143 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to items and services 
furnished on or after January 1, 2010. 
(b) REPEAL OF TRANSFER OF OWNERSHIP OF OXY-
GEN EQUIPMENT.— 
(1) IN GENERAL.—Section 1834(a)(5)(F) of the 
Social Security Act (42 U.S.C. 1395m(a)(5)(F)) is 
amended— 
(A) in the heading, by striking ‘‘OWNER-
SHIP OF EQUIPMENT’’ and inserting ‘‘RENTAL 
CAP’’; and 
(B) by striking clause (ii) and inserting the 
following: 
‘‘(ii) PAYMENTS
AND
RULES
AFTER 
RENTAL CAP.—After the 36th continuous 
month during which payment is made for 
the equipment under this paragraph— 
‘‘(I) the supplier furnishing such 
equipment under this subsection shall 
continue to furnish the equipment 
during any period of medical need for 
the remainder of the reasonable useful 
lifetime of the equipment, as deter-
mined by the Secretary; 
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hsrobinson on PROD1PC76 with BILLS
144 
‘‘(II) payments for oxygen shall 
continue to be made in the amount 
recognized for oxygen under para-
graph (9) for the period of medical 
need; and 
‘‘(III) maintenance and servicing 
payments shall, if the Secretary deter-
mines such payments are reasonable 
and necessary, be made (for parts and 
labor not covered by the supplier’s or 
manufacturer’s warranty, as deter-
mined by the Secretary to be appro-
priate for the equipment), and such 
payments shall be in an amount deter-
mined to be appropriate by the Sec-
retary.’’. 
(2) EFFECTIVE DATE.—The amendments made 
by paragraph (1) shall take effect on January 1, 
2009. 
(c) REVISION OF PAYMENT FOR OXYGEN AND OXY-
GEN EQUIPMENT, PORTABLE OXYGEN EQUIPMENT, AND 
OXYGEN FOR STATIONARY EQUIPMENT.— 
(1) SEPARATE PAYMENT FOR OXYGEN EQUIP-
MENT AND OXYGEN FOR STATIONARY EQUIPMENT.— 
Section 1834(a) of the Social Security Act (42 
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145 
U.S.C. 1395m(a)) is amended by adding at the end 
the following new paragraph: 
‘‘(22) ADDITIONAL
SPECIAL
PAYMENT
RULE 
BEGINNING IN 2009.— 
‘‘(A) IN
GENERAL.—Notwithstanding the 
preceding provisions of this subsection, for oxy-
gen equipment (other than portable oxygen and 
oxygen equipment) furnished during 2009, the 
payment amount otherwise determined under 
this subsection for such equipment shall be 
equal to— 
‘‘(i) the amount of the monthly pay-
ment amount otherwise established by the 
Secretary under this subsection for oxygen 
and oxygen equipment (other than portable 
oxygen equipment) furnished in 2009; 
minus 
‘‘(ii) 71 percent of the amount of the 
monthly payment amount established by 
the Secretary under this subsection for ox-
ygen for stationary equipment furnished in 
such year. 
‘‘(B) APPLICATION
OF
UPDATE
TO
SPE-
CIAL PAYMENT AMOUNT.—The covered item up-
date under paragraph (14) for oxygen equip-
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hsrobinson on PROD1PC76 with BILLS
146 
ment for 2010 and each subsequent year shall 
be applied to the payment amount under sub-
paragraph (A) unless payment is made for such 
items and supplies under section 1847.’’. 
(2) ADD-ON PAYMENT FOR OXYGEN FOR STA-
TIONARY OXYGEN EQUIPMENT.—Section 1834(a)(5) 
of the Social Security Act (42 U.S.C. 1395m(a)(5)) 
is amended by adding at the end the following new 
subparagraph: 
‘‘(G) ADD-ON
FOR
OXYGEN
FOR
STA-
TIONARY OXYGEN EQUIPMENT.—In the case of 
oxygen furnished on or after January 1, 2009, 
when oxygen is used with stationary oxygen 
equipment, the payment amount recognized 
under subparagraph (A) shall be increased by 
the amount established by the Secretary for 
such oxygen (or 71 percent of such amount 
during the rental period for such equipment).’’. 
(3) EQUALIZING ADD-ON PAYMENT FOR OXY-
GEN FOR PORTABLE OXYGEN AND OXYGEN EQUIP-
MENT DURING MONTHLY RENTAL PERIOD AND PAY-
MENT FOR SUCH OXYGEN AND OXYGEN EQUIPMENT 
AFTER SUCH RENTAL PERIOD.—Section 1834(a)(9) 
of the Social Security Act (42 U.S.C. 1395m(a)(9)) 
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hsrobinson on PROD1PC76 with BILLS
147 
is amended by adding at the end the following new 
subparagraph: 
‘‘(E) SPECIAL
RULE
FOR
ADD-ON
PAY-
MENT
FOR
PORTABLE
OXYGEN
AND
OXYGEN 
EQUIPMENT.—In the case of oxygen and oxygen 
equipment furnished on or after January 1, 
2009, for purposes of paragraph (5)(B), the 
monthly amount recognized under this para-
graph for portable oxygen and oxygen equip-
ment in a year shall be equal to the monthly 
payment amount for portable oxygen and oxy-
gen equipment applicable for the year under 
this subsection after the end of the 36-month 
period under paragraph (5)(F).’’. 
