)(2))’’. 
(2) Subparagraphs (A) and (B) of section 
1833(a)(8) of such Act (42 U.S.C. 1395l(a)(8)) are 
each amended by striking ‘‘(which includes outpatient 
speech-language pathology services)’’ and inserting ‘‘, 
outpatient speech-language pathology services,’’. 
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(3) Section 1833(g)(1) of such Act (42 U.S.C. 
1395l(g)(1)) is amended— 
(A) by inserting ‘‘and speech-language pa-
thology services of the type described in such sec-
tion 
through 
the 
application 
of 
section 
1861(ll)(2)’’ after ‘‘1861(p)’’; and 
(B) by inserting ‘‘and speech-language pa-
thology services’’ after ‘‘and physical therapy 
services’’. 
(4) The second sentence of section 1835(a) of 
such Act (42 U.S.C. 1395n(a)) is amended— 
(A) by striking ‘‘section 1861(g)’’ and in-
serting ‘‘subsection (g) or (ll)(2) of section 1861’’ 
each place it appears; and 
(B) by inserting ‘‘or outpatient speech-lan-
guage pathology services, respectively’’ after ‘‘oc-
cupational therapy services’’. 
(5) Section 1861(p) of such Act (42 U.S.C. 
1395x(p)) is amended by striking the fourth sentence. 
(6) Section 1861(s)(2)(D) of such Act (42 U.S.C. 
1395x(s)(2)(D)) is amended by inserting ‘‘, outpatient 
speech-language pathology services,’’ after ‘‘physical 
therapy services’’. 
(7) Section 1862(a)(20) of such Act (42 U.S.C. 
1395y(a)(20)) is amended— 
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324 
(A) by striking ‘‘outpatient occupational 
therapy services or outpatient physical therapy 
services’’ and inserting ‘‘outpatient physical 
therapy services, outpatient speech-language pa-
thology services, or outpatient occupational ther-
apy services’’; and 
(B) by striking ‘‘section 1861(g)’’ and in-
serting ‘‘subsection (g) or (ll)(2) of section 1861’’. 
(8) Section 1866(e)(1) of such Act (42 U.S.C. 
1395cc(e)(1)) is amended— 
(A) by striking ‘‘section 1861(g)’’ and in-
serting ‘‘subsection (g) or (ll)(2) of section 1861’’ 
the first two places it appears; 
(B) by striking ‘‘defined) or’’ and inserting 
‘‘defined),’’; and 
(C) by inserting before the semicolon at the 
end the following: ‘‘, or (through the operation of 
section 1861(ll)(2)) with respect to the furnishing 
of outpatient speech-language pathology’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to services furnished on or after January 
1, 2008. 
(d) CONSTRUCTION.—Nothing in this section shall be 
construed to affect existing regulations and policies of the 
Centers for Medicare & Medicaid Services that require phy-
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sician oversight of care as a condition of payment for 
speech-language pathology services under part B of the 
medicare program. 
SEC. 603. INCREASED REIMBURSEMENT RATE FOR CER-
TIFIED NURSE-MIDWIVES. 
(a) IN GENERAL.—Section 1833(a)(1)(K) of the Social 
Security Act (42 U.S.C.1395l(a)(1)(K)) is amended by 
striking ‘‘(but in no event’’ and all that follows through 
‘‘performed by a physician)’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to services furnished on or after 
April 1, 2008. 
SEC. 604. ADJUSTMENT IN OUTPATIENT HOSPITAL FEE 
SCHEDULE INCREASE FACTOR. 
The first sentence of section 1833(t)(3)(C)(iv) of the 
Social Security Act (42 U.S.C. 1395l(t)(3)(C)(iv)) is 
amended by inserting before the period at the end the fol-
lowing: ‘‘and reduced by 0.25 percentage point for such fac-
tor for such services furnished in 2008’’. 
SEC. 605. EXCEPTION TO 60-DAY LIMIT ON MEDICARE SUB-
STITUTE BILLING ARRANGEMENTS IN CASE 
OF PHYSICIANS ORDERED TO ACTIVE DUTY 
IN THE ARMED FORCES. 
