•HJ 59 EAH3 
price index for all urban consumers (all items; 
U.S. city average), for fiscal year 2022.’’; and 
(C) in subparagraph (D) (as redesignated 
by subparagraph (A)), by striking ‘‘fiscal year 
2022’’ and inserting ‘‘fiscal year 2023’’. 
(b) EFFECTIVE DATE.—The amendments made by sub-
section (a) shall be effective as of October 1, 2013. 
SEC. 1205. REALIGNMENT OF THE MEDICARE SEQUESTER 
FOR FISCAL YEAR 2023. 
Paragraph (6) (relating to implementing direct spend-
ing reductions, as redesignated by section 101(d)(2)(C), and 
as amended by section 101(c), of the Bipartisan Budget Act 
of 2013) of section 251A of the Balanced Budget and Emer-
gency Deficit Control Act of 1985 (2 U.S.C. 901a) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(C) Notwithstanding the 2 percent limit speci-
fied in subparagraph (A) for payments for the Medi-
care programs specified in section 256(d), the seques-
tration order of the President under such subpara-
graph for fiscal year 2023 shall be applied to such 
payments so that— 
‘‘(i) with respect to the first 6 months in 
which such order is effective for such fiscal year, 
the payment reduction shall be 2.90 percent; and
•HJ 59 EAH3 
‘‘(ii) with respect to the second 6 months in 
which such order is so effective for such fiscal 
year, the payment reduction shall be 1.11 per-
cent.’’. 
SEC. 1206. PAYMENT FOR INPATIENT SERVICES IN LONG- 
TERM CARE HOSPITALS (LTCHS). 
(a) ESTABLISHMENT OF CRITERIA FOR APPLICATION 
OF SITE NEUTRAL PAYMENT.— 
(1) IN GENERAL.—Section 1886(m) of the Social 
Security Act (42 U.S.C. 1395ww(m)) is amended by 
adding at the end the following: 
‘‘(6) APPLICATION OF SITE NEUTRAL IPPS PAY-
MENT RATE IN CERTAIN CASES.— 
‘‘(A) GENERAL APPLICATION OF SITE NEU-
TRAL IPPS PAYMENT AMOUNT FOR DISCHARGES 
FAILING TO MEET APPLICABLE CRITERIA.— 
‘‘(i) IN GENERAL.—For a discharge in 
cost reporting periods beginning on or after 
October 1, 2015, except as provided in 
clause (ii) and subparagraph (C), payment 
under this title to a long-term care hospital 
for inpatient hospital services shall be made 
at the applicable site neutral payment rate 
(as defined in subparagraph (B)).
•HJ 59 EAH3 
‘‘(ii) EXCEPTION
FOR
CERTAIN
DIS-
CHARGES
MEETING
CRITERIA.—Clause (i) 
shall not apply (and payment shall be made 
to a long-term care hospital without regard 
to this paragraph) for a discharge if— 
‘‘(I) the discharge meets the ICU 
criterion under clause (iii) or the ven-
tilator criterion under clause (iv); and 
‘‘(II) the discharge does not have 
a principal diagnosis relating to a 
psychiatric diagnosis or to rehabilita-
tion. 
‘‘(iii) INTENSIVE CARE UNIT (ICU) CRI-
TERION.— 
‘‘(I) IN GENERAL.—The criterion 
specified in this clause (in this para-
graph referred to as the ‘ICU cri-
terion’), for a discharge from a long- 
term care hospital, is that the stay in 
the long-term care hospital ending with 
such discharge was immediately pre-
ceded by a discharge from a stay in a 
subsection (d) hospital that included at 
least 3 days in an intensive care unit 
(ICU), as determined by the Secretary.
•HJ 59 EAH3 
‘‘(II) DETERMINING ICU DAYS.— 
In determining intensive care unit 
days under subclause (I), the Secretary 
shall use data from revenue center 
codes 020x or 021x (or such successor 
codes as the Secretary may establish). 
