I
103D CONGRESS
1ST SESSION
H. R. 1586
To amend title XVIII of the Social Security Act to eliminate the annual
cap on the amount of payment for outpatient physical therapy and
occupational therapy services under part B of the medicare program,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 1, 1993
Mr. RICHARDSON introduced the following bill; which was referred jointly to
the Committees on Ways and Means and Energy and Commerce
A BILL
To amend title XVIII of the Social Security Act to eliminate
the annual cap on the amount of payment for outpatient
physical therapy and occupational therapy services under
part B of the medicare 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. ELIMINATION OF ANNUAL CAP ON AMOUNT OF
MEDICARE 
PAYMENT 
FOR 
OUTPATIENT
PHYSICAL 
THERAPY 
AND 
OCCUPATIONAL
THERAPY SERVICES.
(a) IN GENERAL.—Section 1833 of the Social Secu-
rity Act (42 U.S.C. 1395l) is amended by striking sub-
section (g).
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
SEC. 2. EXTRA-BILLING LIMITS.
(a) ENFORCEMENT AND UNIFORM APPLICATION.—
(1) ENFORCEMENT.—Paragraph (1) of section
1848(g) of the Social Security Act (42 U.S.C.
1395w–4(g)) is amended to read as follows:
‘‘(1) LIMITATION ON ACTUAL CHARGES.—
‘‘(A) IN
GENERAL.—In the case of a
nonparticipating physician or nonparticipating
supplier or other person (as defined in section
1842(i)(2)) who does not accept payment on an
assignment-related basis with respect to a phy-
sician’s service furnished to an individual en-
rolled under this part, the following rules apply:
‘‘(i) 
APPLICATION
OF
LIMITING
CHARGE.—No such physician, supplier, or
person may bill or collect an actual charge
for the service in excess of the limiting
charge described in paragraph (2) for such
service.
‘‘(ii) NO
LIABILITY
FOR
EXCESS
CHARGES.—No person is liable for pay-
ment of any amounts billed for the service
in excess of such limiting charge.
‘‘(iii) 
CORRECTION
OF
EXCESS
CHARGES.—If such a physician, supplier,
or other person bills, but does not collect,
an actual charge for a service in violation
of clause (i), the physician, supplier, or
other person shall reduce on a timely basis
the actual charge billed for the service to
an amount not to exceed the limiting
charge for the service.
‘‘(iv) REFUND
OF
EXCESS
COLLEC-
TIONS.—If such a physician, supplier, or
other person collects an actual charge for
a service in violation of clause (i), the phy-
sician, supplier, or other person shall pro-
vide on a timely basis a refund to the indi-
vidual charged in the amount by which the
amount collected exceeded the limiting
charge for the service. The amount of such
a refund shall be reduced to the extent the
individual has an outstanding balance owed
by the individual to the physician, supplier,
or other person.
‘‘(B) SANCTIONS.—If a physician, supplier,
or other person—
‘‘(i) knowingly and willfully bills or
collects for services in violation of subpara-
graph (A)(i) on a repeated basis, or
‘‘(ii) fails to comply with clause (iii)
or (iv) of subparagraph (A) on a timely
basis,
the Secretary may apply sanctions against the
physician, supplier, or other person in accord-
ance with paragraph (2) of section 1842(j). The
provisions of section 1842(j)(4) shall apply for
purposes of this paragraph except that any ref-
erence in such section to a physician is deemed
also to include a reference to a supplier or other
person under this subparagraph.
‘‘(C) TIMELY BASIS.—For purposes of this
paragraph, the term ‘on a timely basis’, means
not later than 30 days after the date the physi-
cian, supplier, or other person is notified by the
carrier under this part of a violation of the re-
quirements of subparagraph (A).’’.
(2) UNIFORM APPLICATION OF EXTRA-BILLING
LIMITS TO PHYSICIANS’ SERVICES.—
(A) IN GENERAL.—Section 1848(g)(2)(C)
of the Social Security Act (42 U.S.C. 1395w–
4(g)(2)(C)) is amended by inserting ‘‘or for
nonparticipating suppliers or other persons’’
after ‘‘nonparticipating physicians’’.
(B) CONFORMING
DEFINITION.—Section
1842(i)(2) of the Social Security Act (42
U.S.C. 1395u(i)(2)) is amended—
(i) by striking ‘‘, and the term’’ and
inserting ‘‘; the term’’, and
(ii) by inserting before the period at
the end the following: ‘‘; and the term
‘nonparticipating supplier or other person’
means a supplier or other person (exclud-
ing a provider of services) that is not a
participating physician or supplier (as de-
fined in subsection (h)(1))’’.
(3) ADDITIONAL CONFORMING AMENDMENTS.—
Section 1848 of the Social Security Act (42 U.S.C.
