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fense which the Secretary determines is inconsistent with
the best interests of program beneficiaries.’’.
(c) MEDICAID.—Section 1902(a)(23) (42 U.S.C.
1396(a)) is amended—
(1) by relocating the matter that precedes ‘‘pro-
vide that, (A)’’ immediately before the semicolon;
(2) by inserting a semicolon immediately after
‘‘1915’’;
(3) by striking the comma after ‘‘Guam’’ and
inserting a semicolon; and
(4) by inserting before the semicolon at the end
‘‘and except that this provision does not require a
State to provide medical assistance for such services
furnished by a person or entity convicted of a felony
under Federal or State law for an offense which the
State agency determines is inconsistent with the best
interests of beneficiaries under the State plan’’.
SEC. 124. FEES AND REQUIREMENTS FOR ISSUANCE OF
STANDARD HEALTH CARE IDENTIFIERS.
Section 1173(b) is amended by adding after para-
graph (2) the following new paragraphs:
‘‘(3) REQUIREMENT TO FURNISH SOCIAL SECU-
RITY
NUMBERS
AND
EMPLOYER
IDENTIFICATION
NUMBERS.—The Secretary shall, as appropriate, re-
quire such individuals and entities to provide their
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social security numbers and employer identification
numbers as a condition to receiving such identifiers.
‘‘(4) FEES.—The Secretary may impose fees for
issuing such identifiers, in amounts which the Sec-
retary reasonably estimates to be sufficient to cover
all costs to the Secretary associated with such activ-
ity. Physicians subject to fees under section 1842(r)
shall not be subject to fees under this paragraph.
Fees collected pursuant to this paragraph shall be
credited to a special fund of the United States
Treasury, and shall remain available until expended,
to the extent and in such amounts as provided in ad-
vance in appropriations acts, for costs incurred by
the Secretary in issuing such identifiers, including
costs of establishing and maintaining an automated
database and procedures; processing applications;
and verifying information provided.’’.
TITLE 
II—PROVIDER 
REIM-
BURSEMENT AND RELATED
MATTERS
PART A—COVERAGE AND PAYMENT LIMITS
SEC. 201. NO HOME HEALTH BENEFITS BASED SOLELY ON
DRAWING BLOOD.
(a) IN
GENERAL.—Sections 1814(a)(2)(C) and
1835(a)(2)(A) 
(42 
U.S.C. 
1395f(a)(2)(C) 
and
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1395n(a)(2)(A)) are each amended by inserting ‘‘(other
than solely venipuncture for the purpose of obtaining a
blood sample)’’ after ‘‘skilled nursing care’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) apply to home health services furnished
after the sixth month beginning after the date of enact-
ment of this Act.
SEC. 202. MONTHLY CERTIFICATION FOR HOSPICE CARE
AFTER FIRST SIX MONTHS.
(a) IN GENERAL.—Sections 1812(a)(4) (42 U.S.C.
1395d(a)(4)) is amended by striking ‘‘a subsequent period
of 30 days, and a subsequent extension period’’ and insert-
ing ‘‘and subsequent periods of 30 days each,’’.
(b) CONFORMING AMENDMENTS.—
(1) SECTION
1812(d).—Section 1812(d) (42
U.S.C. 1395d(d)) is amended—
(A) in paragraph (1), by striking ‘‘only
during two periods of 90 days each’’ and all
that follows through ‘‘with respect to each such
period, if’’ and inserting ‘‘during a particular
period only if, with respect to that period,’’; and
(B) in the matter in paragraph (2)(B) pre-
ceding clause (i), by striking ‘‘90-day or 30-day
period or a subsequent extension’’.
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(2) SECTION
1814(a).—Section 1814(a)(7)(A)
(42 U.S.C. 1395f(a)(7)(A)) is amended—
(A) by adding ‘‘and’’ at the end of clause
(i);
(B) by striking ‘‘, and’’ at the end of
clause (ii) and adding a semicolon; and
(C) by striking clause (iii).
(c) EFFECTIVE DATE.—The amendments made by
the preceding subsections apply to hospice care furnished
after the sixth month beginning after the date of enact-
ment of this Act.
SEC. 203. PAYMENT FOR HOME HOSPICE CARE BASED ON
LOCATION WHERE CARE IS FURNISHED.
(a) IN GENERAL.—Section 1814(i)(2) (42 U.S.C.
1395f(i)(2)) is amended by adding at the end the follow-
ing:
‘‘(D) A hospice program shall submit claims for pay-
ment for hospice care furnished in an individual’s home
under this title only on the basis of the geographic location
at which the service is furnished, as determined by the
Secretary.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) applies to cost reporting periods beginning
on or after October 1, 1997.
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SEC. 204. LIMITATION ON HOSPICE CARE LIABILITY FOR
INDIVIDUALS NOT IN FACT TERMINALLY ILL.