‘‘(iv) VENTILATOR
CRITERION.—The 
criterion specified in this clause (in this 
paragraph referred to as the ‘ventilator cri-
terion’), for a discharge from a long-term 
care hospital, is that— 
‘‘(I) the stay in the long-term care 
hospital ending with such discharge 
was immediately preceded by a dis-
charge from a stay in a subsection (d) 
hospital; and 
‘‘(II) the individual discharged 
was assigned to a Medicare-Severity- 
Long-Term-Care-Diagnosis-Related- 
Group (MS–LTC–DRG) based on the 
receipt of ventilator services of at least 
96 hours. 
‘‘(B) APPLICABLE SITE NEUTRAL PAYMENT 
RATE DEFINED.—
•HJ 59 EAH3 
‘‘(i) IN GENERAL.—In this paragraph, 
the term ‘applicable site neutral payment 
rate’ means— 
‘‘(I) for discharges in cost report-
ing periods beginning during fiscal 
year 2016 or fiscal year 2017, the 
blended payment rate specified in 
clause (iii); and 
‘‘(II) for discharges in cost report-
ing periods beginning during fiscal 
year 2018 or a subsequent fiscal year, 
the site neutral payment rate (as de-
fined in clause (ii)). 
‘‘(ii) SITE
NEUTRAL
PAYMENT
RATE 
DEFINED.—In this paragraph, the term ‘site 
neutral payment rate’ means the lower of— 
‘‘(I) the IPPS comparable per 
diem amount determined under para-
graph (d)(4) of section 412.529 of title 
42, Code of Federal Regulations, in-
cluding any applicable outlier pay-
ments under section 412.525 of such 
title; or 
‘‘(II) 100 percent of the estimated 
cost for the services involved.
•HJ 59 EAH3 
‘‘(iii) BLENDED PAYMENT RATE.—The 
blended payment rate specified in this 
clause, for a long-term care hospital for in-
patient hospital services for a discharge, is 
comprised of— 
‘‘(I) half of the site neutral pay-
ment rate (as defined in clause (ii)) for 
the discharge; and 
‘‘(II) half of the payment rate 
that would otherwise be applicable to 
such discharge without regard to this 
paragraph, as determined by the Sec-
retary. 
‘‘(C) LIMITING PAYMENT FOR ALL HOSPITAL 
DISCHARGES TO SITE NEUTRAL PAYMENT RATE 
FOR HOSPITALS FAILING TO MEET APPLICABLE 
LTCH DISCHARGE THRESHOLDS.— 
‘‘(i) NOTICE OF LTCH DISCHARGE PAY-
MENT PERCENTAGE.—For cost reporting pe-
riods beginning during or after fiscal year 
2016, the Secretary shall inform each long- 
term care hospital of its LTCH discharge 
payment percentage (as defined in clause 
(iv)) for such period.
•HJ 59 EAH3 
‘‘(ii) LIMITATION.—For cost reporting 
periods beginning during or after fiscal 
year 2020, if the Secretary determines for a 
long-term care hospital that its LTCH dis-
charge payment percentage for the period is 
not at least 50 percent— 
‘‘(I) the Secretary shall inform the 
hospital of such fact; and 
‘‘(II) subject to clause (iii), for all 
discharges in the hospital in each suc-
ceeding cost reporting period, the pay-
ment amount under this subsection 
shall be the payment amount that 
would apply under subsection (d) for 
the discharge if the hospital were a 
subsection (d) hospital. 
‘‘(iii) 
PROCESS
FOR
REINSTATE-
MENT.—The Secretary shall establish a 
process whereby a long-term care hospital 
may seek to and have the provisions of sub-
clause (II) of clause (ii) discontinued with 
respect to that hospital. 
‘‘(iv) 
LTCH 
DISCHARGE
PAYMENT 
PERCENTAGE.—In this subparagraph, the 
term ‘LTCH discharge payment percentage’
•HJ 59 EAH3 
means, with respect to a long-term care hos-
pital for a cost reporting period beginning 
during or after fiscal year 2020, the ratio 
(expressed as a percentage) of— 
‘‘(I) the number of discharges for 
such hospital and period for which 
payment is not made at the site neu-
tral payment rate, to 
‘‘(II) the total number of dis-
charges for such hospital and period. 