1395w–4) is amended—
(A) in subsection (a)(3)—
(i) by inserting ‘‘AND
SUPPLIERS’’
after ‘‘PHYSICIANS’’,
(ii) 
by 
inserting 
‘‘or 
a
nonparticipating supplier or other person
(as defined in section 1842(i)(2))’’ after
‘‘nonparticipating physician’’, and
(iii) by adding at the end the follow-
ing: ‘‘In the case of physicians’ services
(including services which the Secretary ex-
cludes pursuant to subsection (j)(3)) of a
nonparticipating physician, supplier, or
other person for which payment 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 services of such type which are fur-
nished by a participating physician, sup-
plier, or other person.’’;
(B) in subsection (g)(1)(A), as amended by
subsection (a), in the matter before clause (i),
by inserting ‘‘(including services which the Sec-
retary excludes pursuant to subsection (j)(3))’’
after ‘‘a physician’s service’’;
(C) in subsection (g)(2)(D), by inserting
‘‘(or, if payment under this part is made on a
basis other than the fee schedule under this sec-
tion, 95 percent of the other payment basis)’’
after ‘‘subsection (a)’’;
(D) in subsection (g)(3)(B)—
(i) by inserting after the first sentence
the following: ‘‘No person is liable for pay-
ment of any amounts billed for such a
service in violation of the previous sen-
tence.’’, and
(ii) in the last sentence, by striking
‘‘previous sentence’’ and inserting ‘‘first
sentence’’; and
(E) in subsection (h)—
(i) by inserting ‘‘or nonparticipating
supplier or other person’’ after ‘‘physician’’
the first place it appears,
(ii) by inserting ‘‘, supplier, or other
person’’ after ‘‘physician’’ the second place
it appears, and
(iii) by inserting ‘‘, suppliers, and
other persons’’ after ‘‘physicians’’ the sec-
ond place it appears.
(b) INFORMATION ON EXTRA-BILLING LIMITS.—
(1) PART OF EXPLANATION OF MEDICARE BEN-
EFITS.—Section 1842(h)(7) of the Social Security
Act (42 U.S.C. 1395u(h)(7)) is amended—
(A) by striking ‘‘and’’ at the end of sub-
paragraph (B);
(B) in subparagraph (C), by striking ‘‘shall
include’’ and by striking the period at the end
and inserting ‘‘, and’’; and
(C) by adding at the end the following new
subparagraph:
‘‘(D) in the case of services for which the billed
amount exceeds the limiting charge imposed under
section 1848(g), information regarding such limiting
charge (including information concerning the right
to a refund under section 1848(g)(1)(A)(iv)).’’.
(2) DETERMINATIONS BY CARRIERS.—Subpara-
graph (G) of section 1842(b)(3) of the Social Secu-
rity Act (42 U.S.C. 1395u(b)(3)) is amended to read
as follows:
‘‘(G) for a service that is furnished with respect
to an individual enrolled under this part, that is not
paid on an assignment-related basis, and that is sub-
ject to a limiting charge under section 1848(g),
will—
‘‘(i) determine, prior to making payment,
whether the amount billed for such service ex-
ceeds the limiting charge applicable under sec-
tion 1848(g)(2);
‘‘(ii) notify the physician, supplier, or other
person periodically (but not less often than once
every 30 days) of determinations that amounts
billed exceeded such limiting charges; and
‘‘(iii) provide for prompt response to in-
quiries of physicians, suppliers, and other per-
sons concerning the accuracy of such limiting
charges for their services;’’.
(c) REPORT ON CHARGES IN EXCESS OF LIMITING
CHARGE.—Section 1848(g)(6)(B) of the Social Security
Act (42 U.S.C. 1395w–4(g)(6)(B)) is amended by insert-
ing ‘‘on the extent to which actual charges exceed limiting
charges, the number and types of services involved, and
the average amount of excess charges and’’ after ‘‘report
to the Congress’’.
(d) EFFECTIVE DATES.—
(1) ENFORCEMENT
AND
UNIFORM
APPLICA-
TION.—The amendments made by subsection (a)
shall apply to services furnished on or after Janu-
ary 1, 1994.
(2) EXPLANATIONS.—The amendments made
by subsection (b)(1) shall apply to explanations of
benefits provided on or after January 1, 1994, ex-
cept that the requirement for including information
concerning the right to a refund shall apply to expla-
nations of benefits provided on or after July 1,
1994.
(3) CARRIER
DETERMINATIONS.—The amend-
ments made by subsection (b)(2) shall apply to con-
tracts as of January 1, 1994.
(4) REPORT.—The amendment made by sub-
section (c) shall apply to reports for years beginning
after 1994.
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