(a) IN
GENERAL.—Section 1879(g) (42 U.S.C.
1395pp(g)) is amended to read as follows:
‘‘(g) A coverage denial described in this subsection
is—
‘‘(1) with respect to the provision of home
health services to an individual, a failure to meet the
requirements of section 1814(a)(2)(C) or section
1835(a)(2)(A) in that the individual—
‘‘(A) is or was not confined to his home;
or
‘‘(B) does or did not need skilled nursing
care on an intermittent basis; and
‘‘(2) with respect to the provision of hospice
care to an individual, a failure to meet the require-
ment of section 1861(dd)(3)(A).’’.
(b) 
CONFORMING
AMENDMENT.—Section
1879(f)(4)(A) (42 U.S.C. 1395pp(f)(4)(A)) is amended by
striking ‘‘subsection (g)’’ and inserting ‘‘subsection
(g)(1)’’.
(c) EFFECTIVE DATE.—The amendments made by
the preceding subsections apply to services furnished after
the date of enactment of this Act.
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SEC. 205. MEDICARE CAPITAL ASSET SALES PRICE EQUAL
TO BOOK VALUE.
(a) IN GENERAL.—Section 1861(v)(1)(o) (42 U.S.C.
1395x(v)(1)(O)) is amended—
(1) in clause (i)—
(A) by striking ‘‘and (if applicable) a re-
turn on equity capital’’;
(B) by striking ‘‘hospital or skilled nursing
facility’’ and inserting ‘‘provider of services’’;
(C) by striking ‘‘clause (iv)’’ and inserting
‘‘clause (iii)’’; and
(D) by striking ‘‘the lesser of the allowable
acquisition cost’’ and all that follows up to the
period and inserting ‘‘the historical cost of the
asset, as recognized under this title, less depre-
ciation allowed, to the owner of record as of the
date of enactment of the Medicare and Medic-
aid Fraud, Abuse and Waste Prevention
Amendments of 1997 (or, in the case of an
asset not in existence as of that date, the first
owner of record of the asset after that date)’’;
(2) by striking clause (ii); and
(3) by renumbering clauses (iii) and (iv) as (ii)
and (iii), respectively.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) apply to changes of ownership that occur
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after the third month beginning after the date of enact-
ment of this Act.
SEC. 206. REPEAL OF MORATORIUM ON BAD DEBT POLICY.
Section 4008(c) of the Omnibus Budget Reconcili-
ation Act of 1987 (42 U.S.C. 1395f note) is repealed.
PART B—BANKRUPTCY PROVISIONS
SEC. 221. APPLICATION OF CERTAIN PROVISIONS OF THE
BANKRUPTCY CODE.
(a) RESTRICTED APPLICABILITY
OF BANKRUPTCY
STAY, DISCHARGE, AND PREFERENTIAL TRANSFER PRO-
VISIONS TO MEDICARE AND MEDICAID DEBTS.—Title XI
is amended by inserting after section 1143 the following
new section:
‘‘APPLICATION OF CERTAIN PROVISIONS OF THE
BANKRUPTCY CODE
‘‘SEC. 1144. (a) MEDICARE AND MEDICAID-RELAT-
ED ACTIONS NOT STAYED BY BANKRUPTCY PROCEED-
INGS.—The commencement or continuation of any action
against a debtor under this title or title XVIII or XIX
(other than an action with respect to health care services
for the debtor under title XVIII), including any action or
proceeding to exclude or suspend the debtor from program
participation, assess civil money penalties, recoup or set
off overpayments, or deny or suspend payment of claims
shall not be subject to the provisions of section 362(a) of
title 11 of the United States Code.
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‘‘(b) MEDICARE- AND MEDICAID-RELATED DEBT
NOT DISCHARGEABLE IN BANKRUPTCY.—A debt owed to
the United States or to a State for an overpayment under
title XVIII or XIX (other than an overpayment for health
care services for the debtor under title XVIII), or for a
penalty, fine, or assessment under this title or title XVIII
or XIX, shall not be dischargeable under any provision
of title 11 of the United States Code.
‘‘(c) REPAYMENT OF CERTAIN DEBTS CONSIDERED
FINAL.—Payments made to repay a debt to the United
States or to a State with respect to items or services pro-
vided, or claims for payment made, under title XVIII or
XIX (including repayment of an overpayment (other than
an overpayment for health care services for the debtor
under such title XVIII)), or to pay a penalty, fine, or as-
sessment under this title or title XVIII or XIX, shall be
considered final and not preferential transfers under sec-
tion 547 of title 11 of the United States Code.’’.