‘‘(D) INCLUSION OF SUBSECTION (D) PUER-
TO RICO HOSPITALS.—In this paragraph, any 
reference in this paragraph to a subsection (d) 
hospital shall be deemed to include a reference to 
a subsection (d) Puerto Rico hospital.’’. 
(2) MEDPAC STUDY AND REPORT ON IMPACT OF 
CHANGES.— 
(A) STUDY.—The Medicare Payment Assess-
ment Commission shall examine the effect of ap-
plying section 1886(m)(6) of the Social Security 
Act, as added by the amendment made by para-
graph (1), on— 
(i) the quality of patient care in long- 
term care hospitals;
•HJ 59 EAH3 
(ii) the use of hospice care and post- 
acute care settings; 
(iii) different types of long-term care 
hospitals; and 
(iv) the growth in Medicare spending 
for services in such hospitals. 
(B) REPORT.—Not later than June 30, 
2019, the Commission shall submit to Congress a 
report on such study. The Commission shall in-
clude in such report such recommendations for 
changes in the application of such section as the 
Commission deems appropriate as well as the 
impact of the application of such section on the 
need to continue applying the 25 percent rule de-
scribed under sections 412.534 and 412.536 of 
title 42, Code of Federal Regulations. 
(3) CALCULATION OF LENGTH OF STAY EXCLUD-
ING CASES PAID ON A SITE NEUTRAL BASIS.— 
(A) IN GENERAL.—For discharges occurring 
in cost reporting periods beginning on or after 
October 1, 2015, subject to subparagraph (B), in 
calculating the length of stay requirement appli-
cable to a long-term care hospital or satellite fa-
cility under section 1886(d)(1)(B)(iv)(I) of the 
Social 
Security 
Act 
(42 
U.S.C.
•HJ 59 EAH3 
1395ww(d)(1)(B)(iv)(I)) 
and 
section 
1861(ccc)(2) 
of 
such 
Act 
(42 
U.S.C. 
1395x(ccc)(2)), the Secretary of Health and 
Human Services shall exclude the following: 
(i) SITE NEUTRAL PAYMENT.—Any pa-
tient for whom payment is made at the site 
neutral payment rate (as defined in section 
1886(m)(6)(B)(ii)) of such Act, as added by 
paragraph (1)). 
(ii) MEDICARE ADVANTAGE.—Any pa-
tient for whom payment is made under a 
Medicare Advantage plan under part C of 
title XVIII of such Act. 
(B) LIMITATION
ON
CONVERTING
SUB-
SECTION
(D)
HOSPITALS.—Subparagraph (A) 
shall not apply to a hospital that is classified as 
of December 10, 2013, as a subsection (d) hos-
pital (as defined in section 1886(d)(1)(B) of the 
Social 
Security 
Act, 
U.S.C. 
1395ww(d)(1)(B)) for purposes of determining 
whether 
the 
requirements 
of 
section 
1886(d)(1)(B)(iv)(I) or 1861(ccc)(2) of such Act 
(42 
U.S.C. 
1395ww(d)(1)(B)(iv)(I), 
1395x(ccc)(2)) are met.
•HJ 59 EAH3 
(b) EXTENSION OF CERTAIN LTCH PAYMENT RULES 
AND MORATORIUM ON THE ESTABLISHMENT OF CERTAIN 
HOSPITALS AND FACILITIES.— 
(1) EXTENSION OF CERTAIN PAYMENT RULES.— 
(A) PAYMENT FOR HOSPITALS-WITHIN-HOS-
PITALS.—Paragraph (2)(C) of section 114(c) of 
the Medicare, Medicaid, and SCHIP Extension 
Act of 2007 (42 U.S.C. 1395ww note), as amend-
ed by sections 3106(a) and 10312(a) of Public 
Law 111–148, is amended by striking ‘‘5-year 
period’’ and inserting ‘‘9-year period’’. 
