922
(d) 
APPLYING
THE
LIMITING
CHARGE
TO
NONPHYSICIAN SERVICES PROVIDED UNDER THE PHYSI-
CIAN FEE SCHEDULE.—Section 1848 (42 U.S.C. 1395w–
4) is amended—
(1) in subsection (a)(3), by inserting ‘‘AND SUP-
PLIERS’’ after ‘‘PHYSICIANS’’, and by inserting ‘‘or a
nonparticipating supplier or other person’’ after
‘‘nonparticipating physician’’ and by adding at the
end the following: ‘‘In the case of physicians’ serv-
ices (including services which the Secretary excludes
pursuant to subsection (j)(3)) of a nonparticipating
physician, supplier, or other person for which pay-
ment is made under this part on a basis other than
the fee schedule amount, the payment shall be based
on 95 percent of the payment basis for such services
furnished by a participating physician, supplier, or
other person.’’;
(2) in subsection (g)(1)(A), as amended by sub-
section (a), in the matter before clause (i), by insert-
ing ‘‘(including services which the Secretary excludes
pursuant to subsection (j)(3))’’ after ‘‘a physician’s
service’’;
(3) in subsection (g)(2)(D), by inserting ‘‘(or, if
payment under this part is made on a basis other
923
than the fee schedule under this section, 95 percent
of the other payment basis)’’ after ‘‘subsection (a)’’;
(4) in subsection (g)(3)(B)—
(A) by inserting after the first sentence the
following: ‘‘ No person is liable for payment of
any amounts billed for such a service in viola-
tion of the previous sentence.’’, and
(B) in the last sentence, by striking ‘‘pre-
vious sentence’’ and inserting ‘‘first sentence’’;
(5) in subsection (h)—
(A) by inserting ‘‘or nonparticipating sup-
plier or other person furnishing physicians’
services (as defined in section 1848(j)(3))’’
after ‘‘physician’’ the first place it appears,
(B) by inserting ‘‘, supplier, or other per-
son’’ after ‘‘physician’’ the second place it ap-
pears, and
(C) by inserting ‘‘, suppliers, and other
persons’’ after ‘‘physicians’’ the second place it
appears; and
(6) in subsection (j)(3), by inserting ‘‘, except
for purposes of subsections (a)(3), (g), and (h)’’
after ‘‘tests and’’.
(e) CLARIFICATION
OF MANDATORY ASSIGNMENT
RULES FOR CERTAIN PRACTITIONERS.—
924
(1) IN GENERAL.—Section 1842(b) (42 U.S.C.
1395u(b)), as amended by section 13449(e), is
amended by adding at the end the following new
paragraph:
‘‘(18)(A) Payment for any service furnished by a
practitioner described in subparagraph (C) and for which
payment may be made under this part on a reasonable
charge or fee schedule basis may only be made under this
part on an assignment-related basis.
‘‘(B) A practitioner described in subparagraph (C) or
other person may not bill (or collect any amount from)
the individual or another person for any service described
in subparagraph (A), except for deductible and coinsur-
ance amounts applicable under this part. No person is lia-
ble for payment of any amounts billed for such a service
in violation of the previous sentence. If a practitioner or
other person knowingly and willfully bills (or collects an
amount) for such a service in violation of such sentence,
the Secretary may apply sanctions against the practitioner
or other person in the same manner as the Secretary may
apply sanctions against a physician in accordance with
section 1842(j)(2) in the same manner as such section ap-
plies with respect to a physician. Paragraph (4) of section
1842(j) shall apply in this subparagraph in the same man-
ner as such paragraph applies to such section.
925
‘‘(C) A practitioner described in this subparagraph
is any of the following:
‘‘(i) A physician assistant, nurse practitioner, or
clinical nurse specialist (as defined in section
1861(aa)(5)).
‘‘(ii) A certified registered nurse anesthetist (as
defined in section 1861(bb)(2)).
‘‘(iii) A certified nurse-midwife (as defined in
section 1861(gg)(2)).
‘‘(iv) A clinical social worker (as defined in sec-
tion 1861(hh)(1)).
‘‘(v) A clinical psychologist (as defined by the
Secretary for purposes of section 1861(ii)).
‘‘(D) For purposes of this paragraph, a service fur-
nished by a practitioner described in subparagraph (C) in-
cludes any services and supplies furnished as incident to
the service as would otherwise be covered under this part
if furnished by a physician or as incident to a physician’s
service.’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 1833 (42 U.S.C. 1395l) is
amended—
(i) in subsection (l)(5), by striking
subparagraph (B) and redesignating sub-
paragraph (C) as subparagraph (B);
926
(ii) by striking subsection (p); and
(iii) in subsection (r), by striking
paragraph (3) and redesignating para-
graph (4) as paragraph (3).
(B) 
Section 
1842(b)(12) 
(42 
U.S.C.
1395u(b)(12)) is amended by striking subpara-
graph (C).
(f) MISCELLANEOUS
AND
TECHNICAL
AMEND-
MENTS.—Section 1833 (42 U.S.C. 1395l) is amended—
(1) in subsection (a)(1), as amended by section
13479(e)(2)—
(A) by striking ‘‘and’’ before ‘‘(O)’’, and
(B) by inserting before the semicolon at
the end the following: ‘‘, and (P) with respect
to services described in clauses (i), (ii) and (iv)
of section 1861(s)(2)(K), the amounts paid are
subject 
to 
the 
provisions 
of 
section
1842(b)(12)’’; and
(2) in subsection (h)(5)(D)—
(A) by striking ‘‘paragraphs (2) and (3)’’
and by inserting ‘‘paragraph (2)’’, and
(B) by adding at the end the following:
‘‘Paragraph (4) of such section shall apply in
this subparagraph in the same manner as such
paragraph applies to such section.’’.
927
(g) EFFECTIVE DATES.—
(1) ENFORCEMENT
AND
UNIFORM
APPLICA-
TION; MISCELLANEOUS
AND
TECHNICAL
AMEND-
MENTS.—The amendments made by subsections (a),
(d), and (f) shall apply to services furnished on or
after the date of the enactment of this Act; except
that such amendments made by subsections (a) and
(d) shall not apply to services of a nonparticipating
supplier or other person furnished before January 1,
1994.
(2) CARRIER
DETERMINATIONS.—The amend-
ments made by subsection (b) shall apply to con-
tracts as of January 1, 1994.
(3) EOMBS.—The amendments made by sub-
section (c)(1) shall apply to explanations of benefits
provided on or after January 1, 1994.
(4) REPORT.—The amendment made by sub-
section (c)(2) shall apply to reports for years begin-
ning with 1994.
(5) PRACTITIONERS.—The amendments made
by subsection (e) shall apply to services furnished on
or after January 1, 1994.
SEC. 13446. RELATIVE VALUES FOR PEDIATRIC SERVICES.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall fully develop, by not later than July
928
1, 1994, relative values for the full range of pediatric phy-
sicians’ services which are consistent with the relative val-
ues developed for other physicians’ services under section
1848(c) of the Social Security Act. In developing such val-
ues, the Secretary shall conduct such refinements as may
be necessary to produce appropriate estimates for such rel-
ative values.
(b) STUDY.—
(1) IN GENERAL.—The Secretary shall conduct
a study of the relative values for pediatric and other
services to determine whether there are significant
variations in the resources used in providing similar
services to different populations. In conducting such
study, the Secretary shall consult with appropriate
organizations representing pediatricians and other
physicians.
(2) REPORT.—Not later than July 1, 1994, the
Secretary shall submit to Congress a report on the
study conducted under paragraph (1). Such report
shall include any appropriate recommendations re-
garding needed changes in coding or other payment
policies to ensure that payments for pediatric serv-
ices appropriately reflect the resources required to
provide these services.
929
SEC. 13447. ANTIGENS UNDER PHYSICIAN FEE SCHEDULE.
(a) IN GENERAL.—Section 1848(j)(3) (42 U.S.C.
1395w–4(j)(3)) is amended by inserting ‘‘(2)(G),’’ after
‘‘(2)(D),’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1995.
SEC. 13448. ADMINISTRATION OF CLAIMS RELATING TO
PHYSICIANS’ SERVICES.
(a) LIMITATION ON CARRIER USER FEES.—Section
1842(c) (42 U.S.C. 1395u(c)) is amended by adding at
the end the following new paragraph:
‘‘(4) Neither a carrier nor the Secretary may impose
a fee under this title—
‘‘(A) for the filing of claims related to physi-
cians’ services,
‘‘(B) for an error in filing a claim relating to
physicians’ services or for such a claim which is
denied,
‘‘(C) for any appeal under this title with respect
to physicians’ services,
‘‘(D) for applying for (or obtaining) a unique
identifier under subsection (r), or
‘‘(E) for responding to inquiries respecting phy-
sicians’ services or for providing information with re-
spect to medical review of such services.’’.
930
(b) CLARIFICATION OF PERMISSIBLE SUBSTITUTE
BILLING ARRANGEMENTS.—
(1) IN
GENERAL.—Clause (D) of section
1842(b)(6) (42 U.S.C. 1395u(b)(6)), as amended by
section 13449(f), is amended to read as follows:
‘‘(D) payment may be made to a physician for physi-
cians’ services (and services furnished incident to
such services) furnished by a second physician to pa-
tients of the first physician if (i) the first physician
is unavailable to provide the services; (ii) the services
are furnished pursuant to an arrangement between
the two physicians that (I) is informal and recip-
rocal, or (II) involves per diem or other fee-for-time
compensation for such services; (iii) the services are
not provided by the second physician over a continu-
ous period of more than 60 days; and (iv) the claim
form submitted to the carrier for such services in-
cludes the second physician’s unique identifier (pro-
vided under the system established under subsection
(r)) and indicates that the claim meets the require-
ments of this clause for payment to the first physi-
cian’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to services furnished on
or after the first day of the first month beginning
931
more than 60 days after the date of the enactment
of this Act.
SEC. 13449. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) OVERVALUED PROCEDURES (SECTION 4101 OF
OBRA–1990).—(1) 
Section 
1842(b)(16)(B)(iii) 
(42
U.S.C. 1395u(b)(16)(B)(iii)) is amended—
(A) by striking ‘‘, simple and subcutaneous’’,
(B) by striking ‘‘; small’’ and inserting ‘‘and
small’’,
(C) by striking ‘‘treatments;’’ the first place it
appears and inserting ‘‘and’’,
(D) by striking ‘‘lobectomy;’’,
(E) by striking ‘‘enterectomy; colectomy; chole-
cystectomy;’’,
(F) by striking ‘‘; transurerethral resection’’
and inserting ‘‘and resection’’, and
(G) by striking ‘‘sacral laminectomy;’’.
(2) Section 4101(b)(2) of OBRA–1990 is amended—
(A) in the matter before subparagraph (A), by
striking 
‘‘1842(b)(16)’’ 
and 
inserting
‘‘1842(b)(16)(B)’’, and
(B) in subparagraph (B)—
(i) by striking ‘‘, simple and subcutane-
ous’’,
932
(ii) by striking ‘‘(HCPCS codes 19160 and
19162)’’ and inserting ‘‘(HCPCS code 19160)’’,
and
(iii) by striking all that follows ‘‘(HCPCS
codes 92250’’ and inserting ‘‘and 92260).’’.
(b) RADIOLOGY
SERVICES
(SECTION
4102 
OF
OBRA–1990).—(1) Section 1834(b)(4) (42 U.S.C.
1395m(b)(4)) is amended by redesignating subparagraphs
(E) and (F) as subparagraphs (F) and (G), respectively.
(2) 
Section 
1834(b)(4)(D) 
(42 
U.S.C.
1395m(b)(4)(D)) is amended—
(A) in the matter before clause (i), by striking
‘‘shall be determined as follows:’’ and inserting
‘‘shall, subject to clause (vii), be reduced to the ad-
justed conversion factor for the locality determined
as follows:’’,
(B) in clause (iv), by striking ‘‘LOCAL ADJUST-
MENT.—Subject to clause (vii), the conversion factor
to be applied to’’ and inserting ‘‘ADJUSTED CONVER-
SION FACTOR.—The adjusted conversion factor for’’,
(C) in clause (vii), by striking ‘‘under this sub-
paragraph’’, and
(D) in clause (vii), by inserting ‘‘reduced under
this subparagraph by’’ after ‘‘shall not be’’.
933
(3) Section 4102(c)(2) of OBRA–1990 is amended
by striking ‘‘radiology services’’ and all that follows and
inserting ‘‘nuclear medicine services.’’.
(4) Section 4102(d) of OBRA–1990 is amended by
striking ‘‘new paragraph’’ and inserting ‘‘new subpara-
graph’’.
(5) 
Section 
1834(b)(4)(E) 
(42 
U.S.C.
1395m(b)(4)(E)) is amended by inserting ‘‘RULE FOR
CERTAIN SCANNING SERVICES.—’’ after ‘‘(E)’’.
(6) Section 1848(a)(2)(D)(iii) (42 U.S.C. 1395w–
4(a)(2)(D)(iii)) is amended by striking ‘‘that are subject
to section 6105(b) of the Omnibus Budget Reconciliation
Act of 1989’’ and by striking ‘‘provided under such sec-
tion’’ and inserting ‘‘provided under section 6105(b) of the
Omnibus Budget Reconciliation Act of 1989’’.
(c) ANESTHESIA
SERVICES
(SECTION
4103 OF
OBRA–1990).—(1) Section 4103(a) of OBRA–1990 is
amended by striking ‘‘REDUCTION IN FEE SCHEDULE’’
and inserting ‘‘REDUCTION IN PREVAILING CHARGES’’.
(2) 
Section 
1842(q)(1)(B) 
(42 
U.S.C.
1395u(q)(1)(B)) is amended—
(A) in the matter before clause (i), by striking
‘‘shall be determined as follows:’’ and inserting
‘‘shall, subject to clause (iv), be reduced to the ad-
934
justed prevailing charge conversion factor for the lo-
cality determined as follows:’’, and
(B) in clause (iii), by striking ‘‘Subject to
clause (iv), the prevailing charge conversion factor to
be applied in’’ and inserting ‘‘The adjusted prevail-
ing charge conversion factor for’’.
(d) ASSISTANTS AT SURGERY (SECTION 4107 OF
OBRA–1990).—(1) Section 4107(c) of OBRA–1990 is
amended by inserting ‘‘(a)(1)’’ after ‘‘subsection’’.
(2) Section 4107(a)(2) of OBRA–1990 is amended
by adding at the end the following: ‘‘In applying section
1848(g)(2)(D) of the Social Security Act for services of
an assistant-at-surgery furnished during 1991, the recog-
nized payment amount shall not exceed the maximum
amount specified under section 1848(i)(2)(A) of such Act
(as applied under this paragraph in such year).’’.
(e) TECHNICAL COMPONENTS OF DIAGNOSTIC SERV-
ICES (SECTION 4108 OF OBRA–1990).—Section 1842(b)
(42 U.S.C. 1395u(b)) is amended by redesignating para-
graph (18), as added by section 4108(a) of OBRA–1990,
as paragraph (17) and, in such paragraph, by inserting
‘‘, tests specified in paragraph (14)(C)(i),’’ after ‘‘diag-
nostic laboratory tests’’.
935
(f) RECIPROCAL BILLING ARRANGEMENTS (SECTION
4110 
OF
OBRA–1990).—Section 1842(b)(6)(D) (42
U.S.C. 1395u(b)(6)(D)) is amended—
(1) by striking ‘‘visit services (including emer-
gency visits and related services)’’ and inserting
‘‘physicians’ services (and services furnished incident
to such services)’’;
(2) by striking ‘‘on an occasional, reciprocal
basis’’ and inserting ‘‘under an arrangement that is
informal and reciprocal or involves per diem or other
fee-for-time compensation for services’’;
(3) by striking ‘‘visit’’ in subclauses (i), (ii),
and (iv); and
(4) in subclause (iii), by striking ‘‘the claim’’
and all that follows through the comma at the end
and inserting ‘‘the claim meets the requirements of
this clause for payment to the first physician’’.
(g) STUDY OF AGGREGATION RULE FOR CLAIMS OF
SIMILAR
PHYSICIAN
SERVICES
(SECTION
4113 
OF
OBRA–1990).—Section 4113 of OBRA–1990 is amend-
ed—
(1) by inserting ‘‘of the Social Security Act’’
after ‘‘1869(b)(2)’’; and
(2) by striking ‘‘December 31, 1992’’ and in-
serting ‘‘December 31, 1993’’.
936
(h) STATEWIDE FEE SCHEDULES (SECTION 4117 OF
OBRA–1990).—Section 4117 of OBRA–1990 is amend-
ed—
(1) in subsection (a)—
(A) by striking ‘‘IN GENERAL.—’’, and
(B) by striking ‘‘, if the’’ and all that fol-
lows through ‘‘1991, ’’; and
(2) by striking subsections (b), (c), and (d).
(i) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—(1) The heading of section 1834(f) (42
U.S.C. 1395m(f)) is amended by striking ‘‘FISCAL YEAR’’.
(2)(A) Section 4105(b) of OBRA–1990 is amended—
(i) in paragraph (2), by striking ‘‘amendments’’
and inserting ‘‘amendment’’, and
(ii) in paragraph (3), by striking ‘‘amendments
made by paragraphs (1) and (2)’’ and inserting
‘‘amendment made by paragraph (1)’’.
(B) Section 1848(f)(2)(C) (42 U.S.C. 1395w–
4(f)(2)(C)) is amended by inserting ‘‘PERFORMANCE
STANDARD
RATES
OF
INCREASE
FOR
FISCAL
YEAR
1991.—’’ after ‘‘(C)’’.
(C) Section 4105(d) of OBRA–1990 is amended by
inserting ‘‘PUBLICATION OF PERFORMANCE STANDARD
RATES.—’’ after ‘‘(d)’’.
937
(3) 
Section 
1842(b)(4)(F) 
(42 
U.S.C.
1395u(b)(4)(F)) is amended—
(A) in clause (i), by striking ‘‘prevailing
charge’’ the first place it appears and inserting
‘‘customary charge’’; and
(B) in clause (ii)(III), by striking ‘‘second,
third, and fourth’’ and inserting ‘‘first, second, and
third’’.
(4) 
Section 
1842(b)(4)(F)(ii)(I) 
(42 
U.S.C.
1395u(b)(4)(F)(ii)(I)) is amended by striking ‘‘respiratory
therapist,’’.
(5) Section 4106(c) of OBRA–1990 is amended by
inserting 
‘‘of 
the 
Social 
Security 
Act’’ 
after
‘‘1848(d)(1)(B)’’.
(6) Section 4114 of OBRA–1990 is amended by
striking ‘‘patients’’ the second place it appears.
(7) Section 1848(e)(1)(C) (42 U.S.C. 1395w–
4(e)(1)(C)) is amended by inserting ‘‘date of the’’ after
‘‘since the’’.
(8) Section 4118(f)(1)(D) of OBRA–1990 is amend-
ed by striking ‘‘is amended’’.
(9) Section 4118(f)(1)(N)(ii) of OBRA–1990 is
amended by striking ‘‘subsection (f)(5)(A)’’ and inserting
‘‘subsection (f)(5)(A))’’.
938
(10) Section 1845(e) (42 U.S.C. 1395w–1(e)) is
amended—
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3), (4), and
(5) as paragraphs (2), (3), and (4).
(11) Section 4118(j)(2) of OBRA–1990 is amended
by striking ‘‘In section’’ and inserting ‘‘Section’’.
(12)(A) Section 1848(i)(3) (42 U.S.C. 1395w–
4(i)(3)) is amended by striking the space before the period
at the end.
(B) 
Section 
1834(a)(10)(B) 
(42 
U.S.C.
1395m(a)(10)(B)) is amended—
(i) by striking ‘‘apply to’’ and inserting ‘‘would
otherwise apply to’’, and
(ii) by inserting before the period at the end
‘‘but for the application of section 1848(i)(3)’’.
(j) EFFECTIVE DATE.—The amendments made by
this section and the provisions of this section shall take
effect as if included in the enactment of OBRA–1990.
Subchapter C—Ambulatory Surgical Center
Services
SEC. 13451. DESIGNATION OF CERTAIN HOSPITALS AS EYE
OR EYE AND EAR HOSPITALS.
(a) IN
GENERAL.—Section 1833(i) (42 U.S.C.
1395l(i)) is amended—
939
(1) in subparagraph (B)(ii)—
(A) by striking ‘‘the last sentence of this
clause’’ and inserting ‘‘paragraph (4)’’, and
(B) by striking the last sentence; and
(2) by inserting after paragraph (3) the follow-
ing new paragraph:
‘‘(4)(A) In the case of a hospital that—
‘‘(i) makes application to the Secretary and
demonstrates that it specializes in eye services or eye
and ear services (as determined by the Secretary),
‘‘(ii) receives more than 30 percent of its total
revenues from outpatient services, and
‘‘(iii) on October 1, 1987—
‘‘(I) was an eye specialty hospital or an eye
and ear specialty hospital, or
‘‘(II) was operated as an eye or eye and
ear unit (as defined in subparagraph (B)) of a
general acute care hospital which, on the date
of the application described in clause (i), oper-
ates less than 20 percent of the beds that the
hospital operated on October 1, 1987, and has
sold or otherwise disposed of a substantial por-
tion of the hospital’s other acute care oper-
ations,
940
the cost proportion and ASC proportion in effect under
subclauses (I) and (II) of paragraph (2)(B)(ii) for cost
reporting periods beginning in fiscal year 1988 shall re-
main in effect for cost reporting periods beginning on or
after October 1, 1988, and before January 1, 1995.
‘‘(B) For purposes of this subparagraph (A)(iii)(II),
the term ‘eye or eye and ear unit’ means a physically sepa-
rate or distinct unit containing separate surgical suites de-
voted solely to eye or eye and ear services.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to portions of cost reporting
periods beginning on or after January 1, 1994.
SEC. 13452. TREATMENT OF INTRAOCULAR LENSES.
(a) EXTENSION OF CAP ON PAYMENTS THROUGH
1994.—
(1) 
IN
GENERAL.—Section 
4151(c)(3) 
of
OBRA–1990 is amended by striking ‘‘December 31,
1992’’ and inserting ‘‘December 31, 1994’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) this subsection shall be effective as
if included in the enactment of OBRA–1990.
(b) STUDY OF COSTS OF INTRAOCULAR LENSES.—
(1) STUDY.—The Secretary of Health and
Human Services shall conduct a study, based on re-
cent data, of the acquisition costs to providers of
941
intraocular lenses provided to individuals enrolled
under part B of the medicare program and shall in-
clude in the study an analysis of the impact of the
availability of new technology lenses on such costs.
(2) REPORT.—Not later than 1 year after the
date of the enactment of this Act, the Secretary
shall submit a report on the study conducted under
paragraph (1) to the Committee on Finance of the
Senate and the Committees on Ways and Means and
Energy and Commerce of the House of Representa-
tives, and shall include in the report any rec-
ommendations the Secretary considers appropriate
regarding the determination of payment amounts for
intraocular lenses under part B of the medicare
program.
SEC. 13453. TECHNICAL AMENDMENTS.
(a) PAYMENT AMOUNTS FOR SERVICES FURNISHED
IN AMBULATORY SURGICAL CENTERS.—
(1) USE OF SURVEY TO DETERMINE INCURRED
COSTS.—Section 
1833(i)(2)(A)(i) 
(42 
U.S.C.
1395l(i)(2)(A)(i)) is amended by striking the comma
at the end and inserting the following: ‘‘, as deter-
mined in accordance with a survey (based upon a
representative sample of procedures and facilities)
taken not later than January 1, 1994, and every 5
943
(b) ADJUSTMENTS TO PAYMENT AMOUNTS FOR NEW
TECHNOLOGY INTRAOCULAR LENSES.—
(1) ESTABLISHMENT OF PROCESS FOR REVIEW
OF AMOUNTS.—Not later than 1 year after the date
of the enactment of this Act, the Secretary of
Health and Human Services (in this subsection re-
ferred to as the ‘‘Secretary’’) shall develop and im-
plement a process under which interested parties
may request review by the Secretary of the appro-
priateness of the reimbursement amount provided
under section 1833(i)(2)(A)(iii) of the Social Secu-
rity Act with respect to a class of new technology
intraocular lenses. For purposes of the preceding
sentence, an intraocular lens may not be treated as
a new technology lens unless it has been approved
by the Food and Drug Administration.
(2) FACTORS
CONSIDERED.—In determining
whether to provide an adjustment of payment with
respect to a particular lens under paragraph (1), the
Secretary shall take into account whether use of the
lens is likely to result in reduced risk of
intraoperative or postoperative complication or trau-
ma, accelerated postoperative recovery, reduced in-
duced astigmatism, improved postoperative visual
944
acuity, more stable postoperative vision, or other
comparable clinical advantages.
(3) NOTICE
AND
COMMENT.—The Secretary
shall publish notice in the Federal Register from
time to time (but no less often than once each year)
of a list of the requests that the Secretary has re-
ceived for review under this subsection, and shall
provide for a 30-day comment period on the lenses
that are the subjects of the requests contained in
such notice. The Secretary shall publish a notice of
his determinations with respect to intraocular lenses
listed in the notice within 90 days after the close of
the comment period.
(4) EFFECTIVE DATE OF ADJUSTMENT.—Any
adjustment of a payment amount (or payment limit)
made under this subsection shall become effective
not later than 30 days after the date on which the
notice with respect to the adjustment is published
under paragraph (3).
(c) TECHNICAL CORRECTION RELATING TO BLEND
AMOUNTS FOR AMBULATORY SURGICAL CENTER PAY-
MENTS.—
(1) IN GENERAL.—Subclauses (I) and (II) of
section 
1833(i)(3)(B)(ii) 
(42 
U.S.C.
1395l(i)(3)(B)(ii)) are each amended—
945
(A) by striking ‘‘for reporting’’ and insert-
ing ‘‘for portions of cost reporting’’; and
(B) by striking ‘‘and on or before’’ and in-
serting ‘‘and ending on or before’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall take effect as if included in
the enactment of OBRA–1990.