(a) IN GENERAL.—Section 1842(b)(6)(D)(iii) of the 
Social Security Act (42 U.S.C. 1395u(b)(6)(D)(iii)) is 
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326 
amended by inserting after ‘‘of more than 60 days’’ the fol-
lowing: ‘‘or are provided over a longer continuous period 
during all of which the first physician has been called or 
ordered to active duty as a member of a reserve component 
of the Armed Forces’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall apply to services furnished on or after the 
date of the enactment of this section. 
SEC. 606. EXCLUDING CLINICAL SOCIAL WORKER SERVICES 
FROM COVERAGE UNDER THE MEDICARE 
SKILLED NURSING FACILITY PROSPECTIVE 
PAYMENT SYSTEM AND CONSOLIDATED PAY-
MENT. 
(a) IN GENERAL.—Section 1888(e)(2)(A)(ii) of the So-
cial Security Act (42 U.S.C. 1395yy(e)(2)(A)(ii)) is amend-
ed by inserting ‘‘clinical social worker services,’’ after 
‘‘qualified psychologist services,’’. 
(b) CONFORMING AMENDMENT.—Section 1861(hh)(2) 
of the Social Security Act (42 U.S.C. 1395x(hh)(2)) is 
amended by striking ‘‘and other than services furnished to 
an inpatient of a skilled nursing facility which the facility 
is required to provide as a requirement for participation’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to items and services furnished on or 
after January 1, 2008. 
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327 
SEC. 607. COVERAGE OF MARRIAGE AND FAMILY THERA-
PIST SERVICES AND MENTAL HEALTH COUN-
SELOR SERVICES. 
(a) COVERAGE OF MARRIAGE AND FAMILY THERAPIST 
SERVICES.— 
(1) COVERAGE OF SERVICES.—Section 1861(s)(2) 
of the Social Security Act (42 U.S.C. 1395x(s)(2)), as 
amended by section 201(a)(1), is amended— 
(A) in subparagraph (AA), by striking 
‘‘and’’ at the end; 
(B) in subparagraph (BB), by adding 
‘‘and’’ at the end; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(CC) marriage and family therapist services (as 
defined in subsection (eee));’’. 
(2) DEFINITION.—Section 1861 of the Social Se-
curity Act (42 U.S.C. 1395x), as amended by sections 
201(a)(2) and 503(b)(1), is amended by adding at the 
end the following new subsection: 
‘‘Marriage and Family Therapist Services 
‘‘(eee)(1) The term ‘marriage and family therapist 
services’ means services performed by a marriage and fam-
ily therapist (as defined in paragraph (2)) for the diagnosis 
and treatment of mental illnesses, which the marriage and 
family therapist is legally authorized to perform under 
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State law (or the State regulatory mechanism provided by 
State law) of the State in which such services are performed, 
provided such services are covered under this title, as would 
otherwise be covered if furnished by a physician or as inci-
dent to a physician’s professional service, but only if no 
facility or other provider charges or is paid any amounts 
with respect to the furnishing of such services. 
‘‘(2) The term ‘marriage and family therapist’ means 
an individual who— 
‘‘(A) possesses a master’s or doctoral degree 
which qualifies for licensure or certification as a mar-
riage and family therapist pursuant to State law; 
‘‘(B) after obtaining such degree has performed 
at least 2 years of clinical supervised experience in 
marriage and family therapy; and 
‘‘(C) is licensed or certified as a marriage and 
family therapist in the State in which marriage and 
family therapist services are performed.’’. 
(3) PROVISION FOR PAYMENT UNDER PART b.— 
Section 1832(a)(2)(B) of the Social Security Act (42 
U.S.C. 1395k(a)(2)(B)) is amended by adding at the 
end the following new clause: 
‘‘(v) marriage and family therapist 
services;’’. 