(4) SPECIAL RULE FOR ADD-ON PAYMENTS FOR 
OXYGEN GENERATING PORTABLE EQUIPMENT.—Sec-
tion 1834(a)(9) of the Social Security Act (42 
U.S.C. 1395m(a)(9)), as amended by paragraph (3), 
is amended by adding at the end the following new 
subparagraph: 
‘‘(F) SPECIAL
RULE
FOR
ADD-ON
PAY-
MENT
FOR
OXYGEN
GENERATING
PORTABLE 
EQUIPMENT.—In the case of oxygen generating 
portable equipment, as defined by the Sec-
retary, furnished on or after January 1, 2009, 
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148 
the Secretary shall make the following monthly 
add-on payments during the 36-month rental 
period under paragraph (5)(F): 
‘‘(i) An amount equal to the monthly 
payment amount specified in subparagraph 
(E) for the month. 
‘‘(ii) An amount equal to the monthly 
payment amount otherwise established by 
the Secretary under this subsection for 
such equipment for the month that recog-
nizes that such equipment substitutes for 
the delivery of portable oxygen and oxygen 
contents during the remaining useful life of 
the equipment that occurs after the end of 
such 36-month rental period.’’. 
(5) CAP ON TOTAL MONTHLY PAYMENT FOR 
LIQUID
OR
GASEOUS
STATIONARY
AND
PORTABLE 
SYSTEMS.—Section 1834(a)(5) of the Social Security 
Act (42 U.S.C. 1395m(a)(5)), as amended by para-
graph (2), is amended by adding at the end the fol-
lowing new subparagraph: 
‘‘(H) CAP ON TOTAL PAYMENTS FOR LIQ-
UID OR GASEOUS STATIONARY AND PORTABLE 
SYSTEMS.—In the case of a liquid or gaseous 
stationary and portable system furnished on or 
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149 
after January 1, 2009, the total monthly 
amount recognized under this part for such sys-
tem for a month (including any add-on pay-
ments under this subsection) may not exceed 
the total monthly amount that would have oth-
erwise been recognized under this part for such 
system for the month (including any add-on 
payments under this subsection) if the amend-
ments made by section 144(c) of the Medicare 
Efficiency and Development of Improvement of 
Care and Services Act (MEDICS Act) of 2008 
had not been enacted.’’. 
(6) CONFORMING AMENDMENTS.—(A) Section 
1834(a)(5)(A) of the Social Security Act (42 U.S.C. 
1395m(a)(5)(A)) is amended— 
(i) by inserting ‘‘and, in the case of items 
and services furnished on or after January 1, 
2009, other than oxygen for stationary equip-
ment’’ after ‘‘portable oxygen equipment’’; and 
(ii) by striking ‘‘subparagraphs (B), (C), 
(E), and (F)’’ and inserting ‘‘the succeeding 
provisions of this paragraph’’. 
(B) Section 1834(a)(9) of the Social Security 
Act (42 U.S.C. 1395m(a)(9)) is amended— 
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151 
(e) INSTITUTE OF MEDICINE STUDY AND REPORT 
ON PAYMENTS FOR DIFFERENT CLASSES OF OXYGEN 
EQUIPMENT.— 
(1) STUDY.—Not later than 3 months after the 
date of the enactment of this Act, the Secretary of 
Health and Human Services shall enter into a con-
tract with the Institute of Medicine of the National 
Academies (in this section referred to as the ‘‘Insti-
tute’’) under which the Institute shall conduct a 
study on the furnishing of, and payments for, oxy-
gen and oxygen equipment under the Medicare pro-
gram. Such study shall include an analysis of the 
following: 
(A) The costs and activities associated with 
furnishing different modalities of oxygen equip-
ment (covering gaseous and liquid portable 
equipment and oxygen generating portable 
equipment), including— 
(i) the acquisition cost of the oxygen 
equipment; 
(ii) the delivery and refilling of oxygen 
contents for stationary and portable sys-
tems, including the frequency of delivery; 
(iii) the delivery of the equipment and 
the provision of supplies and accessories; 
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hsrobinson on PROD1PC76 with BILLS
152 
(iv) training and education, intake of 
patient information and related docu-
mentation, and responding to beneficiary 
inquiries; 
(v) servicing of different types of oxy-
gen and oxygen equipment, including— 
(I) the type and frequency of 
routine and nonroutine servicing fur-
nished, and variation across suppliers 
in furnishing such servicing; and 
(II) the extent to which emer-
gency or after hours servicing is need-
ed and furnished; and 
(vi) other items or activities involved 
with furnishing oxygen and oxygen equip-
ment not described in clauses (i) though 
(v). 