(B) 25 PERCENT PATIENT THRESHOLD PAY-
MENT
ADJUSTMENT; 
MAKING
THE
GRAND-
FATHERED
EXEMPTION
FOR
LONG-TERM
CARE 
HOSPITALS
PERMANENT.—Section 114(c)(1) of 
the Medicare, Medicaid, and SCHIP Extension 
Act of 2007 (42 U.S.C. 1395ww note), as amend-
ed by sections 3106(a) and 10312(a) of Public 
Law 111–148, is amended— 
(i) in the matter preceding subpara-
graph (A), by striking ‘‘for a 5-year pe-
riod’’; and 
(ii) in subparagraph (A), by inserting 
‘‘for a 9-year period,’’ before ‘‘section 
412.536’’.
•HJ 59 EAH3 
(C) REPORT
ASSESSING
CONTINUED
SUS-
PENSION OF 25 PERCENT RULE.—Not later than 
1 year before the end of the 9-year period re-
ferred to in section 114(c)(1) of the Medicare, 
Medicaid, and SCHIP Extension Act of 2007 
(42 U.S.C. 1395ww note), as amended by sub-
paragraph (B), the Secretary of Health and 
Human Services shall submit to Congress a re-
port on the need for any further extensions (or 
modifications of the extensions) of the 25 percent 
rule described in sections 412.534 and 412.536 of 
title 42, Code of Federal Regulations, particu-
larly taking into account the application of sec-
tion 1886(m)(6) of the Social Security Act, as 
added by subsection (a)(1). 
(2) EXTENSION OF MORATORIUM ON ESTABLISH-
MENT OF AND INCREASE IN BEDS FOR LTCHS.—Sec-
tion 114(d) of the Medicare, Medicaid, and SCHIP 
Extension Act of 2007 (42 U.S.C. 1395ww note), as 
amended by sections 3106(b) and 10312(b) of Public 
Law 111–148, is amended— 
(A) in paragraph (1), in the matter pre-
ceding subparagraph (A), by inserting after ‘‘5- 
year period’’ the following: ‘‘(and for the period
100 
•HJ 59 EAH3 
beginning January 1, 2015, and ending Sep-
tember 30, 2017)’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(6) LIMITATION
ON
APPLICATION
OF
EXCEP-
TIONS.—Paragraphs (2) and (3) shall not apply dur-
ing the period beginning January 1, 2015, and end-
ing September 30, 2017.’’. 
(c) 
ADDITIONAL
QUALITY
MEASURE.—Section 
1886(m)(5)(D) of the Social Security Act (42 U.S.C. 
1395ww(m)(5)(D)) is amended by adding at the end the 
following new clause: 
‘‘(iv) 
ADDITIONAL
QUALITY
MEAS-
URES.—Not later than October 1, 2015, the 
Secretary shall establish a functional status 
quality measure for change in mobility 
among inpatients requiring ventilator sup-
port.’’. 
(d) REVIEW OF TREATMENT OF CERTAIN LTCHS.— 
(1) EVALUATION.—As part of the annual rule-
making for fiscal year 2015 or fiscal year 2016 to 
carry out the payment rates under subsection (d) of 
section 1886 of the Social Security Act (42 U.S.C. 
1395ww), the Secretary shall evaluate both the pay-
ment rates and regulations governing hospitals which
101 
•HJ 59 EAH3 
are classified under subclause (II) of subsection 
(d)(1)(B)(iv) of such section. 
(2) ADJUSTMENT AUTHORITY.—Based upon such 
evaluation, the Secretary may adjust payment rates 
under subsection (b)(3) of section 1886 of the Social 
Security Act (42 U.S.C. 1395ww) for a hospital so 
classified (such as payment based upon the TEFRA- 
payment model) and may adjust the regulations gov-
erning such hospitals, including applying the regula-
tions governing hospitals which are classified under 
clause (I) of subsection (d)(1)(B) of such section. 
Attest: 
Clerk.
113TH CONGRESS 
1ST SESSION 
H. J. RES. 59 
HOUSE AMENDMENT TO 
SENATE AMENDMENT