(4) AMOUNT OF PAYMENT.— 
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329 
(A) IN GENERAL.—Section 1833(a)(1) of the 
Social Security Act (42 U.S.C. 1395l(a)(1)), as 
amended by section 201(b)(1), is amended— 
(i) by striking ‘‘and’’ before ‘‘(W)’’; 
and 
(ii) by inserting before the semicolon at 
the end the following: ‘‘, and (X) with re-
spect to marriage and family therapist serv-
ices under section 1861(s)(2)(CC), the 
amounts paid shall be 80 percent of the less-
er of (i) the actual charge for the services or 
(ii) 75 percent of the amount determined for 
payment of a psychologist under subpara-
graph (L)’’. 
(B) DEVELOPMENT OF CRITERIA WITH RE-
SPECT TO CONSULTATION WITH A PHYSICIAN.— 
The Secretary of Health and Human Services 
shall, taking into consideration concerns for pa-
tient confidentiality, develop criteria with re-
spect to payment for marriage and family thera-
pist services for which payment may be made di-
rectly to the marriage and family therapist 
under part B of title XVIII of the Social Secu-
rity Act (42 U.S.C. 1395j et seq.) under which 
such a therapist must agree to consult with a pa-
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330 
tient’s attending or primary care physician in 
accordance with such criteria. 
(5) EXCLUSION OF MARRIAGE AND FAMILY THER-
APIST SERVICES FROM SKILLED NURSING FACILITY 
PROSPECTIVE
PAYMENT
SYSTEM.—Section 
1888(e)(2)(A)(ii) of the Social Security Act (42 
U.S.C. 1395yy(e)(2)(A)(ii)), is amended by inserting 
‘‘marriage and family therapist services (as defined 
in subsection (eee)(1)),’’ after ‘‘qualified psychologist 
services,’’. 
(6) COVERAGE OF MARRIAGE AND FAMILY THER-
APIST SERVICES PROVIDED IN RURAL HEALTH CLIN-
ICS AND FEDERALLY QUALIFIED HEALTH CENTERS.— 
Section 1861(aa)(1)(B) of the Social Security Act (42 
U.S.C. 1395x(aa)(1)(B)) is amended by striking ‘‘or 
by a clinical social worker (as defined in subsection 
(hh)(1)),’’ and inserting ‘‘, by a clinical social worker 
(as defined in subsection (hh)(1)), or by a marriage 
and family therapist (as defined in subsection 
(eee)(2)),’’. 
(7) INCLUSION
OF
MARRIAGE
AND
FAMILY 
THERAPISTS AS PRACTITIONERS FOR ASSIGNMENT OF 
CLAIMS.—Section 1842(b)(18)(C) of the Social Secu-
rity Act (42 U.S.C. 1395u(b)(18)(C)) is amended by 
adding at the end the following new clause: 
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‘‘(vii) A marriage and family therapist (as de-
fined in section 1861(eee)(2)).’’. 
(b) COVERAGE
OF MENTAL HEALTH COUNSELOR 
SERVICES.— 
(1) COVERAGE OF SERVICES.—Section 1861(s)(2) 
of the Social Security Act (42 U.S.C. 1395x(s)(2)), as 
amended by subsection (a)(1), is further amended— 
(A) in subparagraph (BB), by striking 
‘‘and’’ at the end; 
(B) in subparagraph (CC), by inserting 
‘‘and’’ at the end; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(DD) mental health counselor services (as de-
fined in subsection (fff)(2));’’. 
(2) DEFINITION.—Section 1861 of the Social Se-
curity Act (42 U.S.C. 1395x), as amended by sections 
201(a)(2) and 503(b)(1) and subsection (a)(2), is 
amended by adding at the end the following new sub-
section: 
‘‘Mental Health Counselor; Mental Health Counselor 
Services 
‘‘(fff)(1) The term ‘mental health counselor’ means an 
individual who— 
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332 
‘‘(A) possesses a master’s or doctor’s degree which 
qualifies the individual for licensure or certification 
for the practice of mental health counseling in the 
State in which the services are performed; 
‘‘(B) after obtaining such a degree has performed 
at least 2 years of supervised mental health counselor 
practice; and 
‘‘(C) is licensed or certified as a mental health 
counselor or professional counselor by the State in 
which the services are performed. 