(d) TECHNICAL CORRECTION RELATED TO CATA-
RACT SURGERY.—Effective as if included in the enact-
ment of OBRA–1990, section 4151(c)(3) of such Act is
amended by striking ‘‘for the insertion of an intraocular
lens’’ and inserting ‘‘for an intraocular lens inserted’’.
Subchapter D—Durable Medical Equipment
SEC. 13461. CERTIFICATION OF SUPPLIERS.
(a) REQUIREMENTS.—
(1) IN
GENERAL.—Section 1834 (42 U.S.C.
1395m) is amended by adding at the end the follow-
ing new subsection:
‘‘(i) REQUIREMENTS FOR SUPPLIERS OF MEDICAL
EQUIPMENT AND SUPPLIES.—
‘‘(1) ISSUANCE
AND
RENEWAL
OF
SUPPLIER
NUMBER.—
‘‘(A) PAYMENT.—Except as provided in
subparagraph (C), no payment may be made
under this part after October 1, 1993, for items
946
furnished by a supplier of medical equipment
and supplies unless such supplier obtains (and
renews at such intervals as the Secretary may
require) a supplier number.
‘‘(B) STANDARDS FOR POSSESSING A SUP-
PLIER NUMBER.—A supplier may not obtain a
supplier number unless—
‘‘(i) for medical equipment and sup-
plies furnished on or after October 1,
1993, and on or before December 31,
1994, the supplier meets standards pre-
scribed by the Secretary; and
‘‘(ii) for medical equipment and sup-
plies furnished on or after January 1,
1995, the supplier meets revised standards
prescribed by the Secretary (in consulta-
tion with representatives of suppliers of
medical equipment and supplies, carriers,
and consumers) that shall include require-
ments that the supplier—
‘‘(I) comply with all applicable
State and Federal licensure and regu-
latory requirements;
‘‘(II) maintain a physical facility
on an appropriate site;
947
‘‘(III) have proof of appropriate
liability insurance; and
‘‘(IV) meet such other require-
ments as the Secretary may specify.
‘‘(C) EXCEPTION FOR ITEMS FURNISHED
AS
INCIDENT
TO
A
PHYSICIAN’S
SERVICE.—
Subparagraph (A) shall not apply with respect
to medical equipment and supplies furnished as
an incident to a physician’s service.
‘‘(D) PROHIBITION
AGAINST
MULTIPLE
SUPPLIER NUMBERS.—The Secretary may not
issue more than one supplier number to any
supplier of medical equipment and supplies un-
less the issuance of more than one number is
appropriate to identify subsidiary or regional
entities under the supplier’s ownership or con-
trol.
‘‘(E) PROHIBITION AGAINST DELEGATION
OF
SUPPLIER
DETERMINATIONS.—The Sec-
retary may not delegate (other than by contract
under section 1842) the responsibility to deter-
mine whether suppliers meet the standards nec-
essary to obtain a supplier number.
‘‘(2) CERTIFICATES OF MEDICAL NECESSITY.—
948
‘‘(A) STANDARDIZED CERTIFICATES.—Not
later than October 1, 1993, the Secretary shall,
in consultation with carriers under this part,
develop one or more standardized certificates of
medical necessity (as defined in subparagraph
(C)) for medical equipment and supplies for
which the Secretary determines that such a cer-
tificate is necessary.
‘‘(B) PROHIBITION AGAINST DISTRIBUTION
BY SUPPLIERS OF CERTIFICATES OF MEDICAL
NECESSITY.—
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), a supplier of medical
equipment and supplies may not distribute
to physicians or to individuals entitled to
benefits under this part for commercial
purposes any completed or partially com-
pleted certificates of medical necessity on
or after October 1, 1993.
‘‘(ii) EXCEPTION FOR CERTAIN BILL-
ING
INFORMATION.—Clause (i) shall not
apply with respect to a certificate of medi-
cal necessity for any item that is not con-
tained on the list of potentially overused
items developed by the Secretary under
949
subsection (a)(15)(A) to the extent that
such certificate contains only information
completed by the supplier of medical equip-
ment and supplies identifying such supplier
and the beneficiary to whom such medical
equipment and supplies are furnished, a
description of such medical equipment and
supplies, any product code identifying such
medical equipment and supplies, and any
other administrative information (other
than information relating to the bene-
ficiary’s medical condition) identified by
the Secretary. In the event a supplier pro-
vides a certificate of medical necessity con-
taining information permitted under this
clause, such certificate shall also contain
the fee schedule amount and the supplier’s
charge for the medical equipment or sup-
plies being furnished prior to distribution
of such certificate to the physician.
‘‘(iii) PENALTY.—Any supplier of
medical equipment and supplies who know-
ingly and willfully distributes a certificate
of medical necessity in violation of clause
(i) is subject to a civil money penalty in an
950
amount not to exceed $1,000 for each such
certificate of medical necessity so distrib-
uted. The provisions of section 1128A
(other than subsections (a) and (b)) shall
apply to civil money penalties under this
subparagraph in the same manner as they
apply to a penalty or proceeding under sec-
tion 1128A(a).
‘‘(C) DEFINITION.—For purposes of this
paragraph, the term ‘certificate of medical ne-
cessity’ means a form or other document con-
taining information required by the Secretary to
be submitted to show that a covered item is
reasonable and necessary for the diagnosis or
treatment of illness or injury or to improve the
functioning of a malformed body member.
‘‘(3) COVERAGE AND REVIEW CRITERIA.—
‘‘(A) DEVELOPMENT
AND
ESTABLISH-
MENT.—Not later than January 1, 1995, the
Secretary, in consultation with representatives
of suppliers of medical equipment and supplies,
individuals enrolled under this part, and appro-
priate medical specialty societies, shall develop
and establish uniform national coverage and
utilization review criteria for 200 items of medi-
951
cal equipment and supplies selected in accord-
ance with the standards described in subpara-
graph (B). The Secretary shall publish the cri-
teria as part of the instructions provided to fis-
cal intermediaries and carriers under this part
and no further publication, including publica-
tion in the Federal Register, shall be required.
‘‘(B) STANDARDS FOR SELECTING ITEMS
SUBJECT TO CRITERIA.—The Secretary may se-
lect an item for coverage under the criteria de-
veloped and established under subparagraph
(A) if the Secretary finds that—
‘‘(i) the item is frequently purchased
or rented by beneficiaries;
‘‘(ii) the item is frequently subject to
a determination that such item is not
medically necessary; or
‘‘(iii) the coverage or utilization cri-
teria applied to the item (as of the date of
the enactment of this subsection) is not
consistent among carriers.
‘‘(C) ANNUAL REVIEW AND EXPANSION OF
ITEMS SUBJECT TO CRITERIA.—The Secretary
shall annually review the coverage and utiliza-
tion of items of medical equipment and supplies
952
to determine whether items not included among
the items selected under subparagraph (A)
should be made subject to uniform national cov-
erage and utilization review criteria, and, if ap-
propriate, shall develop and apply such criteria
to such additional items.
‘‘(4) DEFINITION.—The term ‘medical equip-
ment and supplies’’ means—
‘‘(A) durable medical equipment (as de-
fined in section 1861(n));
‘‘(B) prosthetic devices (as described in
section 1861(s)(8));
‘‘(C) orthotics and prosthetics (as de-
scribed in section 1861(s)(9));
‘‘(D) surgical dressings (as described in
section 1861(s)(5));
‘‘(E) such other items as the Secretary
may determine; and
‘‘(F) for purposes of paragraphs (1) and
(3)—
‘‘(i) home dialysis supplies and equip-
ment 
(as 
described 
in 
section
1861(s)(2)(F)), and
‘‘(ii) immunosuppressive drugs (as de-
scribed in section 1861(s)(2)(J)).’’.
953
(2) CONFORMING AMENDMENT.—Effective October
1, 1993, paragraph (16) of section 1834(a) (42 U.S.C.
1395m(a)) is repealed.
(b) REPORT ON EFFECT OF UNIFORM CRITERIA ON
UTILIZATION OF ITEMS.—Not later than July 1, 1995,
the Secretary shall submit a report to the Committee on
Ways and Means and the Committee on Energy and Com-
merce of the House of Representatives and the Committee
on Finance of the Senate analyzing the impact of the uni-
form criteria established under section 1834(i)(3)(A) of
the Social Security Act (as added by subsection (a)) on
the utilization of items of medical equipment and supplies
by individuals enrolled under part B of the medicare pro-
gram.
(c) USE OF COVERED ITEMS BY DISABLED BENE-
FICIARIES.—
(1) IN GENERAL.—The Secretary of Health and
Human Services in consultation with representatives
of suppliers of durable medical equipment under
part B of the medicare program and individuals en-
titled to benefits under such program on the basis
of disability, shall conduct a study of the effects of
the methodology for determining payments for items
of such equipment under such part on the ability of
954
such individuals to obtain items of such equipment,
including customized items.
(2) REPORT.—Not later than May 1, 1994, the
Secretary shall submit a report to Congress on the
study conducted under paragraph (1), and shall in-
clude in the report such recommendations as the
Secretary considers appropriate to assure that dis-
abled medicare beneficiaries have access to items of
durable medical equipment.
(d) CRITERIA FOR TREATMENT OF ITEMS AS PROS-
THETICS DEVICES OR ORTHOTICS AND PROSTHETICS.—
Not later than July 1, 1994, the Secretary of Health and
Human Services shall submit a report to the Committees
on Ways and Means and Energy and Commerce of the
House of Representatives and the Committee on Finance
of the Senate describing prosthetic devices or orthotics
and prosthetics covered under part B of the medicare pro-
gram that do not require individualized or custom fitting
and adjustment to be used by a patient. Such report shall
include recommendations for an appropriate methodology
for determining the amount of payment for such items
under such program.
955
SEC. 13462. PROHIBITION AGAINST CARRIER FORUM SHOP-
PING.
(a) IN GENERAL.—Section 1834(a)(12) (42 U.S.C.
1395m(a)(12)) is amended to read as follows:
‘‘(12) 
USE
OF
CARRIERS
TO
PROCESS
CLAIMS.—
‘‘(A) DESIGNATION
OF
REGIONAL
CAR-
RIERS.—The Secretary may designate, by regu-
lation under section 1842, one carrier for one
or more entire regions to process all claims
within the region for covered items under this
section.
‘‘(B) 
PROHIBITION
AGAINST
CARRIER
SHOPPING.—(i) No supplier of a covered item
may present or cause to be presented a claim
for payment under this part unless such claim
is presented to the appropriate regional carrier
(as designated by the Secretary).
‘‘(ii) For purposes of clause (i), the term
‘appropriate regional carrier’ means the carrier
having jurisdiction over the geographic area
that includes the permanent residence of the
patient to whom the item is furnished.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to items furnished on or after
October 1, 1993.
956
(c) CLARIFICATION OF AUTHORITY TO DESIGNATE
CARRIERS FOR OTHER ITEMS AND SERVICES.—Nothing
in this subsection or the amendment made by this sub-
section may be construed to restrict the authority of the
Secretary of Health and Human Services to designate re-
gional carriers or modify claims jurisdiction rules with re-
spect to items or services under part B of the medicare
program that are not covered items under section 1834(a)
of the Social Security Act or prosthetic devices or orthotics
and prosthetics under section 1834(h) of such Act.
SEC. 13463. RESTRICTIONS ON CERTAIN MARKETING AND
SALES ACTIVITIES.
(a) PROHIBITING UNSOLICITED TELEPHONE CON-
TACTS FROM SUPPLIERS OF DURABLE MEDICAL EQUIP-
MENT TO MEDICARE BENEFICIARIES.—
(1) IN GENERAL.—Section 1834(a) (42 U.S.C.
1395m(a)) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(17) PROHIBITION
AGAINST
UNSOLICITED
TELEPHONE CONTACTS BY SUPPLIERS.—
‘‘(A) IN GENERAL.—A supplier of a cov-
ered item under this subsection may not contact
an individual enrolled under this part by tele-
phone regarding the furnishing of a covered
item to the individual (other than a covered
957
item the supplier has already furnished to the
individual) unless—
‘‘(i) the individual gives permission to
the supplier to make contact by telephone
for such purpose; or
‘‘(ii) the supplier has furnished a cov-
ered item under this subsection to the indi-
vidual during the 15-month period preced-
ing the date on which the supplier contacts
the individual for such purpose.
‘‘(B) PROHIBITING PAYMENT FOR ITEMS
FURNISHED
SUBSEQUENT
TO
UNSOLICITED
CONTACTS.—If a supplier knowingly contacts
an individual in violation of subparagraph (A),
no payment may be made under this part for
any item subsequently furnished to the individ-
ual by the supplier.
‘‘(C) EXCLUSION
FROM
PROGRAM
FOR
SUPPLIERS ENGAGING IN PATTERN OF UNSO-
LICITED
CONTACTS.—If a supplier knowingly
contacts individuals in violation of subpara-
graph (A) to such an extent that the supplier’s
conduct establishes a pattern of contacts in vio-
lation of such subparagraph, the Secretary shall
exclude the supplier from participation in the
958
programs under this Act, in accordance with
the procedures set forth in subsections (c), (f),
and (g) of section 1128.’’.
(2) REQUIRING
REFUND
OF
AMOUNTS
COL-
LECTED FOR DISALLOWED ITEMS.—Section 1834(a)
(42 U.S.C. 1395m(a)), as amended by paragraph
(1), is amended by adding at the end the following
new paragraph:
‘‘(18) REFUND OF AMOUNTS COLLECTED FOR
CERTAIN DISALLOWED ITEMS.—
‘‘(A) IN GENERAL.—If a nonparticipating
supplier furnishes to an individual enrolled
under this part a covered item for which no
payment may be made under this part by rea-
son of paragraph (17)(B), the supplier shall re-
fund on a timely basis to the patient (and shall
be liable to the patient for) any amounts col-
lected from the patient for the item, unless—
‘‘(i) the supplier establishes that the
supplier did not know and could not rea-
sonably have been expected to know that
payment may not be made for the item by
reason of paragraph (17)(B), or
‘‘(ii) before the item was furnished,
the patient was informed that payment
959
under this part may not be made for that
item and the patient has agreed to pay for
that item.
‘‘(B) SANCTIONS.—If a supplier knowingly
and willfully fails to make refunds in violation
of subparagraph (A), the Secretary may apply
sanctions against the supplier in accordance
with section 1842(j)(2).
‘‘(C) NOTICE.—Each carrier with a con-
tract in effect under this part with respect to
suppliers of covered items shall send any notice
of denial of payment for covered items by rea-
son of paragraph (17)(B) and for which pay-
ment is not requested on an assignment-related
basis to the supplier and the patient involved.
‘‘(D) TIMELY BASIS DEFINED.—A refund
under subparagraph (A) is considered to be on
a timely basis only if—
‘‘(i) in the case of a supplier who does
not request reconsideration or seek appeal
on a timely basis, the refund is made with-
in 30 days after the date the supplier re-
ceives a denial notice under subparagraph
(C), or
960
‘‘(ii) in the case in which such a re-
consideration or appeal is taken, the re-
fund is made within 15 days after the date
the supplier receives notice of an adverse
determination on reconsideration or ap-
peal.’’.
(b) CONFORMING AMENDMENT.—Section 1834(h)(3)
(42 U.S.C. 1395m(h)(3)) is amended by striking ‘‘Para-
graph (12)’’ and inserting ‘‘Paragraphs (12) and (17)’’.
(c) EFFECTIVE DATE.—The amendments made by
subsections (a) and (b) shall apply to items furnished after
the expiration of the 60-day period that begins on the date
of the enactment of this Act.
SEC. 13464. ANTI-KICKBACK CLARIFICATION.
(a) IN
GENERAL.—Section 1128B(b)(3)(B) (42
U.S.C. 1320a–7b(b)(3)(B)) is amended by inserting be-
fore the semicolon ‘‘(except that in the case of a contract
supply arrangement between any entity and a supplier of
medical supplies and equipment (as defined in section
1834(i)(4), but not including items described in subpara-
graph (F) of such section), such employment shall not be
considered bona fide to the extent that it includes tasks
of a clerical and cataloging nature in transmitting to sup-
pliers assignment rights of individuals eligible for benefits
961
under part B of title XVIII, or performance of
warehousing or stock inventory functions)’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply with respect to services fur-
nished on or after the first day of the first month that
begins after the expiration of the 60-day period beginning
on the date of the enactment of this Act.
SEC. 13465. LIMITATIONS ON BENEFICIARY LIABILITY FOR
NONCOVERED SERVICES.
(a) IN
GENERAL.—Section 1834(i) (42 U.S.C.
1395m(i)), as added by section 13461(a)(1), is amended—
(1) by redesignating paragraph (4) as para-
graph (5), and
(2) by inserting after paragraph (3) the follow-
ing new paragraph:
‘‘(4) LIMITATION ON PATIENT LIABILITY.—If a
supplier of medical equipment and supplies (as de-
fined in paragraph (5))—
‘‘(A) furnishes an item or service to a ben-
eficiary for which no payment may be made by
reason of paragraph (1);
‘‘(B) furnishes an item or service to a ben-
eficiary for which payment is denied in advance
under subsection (a)(15); or
962
‘‘(C) furnishes an item or service to a ben-
eficiary for which payment is denied under sec-
tion 1862(a)(1);
any expenses incurred for items and services fur-
nished to an individual by such a supplier not on an
assigned basis shall be the responsibility of such
supplier. The individual shall have no financial re-
sponsibility for such expenses and the supplier shall
refund on a timely basis to the individual (and shall
be liable to the individual for) any amounts collected
from the individual for such items or services. The
provisions of subsection (a)(18) shall apply to re-
funds required under the previous sentence in the
same manner as such provisions apply to refunds
under such subsection.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1128B(b)(3)(B) (42 U.S.C. 1320a–7b(b)(3)(B)), as
amended by section 13464(a), is amended by strik-
ing ‘‘1834(i)(4)’’ and inserting ‘‘1834(i)(5)’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to items or services furnished
on or after October 1, 1993.
963
SEC. 13466. ADJUSTMENTS FOR INHERENT REASONABLE-
NESS.
(a) ADJUSTMENTS
MADE
TO
FINAL
PAYMENT
AMOUNTS.—
(1) IN GENERAL.—Section 1834(a)(10)(B) (42
U.S.C. 1395m(a)(10)(B)) is amended by adding at
the end the following: ‘‘In applying such provisions
to payments for an item under this subsection, the
Secretary shall make adjustments to the payment
basis for the item described in paragraph (1)(B) if
the Secretary determines (in accordance with such
provisions and on the basis of prices and costs appli-
cable at the time the item is furnished) that such
payment basis is not inherently reasonable.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect on the date of the
enactment of this Act.
(b) ADJUSTMENT REQUIRED FOR CERTAIN ITEMS.—
(1) IN GENERAL.—In accordance with section
1834(a)(10)(B) of the Social Security Act (as
amended by subsection (a)), the Secretary of Health
and Human Services shall determine whether the
payment amounts for the items described in para-
graph (2) are not inherently reasonable, and shall
adjust such amounts in accordance with such section
if the amounts are not inherently reasonable.
964
(2) ITEMS DESCRIBED.—The items referred to
in paragraph (1) are decubitus care equipment,
transcutaneous electrical nerve stimulators, and any
other items considered appropriate by the Secretary.
SEC. 13467. TREATMENT OF NEBULIZERS AND ASPIRATORS.
(a) IN GENERAL.—Section 1834(a)(3)(A) (42 U.S.C.
1395m(a)(3)(A)) is amended by striking ‘‘ventilators, as-
pirators, IPPB machines, and nebulizers’’ and inserting
‘‘ventilators and IPPB machines’’.
(b) PAYMENT
FOR
ACCESSORIES
RELATING
TO
NEBULIZERS AND ASPIRATORS.—Section 1834(a)(2)(A)
(42 U.S.C. 1395m(a)) is amended—
(1) by striking ‘‘or’’ at the end of clause (i),
(2) by adding ‘‘or’’ at the end of clause (ii), and
(3) by inserting after clause (ii) the following
new clause:
‘‘(iii) which is an accessory used in
conjunction with a nebulizer or aspirator,’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to items furnished on or after Jan-
uary 1, 1994.
SEC. 13468. PAYMENT FOR OSTOMY SUPPLIES AND OTHER
SUPPLIES.
(a) OSTOMY SUPPLIES, TRACHEOSTOMY SUPPLIES,
AND UROLOGICALS.—
965
(1) IN
GENERAL.—Section 1834(h)(1) (42
U.S.C. 1395m(h)(1)) is amended by adding at the
end the following new subparagraph:
‘‘(E) EXCEPTION FOR CERTAIN ITEMS.—
Payment for ostomy supplies, tracheostomy
supplies, and urologicals shall be made in ac-
cordance with subparagraphs (B) and (C) of
section 1834(a)(2).’’.
(2) 
CONFORMING
AMENDMENT.—Section
1834(h)(1)(B) (42 U.S.C. 1395m(h)(1)(B)) is
amended by striking ‘‘subparagraph (C),’’ and in-
serting ‘‘subparagraphs (C) and (E),’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to items furnished on
or after January 1, 1994.
(b) SURGICAL DRESSINGS.—
(1) IN
GENERAL.—Section 1834 (42 U.S.C.
1395m), as amended by section 13461(a), is amend-
ed by adding at the end the following new sub-
section:
‘‘(j) PAYMENT FOR SURGICAL DRESSINGS.—
‘‘(1) IN GENERAL.—Payment under this sub-
section for surgical dressings (described in section
1861(s)(5)) shall be made in a lump sum amount
966
for the purchase of the item in an amount equal to
80 percent of the lesser of—
‘‘(A) the actual charge for the item; or
‘‘(B) a payment amount determined in ac-
cordance with the methodology described in
subparagraphs (B) and (C) of subsection (a)(2)
(except that in applying such methodology, the
national limited payment amount referred to in
such subparagraphs shall be initially computed
based on local payment amounts using average
reasonable charges for the 12-month period
ending December 31, 1992, increased by the
covered item updates described in such sub-
section for 1993 and 1994).
‘‘(2) EXCEPTIONS.—Paragraph (1) shall not
apply to surgical dressings that are—
‘‘(A) furnished as an incident to a physi-
cian’s professional service; or
‘‘(B) furnished by a home health agency.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1833(a)(1) (42 U.S.C. 1395l(a)(1)), as amended by
sections 13478(e)(2) and 13445(e)(1), is amended—
(A) by striking ‘‘and’’ before ‘‘(P)’’, and
(B) by inserting before the semicolon at
the end the following: ‘‘, and (Q) with respect
967
to surgical dressings, the amounts paid shall be
the 
amounts 
determined 
under 
section
1834(j);’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to items furnished on
or after January 1, 1994.
(c) REDUCTION
IN PAYMENTS
FOR TENS DE-
VICES.—
(1) IN GENERAL.—Section 1834(a)(1)(D) (42
U.S.C. 1395m(a)(1)(D)) is amended by striking ‘‘15
percent’’ the second place it appears and inserting
‘‘45 percent’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to items furnished on
or after January 1, 1994.
SEC. 13469. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) UPDATES
TO PAYMENT AMOUNTS.—Subpara-
graph 
(A) 
of 
section 
1834(a)(14) 
(42 
U.S.C.
1395m(a)(14)) is amended to read as follows:
‘‘(A) for 1991 and 1992, the percentage
increase in the consumer price index for all
urban consumers (U.S. city average) for the 12-
month period ending with June of the previous
year reduced by 1 percentage point; and’’.
968
(b) TREATMENT OF POTENTIALLY OVERUSED ITEMS
AND ADVANCED DETERMINATIONS OF COVERAGE.—
(1) IN GENERAL.—Effective on the date of the
enactment of this Act, section 1834(a)(15) (42
U.S.C. 1395m(a)(15)) is amended to read as
follows:
‘‘(15) SPECIAL TREATMENT FOR POTENTIALLY
OVERUSED ITEMS.—
‘‘(A) DEVELOPMENT OF LIST OF ITEMS BY
SECRETARY.—The Secretary shall develop and
periodically update a list of items for which
payment may be made under this subsection
that are potentially overused, and shall include
in such list seat-lift mechanisms, transcutane-
ous electrical nerve stimulators, motorized
scooters, decubitus care mattresses, and any
such other item determined by the Secretary to
be potentially overused on the basis of any of
the following criteria—
‘‘(i) the item is marketed directly to
potential patients;
‘‘(ii) the item is marketed with an
offer to potential patients to waive the
costs of coinsurance associated with the
item or is marketed as being available at
969
no cost to policyholders of a medicare sup-
plemental policy (as defined in section
1882(g)(1));
‘‘(iii) the item has been subject to a
consistent pattern of overutilization; or
‘‘(iv) a high proportion of claims for
payment for such item under this part may
not be made because of the application of
section 1862(a)(1).
‘‘(B) ITEMS SUBJECT TO SPECIAL CARRIER
SCRUTINY.—Payment may not be made under
this part for any item contained in the list de-
veloped by the Secretary under subparagraph
(A) unless the carrier has subjected the claim
for payment for the item to special scrutiny or
has followed the procedures described in para-
graph (11)(C) with respect to the item.’’.
(2) ADVANCE DETERMINATION BY CARRIERS.—
Effective January 1, 1994, section 1834(a)(11) (42
U.S.C. 1395m(a)) is amended by adding at the end
the following new subparagraph:
‘‘(C) CARRIER DETERMINATIONS FOR CER-
TAIN ITEMS IN ADVANCE.—A carrier shall de-
termine in advance whether payment for an
item may not be made under this subsection be-
970
cause of the application of section 1862(a)(1)
if—
‘‘(i) the item is a customized item
(other than inexpensive items specified by
the Secretary); or
‘‘(ii) the item is a specified covered
item under subparagraph (B).’’.
(3) INCLUSION
IN
CARRIER
PERFORMANCE
EVALUATIONS.—Effective for standards applied for
contract years beginning after the date of the enact-
ment of this Act, section 1842(c) (42 U.S.C.
