I 
108TH CONGRESS 
1ST SESSION H. R. 1377
To amend title XVIII of the Social Security Act to enhance the access 
of Medicare beneficiaries who live in medically underserved areas to 
critical primary and preventive health care benefits, to improve the 
Medicare+Choice program, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 20, 2003
Mr. WELLER (for himself, Mr. LEWIS of Georgia, Mr. HOUGHTON, Mr. 
MCNULTY, Mr. FARR, Mr. STUPAK, and Mr. HINCHEY) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
and in addition to the Committee on Energy and Commerce, for a period 
to be subsequently determined by the Speaker, in each case for consider-
ation of such provisions as fall within the jurisdiction of the committee 
concerned 
A BILL 
To amend title XVIII of the Social Security Act to enhance 
the access of Medicare beneficiaries who live in medically 
underserved areas to critical primary and preventive 
health care benefits, to improve the Medicare+Choice 
program, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Medicare Safety Net Access Act of 2003’’.
(b) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows:
Sec. 1. Short title; table of contents. 
Sec. 2. Coverage of additional Federally qualified health center services. 
Sec. 3. Providing safe harbor for certain collaborative efforts that benefit medi-
cally underserved populations. 
Sec. 4. Supplemental reimbursement for Federally qualified health centers par-
ticipating in medicare managed care.
SEC. 2. DELIVERY OF MEDICARE-COVERED PRIMARY AND 
PREVENTIVE 
SERVICES 
AT 
FEDERALLY 
QUALIFIED HEALTH CENTERS. 
(a) COVERAGE
OF MEDICARE-COVERED AMBULA-
TORY SERVICES BY FQHCS.—Section 1861(aa)(3) of the 
Social Security Act (42 U.S.C. 1395x(aa)(3)) is amended 
to read as follows: 
‘‘(3) The term ‘Federally qualified health center serv-
ices’ means—
‘‘(A) services of the type described in subpara-
graphs (A) through (C) of paragraph (1), and such 
other services furnished by a Federally qualified 
health center for which payment may otherwise be 
made under this title if such services were furnished 
by a health care provider or health care professional 
other than a Federally qualified health center; and 
‘‘(B) preventive primary health services that a 
center is required to provide under section 330 of 
the Public Health Service Act,
when furnished to an individual as a patient of a Federally 
qualified health center and such services when provided 
by a health care provider or health care professional em-
ployed by or under contract with a Federally qualified 
health center shall be treated as billable visits for purposes 
of payment to the Federally qualified health center.’’. 
(b) ENSURING
FQHC REIMBURSEMENT
UNDER 
HOSPITAL AND SKILLED NURSING FACILITY PROSPEC-
TIVE PAYMENT SYSTEMS.—
(1) PATIENTS OF HOSPITALS AND CRITICAL AC-
CESS HOSPITALS.—Section 1862(a)(14) of the Social 
Security Act (42 U.S.C. 1395y(a)) is amended by 
inserting ‘‘Federally qualified health center serv-
ices,’’ after ‘‘qualified psychologist services,’’. 
(2) PATIENTS
OF
SKILLED
NURSING
FACILI-
TIES.—Section 1888(e)(2)(A) of the Social Security 
Act (42 U.S.C. 1395yy(e)(2)(A)) is amended—
(A) in clause (i)(II), by striking ‘‘clauses 
(ii) and (iii)’’ and inserting ‘‘clauses (ii) 
through (iv)’’; and 
(B) by adding at the end the following new 
clause: 
‘‘(iv) 
EXCLUSION
OF
FEDERALLY 
QUALIFIED HEALTH CENTER SERVICES.—
Services described in this clause are Feder-
ally qualified health center services (as de-
fined in section 1861(aa)(3)).’’. 
(c) TECHNICAL
CORRECTIONS.—Clauses (i) and 
(ii)(II) of section 1861(aa)(4)(A) of the Social Security 
Act (42 U.S.C. 1395x(aa)(4)(A)) are each amended by 
striking ‘‘(other than subsection (h))’’. 