‘‘(2) The term ‘mental health counselor services’ means 
services performed by a mental health counselor (as defined 
in paragraph (1)) for the diagnosis and treatment of mental 
illnesses which the mental health counselor is legally author-
ized to perform under State law (or the State regulatory 
mechanism provided by the State law) of the State in which 
such services are performed, provided such services are cov-
ered under this title, as would otherwise be covered if fur-
nished by a physician or as incident to a physician’s profes-
sional service, but only if no facility or other provider 
charges or is paid any amounts with respect to the fur-
nishing of such services.’’. 
(3) PROVISION FOR PAYMENT UNDER PART b.— 
Section 1832(a)(2)(B) of the Social Security Act (42 
U.S.C. 1395k(a)(2)(B)), as amended by subsection 
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333 
(a)(3), is further amended by adding at the end the 
following new clause: 
‘‘(vi) mental health counselor serv-
ices;’’. 
(4) AMOUNT OF PAYMENT.— 
(A) IN GENERAL.—Section 1833(a)(1) of the 
Social Security Act (42 U.S.C. 1395l(a)(1)), as 
amended by subsection (a)(4), is further amend-
ed— 
(i) by striking ‘‘and’’ before ‘‘(X)’’; and 
(ii) by inserting before the semicolon at 
the end the following: ‘‘, and (Y) with re-
spect to mental health counselor services 
under section 1861(s)(2)(DD), the amounts 
paid shall be 80 percent of the lesser of (i) 
the actual charge for the services or (ii) 75 
percent of the amount determined for pay-
ment of a psychologist under subparagraph 
(L)’’. 
(B) DEVELOPMENT OF CRITERIA WITH RE-
SPECT TO CONSULTATION WITH A PHYSICIAN.— 
The Secretary of Health and Human Services 
shall, taking into consideration concerns for pa-
tient confidentiality, develop criteria with re-
spect to payment for mental health counselor 
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services for which payment may be made directly 
to the mental health counselor under part B of 
title XVIII of the Social Security Act (42 U.S.C. 
1395j et seq.) under which such a counselor must 
agree to consult with a patient’s attending or 
primary care physician in accordance with such 
criteria. 
(5) EXCLUSION OF MENTAL HEALTH COUNSELOR 
SERVICES
FROM
SKILLED
NURSING
FACILITY
PRO-
SPECTIVE
PAYMENT
SYSTEM.—Section 
1888(e)(2)(A)(ii) of the Social Security Act (42 
U.S.C. 1395yy(e)(2)(A)(ii)), as amended by sub-
section (a)(5), is amended by inserting ‘‘mental 
health counselor services (as defined in section 
1861(ddd)(2)),’’ after ‘‘marriage and family therapist 
services (as defined in subsection (eee)(1)),’’. 
(6) COVERAGE OF MENTAL HEALTH COUNSELOR 
SERVICES PROVIDED IN RURAL HEALTH CLINICS AND 
FEDERALLY QUALIFIED HEALTH CENTERS.—Section 
1861(aa)(1)(B) of the Social Security Act (42 U.S.C. 
1395x(aa)(1)(B)), as amended by subsection (a)(6), is 
amended by striking ‘‘or by a marriage and family 
therapist (as defined in subsection (eee)(2)),’’ and in-
serting ‘‘by a marriage and family therapist (as de-
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fined in subsection (eee)(2)), or a mental health coun-
selor (as defined in subsection (fff)(1)),’’. 
(7) INCLUSION OF MENTAL HEALTH COUNSELORS 
AS PRACTITIONERS FOR ASSIGNMENT OF CLAIMS.— 
Section 1842(b)(18)(C) of the Social Security Act (42 
U.S.C. 1395u(b)(18)(C)), as amended by subsection 
(a)(7), is amended by adding at the end the following 
new clause: 
‘‘(viii) A mental health counselor (as defined in 
section 1861(fff)(1)).’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to items and services furnished on or 
after January 1, 2008. 