1395u(c)), as amended by section 13448(a), is
amended by adding at the end the following new
paragraph:
‘‘(5) Each contract under this section which provides
for the disbursement of funds, as described in subsection
(a)(1)(B), shall require the carrier to meet criteria devel-
oped by the Secretary to measure the timeliness of carrier
responses to requests for payment of items described in
section 1834(a)(11)(C).’’.
(4) APPLICATION TO PROSTHETIC DEVICES AND
ORTHOTICS AND PROSTHETICS.—Section 1834(h)(3)
(42 U.S.C. 1395m(h)(3)) is amended by striking
‘‘paragraph (10) and paragraph (11)’’ and inserting
‘‘paragraphs (10) and (11)’’.
971
(c) STUDY OF VARIATIONS IN DURABLE MEDICAL
EQUIPMENT SUPPLIER COSTS.—
(1) COLLECTION AND ANALYSIS OF SUPPLIER
COST
DATA.—The Administration of the Health
Care Financing Administration shall, in consultation
with appropriate organizations, collect data on sup-
plier costs of durable medical equipment for which
payment may be made under part B of the medicare
program, and shall analyze such data to determine
the proportions of such costs attributable to the
service and product components of furnishing such
equipment and the extent to which such proportions
vary by type of equipment and by the geographic
region in which the supplier is located.
(2) DEVELOPMENT
OF
GEOGRAPHIC
ADJUST-
MENT INDEX; REPORTS.—Not later than January 1,
1995—
(A) the Administrator shall submit a re-
port to the Committees on Energy and Com-
merce and Ways and Means of the House of
Representatives and the Committee on Finance
of the Senate on the data collected and the
analysis conducted under paragraph (1), and
shall include in such report the Administrator’s
recommendations for a geographic cost adjust-
972
ment index for suppliers of durable medical
equipment under the medicare program and an
analysis of the impact of such proposed index
on payments under the medicare program; and
(B) the Comptroller General shall submit a
report to the Committees on Energy and Com-
merce and Ways and Means of the House of
Representatives and the Committee on Finance
of the Senate analyzing on a geographic basis
the supplier costs of durable medical equipment
under the medicare program.
(d) OXYGEN RETESTING.—Section 1834(a)(5)(E)
(42 U.S.C. 1395m(a)(5)(E)) is amended by striking ‘‘55’’
and inserting ‘‘56’’.
(e) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—(1) Section 4152(a)(3) of OBRA–1990
is amended by striking ‘‘amendment made by subsection
(a)’’ and inserting ‘‘amendments made by this sub-
section’’.
(2) Section 4152(c)(2) of OBRA–1990 is amended
by 
striking 
‘‘1395m(a)(7)(A)’’ 
and 
inserting
‘‘1395m(a)(7)’’.
(3) 
Section 
1834(a)(7)(A)(iii)(II) 
(42 
U.S.C.
1395m(a)(7)(A)(iii)(II)) is amended by striking ‘‘clause
(v)’’ and inserting ‘‘clause (vi)’’.
973
(4) 
Section 
1834(a)(7)(C)(i) 
(42 
U.S.C.
1395m(a)(7)(C)(i)) is amended by striking ‘‘or paragraph
(3)’’.
(5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is
amended by striking subparagraph (D).
(6) Section 4153(c)(1) of OBRA–1990 is amended
by striking ‘‘1834(a)’’ and inserting ‘‘1834(h)’’.
(7) Section 4153(d)(2) of OBRA–1990 is amended
by striking ‘‘Reconiliation’’ and inserting ‘‘Reconcili-
ation’’.
(8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is
amended by striking paragraph (6).
(B) Section 1834(a) (42 U.S.C. 1395m(a)) is amend-
ed—
(i) in subparagraphs (A) and (B) of paragraph
(1), by striking ‘‘(2) through (7)’’ each place it
appears and inserting ‘‘(2) through (5) and (7)’’;
(ii) in paragraph (7), by striking ‘‘(2) through
(6)’’ and inserting ‘‘(2) through (5)’’;
(iii) in paragraph (8), by striking ‘‘paragraphs
(6) and (7)’’ each place it appears in the matter pre-
ceding subparagraph (A) and in subparagraph (C)
and inserting ‘‘paragraph (7)’’; and
(iv) in paragraph (8)(A)(i), by striking ‘‘de-
scribed—’’ and all that follows and inserting ‘‘de-
974
scribed in paragraph (7) equal to the average of the
purchase prices on the claims submitted on an as-
signment-related basis for the unused item supplied
during the 6-month period ending with December
1986.’’.
(9) The amendments made by this subsection shall
take effect as if included in the enactment of OBRA–1990.
Subchapter E—Other Provisions
SEC. 13471. CLARIFYING PAYMENTS FOR MEDICALLY DI-
RECTED CERTIFIED REGISTERED NURSE AN-
ESTHETIST SERVICES.
(a) IN GENERAL.—Section 1833(l)(4)(B) (42 U.S.C.
1395l(l)(4)(B)) is amended to read as follows:
‘‘(B) Except as provided in subparagraph (D), the
conversion factor used to determine the amount paid
under the fee schedule under this subsection for services
furnished by a certified registered nurse anesthetist who
is medically directed—
‘‘(i) in a year after 1993 and before 1997, shall
be $10.75, or
‘‘(ii) in a subsequent calendar year, shall be the
previous year’s conversion factor increased by the
update determined under section 1848(d)(3) for
physician anesthesia services for that year.’’.
975
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
SEC. 13472. EXTENSION OF ALZHEIMER’S DISEASE DEM-
ONSTRATION PROJECTS.
Section 9342 of OBRA–1986, as amended by section
4164(a)(2) of OBRA–1990, is amended—
(1) in subsection (c)(1), by striking ‘‘4 years’’
and inserting ‘‘5 years’’; and
(2) in subsection (f), —
(A) by striking ‘‘$55,000,000’’ and insert-
ing ‘‘$58,000,000’’, and
(B) by striking ‘‘$3,000,000’’ and insert-
ing ‘‘$5,000,000’’.
SEC. 13473. ORAL CANCER DRUGS.
(a) NEW COVERAGE
OF CERTAIN SELF-ADMINIS-
TERED ANTICANCER DRUGS.—Section 1861(s)(2) (42
U.S.C. 
1395(s)(2)), 
as 
amended 
by 
section
13478(f)(8)(B), is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (N);
(2) by adding ‘‘and’’ at the end of subpara-
graph (O); and
(3) by adding at the end the following new sub-
paragraph:
976
‘‘(P) an oral drug (which is approved by the
Federal Food and Drug Administration) prescribed
for use as an anticancer chemotherapeutic agent for
a given indication, and containing an active ingredi-
ent (or ingredients), which is the same indication
and active ingredient (or ingredients) as a drug
which the carrier determines would be covered pur-
suant to subparagraph (A) or (B) if the drug could
not be self-administered;’’.
(b) 
UNIFORM
COVERAGE
OF
‘‘OFF-LABEL’’
ANTICANCER
DRUGS.—Section 1861(t) (42 U.S.C.
1395x(t)) is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(t)’’;
(2) by striking ‘‘(m)(5) of this section’’ and in-
serting ‘‘(m)(5) and paragraph (2)’’; and
(3) by adding at the end the following new
paragraph:
‘‘(2)(A) For purposes of paragraph (1), the term
‘drugs’ also includes any drugs or biologicals used in an
anticancer chemotherapeutic regimen for a medically ac-
cepted indication (as described in subparagraph (B)).
‘‘(B) In subparagraph (A), the term ‘medically ac-
cepted indication’, with respect to the use of a drug, in-
cludes any use which has been approved by the Food and
977
Drug Administration for the drug, and includes another
use of the drug if—
‘‘(i) the drug has been approved by the Food
and Drug Administration, and
‘‘(ii) the carrier involved determines, based
upon guidance provided by the Secretary to carriers
for determining medically accepted uses of drugs,
that the use is medically accepted taking into ac-
count the uses of such drug which are—
‘‘(I) included (or approved for inclusion) in
one or more of the following compendia: the
American Hospital Formulary Service-Drug In-
formation, the American Medical Association
Drug Evaluations, and the United States Phar-
macopoeia-Drug Information; or
‘‘(II) supported by clinical evidence in peer
reviewed medical literature appearing in publi-
cations which have been specifically approved
for purposes of this paragraph by the Sec-
retary.’’.
(c) STUDY OF MEDICARE COVERAGE OF PATIENT
CARE COSTS ASSOCIATED WITH CLINICAL TRIALS OF
NEW CANCER THERAPIES.—
(1) STUDY.—The Secretary of Health and
Human Services shall conduct a study of the effects
978
of expressly covering under the medicare program
the patient care costs for beneficiaries enrolled in
clinical trials of new cancer therapies, where the pro-
tocol for the trial has been approved by the National
Cancer Institute or meets similar scientific and ethi-
cal standards, including approval by an institutional
review board. The study shall include—
(A) an estimate of the cost of such cov-
erage, taking into account the extent to which
medicare currently pays for such patient care
costs in practice;
(B) an assessment of the extent to which
such clinical trials represent the best available
treatment for the patients involved and of the
effects of participation in the trials on the
health of such patients;
(C) an assessment of whether progress in
developing new anticancer therapies would be
assisted by medicare coverage of such patient
care costs; and
(D) an evaluation of whether there should
be special criteria for the admission of medicare
beneficiaries (on account of their age or phys-
ical condition) to clinical trials for which medi-
care would pay the patient care costs.
979
(2) REPORT.—Not later than 2 years after the
date of the enactment of this Act, the Secretary of
Health and Human Services shall submit a report
on the study conducted under paragraph (1) to the
Committee on Ways and Means and the Committee
on Energy and Commerce of the House of Rep-
resentatives and the Committee on Finance of the
Senate. Such report shall include recommendations
as to the coverage under the medicare program of
patient care costs of beneficiaries enrolled in clinical
trials of new cancer therapies.
(d) EFFECTIVE DATE.—The amendments made by
subsections (a) and (b) shall apply to items furnished on
or after January 1, 1994.
SEC. 13474. PART B PREMIUM PAYMENTS FOR LATE EN-
ROLLMENT.
(a) LIMITATION ON MEDICARE PART B LATE EN-
ROLLMENT PENALTY.—
(1) IN
GENERAL.—Section 1839 (42 U.S.C.
1395r) is amended by adding at the end the follow-
ing new subsection:
‘‘(g) The percent increase in premiums under sub-
section (b) due to late enrollment under this part shall
not exceed 25 percent in the case of an individual who
is an annuitant described in subparagraph (A) or (B) of
980
section 8901(3) of title 5, United States Code (including
an 
individual 
or 
survivor 
described 
in 
section
8906(g)(2)(A) of such title) for a month if—
‘‘(1) during the individual’s initial enrollment
period under section 1837(d)—
‘‘(A) the individual was enrolled in a group
health 
plan 
(as 
defined 
in 
section
1862(b)(1)(A)(v)) that provided coverage of
items and services for which payment may be
made under this part, and
‘‘(B) the individual elected not to enroll (or
to be deemed enrolled) under this section; and
‘‘(2) due to a change of coverage under such
plan, there is no coverage during the month under
such plan with respect to items and services for
which payment may be made under this part unless
the individual is enrolled under this part.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to premiums for
months beginning with January 1992.
(b) PAYMENT OF PART B PREMIUM LATE ENROLL-
MENT PENALTIES BY STATES.—Section 1839 (42 U.S.C.
1395r), as amended by subsection (a), is further amended
by adding at the end the following new subsection:
981
‘‘(h)(1) Upon the request of a State, the Secretary
may enter into an agreement with the State under which
the State agrees to pay on a quarterly or other periodic
basis to the Secretary (to be deposited in the Treasury
to the credit of the Federal Supplementary Medical Insur-
ance Trust Fund) an amount equal to the amount of the
part B late enrollment premium increases with respect to
the premiums for eligible individuals (as defined in para-
graph (3)(A)).
‘‘(2) No part B late enrollment premium increase
shall apply to an eligible individual for premiums for
months for which the amount of such an increase is pay-
able under an agreement under paragraph (1).
‘‘(3) In this subsection:
‘‘(A) The term ‘eligible individual’ means an in-
dividual who is enrolled under this part B and who
is within a class of individuals specified in the agree-
ment under paragraph (1).
‘‘(B) The term ‘part B late enrollment premium
increase’ means any increase in a premium as a re-
sult of the application of subsection (b).’’.
SEC. 13475. COVERAGE OF SERVICES OF SPEECH-LAN-
GUAGE PATHOLOGISTS AND AUDIOLOGISTS.
(a) SERVICES DEFINED.—Section 1861 (42 U.S.C.
1395x), as amended by section 13478(f)(8)(E), is amend-
982
ed by inserting after subsection (kk) the following new
subsection:
‘‘Speech-Language Pathology Services; Audiology
Services
‘‘(ll)(1) The term ‘speech-language pathology serv-
ices’ means such speech, language, and related function
assessment and rehabilitation services furnished by a
qualified speech-language pathologist as the speech-lan-
guage pathologist is legally authorized to perform under
State law (or the State regulatory mechanism provided by
State law) as would otherwise be covered if furnished by
a physician.
‘‘(2) The term ‘audiology services’ means such hear-
ing and balance assessment services furnished by a quali-
fied audiologist as the audiologist is legally authorized to
perform under State law (or the State regulatory mecha-
nism provided by State law).
‘‘(3) In this subsection:
‘‘(A) The term ‘qualified speech-language pa-
thologist’ means an individual with a master’s or
doctoral degree in speech-language pathology who
has performed not less than 9 months of supervised
full-time speech-language pathology services after
obtaining such degree and who—
983
‘‘(i) is licensed (or is otherwise certified) as
a speech-language pathologist by the State in
which the individual furnishes such services, or
‘‘(ii) in the case of an individual who fur-
nishes services in a State which does not pro-
vide for the licensing (or other form of certifi-
cation) of speech-language pathologists, has
successfully completed a national clinical com-
petency examination in speech-language pathol-
ogy approved by the Secretary.
‘‘(B) The term ‘qualified audiologist’ means an
individual with a master’s or doctoral degree in
audiology who has performed not less than 9 months
of supervised full-time audiology services after ob-
taining such degree and who—
‘‘(i) is licensed (or is otherwise certified) as
an audiologist by the State in which the individ-
ual furnishes such services, or
‘‘(ii) in the case of an individual who fur-
nishes services in a State which does not pro-
vide for the licensing (or other form of certifi-
cation) of audiologists, has successfully com-
pleted a national clinical competency examina-
tion in audiology approved by the Secretary.’’.
984
(b) CONFORMING AMENDMENTS RELATING TO MED-
ICARE TREATMENT OF SPEECH AND LANGUAGE SERV-
ICES.—
(1) 
EXTENDED
CARE
SERVICES.—Section
1861(h)(3) (42 U.S.C. 1395x(h)(3)) is amended by
striking ‘‘, occupational, or speech therapy’’ and in-
serting ‘‘or occupational therapy or speech-language
pathology services’’.
(2) 
HOME
HEALTH
SERVICES.—Section
1861(m)(2) (42 U.S.C. 1395x(m)(2)) is amended by
striking ‘‘, occupational, or speech therapy’’ and in-
serting ‘‘or occupational therapy or speech-language
pathology services’’.
(3) OUTPATIENT
PHYSICAL
THERAPY
SERV-
ICES.—The fourth sentence of section 1861(p) (42
U.S.C. 1395x(p)) is amended by striking ‘‘speech
pathology services’’ and inserting ‘‘speech-language
pathology services’’.
(4) COMPREHENSIVE OUTPATIENT REHABILITA-
TION FACILITY SERVICES.—Section 1861(cc)(1)(B)
(42 U.S.C. 1395x(cc)(1)(B)) is amended by striking
‘‘speech pathology services’’ and inserting ‘‘speech-
language pathology services’’.
(5) HOSPICE
CARE.—Section 1861(dd)(1)(B)
(42 U.S.C. 1395x(dd)(1)(B)) is amended by striking
985
‘‘therapy or speech-language pathology’’ and insert-
ing ‘‘therapy, or speech-language pathology serv-
ices’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on January 1, 1994.
SEC. 13476. EXTENSION OF MUNICIPAL HEALTH SERVICE
DEMONSTRATION PROJECTS.
Section 9215 of the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended by section 6135
of OBRA–1989, is amended—
(1) by striking ‘‘December 31, 1993’’ and in-
serting ‘‘December 31, 1997’’, and
(2) in the second sentence, by inserting after
‘‘beneficiary costs,’’ the following: ‘‘costs to the med-
icaid program and other payers, access to care, out-
comes, beneficiary satisfaction, utilization differences
among the different populations served by the
projects,’’.
SEC. 13477. TREATMENT OF CERTAIN INDIAN HEALTH PRO-
GRAMS 
AND 
FACILITIES 
AS 
FEDERALLY-
QUALIFIED HEALTH CENTERS.
(a) IN GENERAL.—Section 1861(aa)(4) (42 U.S.C.
1395x(aa)(4)) is amended—
(1) by striking ‘‘or’’ at the end of subparagraph
(B);
986
(2) by striking the period at the end of sub-
paragraph (C) and inserting ‘‘; or’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(D) is an outpatient health program or facility
operated by a tribe or tribal organization under the
Indian Self-Determination Act or by an urban In-
dian organization receiving funds under title V of
the Indian Health Care Improvement Act.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
SEC. 13478. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) REVISION OF INFORMATION ON PART B CLAIMS
FORMS.—Section 1833(q)(1) (42 U.S.C. 1395l(q)(1)) is
amended—
(1) by striking ‘‘provider number’’ and inserting
‘‘unique physician identification number’’; and
(2) by striking ‘‘and indicate whether or not the
referring physician is an interested investor (within
the meaning of section 1877(h)(5))’’.
(b) CONSULTATION FOR SOCIAL WORKERS.—Effec-
tive with respect to services furnished on or after January
1, 1991, section 6113(c) of OBRA–1989 is amended—
987
(1) by inserting ‘‘and clinical social worker
services’’ after ‘‘psychologist services’’; and
(2) by striking ‘‘psychologist’’ the second and
third place it appears and inserting ‘‘psychologist or
clinical social worker’’.
(c) REPORTS
ON
HOSPITAL
OUTPATIENT
PAY-
MENT.—(1) OBRA–1989 is amended by striking section
6137.
(2) Section 1135(d) (42 U.S.C. 1320b–5(d)) is
amended—
(A) by striking paragraph (6); and
(B) in paragraph (7)—
(i) by striking ‘‘systems’’ each place it ap-
pears and inserting ‘‘system’’; and
(ii) by striking ‘‘paragraphs (1) and (6)’’
and inserting ‘‘paragraph (1)’’.
(d) RADIOLOGY AND DIAGNOSTIC SERVICES PRO-
VIDED IN HOSPITAL OUTPATIENT DEPARTMENTS.—(1)
Effective as if included in the enactment of OBRA–1989,
section 
1833(n)(1)(B)(i)(II) 
(42 
U.S.C.
1395l(n)(1)(B)(i)(II)) is amended—
(A) by inserting ‘‘and for services described in
subsection (a)(2)(E)(ii) furnished on or after Janu-
ary 1, 1992’’ after ‘‘1989’’; and
988
(B) by striking ‘‘1842(b)’’ and inserting
‘‘1842(b) (or, in the case of services furnished on or
after January 1, 1992, under section 1848)’’.
(2) Effective as if included in the enactment of
OBRA–1989, section 1833(n)(1)(B)(i)(II) (42 U.S.C.
1395l(n)(1)(B)(i)(II)) is amended by striking ‘‘January 1,
1989’’ and inserting ‘‘April 1, 1989’’.
(e) PAYMENTS TO NURSE PRACTITIONERS IN RURAL
AREAS (SECTION 4155 OF OBRA–1990).—(1) Section
1861(s)(2)(K)(iii) (42 U.S.C. 1395x(s)(2)(K)(iii)) is
amended—
(A) by striking ‘‘subsection (aa)(3)’’ and insert-
ing ‘‘subsection (aa)(5)’’; and
(B) by striking ‘‘subsection (aa)(4)’’ and insert-
ing ‘‘subsection (aa)(6)’’.
(2) Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is
amended—
(A) by striking ‘‘and’’ before ‘‘(N)’’; and
(B) with respect to the matter inserted by sec-
tion 4155(b)(2)(B) of OBRA–1990—
(i) by striking ‘‘(M)’’ and inserting ‘‘, and
(O)’’, and
(ii) by transferring and inserting it (as
amended) immediately before the semicolon at
the end.
989
(3) Section 1833(r)(1) (42 U.S.C. 1395l(r)(1)) is
amended—
(A) by striking ‘‘ambulatory’’ each place it ap-
pears and inserting ‘‘or ambulatory’’; and
(B) by striking ‘‘center,’’ and inserting ‘‘cen-
ter’’.
(4) Section 1833(r)(2)(A) (42 U.S.C. 1395l(r)(2)(A))
is amended by striking ‘‘subsection (a)(1)(M)’’ and insert-
ing ‘‘subsection (a)(1)(O)’’.
(5) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is
amended by striking ‘‘subsection (s)(2)(K)(i)’’ and insert-
ing ‘‘clauses (i) or (iii) of subsection (s)(2)(K)’’.
(6) Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is
amended by striking ‘‘this Act’’ and inserting ‘‘this title’’.
(7) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is
amended by striking ‘‘1861(s)(2)(K)(i)’’ and inserting
‘‘1861(s)(2)(K)(i) or 1861(s)(2)(K)(iii)’’.
(8) 
Section 
1866(a)(1)(H) 
(42 
U.S.C.
1395cc(a)(1)(H)) 
is 
amended 
by 
striking
‘‘1861(s)(2)(K)(i)’’ and inserting ‘‘1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)’’.
(f) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—
(1) IMMEDIATE ENROLLMENT IN PART B BY IN-
DIVIDUALS
COVERED
BY
AN
EMPLOYMENT-BASED
990
PLAN.—(A) Subparagraphs (A) and (B) of section
1837(i)(3) (42 U.S.C. 1395p(i)(3)) are each amend-
ed—
(i) by striking ‘‘beginning with the first
day of the first month in which the individual
is no longer enrolled’’ and inserting ‘‘including
each month during any part of which the indi-
vidual is enrolled’’; and
(ii) by striking ‘‘and ending seven months
later’’ and inserting ‘‘ending with the last day
of the eighth consecutive month in which the in-
dividual is at no time so enrolled’’.
(B) Paragraphs (1) and (2) of section 1838(e)
(42 U.S.C. 1395q(e)) are amended to read as fol-
lows:
‘‘(1) in any month of the special enrollment pe-
riod in which the individual is at any time enrolled
in a plan (specified in subparagraph (A) or (B), as
applicable, of section 1837(i)(3)) or in the first
month following such a month, the coverage period
shall begin on the first day of the month in which
the individual so enrolls (or, at the option of the in-
dividual, on the first day of any of the following
three months), or
991
‘‘(2) in any other month of the special enroll-
ment period, the coverage period shall begin on the
first day of the month following the month in which
the individual so enrolls.’’.
(C) The amendments made by subparagraphs
(A) and (B) shall take effect on the first day of the
first month that begins after the expiration of the
120-day period that begins on the date of the enact-
ment of this Act.
(2) BLEND AMOUNTS FOR AMBULATORY SUR-
GICAL CENTER PAYMENTS.—Subclauses (I) and (II)
of 
section 
1833(i)(3)(B)(ii) 
(42 
U.S.C.
1395l(i)(3)(B)(ii)) are each amended—
(A) by striking ‘‘for reporting’’ and insert-
ing ‘‘for portions of cost reporting’’; and
(B) by striking ‘‘and on or before’’ and in-
serting ‘‘and ending on or before’’.
(3) CLINICAL DIAGNOSTIC LABORATORY TESTS
(SECTION 4154 OF OBRA–1990).—Section 4154(e)(5)
of OBRA–1990 is amended by striking ‘‘(1)(A)’’ and
inserting ‘‘(1)(A),’’.
(4) SEPARATE PAYMENT UNDER PART B FOR
CERTAIN SERVICES (SECTION 4157 OF OBRA–1990).—
Section 4157(a) of OBRA–1990 is amended by
striking ‘‘(a) SERVICES
OF’’ and all that follows
992
through ‘‘Section’’ and inserting ‘‘(a) TREATMENT
OF SERVICES
OF CERTAIN HEALTH PRACTITION-
ERS.—Section’’.
(5) CERTIFIED
REGISTERED
NURSE
ANES-
THETISTS
(SECTION
4160
OF
OBRA–1990).—Section
1833(l)(4)(B)(ii)(VII) 
(42 
U.S.C.
1395l(l)(4)(B)(ii)(VII)) is amended by striking
‘‘1997’’ and inserting ‘‘1996’’.
(6) COMMUNITY HEALTH CENTERS AND RURAL
HEALTH CLINICS (SECTION 4161 OF OBRA–1990).—
(A) The fourth sentence of section 1861(aa)(2) (42
U.S.C. 1395x(aa)(2)) is amended—
(i) by striking ‘‘certification’’ the first
place it appears and inserting ‘‘approval’’; and
(ii) by striking ‘‘the Secretary’s approval
or disapproval of the certification’’ and insert-
ing ‘‘Secretary’s approval or disapproval’’.
(B) Section 4161(a)(7)(B) of OBRA–1990 is
amended by inserting ‘‘and to the Committee on Fi-
nance of the Senate’’ after ‘‘Representatives’’.
(7) SCREENING MAMMOGRAPHY (SECTION 4163
OF
OBRA–1990).—Section 4163 of OBRA–1990 is
amended—
(A) by adding at the end of subsection (d)
the following new paragraph:
993
‘‘(3) The amendment made by paragraph
(2)(A)(iv) shall apply to screening pap smears per-
formed on or after July 1, 1990.’’; and
(B) in subsection (e), by striking ‘‘The
amendments’’ and inserting ‘‘Except as pro-
vided in subsection (d)(3), the amendments’’.
(8) INJECTABLE DRUGS FOR TREATMENT OF
OSTEOPOROSIS.—
(A) 
CLARIFICATION
OF
DRUGS
COV-
ERED.—The 
section 
1861(jj) 
(42 
U.S.C.