(B) Whether the various items and activi-
ties described in subparagraph (A) are medi-
cally necessary and affect patient outcomes. 
(C)(i) The adequacy of Medicare payment 
rates for oxygen equipment and necessary serv-
icing and items and activities furnished in con-
nection with the provision of oxygen and oxygen 
equipment; and 
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hsrobinson on PROD1PC76 with BILLS
153 
(ii) how such payment rates compare to 
competitively bid rates. 
(D) Whether payment rates for oxygen and 
oxygen equipment under the Medicare program 
should vary depending on the modality of oxy-
gen equipment used or should be the same for 
all modalities. 
(E) The adequacy of add-on payments 
under the Medicare program for— 
(i) contents for stationary equipment; 
(ii) contents for portable equipment; 
and 
(iii) oxygen-generating portable equip-
ment. 
(F)(i) Whether, during the rental period 
for oxygen equipment under the Medicare pro-
gram, payment for such equipment and serv-
icing should be bundled together or whether 
separate payments are appropriate; and 
(ii) if separate payments are appropriate, 
how the payment should be allocated between 
equipment and servicing. 
(G) Options that could be considered for 
suppliers to document or report under the 
Medicare program detailed information on ac-
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hsrobinson on PROD1PC76 with BILLS
154 
tivities related to furnishing oxygen and oxygen 
equipment to Medicare beneficiaries. 
(2) SURVEY.—In conducting the study under 
paragraph (1), the Institute shall conduct a survey 
of suppliers of oxygen and oxygen equipment to ob-
tain data on items described in paragraph (1)(A). 
(3) REPORT.—Not later than 18 months after 
the date of the enactment of this Act, the Institute 
shall submit to the Secretary of Health and Human 
Services a report containing the results of the study 
conducted under paragraph (1), together with such 
recommendations as the Institute determines appro-
priate. 
(4) FUNDING.—For the purpose of carrying out 
this section, the Secretary of Health and Human 
Services shall provide for the transfer, from the Fed-
eral Supplementary Medical Insurance Trust Fund 
established under section 1841 of the Social Security 
Act (42 U.S.C. 1395t), of $5,000,000 to the Centers 
for Medicare & Medicaid Services Program Manage-
ment Account. 
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155 
SEC. 145. REVISION OF PAYMENT FOR POWER-DRIVEN 
WHEELCHAIRS. 
(a) IN GENERAL.—Section 1834(a)(7)(A) of the So-
cial Security Act (42 U.S.C. 1395m(a)(7)(A)) is amend-
ed— 
(1) in clause (i)— 
(A) in subclause (II), by inserting ‘‘sub-
clause (III) and’’ after ‘‘Subject to’’; and 
(B) by adding at the end the following new 
subclause: 
‘‘(III) 
SPECIAL
RULE
FOR 
POWER-DRIVEN
WHEELCHAIRS.—For 
purposes of payment for power-driven 
wheelchairs, subclause (II) shall be 
applied by substituting ‘15 percent’ 
and ‘6 percent’ for ‘10 percent’ and 
‘7.5 percent’, respectively.’’; and 
(2) in clause (iii)— 
(A) in the heading, by inserting ‘‘COM-
PLEX, REHABILITATIVE’’ before ‘‘POWER-DRIV-
EN’’; and 
(B) by inserting ‘‘complex, rehabilitative’’ 
before ‘‘power-driven’’. 
(b) 
TECHNICAL
AMENDMENT.—Section 
1834(a)(7)(C)(ii)(II) of the Social Security Act (42 U.S.C. 
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156 
1395m(a)(7)(C)(ii)(II)) is amended by striking ‘‘(A)(ii) 
or’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Subject to paragraph (2), 
the amendments made by subsection (a) shall take 
effect on January 1, 2009, and shall apply to power- 
driven wheelchairs furnished on or after such date. 
(2) APPLICATION TO COMPETITIVE BIDDING.— 
The amendments made by subsection (a) shall not 
apply to contracts entered into under section 1847 
of the Social Security Act (42 U.S.C. 1395w–3) 
prior to January 1, 2009, pursuant to the implemen-
tation of subsection (a)(1)(B)(i)(I) of such section 
1847. 
SEC. 146. CLINICAL LABORATORY TESTS. 
(a) REPEAL OF MEDICARE COMPETITIVE BIDDING 
DEMONSTRATION PROJECT FOR CLINICAL LABORATORY 
SERVICES.— 
(1) IN GENERAL.—Section 1847 of the Social 
Security Act (42 U.S.C. 1395w–3) is amended by 
striking subsection (e). 
(2) 
CONFORMING
AMENDMENTS.—Section 
1833(a)(1)(D) of the Social Security Act (42 U.S.C. 
1395l(a)(1)(D)) is amended— 
(A) by inserting ‘‘or’’ before ‘‘(ii)’’; and 
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