SEC. 608. RENTAL AND PURCHASE OF POWER-DRIVEN 
WHEELCHAIRS. 
(a) IN GENERAL.—Section 1834(a)(7) of the Social Se-
curity Act (42 U.S.C. 1395m(a)(7)) is amended— 
(1) in subparagraph (A)— 
(A) in clause (i)(I), by striking ‘‘Except as 
provided in clause (iii), payment’’ and inserting 
‘‘Payment’’; 
(B) by striking clause (iii); and 
(C) in clause (iv)— 
(i) by redesignating such clause as 
clause (iii); and 
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336 
(ii) by striking ‘‘or in the case of a 
power-driven wheelchair for which a pur-
chase agreement has been entered into under 
clause (iii)’’; and 
(2) in subparagraph (C)(ii)(II), by striking ‘‘or 
(A)(iii)’’. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.—Subject to paragraph (1), the 
amendments made by subsection (a) shall take effect 
on January 1, 2008, and shall apply to power-driven 
wheelchairs furnished on or after such date. 
(2) APPLICATION
TO
COMPETITIVE
ACQUISI-
TION.—The amendments made by subsection (a) shall 
not apply to contracts entered into under section 1847 
of the Social Security Act (42 U.S.C. 1395w–3) pur-
suant to a bid submitted under such section before 
July 21, 2007. 
SEC. 609. RENTAL AND PURCHASE OF OXYGEN EQUIPMENT. 
(a) IN GENERAL.—Section 1834(a)(5)(F) of the Social 
Security Act (42 U.S.C. 1395m(a)(5)(F)) is amended— 
(1) in clause (i)— 
(A) by striking ‘‘Payment’’ and inserting 
‘‘Subject to clause (iii), payment’’; and 
(B) by striking ‘‘36 months’’ and inserting 
‘‘18 months’’; 
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(2) in clause (ii)(I), by striking ‘‘36th contin-
uous month’’ and inserting ‘‘18th continuous month’’; 
and 
(3) by adding at the end the following new 
clause: 
‘‘(iii) SPECIAL
RULE
FOR
OXYGEN 
GENERATING
PORTABLE
EQUIPMENT.—In 
the case of oxygen generating portable 
equipment referred to in the final rule pub-
lished in the Federal Register on November 
9, 2006 (71 Fed. Reg. 65897–65899), in ap-
plying clauses (i) and (ii)(I) each reference 
to ‘18 months’ is deemed a reference to ‘36 
months’.’’. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.—Subject to paragraph (3), the 
amendments made by subsection (a) shall apply to 
oxygen equipment furnished on or after January 1, 
2008. 
(2) TRANSITION.—In the case of an individual 
receiving oxygen equipment on December 31, 2007, 
for which payment is made under section 1834(a) of 
the Social Security Act (42 U.S.C. 1395m(a)), the 18- 
month period described in paragraph (5)(F)(i) of 
such section, as amended by subsection (a), shall 
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begin on January 1, 2008, but in no case shall the 
rental period for such equipment exceed 36 months. 
(3) APPLICATION
TO
COMPETITIVE
ACQUISI-
TION.—The amendments made by subsection (a) shall 
not apply to contracts entered into under section 1847 
of the Social Security Act (42 U.S.C. 1395w–3) pur-
suant to a bid submitted under such section before 
July 21, 2007. 
(c) STUDY AND REPORT.— 
(1) STUDY.—The Secretary of Health and 
Human Services shall conduct a study to examine the 
service component and the equipment component of 
the provision of oxygen to Medicare beneficiaries. The 
study shall assess— 
(A) the type of services provided and vari-
ation across suppliers in providing such services; 
(B) whether the services are medically nec-
essary or affect patient outcomes; 
(C) whether the Medicare program pays ap-
propriately for equipment in connection with the 
provision of oxygen; 
(D) whether such program pays appro-
priately for necessary services; 
(E) whether such payment in connection 
with the provision of oxygen should be divided 
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