1395x(jj)) inserted by section 4156(a)(2) of
OBRA–1990 is amended—
(i) in the matter preceding paragraph
(1), by striking ‘‘a bone fracture related
to’’; and
(ii) in paragraph (1), by striking ‘‘pa-
tient’’ and inserting ‘‘individual has suf-
fered a bone fracture related to post-meno-
pausal osteoporosis and that the individ-
ual’’.
(B) LIMITING COVERAGE TO DRUGS PRO-
VIDED BY HOME HEALTH AGENCIES.—(i) The
section 1861(jj) (42 U.S.C. 1395x(jj)) inserted
by section 4156(a)(2) of OBRA–1990 is
994
amended by striking ‘‘if’’ and inserting ‘‘by a
home health agency if’’.
(ii) 
Section 
1861(m)(5) 
(42 
U.S.C.
1395x(m)(5)) is amended by striking ‘‘but ex-
cluding’’ 
and 
inserting 
‘‘and 
a 
covered
osteoporosis drug (as defined in subsection
(kk), but excluding other’’.
(iii) 
Section 
1861(s)(2) 
(42 
U.S.C.
1395x(s)(2)) is amended—
(I) by adding ‘‘and’’ at the end of
subparagraph (N), and
(II) by striking subparagraph (O) and
redesignating subparagraph (P) as sub-
paragraph (O).
(C) PAYMENT
BASED
ON
REASONABLE
COST.—Section 
1833(a)(2) 
(42 
U.S.C.
1395l(a)(2)) is amended—
(i) in subparagraph (A), by striking
‘‘health services’’ and inserting ‘‘health
services (other than covered osteoporosis
drug (as defined in section 1861(kk)))’’;
(ii) by striking ‘‘and’’ at the end of
subparagraph (D);
(iii) by striking the semicolon at the
end and inserting ‘‘; and’’; and
995
(iv) by adding at the end the following
new subparagraph:
‘‘(F) with respect to covered osteoporosis
drug (as defined in section 1861(kk)) furnished
by a home health agency, 80 percent of the rea-
sonable cost of such service, as determined
under section 1861(v);’’.
(D) APPLICATION
OF
PART
B
DEDUCT-
IBLE.—Section 
1833(b)(2) 
(42 
U.S.C.
1395l(b)(2)) is amended by striking ‘‘services’’
and inserting ‘‘services (other than covered
osteoporosis 
drug 
(as 
defined 
in 
section
1861(kk)))’’.
(E) COVERED OSTEOPOROSIS DRUG (SEC-
TION 4156 OF OBRA–1990).—Section 1861 (42
U.S.C. 1395x) is amended, in the subsection
(jj) inserted by section 4156(a)(2) of OBRA–
1990, by striking ‘‘(jj) The term’’ and inserting
‘‘(kk) The term’’.
(9) OTHER
MISCELLANEOUS
AND
TECHNICAL
CORRECTIONS (SECTION 4164 OF OBRA–1990).—
(A) OWNERSHIP
DISCLOSURE
REQUIRE-
MENTS.—(i) 
Section 
1124A(a)(2)(A) 
(42
U.S.C. 1320a–3a(a)(2)(A)) is amended by
striking ‘‘of the Social Security Act’’.
996
(ii) Section 4164(b)(4) of OBRA–1990 is
amended by striking ‘‘paragraph’’ and inserting
‘‘paragraphs’’.
(B) DIRECTORY
OF
UNIQUE
PHYSICIAN
IDENTIFIER
NUMBERS.—Section 4164(c) of
OBRA–1990 is amended by striking ‘‘publish’’
and inserting ‘‘publish, and shall periodically
update,’’.
(g) EFFECTIVE DATE.—Except as otherwise provided
in this section, the amendments made by this section shall
take effect as if included in the enactment of OBRA–1990.
Subchapter F—Part B Premium
SEC. 13481. PART B PREMIUM.
Section 1839(e) (42 U.S.C. 1395r(e)) is amended—
(1) in paragraph (1)(A), by inserting ‘‘and for
each month in 1996 and 1997’’ after ‘‘January
1991’’, and
(2) in paragraph (2), by striking ‘‘1991’’ and
inserting ‘‘1998’’.
997
CHAPTER 3—PROVISIONS RELATING TO
PARTS A AND B
Subchapter A—Elimination of Updates
SEC. 13501. ELIMINATION OF COST-OF-LIVING UPDATE IN
PER RESIDENT AMOUNTS FOR DIRECT MEDI-
CAL EDUCATION.
Section 1886(h)(2)(D) (42 U.S.C. 1395ww(h)(2)(D))
is amended by inserting ‘‘(other than in the case of cost
reporting periods beginning during fiscal year 1994 or fis-
cal year 1995)’’ after ‘‘updated’’.
SEC. 13502. ELIMINATION OF INFLATION UPDATE IN COST
LIMITS FOR HOME HEALTH SERVICES.
The Secretary of Health and Human Services shall
not provide for any increase, on the basis of inflation or
changes in the cost of goods and services, in the per visit
cost limits for home health services under section
1861(v)(1)(L) of the Social Security Act for cost reporting
periods beginning during fiscal year 1994 or fiscal year
1995.
Subchapter B—Medicare Secondary Payer
Provisions
SEC. 13511. EXTENSION OF TRANSFER OF DATA.
(a) EXTENSION OF DATA MATCH PROGRAM.—
998
(1) Section 1862(b)(5)(C)(iii) of the Social Se-
curity Act (42 U.S.C. 1395y(b)(5)(C)(iii)) is amend-
ed by striking ‘‘1995’’ and inserting ‘‘1998’’.
(2) Section 6103(l)(12)(F) of the Internal Rev-
enue Code of 1986 is amended—
(A) in clause (i), by striking ‘‘1995’’ and
inserting ‘‘1998’’,
(B) in clause (ii)(I), by striking ‘‘1994’’
and inserting ‘‘1997’’, and
(C) in clause (ii)(II), by striking ‘‘1995’’
and inserting ‘‘1998’’.
(b) SECONDARY PAYER EXEMPTION FOR MEMBERS
OF RELIGIOUS ORDERS.—Effective as if included in the
enactment of OBRA–1989, section 6202(e)(2) of such Act
is amended by adding at the end the following: ‘‘Such
amendment also shall apply to items and services fur-
nished before such date with respect to secondary payer
cases which the Secretary of Health and Human Services
had not identified as of such date.’’.
(c) PERMITTING
THE USE
OF MINIMUM INCOME
THRESHOLDS.—
(1) Section 6103(l)(12)(B)(i) of the Internal
Revenue Code of 1986 is amended by inserting ‘‘,
above an amount (if any) specified by the Secretary
999
of Health and Human Services,’’ after ‘‘section
3401(a))’’.
(2) The matter in section 6103(l)(12)(B)(ii) of
such Code preceding subclause (I) is amended by in-
serting ‘‘, above an amount (if any) specified by the
Secretary of Health and Human Services,’’ after
‘‘wages’’.
(3) The heading to section 6103(l)(12) of such
Code is amended by striking ‘‘TAXPAYER IDENTITY’’
and inserting ‘‘ RETURN’’.
SEC. 13512. 3-YEAR EXTENSION OF MEDICARE SECONDARY
PAYER TO DISABLED BENEFICIARIES.
Section 
1862(b)(1)(B)(iii) 
(42 
U.S.C.
1395y(b)(1)(B)(iii)) is amended by striking ‘‘1995’’ and
inserting ‘‘1998’’.
SEC. 13513. 3-YEAR EXTENSION OF 18-MONTH RULE FOR
ESRD BENEFICIARIES.
Section 1862(b)(1)(C) (42 U.S.C. 1395y(b)(1)(C)) is
amended by striking ‘‘1996’’ and inserting ‘‘1999’’.
SEC. 13514. MEDICARE SECONDARY PAYER REFORMS.
(a) IMPROVING IDENTIFICATION OF MEDICARE SEC-
ONDARY PAYER SITUATIONS.—
(1) SURVEY OF BENEFICIARIES.—
1000
(A) I N GENERAL.—Section 1862(b)(5) (42
U.S.C. 1395y(b)(5)) is amended by adding at
the end the following new subparagraph:
‘‘(D) 
OBTAINING
INFORMATION
FROM
BENEFICIARIES.—Before an individual applies
for benefits under part A or enrolls under part
B, the Administrator shall mail the individual a
questionnaire to obtain information on whether
the individual is covered under a primary plan
and the nature of the coverage provided under
the plan, including the name, address, and iden-
tifying number of the plan.’’.
(B) D ISTRIBUTION OF QUESTIONNAIRE BY
CONTRACTOR.—The Secretary of Health and
Human Services shall enter into an agreement
with an entity not later than November 1,
1993, to distribute the questionnaire described
in section 1862(b)(5)(D) of the Social Security
Act (as added by subparagraph (A)).
(C) N O MEDICARE SECONDARY PAYER DE-
NIAL BASED ON FAILURE TO COMPLETE QUES-
TIONNAIRE.—Section 1862(b)(2) (42 U.S.C.
1395y(b)(2)) is amended by adding at the end
the following new subparagraph:
1001
‘‘(C) T REATMENT OF QUESTIONNAIRES.—
The Secretary may not fail to make payment
under subparagraph (A) solely on the ground
that an individual failed to complete a question-
naire concerning the existence of a primary
plan.’’.
(2) MANDATORY
SCREENING
BY
PROVIDERS
AND SUPPLIERS UNDER PART B.—
(A) IN
GENERAL.—Section 1862(b) (42
U.S.C. 1395y(b)) is amended by adding at the
end the following new paragraph:
‘‘(6) S CREENING REQUIREMENTS FOR PROVID-
ERS AND SUPPLIERS.—
‘‘(A) IN GENERAL.—Notwithstanding any
other provision of this title, no payment may be
made for any item or service furnished under
part B unless the entity furnishing such item or
service completes (to the best of its knowledge
and on the basis of information obtained from
the individual to whom the item or service is
furnished) the portion of the claim form relat-
ing to the availability of other health benefit
plans.
‘‘(B) PENALTIES.—An entity that know-
ingly, willfully, and repeatedly fails to complete
1002
a claim form in accordance with subparagraph
(A) or provides inaccurate information relating
to the availability of other health benefit plans
on a claim form under such subparagraph shall
be subject to a civil money penalty of not to ex-
ceed $2,000 for each such incident. The provi-
sions of section 1128A (other than subsections
(a) and (b)) shall apply to a civil money penalty
under the previous sentence in the same man-
ner as such provisions apply to a penalty or
proceeding under section 1128A(a).’’.
(B) EFFECTIVE DATE.—The amendment
made by subparagraph (A) shall apply with re-
spect to items and services furnished on or
after January 1, 1994.
(b) IMPROVEMENTS IN RECOVERY OF PAYMENTS
FROM PRIMARY PAYERS.—
(1) S UBMISSION OF REPORTS ON EFFORTS TO
RECOVER ERRONEOUS PAYMENTS.—
(A) FISCAL INTERMEDIARIES UNDER PART
A.—Section 1816 (42 U.S.C. 1396h) is amend-
ed by adding at the end the following new sub-
section:
‘‘(k) An agreement with an agency or organization
under this section shall require that such agency or orga-
1003
nization submit an annual report to the Secretary describ-
ing the steps taken to recover payments made for items
or services for which payment has been or could be made
under 
a 
primary 
plan 
(as 
defined 
in 
section
1862(b)(2)(A)).’’.
(B) CARRIERS UNDER PART B.—Section
1842(b)(3) (42 U.S.C. 1395u(b)(3)) is amend-
ed—
(i) by striking ‘‘and’’ at the end of
subparagraph (H); and
(ii) by inserting after subparagraph
(H) the following new subparagraph:
‘‘(I) will submit annual reports to the Secretary
describing the steps taken to recover payments made
under this part for items or services for which pay-
ment has been or could be made under a primary
plan (as defined in section 1862(b)(2)(A)).’’.
(2) REQUIREMENTS UNDER CARRIER PERFORM-
ANCE EVALUATION PROGRAM.—
(A) FISCAL INTERMEDIARIES UNDER PART
A.—Section 
1816(f)(1)(A) 
(42 
U.S.C.
1396h(f)(1)(A)) is amended by striking ‘‘proc-
essing’’ and inserting ‘‘processing (including the
agency’s or organization’s success in recovering
payments made under this title for services for
1004
which payment has been or could be made
under a primary plan (as defined in section
1862(b)(2)(A)))’’.
(B) CARRIERS UNDER PART B.—Section
1842(b)(2) (42 U.S.C. 1395u(b)(2)) is amended
by adding at the end the following new sub-
paragraph:
‘‘(D) In addition to any other standards and criteria
established by the Secretary for evaluating carrier per-
formance under this paragraph relating to avoiding erro-
neous payments, the Secretary shall establish standards
and criteria relating to the carrier’s success in recovering
payments made under this part for items or services for
which payment has been or could be made under a pri-
mary plan (as defined in section 1862(b)(2)(A)).’’.
(3) D EADLINE FOR REIMBURSEMENT BY PRI-
MARY PLANS.—
(A) 
IN
GENERAL.—Section
1862(b)(2)(B)(i) (42 U.S.C. 1395y(b)(2)(B)(i))
is amended by adding at the end the following
sentence: ‘‘If reimbursement is not made to the
appropriate Trust Fund before the expiration of
the 60-day period that begins on the date such
notice or other information is received, the Sec-
retary may charge interest (beginning with the
1005
date on which the notice or other information
is received) on the amount of the reimburse-
ment until reimbursement is made (at a rate
determined by the Secretary in accordance with
regulations of the Secretary of the Treasury
applicable to charges for late payments).’’.
(B) 
CONFORMING
AMENDMENT.—The
heading of clause (i) of section 1862(b)(2)(B) is
amended to read as follows: ‘‘REPAYMENT RE-
QUIRED.—’’.
(C) E FFECTIVE DATE.—The amendments
made by this paragraph shall apply to payments
for items and services furnished on or after the
date of the enactment of this Act.
(4) E FFECTIVE DATE.—The amendments made
by paragraphs (1) and (2) shall apply to contracts
with fiscal intermediaries and carriers under title
XVIII of the Social Security Act for years beginning
with 1994.
(c) APPLICATION OF AGGREGATION RULES.—
(1) WORKING
AGED.—Section 1862(b)(1)(A)
(42 U.S.C. 1395y(b)(1)(A)) is amended by adding at
the end the following new clause:
‘‘(vi) APPLICATION OF AGGREGATION
RULES.—All employers treated as a single
1006
employer under subsection (a) or (b) of
section 52 of the Internal Revenue Code of
1986 shall be treated as a single employer
for purposes of this subparagraph.’’.
(2) 
DISABLED
INDIVIDUALS.—Section
5000(b)(2) of the Internal Revenue Code of 1986
(relating to large group health plans) is amended by
adding at the end the following: ‘‘All employers
treated as a single employer under subsection (a) or
(b) of section 52 shall be treated as a single em-
ployer for purposes of this paragraph.’’.
(3) E FFECTIVE DATE.—The amendments made
by this subsection shall take effect 90 days after the
date of the enactment of this Act.
(d) A PPLICATION OF EXCISE TAX TO FAILURE TO
REIMBURSE FEDERAL GOVERNMENT.—
(1) IN GENERAL.—Section 5000(c) of the Inter-
nal Revenue Code of 1986 (relating to nonconform-
ing group health plans) is amended by striking ‘‘of
section 1862(b)(1)’’ and inserting ‘‘of paragraph (1),
or with the requirements of paragraph (2), of section
1862(b)’’.
(2) E FFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to demands for repay-
1007
ment issued after the date of the enactment of this
Act.
(e) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—
(1) The sentence in section 1862(b)(1)(C)
added by section 4203(c)(1)(B) of OBRA–1990 is
amended—
(A) by striking ‘‘on or before’’ and insert-
ing ‘‘before’’, and
(B) by striking ‘‘clauses (i) and (ii)’’ and
inserting ‘‘this subparagraph’’.
(2) Effective as if included in the enactment of
OBRA–1989, section 1862(b)(1) is amended—
(A) 
in 
subparagraphs 
(A)(v) 
and
(B)(iv)(II), by inserting ‘‘, without regard to
section 5000(d) of such Code’’ before the period
at the end of each subparagraph;
(B) in subparagraph (A)(iii), by striking
‘‘current calendar year or the preceding cal-
endar year’’ and inserting ‘‘current calendar
year and the preceding calendar year’’; and
(C) in the matter in subparagraph (C)
after clause (ii), by striking ‘‘taking into ac-
count that’’ and inserting ‘‘paying benefits sec-
ondary to this title when’’.
1008
(3) Effective as if included in the enactment of
OBRA–1989, section 1862(b)(5)(C)(i) (42 U.S.C.
1395y(b)(5)(C)(i)) 
is 
amended 
by 
striking
‘‘6103(l)(12)(D)(iii)’’ 
and 
inserting
‘‘6103(l)(12)(E)(iii)’’.
(4) Section 4203(c)(2) of OBRA–1990 is
amended—
(A) by striking ‘‘the application of clause
(iii)’’ and inserting ‘‘the second sentence’’;
(B) by striking ‘‘on individuals’’ and all
that follows through ‘‘section 226A of such
Act’’;
(C) in clause (ii), by striking ‘‘clause’’ and
inserting ‘‘sentence’’;
(D) in clause (v), by adding ‘‘and’’ at the
end; and
(E) in clause (vi)—
(i) by inserting ‘‘of such Act’’ after
‘‘1862(b)(1)(C)’’, and
(ii) by striking the period at the end
and inserting the following: ‘‘, without re-
gard to the number of employees covered
by such plans.’’.
1009
(5) Section 4203(d) of OBRA–1990 is amended
by striking ‘‘this subsection’’ and inserting ‘‘this
section’’.
(6) Except as provided in paragraphs (2) and
(3), the amendments made by this subsection shall
be effective as if included in the enactment of
OBRA–1990.
Subchapter C—Physician Ownership and
Referral
SEC. 13521. APPLICATION OF MEDICARE BAN ON SELF-RE-
FERRALS TO ALL PAYERS.
(a) IN GENERAL.—Section 1877 (42 U.S.C. 1395nn)
is amended—
(1) in subsection (a)—
(A) in paragraph (1)(A), by striking ‘‘for
which payment otherwise may be made under
this title’’ and inserting ‘‘for which a charge is
imposed’’, and
(B) in paragraph (1)(B), by striking
‘‘under this title’’;
(2) by amending paragraph (1) of subsection
(g) to read as follows:
‘‘(1) D ENIAL OF PAYMENT.—No payment may
be made under this title, under another Federal
health care program, or under a State health care
1010
program (as defined in section 1128(h)) for a des-
ignated health service for which a claim is presented
in violation of subsection (a)(1)(B). No individual,
third party payer, or other entity is liable for pay-
ment for designated health services for which a
claim is presented in violation of such subsection.’’;
and
(3) in subsection (g)(3), by striking ‘‘for which
payment may not be made under paragraph (1)’’
and inserting ‘‘for which such a claim may not be
presented under subsection (a)(1)’’.
(b) C ONFORMING AMENDMENT TO REPORTING RE-
QUIREMENT.—Section 1877(f) (42 U.S.C. 1395nn(f)) is
amended—
(1) by striking ‘‘for which payment may be
made under this title’’ each place it appears and in-
serting ‘‘for which a charge is imposed’’, and
(2) by striking the third sentence.
SEC. 13522. EXTENSION OF SELF-REFERRAL BAN TO ADDI-
TIONAL SPECIFIED SERVICES.
Section 1877 (42 U.S.C. 1395nn) is amended—
(1) by striking ‘‘clinical laboratory service’’,
‘‘clinical laboratory services’’, and ‘‘CLINICAL LAB-
ORATORY
SERVICES’’ and inserting ‘‘designated
health service’’, ‘‘designated health services’’, and
1011
‘‘DESIGNATED
HEALTH
SERVICES’’, respectively,
each place each appears in subsections (a)(1),
(b)(2)(A)(ii), (b)(4), (d)(1), (d)(2), (d)(3), (f),
(g)(1), and (h)(7)(B); and
(2) by adding at the end the following new sub-
section:
‘‘(i) DESIGNATED HEALTH SERVICES DEFINED.—In
this section, the term ‘designated health services’ means
any of the following items or services:
‘‘(1) clinical laboratory services;
‘‘(2) physical and occupational therapy services;
‘‘(3) radiology services, including magnetic reso-
nance imaging, computerized axial tomography
scans, and ultrasound services;
‘‘(4) radiation therapy services;
‘‘(5) durable medical equipment;
‘‘(6) parenteral and enteral nutrition equipment
and supplies;
‘‘(7) prosthetic devices and orthotics and pros-
thetics;
‘‘(8) outpatient prescription drugs;
‘‘(9) home infusion therapy services, home dial-
ysis, and home health services;
‘‘(10) ambulance services;
‘‘(11) inpatient and outpatient hospital services;
1012
‘‘(12) comprehensive outpatient rehabilitation
facility services;
‘‘(13) contact lenses and eyeglasses; and
‘‘(14) hearing aids.’’.
SEC. 13523. EXCEPTIONS FOR BOTH OWNERSHIP AND COM-
PENSATION ARRANGEMENTS.
(a) M ODIFICATION TO EXCEPTION FOR IN-OFFICE
ANCILLARY SERVICES.—Section 1877(b)(2) (42 U.S.C.
1395nn(b)(2)) is amended—
(1) by inserting ‘‘(other than durable medical
equipment, parenteral and enteral nutrition equip-
ment and supplies, and ambulance services)’’ after
‘‘services’’ the first place it appears, and
(2) in subparagraph (A)(ii)(II), by striking
‘‘centralized provision’’ and inserting ‘‘provision of
some or all’’.
(b) MODIFICATION OF RURAL PROVIDER EXCEP-
TION.—
(1) I N GENERAL.—Section 1877(b) (42 U.S.C.
1395nn(b)) is amended—
(A) by redesignating paragraph (5) as
paragraph (6), and
(B) by inserting after paragraph (4) the
following new paragraph:
1013
‘‘(5) RURAL PROVIDERS.—In the case of des-
ignated health services if—
‘‘(A) the entity furnishing the services is in
a 
rural 
area 
(as 
defined 
in 
section
1886(d)(2)(D)), and
‘‘(B) substantially all of the services (as
defined by the Secretary) furnished by the en-
tity are furnished to individuals who reside in
such a rural area.’’.
(2) 
CONFORMING
AMENDMENTS.—Section
1877(d) (42 U.S.C. 1395nn(d)) is amended—
(A) by striking paragraph (2), and
(B) by redesignating paragraph (3) as
paragraph (2).
SEC. 13524. EXCEPTIONS RELATED ONLY TO OWNERSHIP
OR INVESTMENT.
(a) 
PUBLICLY-TRADED
SECURITIES.—Section
1877(c)(2) (42 U.S.C. 1395nn(c)(2)) is amended by strik-
ing ‘‘total assets’’ and inserting ‘‘stockholder equity’’.
(b) R URAL PROVIDERS.—For amendment to excep-
tion relation to rural providers, see section 13523(b).
SEC. 13525. EXCEPTIONS RELATED ONLY TO COMPENSA-
TION ARRANGEMENTS.
(a) R ENTAL OF OFFICE SPACE AND EQUIPMENT.—
1014
(1) IN
GENERAL.—Paragraph (1) of section
1877(e) (42 U.S.C. 1395nn(e)) is amended to read
as follows:
‘‘(1) RENTAL OF OFFICE SPACE; RENTAL OF
EQUIPMENT.—
‘‘(A) O FFICE SPACE.—Payments made by
a lessee to a lessor for the use of premises if—
‘‘(i) the lease is set out in writing,
signed by the parties, and specifies the
premises covered by the lease,
‘‘(ii) the aggregate space rented or
leased does not exceed that which is rea-
sonable and necessary for the legitimate
business purposes of the lease or rental
and is used exclusively by the lessee when
being used by the lessee,
‘‘(iii) the lease provides for a term of
rental or lease for at least one year,
‘‘(iv) the aggregate rental charges
over the term of the lease are set in ad-
vance, are consistent with fair market
value, and are not determined in a manner
that takes into account the volume or value
of any referrals or other business gen-
erated between the parties,
1015
‘‘(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
‘‘(vi) the lease covers all of the prem-
ises leased between the parties for the
period of the lease, and
‘‘(vii) the compensation arrangement
meets such other requirements as the Sec-
retary may impose by regulation as needed
to protect against program or patient
abuse.
‘‘(B) EQUIPMENT.—Payments made by a
lessee of equipment to the lessor of the equip-
ment for the use of the equipment if—
‘‘(i) the lease is set out in writing,
signed by the parties, and specifies the
equipment covered by the lease,
‘‘(ii) the equipment rented or leased
does not exceed that which is reasonable
and necessary for the legitimate business
purposes of the lease or rental and is used
exclusively by the lessee when being used
by the lessee,
‘‘(iii) the lease provides for a term of
rental or lease of at least one year,
1016
‘‘(iv) the aggregate rental charges
over the term of the lease are set in ad-
vance, are consistent with fair market
value, and are not determined in a manner
that takes into account the volume or value
of any referrals or other business gen-
erated between the parties,
‘‘(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
‘‘(vi) the lease covers all of the equip-
ment leased between the parties for the
period of the lease, and
‘‘(vii) the compensation arrangement
meets such other requirements as the Sec-
retary may impose by regulation as needed
to protect against program or patient
abuse.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1877(h) (42 U.S.C. 1395nn(h)) is amended by strik-
ing paragraphs (5) and (6).
