I
105TH CONGRESS
1ST SESSION
H. R. 2497
To amend title XVIII of the Social Security Act to clarify the right of
Medicare beneficiaries to enter into private contracts with physicians
and other health care professionals for the provision of health services
for which no payment is sought under the Medicare program.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 18, 1997
Mr. ARCHER (for himself, Mr. THOMAS, Mr. GINGRICH, Mr. ARMEY, Mr.
DELAY, Mr. BOEHNER, Mr. LIVINGSTON, Mr. HYDE, Mr. STUMP, Mr.
COMBEST, Mr. TALENT, Mr. CRANE, Mr. NORWOOD, Mr. GANSKE, Mr.
LINDER, Mr. PAUL, Mr. COOKSEY, Mr. COBURN, Mr. SHAW, Mr.
MCCRERY, Mr. RAMSTAD, Mrs. JOHNSON of Connecticut, Mr. COLLINS,
Mr. CAMP, Mr. SAM JOHNSON of Texas, Mr. ENSIGN, Mr. HAYWORTH,
Mr. WELLER, Mr. ISTOOK, Mr. ROHRABACHER, Mr. DAN SCHAEFER of
Colorado, Mr. BARTON of Texas, Mr. BONILLA, Mr. BOB SCHAFFER of
Colorado, Mr. DOOLITTLE, Mr. MILLER of Florida, Mr. SMITH of Michi-
gan, Mr. HASTINGS of Washington, Mr. MANZULLO, Mrs. CUBIN, Mr.
HOEKSTRA, Mr. UPTON, Mr. HOSTETTLER, Mr. KNOLLENBERG, Mr.
STEARNS, Mr. DICKEY, Mr. THORNBERRY, Mr. SESSIONS, Mr. CANNON,
Ms. GRANGER, Mr. BRADY, Mr. HILL, and Mr. SALMON) introduced the
following bill; which was referred to the Committee on Ways and Means,
and in addition to the Committee on Commerce, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend title XVIII of the Social Security Act to clarify
the right of Medicare beneficiaries to enter into private
contracts with physicians and other health care profes-
sionals for the provision of health services for which
no payment is sought under the Medicare program.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Medicare Beneficiary
Freedom To Contract Act of 1997’’.
SEC. 2. USE OF PRIVATE CONTRACTS BY MEDICARE BENE-
FICIARIES FOR PROFESSIONAL SERVICES.
(a) IN GENERAL.—Section 1802 of the Social Secu-
rity Act (42 U.S.C. 1395a) is amended by striking sub-
section (b), as added by section 4507(a) of the Balanced
Budget Act of 1997 (Public Law 105–33), and inserting
the following:
‘‘(b) CLARIFICATION
OF USE
OF PRIVATE CON-
TRACTS
BY MEDICARE BENEFICIARIES
FOR PROFES-
SIONAL SERVICES.—
‘‘(1) IN GENERAL.—Nothing in this title shall
prohibit a medicare beneficiary from entering into a
private contract with a physician or health care
practitioner for the provision of medicare covered
professional services (as defined in paragraph
(5)(C)) if—
‘‘(A) the services are covered under a pri-
vate contract that is between the beneficiary
and the physician or practitioner and meets the
requirements of paragraph (2);
‘‘(B) under the private contract no claim
for payment for services covered under the con-
tract is to be submitted (and no payment made)
under part A or B, under a contract under sec-
tion 1876, or under a Medicare+Choice plan
(other than an MSA plan); and
‘‘(C)(i) the Secretary has been provided
with the minimum information necessary to
avoid any payment under part A or B for serv-
ices covered under the contract, or
‘‘(ii) in the case of an individual enrolled
under a contract under section 1876 or a
Medicare+Choice plan (other than an MSA
plan) under part C, the eligible organization
under the contract or the Medicare+Choice or-
ganization offering the plan has been provided
the minimum information necessary to avoid
any payment under such contract or plan for
services covered under the contract.
‘‘(2) 
REQUIREMENTS
FOR
PRIVATE
CON-
TRACTS.—The requirements in this paragraph for a
private contract between a medicare beneficiary and
a physician or health care practitioner are as fol-
lows:
‘‘(A) GENERAL FORM OF CONTRACT.—The
contract is in writing and is signed by the medi-
care beneficiary.
‘‘(B) NO CLAIMS TO BE SUBMITTED FOR
COVERED
SERVICES.—The contract provides
that no party to the contract (and no entity on
behalf of any party to the contract) shall sub-
mit any claim for (or request) payment for
services covered under the contract under part
A or B, under a contract under section 1876,
or under a Medicare+Choice plan (other than
an MSA plan).
‘‘(C) SCOPE OF SERVICES.—The contract
identifies the medicare covered professional
services and the period (if any) to be covered
under the contract, but does not cover any serv-
ices furnished—
‘‘(i) before the contract is entered
into; or
‘‘(ii) for the treatment of an emer-
gency medical condition (as defined in sec-
tion 1867(e)(1)(A)), unless the contract
was entered into before the onset of the
emergency medical condition.
‘‘(D) CLEAR DISCLOSURE OF TERMS.—The
contract clearly indicates that by signing the
contract the medicare beneficiary—
‘‘(i) agrees not to submit a claim (or
to request that anyone submit a claim)
under part A or B (or under section 1876
or under a Medicare+Choice plan, other
than an MSA plan) for services covered
under the contract;
‘‘(ii) agrees to be responsible, whether
through insurance or otherwise, for pay-
ment for such services and understands
that no reimbursement will be provided
under such part, contract, or plan for such
services;
‘‘(iii) acknowledges that no limits
under this title (including limits under
paragraph (1) and (3) of section 1848(g))
will apply to amounts that may be charged
for such services;
‘‘(iv) acknowledges that medicare sup-
plemental policies under section 1882 do
not, and other supplemental health plans
and policies may elect not to, make pay-
ments for such services because payment is
not made under this title; and
‘‘(v) acknowledges that the beneficiary
has the right to have such services pro-
vided by (or under the supervision of)
other physicians or health care practition-
ers for whom payment would be made
under such part, contract, or plan.
Such contract shall also clearly indicate whether
the physician or practitioner involved is ex-
cluded from participation under this title.
‘‘(3) MODIFICATIONS.—The parties to a private
contract may mutually agree at any time to modify
or terminate the contract on a prospective basis,
consistent with the provisions of paragraphs (1) and
(2).
‘‘(4) NO REQUIREMENTS FOR SERVICES FUR-
NISHED TO MSA PLAN ENROLLEES.—The require-
ments of paragraphs (1) and (2) do not apply to any
contract or arrangement for the provision of services
to a medicare beneficiary enrolled in an MSA plan
under part C.
‘‘(5) DEFINITIONS.—In this subsection: