H. R. 1—352
by the percentage increase in the medical care compo-
nent of the consumer price index for all urban con-
sumers (U.S. city average) for July 2003 to the July
preceding the year involved. Any amount determined
under the previous sentence that is not a multiple
of $10 shall be rounded to the nearest multiple of
$10.’’.
(2) CONFORMING AMENDMENTS.—(A) Section 1852(g)(5) (42
U.S.C. 1395w–22(g)(5)) is amended by adding at the end the
following: ‘‘The provisions of section 1869(b)(1)(E)(iii) shall
apply with respect to dollar amounts specified in the first
2 sentences of this paragraph in the same manner as they
apply 
to 
the 
dollar 
amounts 
specified 
in 
section
1869(b)(1)(E)(i).’’.
(B) Section 1876(b)(5)(B) (42 U.S.C. 1395mm(b)(5)(B)) is
amended by adding at the end the following: ‘‘The provisions of
section 1869(b)(1)(E)(iii) shall apply with respect to dollar amounts
specified in the first 2 sentences of this subparagraph in the same
manner as they apply to the dollar amounts specified in section
1869(b)(1)(E)(i).’’.
SEC. 940A. MEDIATION PROCESS FOR LOCAL COVERAGE DETERMINA-
TIONS.
(a) IN GENERAL.—Section 1869 (42 U.S.C. 1395ff), as amended
by section 938(a), is amended by adding at the end the following
new subsection:
‘‘(i) MEDIATION PROCESS
FOR LOCAL COVERAGE DETERMINA-
TIONS.—
‘‘(1) ESTABLISHMENT
OF
PROCESS.—The Secretary shall
establish a mediation process under this subsection through
the use of a physician trained in mediation and employed
by the Centers for Medicare & Medicaid Services.
‘‘(2) RESPONSIBILITY
OF
MEDIATOR.—Under the process
established in paragraph (1), such a mediator shall mediate
in disputes between groups representing providers of services,
suppliers (as defined in section 1861(d)), and the medical
director for a medicare administrative contractor whenever the
regional administrator (as defined by the Secretary) involved
determines that there was a systematic pattern and a large
volume of complaints from such groups regarding decisions
of such director or there is a complaint from the co-chair of
the advisory committee for that contractor to such regional
administrator regarding such dispute.’’.
(b) INCLUSION IN MAC CONTRACTS.—Section 1874A(b)(3)(A)(i),
as added by section 911(a)(1), is amended by adding at the end
the following: ‘‘Such requirements shall include specific performance
duties expected of a medical director of a medicare administrative
contractor, including requirements relating to professional relations
and the availability of such director to conduct medical determina-
tion activities within the jurisdiction of such a contractor.’’.
H. R. 1—353
Subtitle E—Miscellaneous Provisions
SEC. 941. POLICY DEVELOPMENT REGARDING EVALUATION AND
MANAGEMENT (E & M) DOCUMENTATION GUIDELINES.
(a) IN GENERAL.—The Secretary may not implement any new
or modified documentation guidelines (which for purposes of this
section includes clinical examples) for evaluation and management
physician services under the title XVIII of the Social Security Act
on or after the date of the enactment of this Act unless the
Secretary—
(1) has developed the guidelines in collaboration with prac-
ticing physicians (including both generalists and specialists)
and provided for an assessment of the proposed guidelines
by the physician community;
(2) has established a plan that contains specific goals,
including a schedule, for improving the use of such guidelines;
(3) has conducted appropriate and representative pilot
projects under subsection (b) to test such guidelines;
(4) finds, based on reports submitted under subsection (b)(5)
with respect to pilot projects conducted for such or related
guidelines, that the objectives described in subsection (c) will
be met in the implementation of such guidelines; and
(5) has established, and is implementing, a program to
educate physicians on the use of such guidelines and that
includes appropriate outreach.
The Secretary shall make changes to the manner in which existing
evaluation and management documentation guidelines are imple-
mented to reduce paperwork burdens on physicians.
(b) PILOT PROJECTS TO TEST MODIFIED OR NEW EVALUATION
AND MANAGEMENT DOCUMENTATION GUIDELINES.—
(1) IN GENERAL.—With respect to proposed new or modified
documentation guidelines referred to in subsection (a), the Sec-
retary shall conduct under this subsection appropriate and
representative pilot projects to test the proposed guidelines.
(2) LENGTH AND CONSULTATION.—Each pilot project under
this subsection shall—
(A) be voluntary;
(B) be of sufficient length as determined by the Sec-
retary (but in no case to exceed 1 year) to allow for pre-
paratory physician and medicare contractor education,
analysis, and use and assessment of potential evaluation
and management guidelines; and
(C) be conducted, in development and throughout the
planning and operational stages of the project, in consulta-
tion with practicing physicians (including both generalists
and specialists).
(3) RANGE OF PILOT PROJECTS.—Of the pilot projects con-
ducted under this subsection with respect to proposed new
or modified documentation guidelines—
(A) at least one shall focus on a peer review method
by physicians (not employed by a medicare contractor)
which evaluates medical record information for claims sub-
mitted by physicians identified as statistical outliers rel-
ative to codes used for billing purposes for such services;
H. R. 1—354
(B) at least one shall focus on an alternative method
to detailed guidelines based on physician documentation
of face to face encounter time with a patient;
(C) at least one shall be conducted for services fur-
nished in a rural area and at least one for services fur-
nished outside such an area; and
(D) at least one shall be conducted in a setting where
physicians bill under physicians’ services in teaching set-
tings and at least one shall be conducted in a setting
other than a teaching setting.