(b) BONA FIDE EMPLOYMENT RELATIONSHIPS.—
Section 1877(e) (42 U.S.C. 1395nn(e)) is amended—
(1) in paragraph (2)—
1017
(A) by striking ‘‘EMPLOYMENT’’ and all
that follows through ‘‘if’’ and inserting ‘‘BONA
FIDE
EMPLOYMENT
RELATIONSHIPS.—Any
amount paid by an employer to a physician (or
immediate family member) who has a bona fide
employment relationship with the employer for
the provision of services if ’’;
(B) in subparagraphs (A), (B), and (D),
by striking ‘‘arrangement’’ and inserting ‘‘em-
ployment’’;
(C) in subparagraph (C), by striking ‘‘to
the hospital’’; and
(D) by adding at the end the following:
‘‘Subparagraph (B)(ii) shall not be construed as pro-
hibiting the payment of remuneration in the form of
shares of overall profits or in the form of a produc-
tivity bonus based on services performed personally
by the physician or family member, if the amount of
the remuneration is not determined in a manner
that takes into account directly the volume or value
of any referrals by the referring physician.’’; and
(2) in paragraph (5)(A), by striking ‘‘in the
same manner as they apply to a hospital’’.
(c) PERSONAL SERVICE ARRANGEMENTS.—
1018
(1) IN
GENERAL.—Paragraph (3) of section
1877(e) (42 U.S.C. 1395nn(e)) is amended to read
as follows:
‘‘(3) PERSONAL SERVICE ARRANGEMENTS.—Re-
muneration from an entity under an arrangement
if—
‘‘(A) the arrangement is set out in writing,
signed by the parties, and specifies the services
covered by the arrangement,
‘‘(B) the arrangement covers all of the
services to be provided by the physician (or
family member) to the entity,
‘‘(C) the aggregate services contracted for
do not exceed those that are reasonable and
necessary for the legitimate business purposes
of the arrangement,
‘‘(D) the term of the arrangement is for at
least one year,
‘‘(E) the compensation to be paid over the
term of the arrangement is set in advance, does
not exceed fair market value, and is not deter-
mined in a manner that takes into account di-
rectly or indirectly the volume or value of any
referrals or other business generated between
the parties,
1019
‘‘(F) the services to be performed under
the arrangement do not involve the counseling
or promotion of a business arrangement or
other activity that violates any State or Federal
law, and
‘‘(G) the arrangement meets such other re-
quirements as the Secretary may impose by reg-
ulation as needed to protect against program or
patient abuse.’’.
(2) HEALTH
SERVICES
FURNISHED
UNDER
CERTAIN
HOSPITAL
ARRANGEMENTS.—Section
1877(e) (42 U.S.C. 1395nn(e)) is amended by add-
ing at the end the following new paragraph:
‘‘(7) CERTAIN
GROUP
PRACTICE
ARRANGE-
MENTS WITH A HOSPITAL.—
‘‘(A) IN GENERAL.—An arrangement be-
tween a hospital and a group for the provision
of designated health services by the group but
billed in the name of the hospital if—
‘‘(i) the group would be a group prac-
tice, but for the fact that it bills for such
services in the name of the hospital;
‘‘(ii) with respect to services provided to an
inpatient of the hospital, the arrangement is
1020
pursuant to the provision of inpatient hospital
services under section 1861(b)(3);
‘‘(iii) the arrangement began before De-
cember 19, 1989, and has continued in effect
without interruption since such date;
‘‘(iv) the group provides substantially all of
the designated health services furnished under
the arrangement to the hospital’s patients;
‘‘(v) the arrangement is pursuant to an
agreement that is set out in writing and that
specifies the services to be provided by the par-
ties and the compensation for services provided
under the agreement;
‘‘(vi) the compensation paid over the term
of the agreement is consistent with fair market
value and the compensation per unit of services
is fixed in advance and is not determined in a
manner that takes into account the volume or
value of any referrals or other business gen-
erated between the parties;
‘‘(vii) the compensation is provided pursu-
ant to an agreement which would be commer-
cially reasonable even if no referrals were made
to the entity; and
1021
‘‘(viii) the arrangement between the parties
meets such other requirements as the Secretary
may impose by regulation as needed to protect
against program or patient abuse.’’.
(d) P HYSICIAN RECRUITMENT.—Section 1877(e)(4)
(42 U.S.C. 1395nn(e)(4)) is amended—
(1) by redesignating subparagraphs (A) through
(C) as subparagraph (B) through (D), and
(2) by inserting before subparagraph (B), as so
redesignated, the following new subparagraph:
‘‘(A) the remuneration arrangement is set
out in writing, signed by the parties, and speci-
fies the benefits provided by the hospital, the
terms under which the benefits are to be pro-
vided, and the obligations of the parties,’’.
(e) I SOLATED TRANSACTIONS.—Section 1877(e)(5)
(42 U.S.C. 1395nn(e)(5)) is amended—
(1) by striking ‘‘ISOLATED’’ and inserting
‘‘ONE-TIME’’,
(2) by striking ‘‘isolated’’ and inserting ‘‘one-
time’’, and
(3) by inserting ‘‘or practice’’ after ‘‘one-time
sale of property’’.
(f) NEW EXCEPTION FOR PAYMENTS BY PHYSI-
CIAN.—Section 1877(e) (42 U.S.C. 1395nn(e)), as amend-
1022
ed by subsection (c)(2), is further amended by adding at
the end the following new paragraph:
‘‘(8) PAYMENTS BY A PHYSICIAN FOR ITEMS
AND SERVICES.—Payments made by a physician—
‘‘(A) to a laboratory in exchange for the
provision of clinical laboratory services, or
‘‘(B) to an entity as compensation for
other items or services if the items or services
are furnished at a price that is consistent with
fair market value.’’.
SEC. 13526. CLARIFICATION CONCERNING CIVIL MONEY
PENALTY SANCTIONS.
Section 1877(g)(3) (42 U.S.C. 1395nn(g)(3)) is
amended by inserting ‘‘(including a referring physician)’’
after ‘‘Any person’’.
SEC. 13527. REQUIREMENTS FOR GROUP PRACTICE.
(a) 
ADDITIONAL
REQUIREMENTS.—Section
1877(h)(4) (42 U.S.C. 1395nn(h)(4)) is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (C);
(2) by redesignating subparagraphs (A), (B),
(C), and (D) as clauses (i), (ii), (iii), and (vii),
respectively;
(3) by inserting ‘‘(A)’’ after ‘‘.—’’;
1023
(4) by inserting after clause (iii), as so redesig-
nated, the following:
‘‘(iv) subject to subparagraph (B), no phy-
sician who is a member of the group receives
compensation based on the volume or value of
referrals by the physician;
‘‘(v) there are no less than, on average, 5
physicians for each office location (as defined in
subparagraph (C)), except where there is only a
single office location for the entire group prac-
tice;
‘‘(vi) members of the group personally con-
duct no less than 75 percent of the physician-
patient encounters of the group practice; and’’;
and
(5) by adding at the end the following new sub-
paragraphs:
‘‘(B) A physician in a group practice may be
paid a share of overall profits of the group or a pro-
ductivity bonus (based on services personally per-
formed or personally supervised by the physician or
by another physician in the group) so long as the
share or bonus is not determined in any manner
which is directly related to the volume or value of
referrals by that physician.
1024
‘‘(C)(i) Except as provided in clauses (ii)
through (iv), the term ‘office location’ means an of-
fice where physician services are offered to patients.
‘‘(ii) Such term does not include a location con-
sisting solely of a diagnostic facility, nursing facility,
or treatment facility (such as a physical or occupa-
tional therapy center), or administrative services af-
filiated with the group practice.
‘‘(iii) Any office location which is located imme-
diately adjacent to another office location shall be
treated as the same office location.
‘‘(iv) The term ‘office location’ does not include
an office located in a rural area (as defined in sec-
tion 1886(d)(2)(D)) if at least 85 percent of the
physician services at the location are provided to in-
dividuals who reside in such a rural area.’’.
(b) USE OF BILLING NUMBERS, ETC.—Section 1877
(42 U.S.C. 1395nn) is amended—
(1) in subsection (b)(2)(B), by inserting ‘‘under
a billing number assigned to the group practice’’
after ‘‘member’’,
(2) in subsection (h)(4)(A)(ii), as redesignated
by subsection (a)(2), by inserting ‘‘and under a bill-
ing number assigned to the group’’ after ‘‘in the
name of the group’’, and
1025
(3) in subsection (h)(4)(A)(iii), as redesignated
by subsection (a)(2), by striking ‘‘by members of the
group’’.
(c) T REATMENT OF CERTAIN FACULTY PRACTICE
PLANS.—The last sentence of section 1877(h)(4)(A) (42
U.S.C. 1395nn(h)(4)(A)), as redesignated by subsection
(a)(2), is amended by inserting ‘‘, institution of higher
education, or medical school’’ after ‘‘hospital’’.
SEC. 13538. NO FEDERAL PREEMPTION OF MORE RESTRIC-
TIVE STATE LAWS.
Section 1877 (42 U.S.C. 1395nn), as amended by
section 13522(2), is amended by adding at the end the
following new subsection:
‘‘(j) NO FEDERAL PREEMPTION OF MORE RESTRIC-
TIVE STATE LAWS.—Nothing in this section shall preempt
provisions of State law—
‘‘(1) that relate to referrals not covered by this
section, or
‘‘(2) that relate to referrals covered by this sec-
tion and are more restrictive with respect to such re-
ferrals than the provisions of this section.’’.
SEC. 13529. MISCELLANEOUS PROVISIONS.
(a) INDIRECT FINANCIAL RELATIONSHIPS.—The last
sentence of section 1877(a)(2) (42 U.S.C. 1395nn(a)(2))
is amended by inserting before the period the following:
1026
‘‘and includes an interest in an entity that holds an owner-
ship or investment in another entity’’.
(b) MINOR
REMUNERATION.—Section 1877(h)(1)
(42 U.S.C. 1395nn(h)(1)) is amended—
(1) in subparagraph (A), by inserting before the
period at the end the following: ‘‘(other than an ar-
rangement involving only remuneration described in
subparagraph (C))’’, and
(2) by adding at the end the following new sub-
paragraph:
‘‘(C) Remuneration described in this subpara-
graph is any remuneration consisting of any of the
following:
‘‘(i) The forgiveness of amounts owed for
inaccurate tests or procedures, mistakenly per-
formed tests or procedures, or the correction of
minor billing errors.
‘‘(ii) The provision of items, devices, or
supplies that are used solely to—
‘‘(I) collect, transport, process, or
store specimens for the entity providing
the item, device, or supply, or
‘‘(II) communicate the results of tests
or procedures for such entity.’’.
1027
(c) R EFERRING PHYSICIAN.—Section 1877(h)(7)(C)
(42 U.S.C. 1395nn(h)(7)(C)) is amended—
(1) by inserting ‘‘a request by a radiologist for
diagnostic radiology services, and a request by a ra-
diation oncologist for radiation therapy,’’ after ‘‘ex-
amination services,’’, and
(2) by inserting ‘‘, radiologist, or radiation
oncologist’’ after ‘‘pathologist’’ the second place it
appears.
(d) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—Section 1877 (42 U.S.C. 1395nn) is further
amended—
(1) in the next to last sentence of subsection
(f)—
(A) by striking ‘‘provided’’ and inserting
‘‘furnished’’, and
(B) by striking ‘‘provides’’ and inserting
‘‘furnish’’;
(2) in the last sentence of subsection (f)—
(A) by striking ‘‘providing’’ each place it
appears and inserting ‘‘furnishing’’,
(B) by striking ‘‘with respect to the provid-
ers’’ and inserting ‘‘with respect to the enti-
ties’’, and
1028
(C) by striking ‘‘diagnostic imaging serv-
ices of any type’’ and inserting ‘‘magnetic reso-
nance imaging, computerized axial tomography
scans, and ultrasound services’’; and
(3) in subsection (a)(2)(B), by striking ‘‘sub-
section (h)(1)(A)’’ and inserting ‘‘subsection (h)(1)’’.
SEC. 13530. EFFECTIVE DATES.
(a) E XPANSION OF PAYERS AND SERVICES.—The
amendments made by sections 13521 and 13522 shall
apply with respect to a referral by a physician made on
or after December 31, 1994.
(b) OTHER PROVISIONS.—
(1) I N GENERAL.—Except as provided in this
subsection, the amendments made by sections 13523
through 13529 shall apply to referrals made on or
after January 1, 1992.
(2) D ELAY IN EFFECTIVENESS FOR MORE RE-
STRICTIVE PROVISIONS.—The amendments made by
the following sections shall apply with respect to a
referral by a physician made on or after December
31, 1994:
(A) Section 13523(b) (relating to the rural
provider exception).
(B) Section 13524(a) (relating to publicly-
traded securities).
1029
(C)(i) Section 13525(a) (relating to an ex-
ception for office rental and equipment), other
than the exception relating to equipment.
(ii) Section 13525(c)(1) (relating to excep-
tion for personal services arrangements).
(iii) Section 13525(d) (relating to physi-
cian recruitment).
(D) Section 13526 (relating to civil money
penalty).
(E) Section 13527 (relating to require-
ments for group practices), other than sub-
section (c) (relating to faculty plans).
(F) Section 13528 (relating to non-pre-
emption).
(G) Section 13529(a) (relating to indirect
financial relationships).
Subchapter D—Other Provisions
SEC. 13551. DIRECT GRADUATE MEDICAL EDUCATION.
(a) A DJUSTMENT IN GME B ASE-YEAR COSTS OF
FEDERAL INSURANCE CONTRIBUTIONS ACT.—
(1) I N GENERAL.—In determining the amount
of payment to be made under section 1886(h) of the
Social Security Act in the case of a hospital de-
scribed in paragraph (2) for cost reporting periods
beginning on or after October 1, 1992, the Secretary
1030
of Health and Human Services shall redetermine the
approved FTE resident amount to reflect the
amount that would have been paid the hospital if,
during the hospital’s base cost reporting period, the
hospital had been liable for FICA taxes or for con-
tributions to the retirement system of a State, a po-
litical subdivision of a State, or an instrumentality
of such a State or political subdivision with respect
to interns and residents in its medical residency
training program.
(2) HOSPITALS
AFFECTED.—A hospital de-
scribed in this paragraph is a hospital that did not
pay FICA taxes with respect to interns and resi-
dents in its medical residency training program dur-
ing the hospital’s base cost reporting period, but is
required to pay FICA taxes or make contributions to
a retirement system described in paragraph (1) with
respect to such interns and residents because of the
amendments made by section 11332(b) of OBRA–
1990.
(3) DEFINITIONS.—In this subsection:
(A) The ‘‘base cost reporting period’’ for a
hospital is the hospital’s cost reporting period
that began during fiscal year 1984.
1031
(B) The term ‘‘FICA taxes’’ means, with
respect to a hospital, the taxes under section
3111 of the Internal Revenue Code of 1986.
(b) PUBLICLY-FUNDED FAMILY PRACTICE RESI-
DENCY PROGRAMS.—
(1) IN
GENERAL.—Section 1886(h)(5) (42
U.S.C. 1395ww(h)(5)) is amended by adding at the
end the following new subparagraph:
‘‘(I) A DJUSTMENTS FOR CERTAIN FAMILY
PRACTICE RESIDENCY PROGRAMS.—
‘‘(i) I N GENERAL.—In the case of an
approved medical residency training pro-
gram (meeting the requirements of clause
(ii)) of a hospital which received payments
from the United States, a State, or a polit-
ical subdivision of a State or an instrumen-
tality of such a State or political subdivi-
sion (other than payments under this title
or a State plan under title XIX) for the
program during the cost reporting period
that began during fiscal year 1984, the
Secretary shall—
‘‘(I) provide for an average
amount under paragraph (2)(A) that
takes into account the Secretary’s es-
1032
timate of the amount that would have
been recognized as reasonable under
this title if the hospital had not re-
ceived such payments, and
‘‘(II) reduce the payment amount
otherwise provided under this sub-
section in an amount equal to the pro-
portion of such program payments
during the cost reporting period in-
volved that is allocable to this title.
‘‘(ii) ADDITIONAL REQUIREMENTS.—
A hospital’s approved medical residency
program meets the requirements of this
clause if—
‘‘(I) the program is limited to
training for family and community
medicine;
‘‘(II) the program is the only ap-
proved medical residency program of
the hospital; and
‘‘(III) the average amount deter-
mined under paragraph (2)(A) for the
hospital (as determined without re-
gard to the increase in such amount
1033
described in clause (i)(I)) does not ex-
ceed $10,000.’’.
(2) E FFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to payments under sec-
tion 1886(h) of the Social Security Act for cost re-
porting periods beginning on or after October 1,
1990.
(c) PREVENTIVE CARE RESIDENCIES.—
(1) E LIGIBILITY OF PREVENTIVE CARE RESI-
DENCY
PROGRAMS
FOR
EXPANDED
INITIAL
RESI-
DENCY
PERIODS.—Section 1886(h)(5)(F)(ii) (42
U.S.C. 1395ww(h)(5)(F)(ii)) is amended by insert-
ing after ‘‘fellowship program’’ the following: ‘‘or a
preventive care residency or fellowship program’’.
(2) E FFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to cost reporting
periods beginning on or after October 1, 1993.
SEC. 13552. IMMUNOSUPPRESSIVE DRUG THERAPY.
Section 1861(s)(2)(J) (42 U.S.C. 1395x(s)(2)(J)) is
amended by striking ‘‘title, within’’ and all that follows
and inserting the following: ‘‘title, but only in the case of
drugs furnished—
‘‘(i) before 1994, within 12 months after
the date of the transplant procedure,
1034
‘‘(ii) during 1994, within 18 months after
the date of the transplant procedure,
‘‘(iii) during 1995, within 24 months after
the date of the transplant procedure,
‘‘(iv) during 1996, within 30 months after
the date of the transplant procedure, and
‘‘(v) during any year after 1997, within 36
months after the date of the transplant proce-
dure;’’.
SEC. 
13553. 
REDUCTION 
IN 
PAYMENTS 
FOR
ERYTHROPOIENTIN.
(a) IN GENERAL.—Section 1881(b)(11)(B)(ii)(I) (42
U.S.C. 1395rr(b)(11)(B)(ii)(I)) is amended—
(1) by striking ‘‘1991’’ and inserting ‘‘1994’’;
and
(2) by striking ‘‘$11’’ and inserting ‘‘$10’’.
(b) E FFECTIVE DATE.—The amendments made by
subsection (a) shall apply to erythropoietin furnished on
or after January 1, 1994.
SEC. 13554. QUALIFIED MEDICARE BENEFICIARY OUT-
REACH.
The Secretary of Health and Human Services shall
establish and implement a method for obtaining informa-
tion from newly eligible medicare beneficiaries that may
be used to determine whether such beneficiaries may be
1035
eligible for medical assistance for medicare cost-sharing
under State medicaid plans as qualified medicare bene-
ficiaries, and for transmitting such information to the
State in which such a beneficiary resides.
SEC. 13555. EXTENSION OF SOCIAL HEALTH MAINTENANCE
ORGANIZATION DEMONSTRATIONS.
(a) EXTENSION
OF CURRENT WAIVERS.—Section
4018(b) of OBRA–1987, as amended by section
4207(b)(4)(B) of OBRA–1990, is amended—
(1) in paragraph (1) by striking ‘‘December 31,
1995’’ and inserting ‘‘December 31, 1997’’; and
(2) in paragraph (4) by striking ‘‘March 31,
1996’’ and inserting ‘‘March 31, 1998’’.
(b) EXPANSION
OF
DEMONSTRATIONS.—Section
2355 of the Deficit Reduction Act of 1984 is amended—
(1) in the last sentence of subsection (a) by
striking ‘‘12 months’’ and inserting ‘‘36 months’’;
and
(2) in subsection (b)(1)(B)—
(A) by striking ‘‘or’’ at the end of clause
(iii); and
(B) by redesignating clause (iv) as clause
(v) and inserting after clause (iii) the following
new clause:
1036
‘‘(iv) integrating acute and chronic
care management for patients with end-
stage renal disease through expanded com-
munity care case management services
(and for purposes of a demonstration
project conducted under this clause, any
requirement under a waiver granted under
this section that a project disenroll individ-
uals who develop end-stage renal disease
shall not apply); or’’.
(c) EXPANSION
OF NUMBER
OF MEMBERS PER
SITE.—The Secretary of Health and Human Services may
not impose a limit of less than 12,000 on the number of
individuals that may participate in a project conducted
under section 2355 of the Deficit Reduction Act of 1984.
(d) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—
(1) The section following section 4206 of
OBRA–1990 is amended by striking ‘‘SEC. 4027.’’
and inserting ‘‘SEC. 4207.’’, and in this subtitle is
referred to as section 4207 of OBRA–1990.
(2) Section 2355(b)(1)(B) of the Deficit Reduc-
tion 
Act 
of 
1984, 
as 
amended 
by 
section
4207(b)(4)(B)(ii) of OBRA–1990, is amended—
1037
(A) by striking ‘‘12907(c)(4)(A)’’ and in-
serting ‘‘4207(b)(4)(B)(i)’’, and
(B) by striking ‘‘feasibilitly’’ and inserting
‘‘feasibility’’.
(3) Section 4207(b)(4)(B)(iii)(III) of OBRA–
1990 is amended by striking the period at the end
and inserting a semicolon.
(4) Subsections (c)(3) and (e) of section 2355
of the Deficit Reduction Act of 1984, as amended by
section 4207(b)(4)(B) of OBRA–1990, are each
amended by striking ‘‘12907(c)(4)(A)’’ each place it
appears and inserting ‘‘4207(b)(4)(B)’’.
(5) Section 4207(c)(2) of OBRA–1990 is
amended by striking ‘‘the Committee on Ways and
Means’’ each place it appears and inserting ‘‘the
Committees on Ways and Means and Energy and
Commerce’’.
(6) Section 4207(d) of OBRA–1990 is amended
by redesignating the second paragraph (3) (relating
to effective date) as paragraph (4).
(7) Section 4207(i)(2) of OBRA–1990 is
amended—
(A) by striking the period at the end of
clause (iii) and inserting a semicolon, and
1038
(B) in clause (v), by striking ‘‘residents’’
and inserting ‘‘patients’’.
(8) Section 4207(j) of OBRA–1990 is amended
by striking ‘‘title’’ each place it appears and insert-
ing ‘‘subtitle’’.
(e) E FFECTIVE DATE.—The amendments made by
this section shall take effect as if included in the enact-
ment of OBRA–90.
SEC. 13556. HOSPICE NOTIFICATION TO HOME HEALTH
BENEFICIARIES.
(a) I N GENERAL.—Section 1891(a)(1) (42 U.S.C.
1395bbb(a)(1)) is amended by adding at the end the fol-
lowing new subparagraph:
‘‘(H) The right, in the case of a resident
who is entitled to benefits under this title, to be
fully informed orally and in writing (at the time
of coming under the care of the agency) of the
entitlement of individuals to hospice care under
section 1812(a)(4) (unless there is no hospice
program providing hospice care for which pay-
ment may be made under this title within the
geographic area of the facility and it is not the
common practice of the agency to refer patients
to hospice programs located outside such geo-
graphic area).’’.
1039
(b) E FFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
the first day of the first month beginning more than one
year after the date of the enactment of this Act.
SEC. 13557. INTEREST PAYMENTS.
(a) IN GENERAL.—Sections 1816(c)(2)(B)(ii)(IV)
and 1842(c)(2)(B)(ii)(IV) of the Social Security Act shall
be applied with respect to claims received in the 12-month
period beginning October 1, 1992, by substituting ‘‘30 cal-
endar days’’ for ‘‘24 calendar days’’ and ‘‘17 calendar
days’’.
(b) EFFECTIVE DATE.—Subsection (a) shall be in ef-
fect during the period that begins on the date of the enact-
ment of this Act and ends on September 30, 1993.
SEC. 13558. PEER REVIEW ORGANIZATIONS.
(a) R EPEAL OF PRO P RECERTIFICATION REQUIRE-
MENT FOR CERTAIN SURGICAL PROCEDURES.—
(1) IN
GENERAL.—Section 1164 (42 U.S.C.
1320c–13) is repealed.
(2) CONFORMING AMENDMENTS.—
(A) Section 1154 (42 U.S.C. 1320c–3) is
amended—
(i) in subsection (a), by striking para-
graph (12), and
1040
(ii) in subsection (d), by striking
‘‘(and except as provided in section
1164)’’.
(B) Section 1833 (42 U.S.C. 1395l) is
amended—
(i) in subsection (a)(1)(D)(i), by strik-
ing ‘‘, or for tests furnished in connection
with obtaining a second opinion required
under section 1164(c)(2) (or a third opin-
ion, if the second opinion was in disagree-
ment with the first opinion)’’;
(ii) in subsection (a)(1), by striking
clause (G);
(iii) in subsection (a)(2)(A), by strik-
ing ‘‘, to items and services (other than
clinical diagnostic laboratory tests) fur-
nished in connection with obtaining a sec-
ond 
opinion 
required 
under 
section
1164(c)(2) (or a third opinion, if the sec-
ond opinion was in disagreement with the
first opinion),’’;
(iv) in subsection (a)(2)(D)(i)—
(I) by striking ‘‘basis,’’ and in-
serting ‘‘basis or’’, and
1041
(II) by striking ‘‘, or for tests
furnished in connection with obtaining
a second opinion required under sec-
tion 1164(c)(2) (or a third opinion, if
the second opinion was in disagree-
ment with the first opinion)’’;
(v) in subsection (a)(3), by striking
‘‘and for items and services furnished in
connection with obtaining a second opinion
required under section 1164(c)(2), or a
third opinion, if the second opinion was in
disagreement with the first opinion)’’; and
(vi) in the first sentence of subsection
(b), by striking ‘‘(4)’’ and all that follows
through ‘‘and (5)’’ and inserting and (4)’’.
(C) Section 1834(g)(1)(B) (42 U.S.C.
1395m(g)(1)(B)) is amended by striking ‘‘and
for items and services furnished in connection
with obtaining a second opinion required under
section 1164(c)(2), or a third opinion, if the
second opinion was in disagreement with the
first opinion)’’.
(D) Section 1862(a) (42 U.S.C. 1395y(a))
is amended—
1042
(i) by adding ‘‘or’’ at the end of para-
graph (14),
(ii) by striking ‘‘; or’’ at the end of
paragraph (15) and inserting a period, and
(iii) by striking paragraph (16).