(b) MEDICARE RULES APPLICABLE TO BANKRUPTCY
PROCEEDINGS.—Title XVIII is amended by adding at the
end the following new section:
‘‘APPLICATION OF PROVISIONS OF THE BANKRUPTCY
CODE
‘‘SEC. 1894. (a) USE OF MEDICARE STANDARDS AND
PROCEDURES.—Notwithstanding any provision of title 11
of the United States Code or any other provision of law,
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in the case of claims by a debtor in bankruptcy for pay-
ment under this title, the determination of whether the
claim is allowable, and of the amount payable, shall be
made in accordance with the provisions of this title and
title XI and implementing regulations.
‘‘(b) NOTICE TO CREDITOR OF BANKRUPTCY PETI-
TIONER.—In the case of a debt owed to the United States
with respect to items or services provided, or claims for
payment made, under this title (including a debt arising
from an overpayment or a penalty, fine, or assessment
under title XI of this title), the notices to the creditor of
bankruptcy petitions, proceedings, and relief required
under title 11 of the United States Code (including under
section 342 of that title and section 2002(j) of the Federal
Rules of Bankruptcy Procedure) shall be given to the Sec-
retary. Provision of such notice to a fiscal agent of the
Secretary shall not be considered to satisfy this require-
ment.
‘‘(c) TURNOVER OF PROPERTY TO THE BANKRUPTCY
ESTATE.—For purposes of section 542(b) of title 11 of
the United States Code, a claim for payment under this
title shall not be considered to be a matured debt payable
to the estate of a debtor until such claim has been allowed
by the Secretary in accordance with procedures under this
title.’’.
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TITLE III—MEDICARE MENTAL
HEALTH 
PARTIAL 
HOS-
PITALIZATION SERVICES
SEC. 301. SERVICES NOT TO BE FURNISHED IN RESIDEN-
TIAL SETTINGS.
(a) IN
GENERAL.—Section 1861(ff)(3)(A) (42
U.S.C. 1395x(ff)(3)(A)) is amended by inserting ‘‘other
than in an individual’s home or in an inpatient or residen-
tial setting’’ before the period.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) applies to services furnished after the sixth
month beginning after the date of enactment of this Act.
SEC. 302. ADDITIONAL REQUIREMENTS FOR COMMUNITY
MENTAL HEALTH CENTERS.
(a) CRITERIA FOR PROVIDING SERVICES.—Section
1861(ff)(3)(B) (42 U.S.C. 1395x(ff)(3)(B)) is amended
by striking ‘‘entity—’’ and all that follows and inserting
the following:
‘‘entity that—
‘‘(i) provides the community mental health serv-
ices specified in section 1913(c)(1)) of the Public
Health Service Act;
‘‘(ii) meets applicable certification or licensing
requirements for community mental health centers
in the State in which it is located;
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‘‘(iii) is providing a significant share of its serv-
ices to individuals who are not eligible for benefits
under this title; and
‘‘(iv) meets such additional conditions as the
Secretary may specify in the interest of the health
and safety of individuals furnished services, or for
the effective or efficient furnishing of services.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) apply to services furnished after the sixth
month beginning after the date of enactment of this Act.
SEC. 303. PROSPECTIVE PAYMENT SYSTEM.
(a) ESTABLISHMENT OF SYSTEM.—Section 1833 (42
U.S.C. 13951) is amended by inserting after subsection
(o) the following new subsection:
‘‘(p) PROSPECTIVE PAYMENT SYSTEM FOR PARTIAL
HOSPITALIZATION SERVICES PROVIDED BY A COMMUNITY
MENTAL HEALTH CENTER.—The Secretary may establish
by regulation a prospective payment system for partial
hospitalization services provided by a community mental
health center. The system shall provide for appropriate
payment levels for efficient centers and take into account
payment levels for similar services furnished by other enti-
ties.’’.
(b) COINSURANCE AT 20 PERCENT OF PROSPECTIVE
PAYMENT
BASIS.—Section 1866(a)(2)(A) (42 U.S.C.
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1395cc(a)(2)(A)) is amended by adding at the end the fol-
lowing: ‘‘In the case of services described in section
1832(a)(2)(J), clause (ii) of the first sentence of this sub-
paragraph shall be applied by substituting the payment
basis established under section 1833(p) for the reasonable
charges.’’.
(c) CONFORMING AMENDMENTS.—Section 1833(a)
(42 U.S.C. 1395l(a)) is amended—
(1) in the matter in paragraph (2) preceding
subparagraph (A), by striking ‘‘and (I)’’ and insert-
ing ‘‘(I), and (J)’’;
(2) by striking ‘‘and’’ at the end of paragraph
(6);
(3) by striking the period at the end of para-
graph (7) and adding ‘‘; and’’; and
(4) by adding at the end the following new
paragraph:
‘‘(8) in the case of services described in section
1832(a)(2)(J), 80 percent of the payment basis
under the prospective payment system established
under section 1833(p).’’.
(d) EFFECTIVE DATE.—The amendments made by
subsections (b) and (c) apply to services furnished after
the first calendar year that ends at least six months after