(4) STUDY OF IMPACT.—Each pilot project shall examine
the effect of the proposed guidelines on—
(A) different types of physician practices, including
those with fewer than 10 full-time-equivalent employees
(including physicians); and
(B) the costs of physician compliance, including edu-
cation, implementation, auditing, and monitoring.
(5) REPORT ON PILOT PROJECTS.—Not later than 6 months
after the date of completion of pilot projects carried out under
this subsection with respect to a proposed guideline described
in paragraph (1), the Secretary shall submit to Congress a
report on the pilot projects. Each such report shall include
a finding by the Secretary of whether the objectives described
in subsection (c) will be met in the implementation of such
proposed guideline.
(c) OBJECTIVES
FOR EVALUATION
AND MANAGEMENT GUIDE-
LINES.—The objectives for modified evaluation and management
documentation guidelines developed by the Secretary shall be to—
(1) identify clinically relevant documentation needed to
code accurately and assess coding levels accurately;
(2) decrease the level of non-clinically pertinent and
burdensome documentation time and content in the physician’s
medical record;
(3) increase accuracy by reviewers; and
(4) educate both physicians and reviewers.
(d) STUDY OF SIMPLER, ALTERNATIVE SYSTEMS OF DOCUMENTA-
TION FOR PHYSICIAN CLAIMS.—
(1) STUDY.—The Secretary shall carry out a study of the
matters described in paragraph (2).
(2) MATTERS DESCRIBED.—The matters referred to in para-
graph (1) are—
(A) the development of a simpler, alternative system
of requirements for documentation accompanying claims
for evaluation and management physician services for
which payment is made under title XVIII of the Social
Security Act; and
(B) consideration of systems other than current coding
and documentation requirements for payment for such
physician services.
(3) 
CONSULTATION
WITH
PRACTICING
PHYSICIANS.—In
designing and carrying out the study under paragraph (1),
the Secretary shall consult with practicing physicians, including
physicians who are part of group practices and including both
generalists and specialists.
(4) APPLICATION
OF
HIPAA
UNIFORM
CODING
REQUIRE-
MENTS.—In developing an alternative system under paragraph
(2), the Secretary shall consider requirements of administrative
H. R. 1—355
simplification under part C of title XI of the Social Security
Act.
(5) REPORT TO CONGRESS.—(A) Not later than October 1,
2005, the Secretary shall submit to Congress a report on the
results of the study conducted under paragraph (1).
(B) The Medicare Payment Advisory Commission shall con-
duct an analysis of the results of the study included in the
report under subparagraph (A) and shall submit a report on
such analysis to Congress.
(e) STUDY
ON APPROPRIATE CODING
OF CERTAIN EXTENDED
OFFICE VISITS.—The Secretary shall conduct a study of the appro-
priateness of coding in cases of extended office visits in which
there is no diagnosis made. Not later than October 1, 2005, the
Secretary shall submit a report to Congress on such study and
shall include recommendations on how to code appropriately for
such visits in a manner that takes into account the amount of
time the physician spent with the patient.
(f) DEFINITIONS.—In this section—
(1) the term ‘‘rural area’’ has the meaning given that term
in section 1886(d)(2)(D) of the Social Security Act (42 U.S.C.
1395ww(d)(2)(D)); and
(2) the term ‘‘teaching settings’’ are those settings described
in section 415.150 of title 42, Code of Federal Regulations.
SEC. 942. IMPROVEMENT IN OVERSIGHT OF TECHNOLOGY AND COV-
ERAGE.
(a) COUNCIL FOR TECHNOLOGY AND INNOVATION.—Section 1868
(42 U.S.C. 1395ee) is amended—
(1) by adding at the end of the heading the following:
‘‘; COUNCIL FOR TECHNOLOGY AND INNOVATION’’;
(2) 
by 
inserting 
‘‘PRACTICING
PHYSICIANS
ADVISORY
COUNCIL.—(1)’’ after ‘‘(a)’’;
(3) in paragraph (1), as so redesignated under paragraph
(2), by striking ‘‘in this section’’ and inserting ‘‘in this sub-
section’’;
(4) by redesignating subsections (b) and (c) as paragraphs
(2) and (3), respectively; and
(5) by adding at the end the following new subsection:
‘‘(b) COUNCIL FOR TECHNOLOGY AND INNOVATION.—
‘‘(1) ESTABLISHMENT.—The Secretary shall establish a
Council for Technology and Innovation within the Centers for
Medicare & Medicaid Services (in this section referred to as
‘CMS’).
‘‘(2) COMPOSITION.—The Council shall be composed of senior
CMS staff and clinicians and shall be chaired by the Executive
Coordinator for Technology and Innovation (appointed or des-
ignated under paragraph (4)).
‘‘(3) DUTIES.—The Council shall coordinate the activities
of coverage, coding, and payment processes under this title
with respect to new technologies and procedures, including
new drug therapies, and shall coordinate the exchange of
information on new technologies between CMS and other enti-
ties that make similar decisions.
‘‘(4) EXECUTIVE
COORDINATOR
FOR
TECHNOLOGY
AND
INNOVATION.—The Secretary shall appoint (or designate) a non-
career appointee (as defined in section 3132(a)(7) of title 5,