(E) 
The 
third 
sentence 
of 
section
1866(a)(2)(A) (42 U.S.C. 1395w(a)(2)(A)) is
amended by striking ‘‘, with respect to items
and services furnished in connection with ob-
taining a second opinion required under section
1164(c)(2) (or a third opinion, if the second
opinion was in disagreement with the first opin-
ion),’’.
(3) E FFECTIVE DATE.—The amendments made
by this subsection shall apply to services provided on
or after the date of the enactment of this Act.
(b) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—(1) The third sentence of section 1156(b)(1) (42
U.S.C. 1320c–5(b)(1)) is amended by striking ‘‘whehter’’
and inserting ‘‘whether’’.
(2) Section 1154(a)(9)(B) (42 U.S.C. 1320c–
3(a)(9)(B)) is amended by striking ‘‘this subsection’’ and
inserting ‘‘section 1156(a)’’.
1043
(3) Section 4205(d)(2)(B) of OBRA–1990 is amend-
ed by striking ‘‘amendments’’ and inserting ‘‘amend-
ment’’.
(4) Section 1160(d) (42 U.S.C. 1320c–9(d)) is
amended by striking ‘‘subpena’’ and inserting ‘‘subpoena’’.
(5) Section 4205(e)(2) of OBRA–1990 is amended
by striking ‘‘amendments’’ and inserting ‘‘amendment’’
and by striking ‘‘all’’.
(6)(A) Except as provided in subparagraph (B), the
amendments made by this subsection shall take effect as
if included in the enactment of OBRA–1990.
(B) The amendment made by paragraph (2) (relating
to the requirement on reporting of information to State
licensing boards) shall take effect on the date of the enact-
ment of this Act.
SEC. 13559. HEALTH MAINTENANCE ORGANIZATIONS.
(a) A DJUSTMENT IN MEDICARE CAPITATION PAY-
MENTS TO ACCOUNT FOR REGIONAL VARIATIONS IN AP-
PLICATION OF SECONDARY PAYER PROVISIONS.—
(1) IN
GENERAL.—Section 1876(a)(4) (42
U.S.C. 1395mm(a)(4)) is amended by adding at the
end the following new sentence: ‘‘In establishing the
adjusted average per capita cost for a geographic
area, the Secretary shall take into account the dif-
ferences between the proportion of individuals in the
1044
area with respect to whom there is a group health
plan that is a primary plan (within the meaning of
section 1862(b)(2)(A)) compared to the proportion
of all such individuals with respect to whom there is
such a group health plan.’’.
(2) E FFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to contracts entered
into for years beginning with 1994.
(b) REVISIONS IN THE PAYMENT METHODOLOGY
FOR RISK CONTRACTORS.—Section 4204(b) of OBRA–
1990 is amended to read as follows:
‘‘(b) REVISIONS IN THE PAYMENT METHODOLOGY
FOR RISK CONTRACTORS.—(1)(A) Not later than October
1, 1993, the Secretary of Health and Human Services (in
this subsection referred to as the ‘Secretary’) shall submit
a proposal to the Congress that provides for revisions to
the payment method to be applied in years beginning with
1995 for organizations with a risk-sharing contract under
section 1876(g) of the Social Security Act.
‘‘(B) In proposing the revisions required under sub-
paragraph (A) the Secretary shall consider—
‘‘(i) the difference in costs associated with med-
icare beneficiaries with differing health status and
demographic characteristics; and
1045
‘‘(ii) the effects of using alternative geographic
classifications on the determinations of costs associ-
ated with beneficiaries residing in different areas.
‘‘(2) Not later than 3 months after the date of sub-
mittal of the proposal under paragraph (1), the Comptrol-
ler General shall review the proposal and shall report to
Congress on the appropriateness of the proposed modifica-
tions.’’.
(c) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—(1) 
Section 
1876(a)(3) 
(42 
U.S.C.
1395mm(a)(3)) is amended by striking ‘‘subsection
(c)(7)’’ and inserting ‘‘subsections (c)(2)(B)(ii) and
(c)(7)’’.
(2) Section 4204(c)(3) of OBRA–1990 is amended
by striking ‘‘for 1991’’ and inserting ‘‘for years beginning
with 1991’’.
(3) Section 4204(d)(2) of OBRA–1990 is amended
by striking ‘‘amendment’’ and inserting ‘‘amendments’’.
(4) 
Section 
1876(a)(1)(E)(ii)(I) 
(42 
U.S.C.
1395mm(a)(1)(E)(ii)(I)) is amended by striking the
comma after ‘‘contributed to’’.
(5) Section 4204(e)(2) of OBRA–1990 is amended
by striking ‘‘(which has a risk-sharing contract under sec-
tion 1876 of the Social Security Act)’’.
1046
(6) Section 4204(f)(4) of OBRA–1990 is amended by
striking ‘‘final’’.
(7) 
Section 
1862(b)(3)(C) 
(42 
U.S.C.
1395y(b)(3)(C)) is amended—
(A) in the heading, by striking ‘‘PLAN’’ and in-
serting ‘‘ PLAN OR A LARGE GROUP HEALTH PLAN’’;
(B) by striking ‘‘group health plan’’ and insert-
ing ‘‘group health plan or a large group health
plan’’;
(C) by striking ‘‘, unless such incentive is also
offered to all individuals who are eligible for cov-
erage under the plan’’; and
(D) by striking ‘‘the first sentence of subsection
(a) and other than subsection (b)’’ and inserting
‘‘subsections (a) and (b)’’.
(8) The amendments made by this subsection shall
take effect as if included in the enactment of OBRA–1990.
SEC. 13560. MEDICARE ADMINISTRATION BUDGET PROC-
ESS.
(a) A DJUSTMENTS.—Section 251(b)(2) of the Bal-
anced Budget and Emergency Deficit Control Act of 1985
is amended by redesignating subparagraphs (E) and (F)
as subparagraphs (F) and (G), respectively, and by insert-
ing after subparagraph (D) the following new subpara-
graph:
1047
‘‘(E) 
MEDICARE
ADMINISTRATIVE
COSTS.—To the extent that appropriations are
enacted that provide additional new budget au-
thority (as compared with a base level of
$1,526,000,000 for new budget authority) for
the administration of the Medicare program by
fiscal intermediaries and carriers pursuant to
sections 1816 and 1842(a) of title XVIII of the
Social Security Act, the adjustment for that
year shall be that amount, but shall not ex-
ceed—
‘‘(i) 
for 
fiscal 
year 
1994,
$198,000,000 in new budget authority and
$198,000,000 in outlays; and
‘‘(ii) 
for 
fiscal 
year 
1995,
$220,000,000 in new budget authority and
$220,000,000 in outlays; and
the prior-year outlays resulting from these appro-
priations of budget authority and additional adjust-
ments equal to the sum of the maximum adjust-
ments that could have been made in preceding fiscal
years under this subparagraph.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 603(a) of the Congressional Budget
Act of 1974 is amended by striking ‘‘section
1048
251(b)(2)(E)(i)’’ 
and 
inserting 
‘‘section
251(b)(2)(F)(i)’’.
(2) Section 606(d) of the Congressional Budget
Act of 1974 is amended—
(A) in paragraph (1)(A) by striking ‘‘sec-
tion 251(b)(2)(E)(i)’’ and inserting ‘‘section
251(b)(2)(F)(i)’’; and
(B) 
in 
paragraph 
(2), 
by 
inserting
‘‘251(b)(2)(E),’’ after ‘‘251(b)(2)(D),’’.
SEC. 13561. OTHER PROVISIONS.
(a) SURVEY AND CERTIFICATION REQUIREMENTS.—
(1) Section 1864 (42 U.S.C. 1395aa) is amended—
(A) in subsection (e), by striking ‘‘title’’ and in-
serting ‘‘title (other than any fee relating to section
353 of the Public Health Service Act)’’; and
(B) in the first sentence of subsection (a), by
striking ‘‘1861(s) or’’ and all that follows through
‘‘Service Act,’’ and inserting ‘‘1861(s),’’.
(2) An agreement made by the Secretary of Health
and Human Services with a State under section 1864(a)
of the Social Security Act may include an agreement that
the services of the State health agency or other appro-
priate State agency (or the appropriate local agencies) will
be utilized by the Secretary for the purpose of determining
1049
whether a laboratory meets the requirements of section
353 of the Public Health Service Act.
(b) H OME DIALYSIS DEMONSTRATION TECHNICAL
CORRECTION.—Section 4202 of OBRA–1990 is amend-
ed—
(1) in subsection (b)(1)(A), by striking ‘‘home
hemodialysis staff assistant’’ and inserting ‘‘quali-
fied home hemodialysis staff assistant (as described
in subsection (d))’’;
(2) in subsection (b)(2)(B)(ii)(I), by striking
‘‘(as adjusted to reflect differences in area wage
levels);
(3) 
in 
subsection 
(c)(1)(A), 
by 
striking
‘‘skilled’’; and
(4) in subsection (c)(1)(E), by striking ‘‘(b)(4)’’
and inserting ‘‘(b)(2)’’.
(c) O THER TECHNICAL AMENDMENTS.—(1) Section
1833 (42 U.S.C. 1395l) is amended by redesignating the
subsection (r) added by section 4206(b)(2) of OBRA–
1990 as subsection (s).
(2) Section 1866(f)(1) (42 U.S.C. 1395cc(f)(1)) is
amended by striking ‘‘1833(r)’’ and inserting ‘‘1833(s)’’.
(3) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is
amended by moving subparagraph (O), as redesignated by
1050
section 13478(f)(8)(B)(iii)(II) of this title, two ems to the
left.
(4) 
Section 
1881(b)(1)(C) 
(42 
U.S.C.
1395rr(b)(1)(C)) is amended by striking ‘‘1861(s)(2)(Q)’’
and inserting ‘‘1861(s)(2)(P)’’.
(5) Section 4201(d)(2) of OBRA–1990 is amended
by striking ‘‘(B) by striking’’, ‘‘(C) by striking’’, and ‘‘(3)
by adding’’ and inserting ‘‘(i) by striking’’, ‘‘(ii) by strik-
ing’’, and ‘‘(B) by adding’’, respectively.
(6)(A) Section 4207(a)(1) of OBRA–1990 is amend-
ed by adding closing quotation marks and a period after
‘‘such review.’’.
(B) Section 4207(a)(4) of OBRA–1990 is amended
by striking ‘‘this subsection’’ and inserting ‘‘paragraphs
(2) and (3)’’.
(C) Section 4207(b)(1) of OBRA–1990 is amended
by striking ‘‘section 3(7)’’ and inserting ‘‘section
601(a)(1)’’.
(d) E FFECTIVE DATE.—The amendments made by
this section shall take effect as if included in the enact-
ment of OBRA–1990.
1051
CHAPTER 4—MEDICARE SUPPLEMENTAL
INSURANCE POLICIES
SEC. 13571. STANDARDS FOR MEDICARE SUPPLEMENTAL
INSURANCE POLICIES.
(a) S IMPLIFICATION OF MEDICARE SUPPLEMENTAL
POLICIES.—
(1) Section 4351 of OBRA–1990 is amended by
striking ‘‘(a) I N GENERAL.—’’.
(2) Section 1882(p) (42 U.S.C. 1395ss(p)) is
amended—
(A) in paragraph (1)(A)—
(i) by striking ‘‘promulgates’’ and in-
serting ‘‘changes the revised NAIC Model
Regulation (described in subsection (m)) to
incorporate’’,
(ii) by striking ‘‘(such limitations, lan-
guage, definitions, format, and standards
referred to collectively in this subsection as
‘NAIC standards’),’, and
(iii) by striking ‘‘included a reference
to the NAIC standards’’ and inserting
‘‘were a reference to the revised NAIC
Model Regulation as changed under this
subparagraph (such changed regulation re-
1052
ferred to in this section as the ‘1991 NAIC
Model Regulation’)’’;
(B) in paragraph (1)(B)—
(i) by striking ‘‘promulgate NAIC
standards’’ 
and 
inserting 
‘‘make 
the
changes in the revised NAIC Model Regu-
lation’’,
(ii) by striking ‘‘limitations, language,
definitions, format, and standards de-
scribed in clauses (i) through (iv) of such
subparagraph (in this subsection referred
to collectively as ‘Federal standards’)’’ and
inserting ‘‘a regulation’’, and
(iii) by striking ‘‘included a reference
to the Federal standards’’ and inserting
‘‘were a reference to the revised NAIC
Model Regulation as changed by the Sec-
retary under this subparagraph (such
changed regulation referred to in this sec-
tion as the ‘1991 Federal Regulation’)’’;
(C) in paragraph (1)(C)(i), by striking
‘‘NAIC standards or the Federal standards’’
and inserting ‘‘1991 NAIC Model Regulation or
1991 Federal Regulation’’;
1053
(D) in paragraphs (1)(C)(ii)(I), (1)(E),
(2), and (9)(B), by striking ‘‘NAIC or Federal
standards’’ and inserting ‘‘1991 NAIC Model
Regulation or 1991 Federal Regulation’’;
(E) in paragraph (2)(C), by striking
‘‘(5)(B)’’ and inserting ‘‘(4)(B)’’;
(F) in paragraph (4)(A)(i), by inserting
‘‘or paragraph (6)’’ after ‘‘(B)’’;
(G) in paragraph (4), by striking ‘‘applica-
ble standards’’ each place it appears and insert-
ing ‘‘applicable 1991 NAIC Model Regulation
or 1991 Federal Regulation’’;
(H) in paragraph (6), by striking ‘‘in re-
gard to the limitation of benefits described in
paragraph (4)’’ and inserting ‘‘described in
clauses (i) through (iii) of paragraph (1)(A)’’;
(I) in paragraph (7), by striking ‘‘policy-
holder’’ and inserting ‘‘policyholders’’;
(J) in paragraph (8), by striking ‘‘after the
effective date of the NAIC or Federal standards
with respect to the policy, in violation of the
previous requirements of this subsection’’ and
inserting ‘‘on and after the effective date speci-
fied in paragraph (1)(C) (but subject to para-
graph (10)), in violation of the applicable 1991
1054
NAIC Model Regulation or 1991 Federal Regu-
lation insofar as such regulation relates to the
requirements of subsection (o) or (q) or clause
(i), (ii), or (iii) of paragraph (1)(A)’’;
(K) in paragraph (9), by adding at the end
the following new subparagraph:
‘‘(D) Subject to paragraph (10), this paragraph shall
apply to sales of policies occurring on or after the effective
date specified in paragraph (1)(C).’’; and
(L) in paragraph (10), by striking ‘‘this
subsection’’ 
and 
inserting 
‘‘paragraph
(1)(A)(i)’’.
(b) GUARANTEED RENEWABILITY.—Section 1882(q)
(42 U.S.C. 1395ss(q)) is amended—
(1) in paragraph (2), by striking ‘‘paragraph
(2)’’ and inserting ‘‘paragraph (4)’’, and
(2) in paragraph (4), by striking ‘‘the succeed-
ing issuer’’ and inserting ‘‘issuer of the replacement
policy’’.
(c) ENFORCEMENT OF STANDARDS.—
(1) 
Section 
1882(a)(2) 
(42 
U.S.C.
1395ss(a)(2)) is amended—
(A) in subparagraph (A), by striking
‘‘NAIC standards or the Federal standards’’
1055
and inserting ‘‘1991 NAIC Model Regulation or
1991 Federal Regulation’’, and
(B) by striking ‘‘after the effective date of
the NAIC or Federal standards with respect to
the policy’’ and inserting ‘‘on and after the ef-
fective date specified in subsection (p)(1)(C)’’.
(2) The sentence in section 1882(b)(1) added
by section 4353(c)(5) of OBRA–1990 is amended—
(A) by striking ‘‘The report’’ and inserting
‘‘Each report’’,
(B) by inserting ‘‘and requirements’’ after
‘‘standards’’,
(C) by striking ‘‘and’’ after ‘‘compliance,’’,
and
(D) by striking the comma after ‘‘Commis-
sioners’’.
(3) 
Section 
1882(g)(2)(B) 
(42 
U.S.C.
1395ss(g)(2)(B)) is amended by striking ‘‘Panel’’
and inserting ‘‘Secretary’’.
(4) 
Section 
1882(b)(1) 
(42 
U.S.C.
1395ss(b)(1)) is amended by striking ‘‘the the Sec-
retary’’ and inserting ‘‘the Secretary’’.
(d) PREVENTING DUPLICATION.—
(1) 
Section 
1882(d)(3)(A) 
(42 
U.S.C.
1395ss(d)(3)(A)) is amended—
1056
(A) by amending the first sentence to read
as follows:
‘‘(i) It is unlawful for a person to sell or issue to an
individual entitled to benefits under part A or enrolled
under part B of this title—
‘‘(I) a health insurance policy with knowledge
that the policy duplicates health benefits to which
the individual is otherwise entitled under this title or
title XIX,
‘‘(II) a medicare supplemental policy with
knowledge that the individual is entitled to benefits
under another medicare supplemental policy, or
‘‘(III) a health insurance policy (other than a
medicare supplemental policy) with knowledge that
the policy duplicates health benefits to which the in-
dividual is otherwise entitled, other than benefits to
which the individual is entitled under a requirement
of State or Federal law.’’;
(B) by designating the second sentence as
clause (ii) and, in such clause, by striking ‘‘the
previous sentence’’ and inserting ‘‘clause (i)’’;
(C) by designating the third sentence as
clause (iii) and, in such clause—
(i) by striking ‘‘the previous sentence’’
and inserting ‘‘clause (i) with respect to
1057
the sale of a medicare supplemental pol-
icy’’, and
(ii) by striking ‘‘and the statement’’
and all that follows up to the period at the
end; and
(D) by striking the last sentence.
(2) 
Section 
1882(d)(3)(B) 
(42 
U.S.C.
1395ss(d)(3)(B)) is amended—
(A) in clause (ii)(II), by striking ‘‘65 years
of age or older’’,
(B) in clause (iii)(I), by striking ‘‘another
medicare’’ and inserting ‘‘a medicare’’,
(C) in clause (iii)(I), by striking ‘‘such a
policy’’ and inserting ‘‘a medicare supplemental
policy’’,
(D) in clause (iii)(II), by striking ‘‘another
policy’’ and inserting ‘‘a medicare supplemental
policy’’, and
(E) by amending subclause (III) of clause
(iii) to read as follows:
‘‘(III) If the statement required by clause (i) is ob-
tained and indicates that the individual is entitled to any
medical assistance under title XIX, the sale of the policy
is not in violation of clause (i) (insofar as such clause re-
lates to such medical assistance), if a State medicaid plan
1058
under such title pays the premiums for the policy, or, in
the case of a qualified medicare beneficiary described in
section 1905(p)(1), if the State pays less than the full
amount of medicare cost-sharing as described in subpara-
graphs (B), (C), and (D) of section 1905(p)(3) for such
individual.’’.
(3)(A) 
Section 
1882(d)(3)(C) 
(42 
U.S.C.
1395ss(d)(3)(C)) is amended—
(i) by striking ‘‘the selling’’ and inserting
‘‘(i) the sale or issuance’’, and
(ii) by inserting before the period at the
end the following: ‘‘, (ii) the sale or issuance of
a policy or plan described in subparagraph
(A)(i)(I) (other than a medicare supplemental
policy to an individual entitled to any medical
assistance under title XIX) under which all the
benefits are fully payable directly to or on be-
half of the individual without regard to other
health benefit coverage of the individual but
only if (for policies sold or issued more than 60
days after the date the statements are pub-
lished or promulgated under subparagraph (D))
there is disclosed in a prominent manner as
part of (or together with) the application the
applicable statement (specified under subpara-
1059
graph (D)) of the extent to which benefits pay-
able under the policy or plan duplicate benefits
under this title, or (iii) the sale or issuance of
a policy or plan described in subparagraph
(A)(i)(III) under which all the benefits are fully
payable directly to or on behalf of the individual
without regard to other health benefit coverage
of the individual’’.
(B) 
Section 
1882(d)(3) 
(42 
U.S.C.
1395ss(d)(3)) is amended by adding at the end the
following:
‘‘(D)(i) If—
‘‘(I) within the 90-day period beginning on the
date of the enactment of this subparagraph, the Na-
tional Association of Insurance Commissioners devel-
ops (after consultation with consumer and insurance
industry representatives) and submits to the Sec-
retary a statement for each of the types of health in-
surance policies (other than medicare supplemental
policies and including, as separate types of policies,
policies paying directly to the beneficiary fixed, cash
benefits) which are sold to persons entitled to health
benefits under this title, of the extent to which bene-
fits payable under the policy or plan duplicate bene-
fits under this title, and
1060
‘‘(II) the Secretary approves all the statements
submitted as meeting the requirements of subclause
(I),
each such statement shall be (for purposes of subpara-
graph (C)) the statement specified under this subpara-
graph for the type of policy involved. The Secretary shall
review and approve (or disapprove) all the statements sub-
mitted under subclause (I) within 30 days after the date
of their submittal. Upon approval of such statements, the
Secretary shall publish such statements.
‘‘(ii) If the Secretary does not approve the statements
under clause (i) or the statements are not submitted with-
in the 90-day period specified in such clause, the Secretary
shall promulgate (after consultation with consumer and
insurance industry representatives and not later than 90
days after the date of disapproval or the end of such 90-
day period (as the case may be)) a statement for each
of the types of health insurance policies (other than medi-
care supplemental policies and including, as separate types
of policies, policies paying directly to the beneficiary fixed,
cash benefits) which are sold to persons entitled to health
benefits under this title, of the extent to which benefits
payable under the policy or plan duplicate benefits under
this title, and each such statement shall be (for purposes
1061
of subparagraph (C)) the statement specified under this
subparagraph for the type of policy involved.’’.
(C) The requirement of a disclosure under sec-
tion 1882(d)(3)(C)(ii) of the Social Security Act
shall not apply to an application made for a policy
or plan before 60 days after the date of the Sec-
retary of Health and Human Services publishes or
promulgates all the statements under section
1882(d)(3)(D) of such Act.
(4) Subparagraphs (A) and (B) of section
1882(q)(5) are amended by striking ‘‘of the Social
Security Act’’.
(e) LOSS RATIOS AND REFUNDS OF PREMIUMS.—
(1) Section 1882(r) (42 U.S.C. 1395ss(r)) is
amended—
(A) in paragraph (1), by striking ‘‘or sold’’
and inserting ‘‘or renewed (or otherwise provide
coverage after the date described in subsection
(p)(1)(C))’’;
(B) in paragraph (1)(A), by inserting ‘‘for
periods after the effective date of these provi-
sions’’ after ‘‘the policy can be expected’’;
(C) in paragraph (1)(A), by striking
‘‘Commissioners,’’ 
and 
inserting 
‘‘Commis-
sioners)’’;
1062
(D) in paragraph (1)(B), by inserting be-
fore the period at the end the following: ‘‘,
treating policies of the same type as a single
policy for each standard package’’;
(E) by adding at the end of paragraph (1)
the following: ‘‘For the purpose of calculating
the refund or credit required under paragraph
(1)(B) for a policy issued before the date speci-
fied in subsection (p)(1)(C), the refund or cred-
it calculation shall be based on the aggregate
benefits provided and premiums collected under
all such policies issued by an insurer in a State
(separated as to individual and group policies)
and shall be based only on aggregate benefits
provided and premiums collected under such
policies after the date specified in section
13571(m)(4) of the Omnibus Budget Reconcili-
ation Act of 1993.’’;
(F) in the first sentence of paragraph
(2)(A), by striking ‘‘by policy number’’ and in-
serting ‘‘by standard package’’;
(G) by striking the second sentence of
paragraph (2)(A) and inserting the following:
‘‘Paragraph (1)(B) shall not apply to a policy
until 12 months following issue.’’;
1063
(H) in the last sentence of paragraph
(2)(A), by striking ‘‘in order’’ and all that fol-
lows through ‘‘are effective’’;
(I) by adding at the end of paragraph
(2)(A), the following new sentence: ‘‘In the case
of a policy issued before the date specified in
subsection (p)(1)(C), paragraph (1)(B) shall
not apply until 1 year after the date specified
in section 13571(m)(4) of the Omnibus Budget
Reconciliation Act of 1993.’’;
(J) in paragraph (2), by striking ‘‘policy
year’’ each place it appears and inserting ‘‘cal-
endar year’’;
(K) in paragraph (4), by striking ‘‘Feb-
ruary’’, ‘‘disllowance’’, ‘‘loss-ratios’’ each place
it appears, and ‘‘loss-ratio’’ and inserting ‘‘Oc-
tober’’, ‘‘disallowance’’, ‘‘loss ratios’’, and ‘‘loss
ratio’’, respectively;
(L) in paragraph (6)(A), by striking ‘‘is-
sues a policy in violation of the loss ratio re-
quirements of this subsection’’ and ‘‘such viola-
tion’’ and inserting ‘‘fails to provide refunds or
credits as required in paragraph (1)(B)’’ and
‘‘policy issued for which such failure occurred’’,
respectively; and
1064
(M) in paragraph (6)(B), by striking ‘‘to
policyholders’’ and inserting ‘‘to the policy-
holder or, in the case of a group policy, to the
certificate holder’’.
(2) 
Section 
1882(b)(1) 
(42 
U.S.C.
1395ss(b)(1)) is amended, in the matter after sub-
paragraph (H), by striking ‘‘subsection (F)’’ and in-
serting ‘‘subparagraph (F)’’.
(3) Section 4355(d) of OBRA–1990 is amended
by striking ‘‘sold or issued’’ and all that follows and
inserting ‘‘issued or renewed (or otherwise providing
coverage after the date described in section
1882(p)(1)(C) of the Social Security Act) on or after
the date specified in section 1882(p)(1)(C) of such
Act.’’.
(f) TREATMENT OF HMO’S.—
(1) 
Section 
1882(g)(1) 
(42 
U.S.C.