(d) EFFECTIVE DATES.—The amendments made—
(1) by subsections (a) and (b) shall apply to 
services furnished on or after January 1, 2004; and 
(2) by subsection (c) shall take effect on the 
date of enactment of this Act. 
SEC. 3. PROVIDING SAFE HARBOR FOR CERTAIN COLLABO-
RATIVE EFFORTS THAT BENEFIT MEDICALLY 
UNDERSERVED POPULATIONS.
(a) IN GENERAL.—Section 1128B(b)(3) (42 U.S.C. 
1320a–7(b)(3)) is amended—
(1) in subparagraph (E), by striking ‘‘and’’ 
after the semicolon at the end; 
(2) in subparagraph (F), by striking the period 
at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph:
‘‘(G) any remuneration between a public or 
nonprofit private health center entity described 
under clause (i) or (ii) of section 1905(l)(2)(B)
and any individual or entity providing goods, 
items, services, donations or loans, or a com-
bination thereof, to such health center entity 
pursuant to a contract, lease, grant, loan, or 
other agreement, if such agreement contributes 
to the ability of the health center entity to 
maintain or increase the availability, or enhance 
the quality, of services provided to a medically 
underserved population served by the health 
center entity.’’. 
(b) RULEMAKING
FOR EXCEPTION
FOR HEALTH 
CENTER ENTITY ARRANGEMENTS.—
(1) ESTABLISHMENT.—
(A) 
IN
GENERAL.—The 
Secretary 
of 
Health and Human Services (in this subsection 
referred to as the ‘‘Secretary’’) shall establish, 
on an expedited basis, standards relating to the 
exception described in section 1128B(b)(3)(G) 
of the Social Security Act, as added by sub-
section (a), for health center entity arrange-
ments to the antikickback penalties. 
(B) FACTORS
TO
CONSIDER.—The Sec-
retary shall consider the following factors, 
among others, in establishing standards relating
to the exception for health center entity ar-
rangements under subparagraph (A): 
(i) Whether the arrangement between 
the health center entity and the other 
party results in savings of Federal grant 
funds or increased revenues to the health 
center entity. 
(ii) Whether the arrangement between 
the health center entity and the other 
party restricts or limits a patient’s freedom 
of choice. 
(iii) Whether the arrangement be-
tween the health center entity and the 
other party protects a health care profes-
sional’s independent medical judgment re-
garding medically appropriate treatment. 
The Secretary may also include other standards 
and criteria that are consistent with the intent 
of Congress in enacting the exception estab-
lished under this section. 
(2) INTERIM
FINAL
EFFECT.—No later than 
180 days after the date of enactment of this Act, the 
Secretary shall publish a rule in the Federal Reg-
ister consistent with the factors under paragraph 
(1)(B). Such rule shall be effective and final imme-
diately on an interim basis, subject to such change 
and revision, after public notice and opportunity (for 
a period of not more than 60 days) for public com-
ment, as is consistent with this subsection. 
SEC. 4. REIMBURSEMENT FOR FEDERALLY QUALIFIED 
HEALTH CENTERS PARTICIPATING IN MEDI-
CARE MANAGED CARE. 
(a) REIMBURSEMENT.—
(1) IN GENERAL.—Section 1833(a)(3) of the 
Social Security Act (42 U.S.C. 1395l(a)(3)) is 
amended to read as follows: 
‘‘(3) in the case of services described in section 
1832(a)(2)(D)—
‘‘(A) except as provided in subparagraph 
(B), the costs which are reasonable and related 
to the cost of furnishing such services or which 
are based on such other tests of reasonableness 
as the Secretary may prescribe in regulations, 
including 
those 
authorized 
under 
section 
1861(v)(1)(A), less the amount a provider may 
charge as described in clause (ii) of section 
1866(a)(2)(A), but in no case may the payment 
for such services (other than for items and serv-
ices described in section 1861(s)(10)(A)) exceed 
80 percent of such costs; or
‘‘(B) with respect to the services described 
in clause (ii) of section 1832(a)(2)(D) that are 
furnished to an individual enrolled with a 
Medicare+Choice organization under part C 
pursuant to a written agreement described in 
section 1853(j), the amount by which—
‘‘(i) the amount of payment that 
would have otherwise been provided under 
subparagraph (A) (calculated as if ‘100 
percent’ were substituted for ‘80 percent’ 
in such subparagraph) for such services if 
the individual had not been so enrolled; ex-
ceeds 
‘‘(ii) the amount of the payments re-
ceived under such written agreement for 
such services (not including any financial 
incentives provided for in such agreement 
such as risk pool payments, bonuses, or 
withholds), 
less the amount the Federally qualified health 
center may charge as described in section 
1857(e)(3)(C);’’.
