(B) by striking ‘‘paragraphs (11) and (12)’’ 
and inserting ‘‘paragraphs (11), (12), and (15)’’. 
SEC. 
305. 
MEDICARE 
REMOTE 
MONITORING 
PILOT 
PROJECTS. 
(a) PILOT PROJECTS.— 
(1) IN
GENERAL.—Not later than 9 months 
after the date of enactment of this Act, the Sec-
retary of Health and Human Services (in this sec-
tion referred to as the ‘‘Secretary’’) shall conduct 
pilot projects under title XVIII of the Social Secu-
rity Act for the purpose of providing incentives to 
home health agencies to utilize home monitoring and 
communications technologies that— 
(A) enhance health outcomes for Medicare 
beneficiaries; and 
(B) reduce expenditures under such title. 
(2) SITE REQUIREMENTS.— 
(A) URBAN AND RURAL.—The Secretary 
shall conduct the pilot projects under this sec-
tion in both urban and rural areas. 
(B) SITE IN A SMALL STATE.—The Sec-
retary shall conduct at least 3 of the pilot 
projects in a State with a population of less 
than 1,000,000. 
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(3) DEFINITION OF HOME HEALTH AGENCY.— 
In this section, the term ‘‘home health agency’’ has 
the meaning given that term in section 1861(o) of 
the Social Security Act (42 U.S.C. 1395x(o)). 
(b) MEDICARE BENEFICIARIES WITHIN THE SCOPE 
OF PROJECTS.—The Secretary shall specify the criteria 
for identifying those Medicare beneficiaries who shall be 
considered within the scope of the pilot projects under this 
section for purposes of the application of subsection (c) 
and for the assessment of the effectiveness of the home 
health agency in achieving the objectives of this section. 
Such criteria may provide for the inclusion in the projects 
of Medicare beneficiaries who begin receiving home health 
services under title XVIII of the Social Security Act after 
the date of the implementation of the projects. 
(c) INCENTIVES.— 
(1) PERFORMANCE
TARGETS.—The Secretary 
shall establish for each home health agency partici-
pating in a pilot project under this section a per-
formance target using one of the following meth-
odologies, as determined appropriate by the Sec-
retary: 
(A) ADJUSTED HISTORICAL PERFORMANCE 
TARGET.—The Secretary shall establish for the 
agency— 
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(i) a base expenditure amount equal 
to the average total payments made to the 
agency under parts A and B of title XVIII 
of the Social Security Act for Medicare 
beneficiaries determined to be within the 
scope of the pilot project in a base period 
determined by the Secretary; and 
(ii) an annual per capita expenditure 
target for such beneficiaries, reflecting the 
base expenditure amount adjusted for risk 
and adjusted growth rates. 
(B) COMPARATIVE
PERFORMANCE
TAR-
GET.—The Secretary shall establish for the 
agency a comparative performance target equal 
to the average total payments under such parts 
A and B during the pilot project for comparable 
individuals in the same geographic area that 
are not determined to be within the scope of the 
pilot project. 
(2) INCENTIVE.—Subject to paragraph (3), the 
Secretary shall pay to each participating home care 
agency an incentive payment for each year under the 
pilot project equal to a portion of the Medicare sav-
ings realized for such year relative to the perform-
ance target under paragraph (1). 
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(3) LIMITATION ON EXPENDITURES.—The Sec-
retary shall limit incentive payments under this sec-
tion in order to ensure that the aggregate expendi-
tures under title XVIII of the Social Security Act 
(including incentive payments under this subsection) 
do not exceed the amount that the Secretary esti-
mates would have been expended if the pilot projects 
under this section had not been implemented. 
(d) WAIVER AUTHORITY.—The Secretary may waive 
such provisions of titles XI and XVIII of the Social Secu-
rity Act as the Secretary determines to be appropriate for 
the conduct of the pilot projects under this section. 
(e) REPORT TO CONGRESS.—Not later than 5 years 
after the date that the first pilot project under this section 
is implemented, the Secretary shall submit to Congress a 
report on the pilot projects. Such report shall contain a 
detailed description of issues related to the expansion of 
the projects under subsection (f) and recommendations for 
such legislation and administrative actions as the Sec-
retary considers appropriate. 
(f) EXPANSION.—If the Secretary determines that 
any of the pilot projects under this section enhance health 
outcomes for Medicare beneficiaries and reduce expendi-
tures under title XVIII of the Social Security Act, the Sec-
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