1395ss(g)(1)) is amended by striking ‘‘a health
maintenance organization or other direct service or-
ganization’’ and all that follows through ‘‘1833’’ and
inserting ‘‘an eligible organization (as defined in sec-
tion 1876(b)) if the policy or plan provides benefits
pursuant to a contract under section 1876 or an ap-
proved demonstration project described in section
603(c) of the Social Security Amendments of 1983,
1065
section 2355 of the Deficit Reduction Act of 1984,
or section 9412(b) of the Omnibus Budget Reconcili-
ation Act of 1986 or, during the period beginning on
the date specified in subsection (p)(1)(C) and ending
on December 31, 1994, a policy or plan of an orga-
nization if the policy or plan provides benefits pursu-
ant to an agreement under section 1833(a)(1)(A)’’.
(2) Section 4356(b) of OBRA–1990 is amended
by striking ‘‘on the date of the enactment of this
Act’’ and inserting ‘‘on the date specified in section
1882(p)(1)(C) of the Social Security Act’’.
(g) P RE-EXISTING CONDITION LIMITATIONS.—Sec-
tion 1882(s) (42 U.S.C. 1395ss(s)) is amended—
(1) in paragraph (2)(A), by striking ‘‘for which
an application is submitted’’ and inserting ‘‘in the
case of an individual for whom an application is sub-
mitted prior to or’’,
(2) in paragraph (2)(A), by striking ‘‘in which
the individual (who is 65 years of age or older) first
is enrolled for benefits under part B’’ and inserting
‘‘as of the first day on which the individual is 65
years of age or older and is enrolled for benefits
under part B’’, and
(3) in paragraph (2)(B), by striking ‘‘before it’’
and inserting ‘‘before the policy’’.
1066
(h) MEDICARE SELECT POLICIES.—
(1) Section 1882(t) (42 U.S.C. 1395ss(t)) is
amended—
(A) in paragraph (1), by inserting ‘‘medi-
care supplemental’’ after ‘‘If a’’,
(B) in paragraph (1), by striking ‘‘NAIC
Model Standards’’ and inserting ‘‘1991 NAIC
Model Regulation or 1991 Federal Regulation’’,
(C) in paragraph (1)(A), by inserting ‘‘or
agreements’’ after ‘‘contracts’’,
(D) in subparagraphs (E)(i) and (F) of
paragraph (1), by striking ‘‘NAIC standards’’
and inserting ‘‘standards in the 1991 NAIC
Model Regulation or 1991 Federal Regulation’’,
and
(E) in paragraph (2), by inserting ‘‘the is-
suer’’ before ‘‘is subject to a civil money pen-
alty’’.
(2) Section 1154(a)(4)(B) (42 U.S.C. 1320c–
3(a)(4)(B)) is amended—
(A) by inserting ‘‘that is’’ after ‘‘(or’’, and
(B) by striking ‘‘1882(t)’’ and inserting
‘‘1882(t)(3)’’.
(i) HEALTH
INSURANCE
COUNSELING.—Section
4360 of OBRA–1990 is amended—
1067
(1) in subsection (b)(2)(A)(ii), by striking
‘‘Act’’ and inserting ‘‘Act)’’;
(2) in subsection (b)(2)(D), by striking ‘‘serv-
ices’’ and inserting ‘‘counseling’’;
(3) in subsection (b)(2)(I), by striking ‘‘assist-
ance’’ and inserting ‘‘referrals’’;
(4) in subsection (c)(1), by striking ‘‘and that
such activities will continue to be maintained at such
level’’;
(5) in subsection (d)(3), by striking ‘‘to the
rural areas’’ and inserting ‘‘eligible individuals resid-
ing in rural areas’’;
(6) in subsection (e)—
(A) by striking ‘‘subsection (c) or (d)’’ and
inserting ‘‘this section’’,
(B) by striking ‘‘and annually thereafter,
issue an annual report’’ and inserting ‘‘and an-
nually thereafter during the period of the grant,
issue a report’’, and
(C) in paragraph (1), by striking ‘‘State-
wide’’;
(7) in subsection (f), by striking paragraph (2)
and by redesignating paragraphs (3) through (5) as
paragraphs (2) through (4), respectively; and
1068
(8) by redesignating the second subsection (f)
(relating to authorization of appropriations for
grants) as subsection (g).
(j) TELEPHONE INFORMATION SYSTEM.—
(1) Section 1804 (42 U.S.C. 1395b–2) is
amended—
(A) by adding at the end of the heading
the following: ‘‘; MEDICARE AND MEDIGAP IN-
FORMATION’’,
(B) by inserting ‘‘(a)’’ after ‘‘1804.’’, and
(C) by adding at the end the following new
subsection:
‘‘(b) The Secretary shall provide information via a
toll-free telephone number on the programs under this
title.’’.
(2) Section 1882(f) (42 U.S.C. 1395ss(f)) is
amended by adding at the end the following new
paragraph:
‘‘(3) The Secretary shall provide information via a
toll-free telephone number on medicare supplemental poli-
cies (including the relationship of State programs under
title XIX to such policies).’’.
(3) Section 1889 is repealed.
(k) M AILING OF POLICIES.—Section 1882(d)(4) (42
U.S.C. 1395ss(d)(4)) is amended—
1069
(1) in subparagraph (D), by striking ‘‘, if such
policy’’ and all that follows up to the period at the
end, and
(2) by adding at the end the following new sub-
paragraph:
‘‘(E) Subparagraph (A) shall not apply in the case
of an issuer who mails or causes to be mailed a policy,
certificate, or other matter solely to comply with the re-
quirements of subsection (q).’’.
(l) E FFECTIVE DATE.—The amendments made by
this section shall be effective as if included in the enact-
ment of OBRA–1990; except that—
(1) the amendments made by subsection (d)(1)
shall take effect on the date of the enactment of this
Act, but no penalty shall be imposed under section
1882(d)(3)(A) of the Social Security Act (for an ac-
tion occurring after the effective date of the amend-
ments made by section 4354 of OBRA–1990 and be-
fore the date of the enactment of this Act) with re-
spect to the sale or issuance of a policy which is not
unlawful under section 1882(d)(3)(A)(i)(II) of the
Social Security Act (as amended by this section);
(2) the amendments made by subsection
(d)(2)(A) and by subparagraphs (A), (B), and (E)
1070
of subsection (e)(1) shall be effective on the date
specified in subsection (m)(4); and
(3) the amendment made by subsection (g)(2)
shall take effect on January 1, 1994, and shall apply
to individuals who attain 65 years of age or older on
or after the effective date of section 1882(s)(2) of
the Social Security Act (and, in the case of individ-
uals who attained 65 years of age after such effec-
tive date and before January 1, 1994, and who were
not covered under such section before January 1,
1994, the 6-month period specified in that section
shall begin January 1, 1994).
(m) TRANSITION PROVISIONS.—
(1) I N GENERAL.—If the Secretary of Health
and Human Services identifies a State as requiring
a change to its statutes or regulations to conform its
regulatory program to the changes made by this sec-
tion, the State regulatory program shall not be con-
sidered to be out of compliance with the require-
ments of section 1882 of the Social Security Act due
solely to failure to make such change until the date
specified in paragraph (4).
(2) NAIC STANDARDS.—If, within 6 months
after the date of the enactment of this Act, the Na-
tional Association of Insurance Commissioners (in
1071
this subsection referred to as the ‘‘NAIC’’) modifies
its 1991 NAIC Model Regulation (adopted in July
1991) to conform to the amendments made by this
section and to delete from section 15C the exception
which begins with ‘‘unless’’, such modifications shall
be considered to be part of that Regulation for the
purposes of section 1882 of the Social Security Act.
(3) SECRETARY
STANDARDS.—If the NAIC
does not make the modifications described in para-
graph (2) within the period specified in such para-
graph, the Secretary of Health and Human Services
shall make the modifications described in such para-
graph and such modifications shall be considered to
be part of that Regulation for the purposes of sec-
tion 1882 of the Social Security Act.
(4) DATE SPECIFIED.—
(A) IN
GENERAL.—Subject to subpara-
graph (B), the date specified in this paragraph
for a State is the earlier of—
(i) the date the State changes its stat-
utes or regulations to conform its regu-
latory program to the changes made by
this section, or
1072
(ii) 1 year after the date the NAIC or
the Secretary first makes the modifications
under paragraph (2) or (3), respectively.
(B) A DDITIONAL LEGISLATIVE ACTION RE-
QUIRED.—In the case of a State which the Sec-
retary identifies as—
(i) requiring State legislation (other
than legislation appropriating funds) to
conform its regulatory program to the
changes made in this section, but
(ii) having a legislature which is not
scheduled to meet in 1994 in a legislative
session in which such legislation may be
considered,
the date specified in this paragraph is the first
day of the first calendar quarter beginning after
the close of the first legislative session of the
State legislature that begins on or after Janu-
ary 1, 1994. For purposes of the previous sen-
tence, in the case of a State that has a 2-year
legislative session, each year of such session
shall be deemed to be a separate regular session
of the State legislature.
1073
CHAPTER 5—TREATMENT OF CERTAIN
STATE HEALTH CARE PROGRAMS
SEC. 13581. TREATMENT OF CERTAIN STATE HEALTH CARE
PROGRAMS.
Section 514(b)(5) of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1144(b)(5)) is
amended to read as follows:
‘‘(5)(A) Except as provided in subparagraphs
(B) and (C), subsection (a) shall not apply to the
Hawaii Prepaid Health Care Act (Haw. Rev. Stat.
§§ 393–1 through 393–51).
‘‘(B) Nothing in subparagraph (A) shall be con-
strued to exempt from subsection (a) any State tax
law relating to employee benefits plans.
‘‘(C) If the Secretary of Labor notifies the Gov-
ernor of the State of Hawaii that as the result of
an amendment to the Hawaii Prepaid Health Care
Act enacted after October 5, 1992—
‘‘(i) the proportion of the population with
health care coverage under such Act is less than
such proportion on such date, or
‘‘(ii) the level of benefit coverage provided
under such Act is less than the actuarial equiv-
alent of such level of coverage on such date,
1074
subparagraph (A) shall not apply with respect to the
application of such amendment to such Act after the
date of such notification.’’.
Subtitle D—Customs and Trade
Provisions
SEC. 13601. CUSTOMS AND TRADE AGENCY AUTHORIZA-
TIONS FOR FISCAL YEARS 1994 AND 1995.
(a) U NITED STATES INTERNATIONAL TRADE COM-
MISSION.—Section 330(e)(2) of the Tariff Act of 1930 (19
U.S.C. 1330(e)(2)) is amended to read as follows:
‘‘(2)(A) There are authorized to be appropriated to
the Commission for necessary expenses (including the
rental of conference rooms in the District of Columbia and
elsewhere) not to exceed the following:
‘‘(i) $45,416,000 for fiscal year 1994.
‘‘(ii) $45,974,000 for fiscal year 1995.
‘‘(B) Not to exceed $2,500 of the amount authorized
to be appropriated for any fiscal year under subparagraph
(A) may
be
used,
subject
to
the
approval
of
the
Chairman of the Commission, for reception and entertain-
ment expenses.
‘‘(C) No part of any sum that is appropriated under
the authority of subparagraph (A) may be used by the
Commission in the making of any special study, investiga-
tion, or report that is requested by any agency of the exec-
1075
utive branch unless that agency reimburses the Commis-
sion for the cost thereof.’’.
(b) UNITED STATES CUSTOMS SERVICE.—Section
301(b) of the Customs Procedural Reform and Simplifica-
tion Act of 1978 (19 U.S.C. 2075(b)) is amended to read
as follows:
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) FOR
NONCOMMERCIAL
OPERATIONS.—
There are authorized to be appropriated for the sala-
ries and expenses of the Customs Service that are
incurred in noncommercial operations not to exceed
the following:
‘‘(A) $540,783,000 for fiscal year 1994.
‘‘(B) $527,000,000 for fiscal year 1995.
‘‘(2) 
FOR
COMMERCIAL
OPERATIONS.—(A)
There are authorized to be appropriated for the sala-
ries and expenses of the Customs Service that are
incurred in commercial operations not less than the
following:
‘‘(i) $771,036,000 for fiscal year 1994.
‘‘(ii) $748,000,000 for fiscal year 1995.
‘‘(B) The monies authorized to be appropriated
under subparagraph (A) for any fiscal year, except
for such sums as may be necessary for the salaries
and expenses of the Customs Service that are in-
1076
curred in connection with the processing of merchan-
dise that is exempt from the fees imposed under sec-
tion 13031(a) (9) and (10) of the Consolidated Om-
nibus Budget Reconciliation Act of 1985, shall be
appropriated from the Customs User Fee Account.
‘‘(3) FOR AIR AND MARINE INTERDICTION.—
There are authorized to be appropriated for the op-
eration (including salaries and expenses) and main-
tenance of the air and marine interdiction programs
of the Customs Service not to exceed the following:
‘‘(A) $95,156,000 for fiscal year 1994.
‘‘(B) $128,000,000 for fiscal year 1995.’’.
(c) O FFICE OF THE UNITED STATES TRADE REP-
RESENTATIVE.—Section 141(g)(1) of the Trade Act of
1974 (19 U.S.C. 2171(g)(1)) is amended to read as
follows:
‘‘(g)(1)(A) There are authorized to be appropriated
to the Office for the purposes of carrying out its functions
not to exceed the following:
‘‘(i) $20,143,000 for fiscal year 1994.
‘‘(ii) $20,419,000 for fiscal year 1995.
‘‘(B) Of the amounts authorized to be appropriated
under subparagraph (A) for any fiscal year—
1077
‘‘(i) not to exceed $98,000 may be used for en-
tertainment and representation expenses of the Of-
fice; and
‘‘(ii) not to exceed $2,500,000 shall remain
available until expended.’’.
SEC. 13602. EXTENSION OF AUTHORITY TO LEVY CUSTOMS
USER FEES.
Section 13031(j)(3) of the Consolidated Omnibus
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3))
is amended by striking out ‘‘1995’’ and inserting ‘‘1998’’.
SEC. 13603. GENERALIZED SYSTEM OF PREFERENCES.
(a) TREATMENT OF COUNTRIES FORMERLY WITHIN
THE UNION
OF SOVIET SOCIALIST REPUBLICS.—The
table in section 502(b) of the Trade Act of 1974 (19
U.S.C. 2462(b)) is amended by striking out ‘‘Union of So-
viet Socialist Republics’’.
(b) EXTENSION OF DUTY-FREE TREATMENT UNDER
SYSTEM.—
(1) I N GENERAL.—Section 505(a) of the Trade
Act of 1974 (19 U.S.C. 2465(a)) is amended by
striking out ‘‘July 4, 1993’’ and inserting ‘‘Septem-
ber 30, 1994’’.
(2) R ETROACTIVE APPLICATION FOR CERTAIN
LIQUIDATIONS
AND
RELIQUIDATIONS.—Notwith-
standing section 514 of the Tariff Act of 1930 or
1078
any other provision of law, upon proper request filed
with the appropriate customs officer within 180 days
after the date of the enactment of this Act, the
entry—
(A) of any article to which duty-free treat-
ment under title V of the Trade Act of 1974
would have applied if the entry had been made
on July 4, 1993, and
(B) that was made after July 4, 1993, and
before such date of enactment,
shall be liquidated or reliquidated as free of duty,
and the Secretary of the Treasury shall refund any
duty paid with respect to such entry. As used in this
paragraph, the term ‘‘entry’’ includes a withdrawal
from warehouse for consumption.
SEC. 13604. EXTENSION OF, AND AUTHORIZATION OF AP-
PROPRIATIONS FOR, THE WORKER TRADE
ADJUSTMENT ASSISTANCE PROGRAM.
(a) E XTENSION.—Section 285 of the Trade Act of
1974 (19 U.S.C. note preceding 2271) is amended—
(1) by striking out ‘‘No’’ and all that follows
thereafter down through ‘‘chapter 2, no’’ in sub-
section (b) and inserting ‘‘No’’; and
(2) by adding at the end the following new sub-
section:
1079
‘‘(c) No assistance, vouchers, allowances, or other
payments may be provided under chapter 2 after Septem-
ber 30, 1996.’’.
(b) A UTHORIZATION OF APPROPRIATIONS.—Section
245 of the Trade Act of 1974 (19 U.S.C. 2317) is amend-
ed by striking out ‘‘and 1993,’’ and inserting ‘‘1993,
1994, 1995, and 1996,’’.
SEC. 13605. EXTENSION OF URUGUAY ROUND TRADE
AGREEMENT NEGOTIATING AND PROCLAMA-
TION AUTHORITY AND OF ‘‘FAST TRACK’’ PRO-
CEDURES TO IMPLEMENTING LEGISLATION.
Section 1102 of the Omnibus Trade and Competitive-
ness Act of 1988 (19 U.S.C. 2902) is amended by insert-
ing at the end the following new subsection:
‘‘(e) SPECIAL PROVISIONS REGARDING URUGUAY
ROUND TRADE NEGOTIATIONS.—
‘‘(1) IN GENERAL.—Notwithstanding the time
limitations in subsections (a) and (b), if the Uru-
guay Round of multilateral trade negotiations under
the auspices of the General Agreement on Tariffs
and Trade has not resulted in trade agreements by
May 31, 1993, the President may, during the period
after May 31, 1993, and before April 16, 1994,
enter into, under subsections (a) and (b), trade
agreements resulting from such negotiations.
1080
‘‘(2) APPLICATION OF TARIFF PROCLAMATION
AUTHORITY.—No proclamation under subsection (a)
to carry out the provisions regarding tariff barriers
of a trade agreement that is entered into pursuant
to paragraph (1) may take effect before the effective
date of a bill that implements the provisions regard-
ing nontariff barriers of a trade agreement that is
entered into under such paragraph.
‘‘(3) APPLICATION
OF
IMPLEMENTING
AND
‘FAST TRACK’ PROCEDURES.—Section 1103 applies
to any trade agreement negotiated under subsection
(b) pursuant to paragraph (1), except that—
‘‘(A) in applying subsection (a)(1)(A) of
section 1103 to any such agreement, the phrase
‘at least 120 calendar days before the day on
which he enters into the trade agreement (but
not later than December 15, 1993),’ shall be
substituted for the phrase ‘at least 90 calendar
days before the day on which he enters into the
trade agreement; and
‘‘(B) no provision of subsection (b) of sec-
tion 1103 other than paragraph (1)(A) applies
to any such agreement and in applying such
paragraph, ‘April 16, 1994;’ shall be sub-
stituted for ‘June 1, 1991;’.
1081
‘‘(4) ADVISORY COMMITTEE REPORTS.—The re-
port required under section 135(e)(1) of the Trade
Act of 1974 regarding any trade agreement provided
for under paragraph (1) shall be provided to the
President, the Congress, and the United States
Trade Representative not later than 30 days after
the date on which the President notifies the Con-
gress under section 1103(a)(1)(A) of his intention to
enter into the agreement (but before January 15,
1994).’’.
SEC. 13606. REPEAL OF EAST-WEST TRADE STATISTICS
MONITORING SYSTEM.
(a) REPEAL.—Section 410 of the Trade Act of 1974
(19 U.S.C. 2440) is repealed.
(b) C ONFORMING AMENDMENT.—The table of con-
tents for such Act of 1974 is amended by striking out the
following:
‘‘Sec. 410. East-West Trade Statistics Monitoring System.’’.
Subtitle E—Customs Officer Pay
Reform
SEC. 13701. OVERTIME AND PREMIUM PAY FOR CUSTOMS
OFFICERS.
(a) IN GENERAL.—Section 5 of the Act of February
13, 1911 (19 U.S.C. 261 and 267) is amended to read
as follows:
1082
‘‘SEC. 5. OVERTIME AND PREMIUM PAY FOR CUSTOMS OF-
FICERS.
‘‘(a) OVERTIME PAY.—
‘‘(1) IN GENERAL.—Subject to paragraph (2)
and subsection (c), a customs officer who is officially
assigned to perform work in excess of 40 hours in
the administrative workweek of the officer or in ex-
cess of 8 hours in a day shall be compensated for
that work at an hourly rate of pay that is equal to
2 times the hourly rate of the basic pay of the offi-
cer. For purposes of this paragraph, the hourly rate
of basic pay for a customs officer does not include
any premium pay provided for under subsection (b).
‘‘(2) S PECIAL PROVISIONS RELATING TO OVER-
TIME WORK ON CALLBACK BASIS.—
‘‘(A) M INIMUM DURATION.—Any work for
which compensation is authorized under para-
graph (1) and for which the customs officer is
required to return to the officer’s place of work
shall be treated as being not less than 2 hours
in duration; but only if such work begins at
least 1 hour after the end of any previous regu-
larly scheduled work assignment and ends at
least 1 hour before the beginning of the follow-
ing regularly scheduled work assignment.
1083
‘‘(B) COMPENSATION
FOR
COMMUTING
TIME.—
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), in addition to the com-
pensation authorized under paragraph (1)
for work to which subparagraph (A) ap-
plies, the customs officer is entitled to be
paid, as compensation for commuting time,
an amount equal to 3 times the hourly rate
of basic pay of the officer.
‘‘(ii) EXCEPTION.—Compensation for
commuting time is not payable under
clause (i) if the work for which compensa-
tion is authorized under paragraph (1)—
‘‘(I) does not commence within
16 hours of the customs officer’s last
regularly scheduled work assignment,
or
‘‘(II) commences within 2 hours
of the next regularly scheduled work
assignment of the customs officer.
‘‘(b) PREMIUM PAY FOR CUSTOMS OFFICERS.—
‘‘(1) NIGHT WORK DIFFERENTIAL.—
‘‘(A) 3 P.M. TO MIDNIGHT SHIFTWORK.—If
the majority of the hours of regularly scheduled
1084
work of a customs officer occur during the pe-
riod beginning at 3 p.m. and ending at 12 a.m.,
the officer is entitled to pay for work during
such period (except for work to which para-
graph (2) or (3) applies) at the officer’s hourly
rate of basic pay plus premium pay amounting
to 15 percent of that basic rate.
‘‘(B) 11 P.M. TO 8 A.M. SHIFTWORK.—If
the majority of the hours of regularly scheduled
work of a customs officer occur during the pe-
riod beginning at 11 p.m. and ending at 8 a.m.,
the officer is entitled to pay for work during
such period (except for work to which para-
graph (2) or (3) applies) at the officer’s hourly
rate of basic pay plus premium pay amounting
to 20 percent of that basic rate.
‘‘(C) 7:30 P.M. TO 3:30 A.M. SHIFTWORK.—
If the regularly scheduled work assignment of a
customs officer is 7:30 p.m. to 3:30 a.m., the
officer is entitled to pay for work during such
period (except for work to which paragraph (2)
or (3) applies) at the officer’s hourly rate of
basic pay plus premium pay amounting to 15
percent of that basic rate for the period from
7:30 p.m. to 11:30 p.m. and at the officer’s
1085
hourly rate of basic pay plus premium pay
amounting to 20 percent of that basic rate for
the period from 11:30 p.m. to 3:30 a.m.
‘‘(2) S UNDAY DIFFERENTIAL.—A customs offi-
cer who performs any regularly scheduled work on a
Sunday that is not a holiday is entitled to pay for
that work at the officer’s hourly rate of basic pay
plus premium pay amounting to 50 percent of that
basic rate.
‘‘(3) HOLIDAY DIFFERENTIAL.—A customs offi-
cer who performs any regularly scheduled work on a
holiday is entitled to pay for that work at the offi-
cer’s hourly rate of basic pay plus premium pay
amounting to 100 percent of that basic rate.
‘‘(4) TREATMENT OF PREMIUM PAY.—Premium
pay provided for under this subsection may not be
treated as being overtime pay or compensation for
any purpose.
‘‘(c) LIMITATIONS.—
‘‘(1) FISCAL
YEAR
CAP.—The aggregate of
overtime pay under subsection (a) (including com-
muting compensation under subsection (a)(2)(B))
and premium pay under subsection (b) that a cus-
toms officer may be paid in any fiscal year may not
exceed $25,000; except that the Commissioner of
1086
Customs or his designee may waive this limitation in
individual cases in order to prevent excessive costs
or to meet emergency requirements of the Customs
Service.
‘‘(2) EXCLUSIVITY OF PAY UNDER THIS SEC-
TION.—A customs officer who receives overtime pay
under subsection (a) or premium pay under sub-
section (b) for time worked may not receive pay or
other compensation for that work under any other
provision of law.
‘‘(d) REGULATIONS.—The Secretary of the Treasury
shall prescribe such regulations as are necessary or appro-
priate to carry out this section, including regulations—
‘‘(1) to ensure that callback work assignments
are commensurate with the overtime pay authorized
for such work; and
‘‘(2) to prevent the disproportionate assignment
of overtime work to customs officers who are near
to retirement.
‘‘(e) DEFINITIONS.—As used in this section:
‘‘(1) The term ‘customs officer’ means an indi-
vidual performing those functions specified by regu-
lation by the Secretary of the Treasury for a cus-
toms inspector or canine enforcement officer. Such
functions shall be consistent with such applicable
1087
standards as may be promulgated by the Office of
Personnel Management.
‘‘(2) The term ‘holiday’ means any day des-
ignated as a holiday under a Federal statute or Ex-
ecutive order.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 2 of the Act of June 3, 1944 (19
U.S.C. 1451a), is repealed.
(2) Section 450 of the Tariff Act of 1930 (19
U.S.C. 1450) is amended—
(A) by striking out ‘‘at night’’ in the sec-
tion heading and inserting ‘‘during overtime
hours’’;
(B) by striking out ‘‘at night’’ and insert-
ing ‘‘during overtime hours’’; and
(C) by inserting ‘‘aircraft,’’ immediately
before ‘‘vessel’’.
(c) E FFECTIVE DATE.—The amendments made by
subsections (a) and (b) apply to customs inspectional serv-
ices provided on or after October 1, 1993.
SEC. 13702. FOREIGN LANGUAGE PROFICIENCY AWARDS
FOR CUSTOMS OFFICERS.