(b) CONTINUATION OF MEDICARE+CHOICE MONTH-
LY PAYMENTS.—
(1) IN GENERAL.—Section 1853 of the Social 
Security Act (42 U.S.C. 1395w–23) is amended by 
adding at the end the following new subsection: 
‘‘(j) PAYMENT RULE FOR FEDERALLY QUALIFIED 
HEALTH CENTER SERVICES.—If an individual who is en-
rolled with a Medicare+Choice organization under this 
part receives a service from a Federally qualified health 
center that has a written agreement with such organiza-
tion for providing such a service (including any agreement 
required under section 1857(e)(3))—
‘‘(1) the Secretary shall pay the amount deter-
mined under section 1833(a)(3)(B) directly to the 
Federally qualified health center not less frequently 
than quarterly; and 
‘‘(2) the Secretary shall not reduce the amount 
of the monthly payments to the Medicare+Choice 
organization made under section 1853(a) as a result 
of the application of paragraph (1).’’. 
(2) CONFORMING AMENDMENTS.—
(A) Paragraphs (1) and (2) of section 
1851(i) of the Social Security Act (42 U.S.C. 
1395w–21(i)(1)) are each amended by inserting 
‘‘1853(j),’’ after ‘‘1853(h),’’. 
(B) Section 1853(c)(5) is amended by 
striking ‘‘subsections (a)(3)(C)(iii) and (i)’’ and
inserting ‘‘subsections (a)(3)(C)(iii), (i), and 
(j)(1)’’.
(c) ADDITIONAL MEDICARE+CHOICE CONTRACT RE-
QUIREMENTS.—Section 1857(e) of the Social Security Act 
(42 U.S.C. 1395w–27(e)) is amended by adding at the end 
the following new paragraph: 
‘‘(3) AGREEMENTS
WITH
FEDERALLY
QUALI-
FIED HEALTH CENTERS.—
‘‘(A) PAYMENT LEVELS AND AMOUNTS.—A 
contract under this part shall require the 
Medicare+Choice organization to provide, in 
any contract between the organization and a 
Federally qualified health center, for a level and 
amount of payment to the Federally qualified 
health center for services provided by such 
health center that is not less than the level and 
amount of payment that the organization would 
make for such services if the services had been 
furnished by a provider of services that was not 
a Federally qualified health center. 
‘‘(B) COST-SHARING.—Under the written 
agreement described in subparagraph (A), a 
Federally qualified health center must accept 
the Medicare+Choice contract price plus the 
Federal payment provided for in section
1833(a)(3)(B) as payment in full for services 
covered by the contract, except that such a 
health center may collect any amount of cost-
sharing permitted under the contract under this 
part, so long as the amounts of any deductible, 
coinsurance, or copayment comply with the re-
quirements under section 1854(e) and do not 
result in a total payment to the center in excess 
of the amount determined under section 
1833(a)(3)(A) (calculated as if ‘100 percent’ 
were substituted for ‘80 percent’ in such sec-
tion).’’. 
(d) SAFE HARBOR FROM ANTIKICKBACK PROHIBI-
TION.—Section 1128B(b)(3) of the Social Security Act 
(42 U.S.C. 1320a–7b(b)(3)), as amended by section 3(a), 
is amended—
(1) in subparagraph (F), by striking ‘‘and’’ 
after the semicolon at the end; 
(2) in subparagraph (G), by striking the period 
at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(H) any remuneration between a Feder-
ally qualified health center (or an entity con-
trolled by such a health center) and a