I
106TH CONGRESS
2D SESSION
H. R. 5070
To amend title XVIII of the Social Security Act to improve geographic
fairness in Medicare+Choice payments and hospital payments under
the Medicare Program.
IN THE HOUSE OF REPRESENTATIVES
JULY 27, 2000
Mr. MINGE (for himself, Mr. BAIRD, Ms. HOOLEY of Oregon, Mr. KIND, Mr.
MCINTYRE, Mr. LUTHER, Mr. KANJORSKI, Ms. BALDWIN, Mr. KOLBE,
and Mr. SABO) introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committee on
Commerce, for a period to be subsequently determined by the Speaker,
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned
A BILL
To amend title XVIII of the Social Security Act to improve
geographic fairness in Medicare+Choice payments and
hospital payments under the Medicare Program.
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 Fairness in Reimbursement Act of 2000’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Fairness in payments under the Medicare+Choice program.
Sec. 3. New hospital wage survey.
Sec. 4. Reduction in proportion of payments subject to wage-related geographic
adjustments.
Sec. 5. Permanently removing application of budget neutrality under the
Medicaid+Choice program beginning in 2002.
Sec. 6. Allowing movement to 50:50 percent blend in 2002.
Sec. 7. MedPAC review of impact of wage and other cost adjustments.
SEC. 
2. 
FAIRNESS 
IN 
PAYMENTS 
UNDER 
THE
MEDICARE+CHOICE PROGRAM.
Section 1853(c) of the Social Security Act (42 U.S.C.
1395w–23(c)) is amended—
(1) in paragraph (1), by striking ‘‘and (7)’’ and
inserting ‘‘, (7), and (8)’’;
(2) in paragraph (4), by striking ‘‘paragraph
(1)(A)’’ and inserting ‘‘paragraphs (1)(A) and (8)’’;
and
(3) by adding at the end the following new
paragraph:
‘‘(8) FAIRNESS
IN
PAYMENTS.—The annual
Medicare+Choice 
capitation 
rate 
for 
a
Medicare+Choice payment area for—
‘‘(A) 2002, shall not exceed 150 percent
(or be less than 82 percent) of the input-price-
adjusted annual national Medicare+Choice
capitation rate (as computed under paragraph
(4)) for the year;
‘‘(B) 2003, shall not exceed 140 percent
(or be less than 86 percent) of the input-price-
adjusted annual national Medicare+Choice
capitation rate for the year;
‘‘(C) 2004, shall not exceed 130 percent
(or be less than 90 percent) of the input-price-
adjusted annual national Medicare+Choice
capitation rate for the year;
‘‘(D) 2005, shall not exceed 120 percent
(or be less than 94 percent) of the input-price-
adjusted annual national Medicare+Choice
capitation rate for the year;
‘‘(E) 2006, shall not exceed 110 percent
(or be less than 98 percent) of the input-price-
adjusted annual national Medicare+Choice
capitation rate for the year; or
‘‘(F) 2007 or any subsequent year, shall be
equal to the input-price-adjusted annual na-
tional Medicare+Choice capitation rate for the
year.’’.
SEC. 3. NEW HOSPITAL WAGE SURVEY.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall promptly conduct a new survey of
levels of wages and wage-related costs for different occu-
pational categories of hospital employees.
(b) APPLICATION TO HOSPITAL WAGE INDEX.—The
Secretary shall use the data derived from the survey con-
ducted under subsection (a) in computing the hospital
wage index applied under section 1886(d)(3)(E) of the So-
cial Security Act (42 U.S.C. 1395ww(d)(3)(E)) for dis-
charges occurring on or after October 1, 2001.
SEC. 4. REDUCTION IN PROPORTION OF PAYMENTS SUB-
JECT TO WAGE-RELATED GEOGRAPHIC AD-
JUSTMENTS.
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, in applying any wage-related geographic area
adjustment (as defined in subsection (b)) to a portion of
a payment amount or rate under title XVIII of the Social
Security Act, the portion to which the adjustment is ap-
plied shall be 75 percent of the portion otherwise com-
puted and 25 percent of such portion shall not be subject
to any such geographic area adjustment.
(b) WAGE-RELATED GEOGRAPHIC AREA ADJUST-
MENT DEFINED.—For purposes of this section, the term
‘‘wage-related geographic area adjustment’’ means an ad-
justment in a payment rate by geographic area that is
based on a geographic variation in wages or wage-related
costs or similar costs.
(c) SPECIFIC APPLICATION.—Subsection (a) applies
to geographic adjustments made under the following provi-
sions of law (as well as other provisions identified by the
Secretary of Health and Human Services):
SEC. 6. ALLOWING MOVEMENT TO 50:50 PERCENT BLEND IN
2002.
Section 1853(c)(2) of the Social Security Act (42
U.S.C. 1395w–23(c)(2)) is amended—
(1) by striking the period at the end of sub-
paragraph (F) and inserting a semicolon; and
(2) by adding after and below subparagraph
(F) the following:
‘‘except that a Medicare+Choice organization may
elect to apply subparagraph (F) (rather than sub-
paragraph (E)) for 2002.’’.
SEC. 7. MEDPAC REVIEW OF IMPACT OF WAGE AND OTHER
COST ADJUSTMENTS.
(a) IN GENERAL.—Section 1805(b)(2)(B) of the So-
cial Security Act (42 U.S.C. 1395b–6(b)(2)(B)) is
amended—
(1) by striking ‘‘and’’ at the end of clause (ii);
(2) by striking the period at the end of clause
(iii) and inserting ‘‘; and’’; and
(3) by adding at the end the following new
clause:
‘‘(iv) the extent to which the adjust-
ments made (through wage indices and
other measures) in payment rates on a ge-
ographic basis for variations in costs accu-
rately reflect the actual costs of items and
services in low reimbursement areas and
the impact of such adjustments on the
health infrastructure in such areas.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) take effect on the date of the enactment
of this Act and the Medicare Payment Advisory Commis-
sion shall first report on the review conducted pursuant
to such amendments in its report submitting in June
2001.
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