Cash awards for foreign language proficiency may,
under regulations prescribed by the Secretary of the
Treasury, be paid to customs officers (as referred to in
1088
section 5(e)(1) of the Act of February 13, 1911) to the
same extent and in the same manner as would be allowable
under subchapter III of chapter 45 of title 5, United
States Code, with respect to law enforcement officers (as
defined by section 4521 of such title).
SEC. 13703. APPROPRIATIONS REIMBURSEMENTS FROM
THE CUSTOMS USER FEE ACCOUNT.
Section 13031(f)(3) of the Consolidated Omnibus
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(f)(3))
is amended—
(1) by amending clause (i) of subparagraph (A)
to read as follows: ‘‘(i) in—
‘‘(I) paying overtime compensation under
section 5(a) of the Act of February 13, 1911,
‘‘(II) paying premium pay under section
5(b) of the Act of February 13, 1911, but the
amount for which reimbursement may be made
under this subclause may not, for any fiscal
year, exceed the difference between the cost of
the premium pay for that year calculated under
such section 5(b) as amended by section 13701
of the Omnibus Budget Reconciliation Act of
1993 and the cost of such pay calculated under
subchapter V of chapter 55 of title 5, United
States Code,
1089
‘‘(III) paying agency contributions to the
Civil Service Retirement and Disability Fund to
match deductions from the overtime compensa-
tion paid under subclause (I), and
‘‘(IV) providing all preclearance services
for which the recipients of such services are not
required to reimburse the Secretary of the
Treasury, and’’;
(2) by inserting before the flush sentence ap-
pearing after clause (ii) of subparagraph (A) the fol-
lowing sentence: ‘‘The transfer of funds required
under subparagraph (C)(iii) has priority over reim-
bursements under this subparagraph to carry out
subclauses (II), (III), and (IV) of clause (i).’’;
(3) by striking out ‘‘except for costs described
in subparagraph (A)(i) (I) and (II),’’ in subpara-
graph (B)(i); and
(4) by amending subparagraph (C)—
(A) by striking out ‘‘to fully reimburse
inspectional overtime and preclearance costs’’ in
clause (i) and inserting ‘‘to reimburse costs de-
scribed in subparagraph (A)(i)’’; and
(B) by inserting after clause (ii) of sub-
paragraph (C) the following:
1090
‘‘(iii) For each fiscal year, the Secretary of the
Treasury shall calculate the difference between—
‘‘(I) the estimated cost for overtime com-
pensation that would have been incurred during
that fiscal year for inspectional services if sec-
tion 5 of the Act of February 13, 1911 (19
U.S.C. 261 and 267), as in effect before the en-
actment of section 13701 of the Omnibus
Budget Reconciliation Act of 1993, had gov-
erned such costs, and
‘‘(II) the actual cost for overtime com-
pensation, premium pay, and agency retirement
contributions that is incurred during that fiscal
year in regard to such services under section 5
of the Act of February 13, 1991, as amended
by section 13701 of the Omnibus Budget Rec-
onciliation Act of 1993, and under section
8331(3) of title 5, United States Code, as
amended by section 13704 of such Act of 1993,
and shall transfer from the Customs User Fee Ac-
count to the General Fund of the Treasury an
amount equal to the difference calculated under this
clause, or $18,000,000, whichever amount is less.
Transfers shall be made under this clause at least
quarterly and on the basis of estimates to the same
1091
extent as are reimbursements under subparagraph
(B)(iii).’’.
SEC. 13704. TREATMENT OF CERTAIN PAY OF CUSTOMS OF-
FICERS FOR RETIREMENT PURPOSES.
(a) IN GENERAL.—Section 8331(3) of title 5, United
States Code, is amended—
(1) by striking out ‘‘and’’ at the end of sub-
paragraph (C);
(2) by striking out the semicolon at the end of
subparagraph (D) and inserting ‘‘; and’’;
(3) by adding after subparagraph (D) the fol-
lowing:
‘‘(E) with respect to a customs officer (re-
ferred to in subsection (e)(1) of section 5 of the
Act of February 13, 1911), compensation for
overtime inspectional services provided for
under subsection (a) of such section 5, but not
to exceed 50 percent of any statutory maximum
in overtime pay for customs officers which is in
effect for the year involved;’’; and
(4) by striking out ‘‘subparagraphs (B), (C),
and (D) of this paragraph,’’ and inserting ‘‘subpara-
graphs (B), (C), (D), and (E) of this paragraph’’.
(b) E FFECTIVE DATE.—The amendments made by
subsection (a) take effect on the date of the enactment
1092
of this Act and apply only with respect to service per-
formed on or after such date.
SEC. 13705. REPORTS.
(a) CUSTOMS USER FEE ACCOUNT REPORTS.—Sub-
paragraph (D) of section 13031(f)(3) of the Consolidated
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C.
58c(f)(3)(D)) is amended to read as follows:
‘‘(D) At the close of each fiscal year, the
Secretary of the Treasury shall submit a report
to the Committee on Finance of the Senate and
the Committee on Ways and Means of the
House of Representatives—
‘‘(i) containing a detailed accounting
of all expenditures from the Customs User
Fee Account during such year, including a
summary of the expenditures, on a port-by-
port basis, for which reimbursement has
been provided under subparagraph (A)(ii);
‘‘(ii) containing a listing of all call-
back assignments of customs officers for
which overtime compensation was paid
under section 5(a) of the Act of February
13, 1911, and that were less than 1 hour
in duration; and
1093
‘‘(iii) containing a listing of all cus-
toms officers who were paid $25,000 or
more under subsections 5(a) and 5(b) of
the Act of February 13, 1911, including a
listing of the total compensation paid to
each of those customs officers under all
other statutory authority.’’.
(b) OTHER REPORTS.—
(1) GAO REPORT.—The Comptroller General of
the United States shall undertake—
(A) an evaluation of the appropriateness
and efficiency of the customs user fee laws for
financing the provision of customs inspectional
services; and
(B) a study to determine whether cost sav-
ings in the provision of overtime inspectional
services could be realized by the United States
Customs Service through the use of additional
inspectors as opposed to continuing the current
practice of relying on overtime pay.
The Comptroller General shall submit a report on
the evaluation and study required under this sub-
section to the Committees by no later than the 1st
anniversary of the date of the enactment of this Act.
1094
(2) TREASURY RECOMMENDATION.—On the day
that the President submits the budget for the Unit-
ed States Government for fiscal year 1995 to the
Congress under section 1105(a) of title 31, United
States Code, the Secretary of the Treasury shall
submit to the Committees recommended legislative
proposals for improving the operation of customs
user fee laws in financing the provision of customs
inspectional services.
(3) DEFINITION
OF
COMMITTEES.—For pur-
poses of this subsection, the term ‘‘Committees’’
means the Committee on Ways and Means of the
House of Representatives and the Committee on Fi-
nance of the Senate.
TITLE XIV—REVENUE
PROVISIONS
SEC. 14001. SHORT TITLE; ETC.
(a) S HORT TITLE.—This title may be cited as the
‘‘Revenue Reconciliation Act of 1993’’.
(b) A MENDMENT TO 1986 C ODE.—Except as other-
wise expressly provided, whenever in this title an amend-
ment or repeal is expressed in terms of an amendment
to, or repeal of, a section or other provision, the reference
shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986.
1095
(c) SECTION 15 NOT TO APPLY.—Except in the case
of the amendments made by section 14221 (relating to
corporate rate increase), no amendment made by this title
shall be treated as a change in a rate of tax for purposes
of section 15 of the Internal Revenue Code of 1986.
(d) W AIVER OF ESTIMATED TAX PENALTIES.—No
addition to tax shall be made under section 6654 or 6655
of the Internal Revenue Code of 1986 for any period be-
fore April 16, 1994 (March 16, 1994, in the case of a
corporation), with respect to any underpayment to the ex-
tent such underpayment was created or increased by any
provision of this title.
(e) TABLE OF CONTENTS.—
TITLE XIV—REVENUE PROVISIONS
Sec. 14001. Short title; etc.
Subtitle A—Training and Investment Incentives
PART I—PROVISIONS RELATING TO EDUCATION AND TRAINING
Sec. 14101. Employer-provided educational assistance.
Sec. 14102. Targeted jobs credit.
PART II—INVESTMENT INCENTIVES
SUBPART A—RESEARCH CREDIT
Sec. 14111. Permanent extension of research credit.
Sec. 14112. Modification of fixed base percentage for startup companies.
SUBPART B—CAPITAL GAIN PROVISIONS
Sec. 14113. 50-percent exclusion for gain from certain small business stock.
Sec. 14114. Rollover of gain from sale of publicly traded securities into special-
ized small business investment companies.
SUBPART C—MODIFICATIONS TO MINIMUM TAX DEPRECIATION RULES
Sec. 14115. Modification to minimum tax depreciation rules.
SUBPART D—INCREASE IN EXPENSE TREATMENT FOR SMALL BUSINESSES
Sec. 14116. Increase in expense treatment for small businesses.
1096
PART III—TAX-EXEMPT BOND PROVISIONS
Sec. 14121. High-speed intercity rail facility bonds exempt from State volume
cap.
Sec. 14122. Permanent extension of qualified small issue bonds.
PART IV—EXPANSION AND SIMPLIFICATION OF EARNED INCOME TAX
CREDIT
Sec. 14131. Expansion and simplification of earned income tax credit.
PART V—INCENTIVES FOR INVESTMENT IN REAL ESTATE
SUBPART A—EXTENSION OF QUALIFIED MORTGAGE BONDS AND LOW-INCOME
HOUSING CREDIT
Sec. 14141. Permanent extension of qualified mortgage bonds.
Sec. 14142. Permanent extension of low-income housing credit.
SUBPART B—MODIFICATION OF PASSIVE LOSS RULES
Sec. 14143. Application of passive loss rules to rental real estate activities.
SUBPART C—PROVISIONS RELATING TO REAL ESTATE INVESTMENTS BY
PENSION FUNDS
Sec. 14144. Real estate property acquired by a qualified organization.
Sec. 14145. Repeal of special treatment of publicly traded partnerships.
Sec. 14146. Title-holding companies permitted to receive small amounts of un-
related business taxable income.
Sec. 14147. Exclusion from unrelated business tax of gains from certain prop-
erty.
Sec. 14148. Exclusion from unrelated business tax of certain fees and option
premiums.
Sec. 14149. Treatment of pension fund investments in real estate investment
trusts.
SUBPART D—DISCHARGE OF INDEBTEDNESS
Sec. 14150. Exclusion from gross income for income from discharge of qualified
real property business indebtedness.
SUBPART E—INCREASE IN RECOVERY PERIOD FOR NONRESIDENTIAL REAL
PROPERTY
Sec. 14151. Increase in recovery period for nonresidential real property.
PART VI—LUXURY TAX
Sec. 14161. Repeal of luxury excise taxes other than on passenger vehicles.
Sec. 14162. Exemption from luxury excise tax for certain equipment installed
on passenger vehicles for use by disabled individuals.
Sec. 14163. Tax on diesel fuel used in noncommercial boats.
PART VII—OTHER CHANGES
Sec. 14171. Alternative minimum tax treatment of contributions of appreciated
property.
Sec. 14172. Certain transfers to railroad retirement account made permanent.
1097
Sec. 14173. Temporary extension of deduction for health insurance costs of
self-employed individuals.
Subtitle B—Revenue Increases
PART I—PROVISIONS AFFECTING INDIVIDUALS
SUBPART A—RATE INCREASES
Sec. 14201. Increase in top marginal rate under section 1.
Sec. 14202. Surtax on high-income taxpayers.
Sec. 14203. Modifications to alternative minimum tax rates and exemption
amounts.
Sec. 14204. Overall limitation on itemized deductions for high-income taxpayers
made permanent.
Sec. 14205. Phaseout of personal exemption of high-income taxpayers made
permanent.
Sec. 14206. Provisions to prevent conversion of ordinary income to capital gain.
SUBPART B—OTHER PROVISIONS
Sec. 14207. Repeal of limitation on amount of wages subject to health insur-
ance employment tax.
Sec. 14208. Top estate and gift tax rates made permanent.
Sec. 14209. Reduction in deductible portion of business meals and entertain-
ment.
Sec. 14210. Elimination of deduction for club membership fees.
Sec. 14211. Disallowance of deduction for certain employee remuneration in ex-
cess of $1,000,000.
Sec. 14212. Reduction in compensation taken into account in determining con-
tributions and benefits under qualified retirement plans.
Sec. 14213. Modification to deduction for certain moving expenses.
Sec. 14214. Simplification of individual estimated tax safe harbor based on last
year’s tax.
Sec. 14215. Social security and tier 1 railroad retirement benefits.
PART II—PROVISIONS AFFECTING BUSINESSES
Sec. 14221. Increase in top marginal rate under section 11.
Sec. 14222. Denial of deduction for lobbying expenses.
Sec. 14223. Mark to market accounting method for securities dealers.
Sec. 14224. Clarification of treatment of certain FSLIC financial assistance.
Sec. 14225. Modification of corporate estimated tax rules.
Sec. 14226. Limitation on section 936 credit.
Sec. 14227. Modification to limitation on deduction for certain interest.
PART III—FOREIGN TAX PROVISIONS
SUBPART A—CURRENT TAXATION OF CERTAIN EARNINGS OF CONTROLLED
FOREIGN CORPORATIONS
Sec. 14231. Earnings invested in excess passive assets.
Sec. 14232. Modification to taxation of investment in United States property.
Sec. 14233. Other modifications to subpart F.
SUBPART B—ALLOCATION OF RESEARCH AND EXPERIMENTAL EXPENDITURES
Sec. 14234. Allocation of research and experimental expenditures.
1098
SUBPART C—OTHER PROVISIONS
Sec. 14235. Repeal of certain exceptions for working capital.
Sec. 14236. Modifications of accuracy-related penalty.
Sec. 14237. Denial of portfolio interest exemption for contingent interest.
Sec. 14238. Regulations dealing with conduit arrangements.
PART IV—ENERGY TAX PROVISIONS
SUBPART A—ENERGY TAX BASED ON BTU CONTENT
Sec. 14241. Imposition of energy tax based on Btu content.
SUBPART B—MODIFICATIONS TO TAX ON DIESEL FUEL
Sec. 14242. Modifications to tax on diesel fuel.
Sec. 14243. Floor stocks tax.
SUBPART C—EXTENSION OF MOTOR FUEL TAX RATES; INCREASED DEPOSITS
INTO HIGHWAY TRUST FUND
Sec. 14244. Extension of motor fuel tax rates; increased deposits into highway
trust fund.
PART V—COMPLIANCE PROVISIONS
Sec. 14251. Reporting required for certain payments to corporations.
Sec. 14252. Modifications to substantial understatement and return-preparer
penalties.
Sec. 14253. Returns relating to the cancellation of indebtedness by certain fi-
nancial entities.
PART VI—TREATMENT OF INTANGIBLES
Sec. 14261. Amortization of goodwill and certain other intangibles.
Sec. 14262. Treatment of certain payments to retired or deceased partner.
PART VII—MISCELLANEOUS PROVISIONS
Sec. 14271. Substantiation requirement for deduction of certain charitable con-
tributions.
Sec. 14272. Disclosure related to quid pro quo contributions.
Sec. 14273. Disallowance of interest on certain overpayments of tax.
Sec. 14274. Denial of deduction relating to travel expenses.
Sec. 14275. Increase in withholding from supplemental wage payments.
Subtitle C—Empowerment Zones and Enterprise Communities, Etc.
PART I—EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES
Sec. 14301. Designation and treatment of empowerment zones and enterprise
communities.
Sec. 14302. Expansion of targeted jobs credit.
Sec. 14303. Technical and conforming amendments.
Sec. 14304. Effective date.
PART II—CREDIT FOR CONTRIBUTIONS TO CERTAIN COMMUNITY
DEVELOPMENT CORPORATIONS
1099
Sec. 14311. Credit for contributions to certain community development cor-
porations.
Subtitle D—Other Provisions
PART I—DISCLOSURE PROVISIONS
Sec. 14401. Disclosure of return information for administration of certain vet-
erans programs.
Sec. 14402. Disclosure of return information to carry out income contingent re-
payment of student loans.
Sec. 14403. Use of return information for income verification under certain
housing assistance programs.
PART II—USER FEE PROVISIONS
Sec. 14411. Fees for applications for alcohol labeling and formula reviews.
Sec. 14412. Use of Harbor Maintenance Trust Fund amounts for administra-
tive expenses.
Sec. 14413. Increase in tax on fuel used in commercial transportation on inland
waterways.
PART III—PUBLIC DEBT LIMIT
Sec. 14421. Increase in public debt limit.
PART IV—VACCINE PROVISIONS
Sec. 14431. Excise tax on certain vaccines made permanent.
Sec. 14432. Continuation coverage under group health plans of costs of pedi-
atric vaccines.
Sec. 14433. Childhood Immunization Trust Fund.
Subtitle A—Training and
Investment Incentives
PART I—PROVISIONS RELATING TO EDUCATION
AND TRAINING
SEC. 14101. EMPLOYER-PROVIDED EDUCATIONAL ASSIST-
ANCE.
(a) PERMANENT EXTENSION OF EXCLUSION.—
(1) IN GENERAL.—Section 127 (relating to edu-
cational assistance programs) is amended by striking
subsection (d) and by redesignating subsection (e) as
subsection (d).
1100
(2) CONFORMING AMENDMENT.—Paragraph (2)
of section 103(a) of the Tax Extension Act of 1991
is hereby repealed.
(b) COORDINATION WITH SECTION 132.—Paragraph
(8) of section 132(i) is amended to read as follows:
‘‘(8) A PPLICATION OF SECTION TO OTHERWISE
TAXABLE EDUCATIONAL OR TRAINING BENEFITS.—
Amounts paid or expenses incurred by the employer
for education or training provided to the employee
which are not excludable from gross income under
section 127 shall be excluded from gross income
under this section if (and only if) such amounts or
expenses are a working condition fringe.’’
(c) EFFECTIVE DATES.—
(1) S UBSECTION (a).—The amendments made
by subsection (a) shall apply to taxable years ending
after June 30, 1992.
(2) SUBSECTION (b).—The amendment made
by subsection (b) shall apply to taxable years begin-
ning after December 31, 1988.
(d) TRANSITION RULES.—
(1) W AIVER OF INTEREST AND PENALTIES.—
No interest, penalty, or addition to tax shall be im-
posed or required to be paid solely by reason of a
failure, before the date of the enactment of this Act,
1101
to treat educational assistance in a manner consist-
ent with the provisions of section 103(a) of the Tax
Extension Act of 1991 (as in effect before the
amendments made by subsection (a)).
(2) SPECIAL RULES FOR 1992.—
(A) EMPLOYMENT TAXES.—If—
(i) an employer provided an employee
with educational assistance during the pe-
riod beginning on July 1, 1992, and end-
ing on December 31, 1992,
(ii) consistent with the provisions of
section 103(a) of the Tax Extension Act of
1991 (as so in effect), such employer treat-
ed such assistance as taxable for purposes
of any employment tax and as a result of
such treatment there was an increase in
taxable wages for purposes of such tax,
(iii) on or after the date of the enact-
ment of this Act and before January 1,
1994, such employer pays such employee
amounts which are taxable wages for pur-
poses of such tax and which equal or ex-
ceed the increase referred to in clause (ii),
and
1102
(iv) such employee did not treat such
assistance for purposes of such employ-
ment tax (or for purposes of chapter 1 of
the Internal Revenue Code of 1986 in the
case of employment tax imposed by chap-
ter 24 of such Code) in a manner incon-
sistent with the employer’s treatment of
such assistance,
the amendments made by subsection (a) shall
not apply to such educational assistance for
purposes of such employment tax, but, for pur-
poses of applying such employment tax (and for
purposes of the reporting requirements imposed
by chapter 61 of such Code), the taxable wages
of the employee referred to in clause (iii) shall
be reduced by the amount of the increase re-
ferred to in clause (ii). For purposes of clause
(iv), an employer may assume that the em-
ployee treated the assistance in a manner con-
sistent with the employer’s treatment unless
such employer has actual knowledge to the con-
trary.
(B) R EPORTING REQUIREMENT.—An em-
ployer shall separately report the amounts of
any reduction under subparagraph (A) as non-
1103
taxable income on any returns or receipts re-
quired under chapter 61 of such Code for cal-
endar year 1993.
(C) D EFINITIONS.—For purposes of this
paragraph—
(i) EMPLOYMENT
TAX.—The term
‘‘employment tax’’ means any tax imposed
by subtitle C of such Code.
(ii) 
TAXABLE
WAGES.—The 
term
‘‘taxable wages’’means—
(I) wages (as defined in section
3121(a) of such Code) in the case of
the taxes imposed by chapter 21 of
such Code,
(II) compensation (as defined in
section 3231(e) of such Code) in the
case of the taxes imposed by chapter
22 of such Code,
(III) wages (as defined in section
3306(b) of such Code) in the case of
the taxes imposed by chapter 23 of
such Code, and
(IV) wages (as defined in section
3401(a) of such Code) in the case of
1104
the taxes imposed by chapter 24 of
such Code.
(3) INCOME TAX TREATMENT.—If—
(A) subparagraph (A) of paragraph (2) ap-
plies to any educational assistance referred to
in such paragraph provided to any employee,
and
(B) such employee included such assistance
in his taxable income for purposes of the tax
imposed by chapter 1 of such Code,
the amendments made by subsection (a) shall not
apply to such assistance for purposes of such chap-
ter 1, but the amount included in the gross income
of such employee by reason of wages received from
the employer referred to in subparagraph (A) of
paragraph (2) during 1993 shall be reduced in the
manner provided in such subparagraph (A).
SEC. 14102. TARGETED JOBS CREDIT.
(a) PERMANENT EXTENSION OF CREDIT.—
(1) I N GENERAL.—Subsection (c) of section 51
(relating to amount of targeted jobs credit) is
amended by striking paragraph (4).
(2) E FFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to individuals who
begin work for the employer after June 30, 1992.
1105
(b) CREDIT
FOR
PARTICIPANTS
IN
APPROVED
SCHOOL-TO-WORK PROGRAMS.—
(1) I N GENERAL.—Subparagraph (I) of section
51(d)(1) (defining members of targeted group) is
amended to read as follows:
‘‘(I) a qualified participant in an
approved school-to-work program, or’’.
(2) Q UALIFIED PARTICIPANT IN AN APPROVED
SCHOOL-TO-WORK
PROGRAM.—Paragraph (10) of
section 51(d) is amended to read as follows:
‘‘(10) QUALIFIED
PARTICIPANT
IN
AN
AP-
PROVED SCHOOL-TO-WORK PROGRAM DEFINED.—
‘‘(A) IN GENERAL.—Except as otherwise
provided in this paragraph, the term ‘qualified
participant in an approved school-to-work pro-
gram’ means any individual who is certified
under an approved school-to-work program as—
‘‘(i) having attained age 16 but not
having attained age 21, and
‘‘(ii) being enrolled in and making
satisfactory progress in completing such
approved school-to-work program.
‘‘(B) LIMITATION ON NUMBER OF PARTICI-
PANTS.—
1106
‘‘(i) IN
GENERAL.—Any individual
who begins work for the employer during
any calendar year shall not be treated as
a qualified participant in an approved
school-to-work program unless the individ-
ual is certified under such program as an
eligible participant with respect to such
calendar year.
‘‘(ii) 
LIMITATION
ON
CERTIFI-
CATIONS.—The aggregate number of indi-
viduals certified under an approved school-
to-work program as eligible participants
with respect to any calendar year shall not
exceed the portion of the national school-
to-work program limitation for such cal-
endar year allocated under subsection (l)
to such program.
‘‘(C) APPROVED
SCHOOL-TO-WORK
PRO-
GRAM.—The term ‘approved school-to-work pro-
gram’ means any program which—
‘‘(i) is a planned program of struc-
tured job training designed to integrate
academic instruction provided by an edu-
cational institution and work-based learn-
ing provided by an employer, and
1107
‘‘(ii) is approved by the Secretaries of
Labor and Education.
‘‘(D) L IMITATION ON AMOUNT OF WAGES
TAKEN INTO ACCOUNT.—For purposes of apply-
ing this subpart to wages paid or incurred to
any qualified participant in an approved school-
to-work program, subsection (b)(3) shall be ap-
plied by substituting ‘$3,000’ for ‘$6,000’.
‘‘(E) WAGES.—In the case of remunera-
tion attributable to services performed while the
individual meets the requirements of subpara-
graph (A), wages, and unemployment insurance
wages, shall be determined without regard to
section 3306(c)(10)(C).’’
(3) OVERALL
LIMITATIONS.—Section 51 is
amended by adding at the end thereof the following
new subsection:
‘‘(l) O VERALL LIMITATION ON APPROVED SCHOOL-
TO-WORK PROGRAM PARTICIPANTS.—
‘‘(1) I N GENERAL.—For purposes of subsection
(d)(10), the national school-to-work program limita-
tion—
‘‘(A) for calendar year 1994 is 125,000,
‘‘(B) for calendar year 1995 is 140,000,
‘‘(C) for calendar year 1996 is 160,000,
1113
sued by such corporation which may be taken into
account under subsection (a) for the taxable year
shall not exceed the greater of—
‘‘(A) $10,000,000 reduced by the aggre-
gate amount of eligible gain taken into account
under subsection (a) for prior taxable years and
attributable to dispositions of stock issued by
such corporation, or
‘‘(B) 10 times the aggregate adjusted
bases of qualified small business stock issued by
such corporation and disposed of by the tax-
payer during the taxable year.
For purposes of subparagraph (B), the adjusted
basis of any stock shall be determined without re-
gard to any addition to basis after the date on which
such stock was originally issued.
‘‘(2) ELIGIBLE
GAIN.—For purposes of this
subsection, the term ‘eligible gain’ means any gain
from the sale or exchange of qualified small business
stock held for more than 5 years.
‘‘(3) T REATMENT OF MARRIED INDIVIDUALS.—
‘‘(A) S EPARATE RETURNS.—In the case of
a separate return by a married individual, para-
graph (1)(A) shall be applied by substituting
‘$5,000,000’ for ‘$10,000,000’.