I 
112TH CONGRESS 
1ST SESSION H. R. 3735 
To provide for enhanced penalties to combat Medicare and Medicaid fraud, 
a Medicare data-mining system and biometric technology pilot program, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 19, 2011 
Ms. ROS-LEHTINEN introduced the following bill; which was referred to the 
Committee on Energy and Commerce, and in addition to the Committee 
on Ways and Means, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall within 
the jurisdiction of the committee concerned 
A BILL 
To provide for enhanced penalties to combat Medicare and 
Medicaid fraud, a Medicare data-mining system and bio-
metric technology pilot program, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Medicare Fraud En-
forcement and Prevention Act of 2011’’. 
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SEC. 2. ENHANCED CRIMINAL PENALTIES TO COMBAT 
MEDICARE AND MEDICAID FRAUD. 
(a) IN GENERAL.—Section 1128B of the Social Secu-
rity Act (42 U.S.C. 1320a–7b) is amended— 
(1) in subsection (a), by striking ‘‘$10,000 or 
imprisoned for not more than one year’’ and insert-
ing ‘‘$20,000 or imprisoned for not more than two 
years’’; and 
(2) in each of subsections (a), (b)(1), (b)(2), 
(c), and (d), by striking ‘‘$25,000 or imprisoned for 
not more than five years’’ and inserting ‘‘$50,000 or 
imprisoned for not more than 10 years’’. 
(b) ILLEGAL DISTRIBUTION OF MEDICARE OR MED-
ICAID BENEFICIARY IDENTIFICATION OR BILLING PRIVI-
LEGES.—Section 1128B of such Act (42 U.S.C. 1320a– 
7b) is amended by adding at the end the following new 
subsection: 
‘‘(g) Whoever knowingly, intentionally, and with the 
intent to defraud purchases, sells, or distributes, or ar-
ranges for the purchase, sale, or distribution of two or 
more Medicare or Medicaid beneficiary identification num-
bers or billing privileges under title XVIII or title XIX 
shall be imprisoned for not more than 10 years or fined 
under title 18, United States Code (or, if greater, an 
amount equal to the monetary loss to the Federal and any 
State government as a result of such acts), or both.’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to acts committed on or after the 
date of the enactment of this Act. 
SEC. 3. ENHANCED CIVIL AUTHORITIES TO COMBAT MEDI-
CARE AND MEDICAID FRAUD. 
(a) CIVIL MONETARY PENALTIES LAW ALIGNMENT 
AND OTHER CHANGES.— 
(1) Section 1128A(a) of the Social Security Act 
(42 U.S.C. 1320a–7a(a)) is amended— 
(A) in paragraph (1), by striking ‘‘to an 
officer, employee, or agent of the United States, 
or of any department or agency thereof, or of 
any State agency (as defined in subsection 
(i)(1)),’’; 
(B) by inserting after paragraph (10), as 
added by section 6402(d)(2) of the Patient Pro-
tection and Affordable Care Act (Public Law 
111–148) the following new paragraphs: 
‘‘(11) conspires to commit a violation of this 
section; or 
‘‘(12) knowingly makes, uses, or causes to be 
made or used, a false record or statement material 
to an obligation to pay or transmit money or prop-
erty to a Federal health care program, or knowingly 
conceals or knowingly and improperly avoids or de-
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creases an obligation to pay or transmit money or 
property to a Federal health care program;’’; 
(C) in the first sentence— 
(i) by striking ‘‘or in cases under 
paragraph (9)’’ and inserting ‘‘in cases 
under paragraph (9)’’; and 
(ii) by striking ‘‘fact)’’ and inserting 
‘‘fact), in cases under paragraph (11), 
$50,000 for any violation described in this 
section committed in furtherance of the 
conspiracy involved, and in cases under 
paragraph (12), $50,000 for each false 
record or statement, or concealment, avoid-
ance, or decrease’’; and 
(D) in the second sentence, by striking 
‘‘material fact).’’ and inserting ‘‘material fact); 
or in cases under paragraph (11), an assess-
ment of not more than 3 times the total 
amount that would otherwise apply for any vio-
lation described in this section committed in 
furtherance of the conspiracy involved; or in 
cases under paragraph (12), an assessment of 
not more than 3 times the total amount of the 
obligation to which the false record or state-
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ment was material or that was avoided or de-
creased.’’. 
(2) Section 1128A(c)(1) of the Social Security 
Act (42 U.S.C. 1320a–7a(c)(1)) is amended by 
striking ‘‘six years’’ and inserting ‘‘10 years’’. 
(3) Section 1128A(i) of the Social Security Act 
(42 U.S.C. 1320a–7a(i)) is amended— 
(A) by amending paragraph (2) to read as 
follows: 
‘‘(2) The term ‘claim’ means any application, 
request, or demand, whether under contract, or oth-
erwise, for money or property for items and services 
under a Federal health care program (as defined in 
section 1128B(f)), whether or not the United States 
or a State agency has title to the money or property, 
that— 
‘‘(A) is presented or caused to be pre-
sented to an officer, employee, or agent of the 
United States, or of any department or agency 
thereof, or of any State agency (as defined in 
subsection (i)(1)); or 
‘‘(B) is made to a contractor, grantee, or 
other recipient if the money or property is to be 
spent or used on the Federal health care pro-
gram’s behalf or to advance a Federal health 
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care program interest, and if the Federal health 
care program— 
‘‘(i) provides or has provided any por-
tion of the money or property requested or 
demanded; or 
‘‘(ii) will reimburse such contractor, 
grantee, or other recipient for any portion 
of the money or property which is re-
quested or demanded.’’; 
(B) by amending paragraph (3) to read as 
follows: 
‘‘(3) The term ‘item or service’ means, without 
limitation, any medical, social, management, admin-
istrative, or other item or service used in connection 
with or directly or indirectly related to a Federal 
health care program.’’; 
(C) in paragraph (7)— 
(i) by striking ‘‘term ‘should know’ 
means’’ and inserting ‘‘terms ‘knowing’, 
‘knowingly’, and ‘should know’ mean’’; 
(ii) by redesignating subparagraphs 
(A) and (B) as subparagraphs (B) and 
(C), respectively; 
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(iii) by inserting before subparagraph 
(B), as redesignated by clause (ii), the fol-
lowing new subparagraph: 
‘‘(A) has actual knowledge of the informa-
tion;’’; and 
(iv) in the matter following subpara-
graph (C), as redesignated by clause (ii)— 
(I) by inserting ‘‘require’’ after 
‘‘and’’; and 
(II) by striking ‘‘is required’’; 
and 
(D) by adding at the end the following new 
paragraphs: 
‘‘(8) The term ‘obligation’ means an established 
duty, whether or not fixed, arising from an express 
or implied contractual, grantor-grantee, or licensor 
licensee relationship, from a fee-based or similar re-
lationship, from statute or regulation, or from the 
retention of any overpayment. 
‘‘(9) The term ‘material’ means having a nat-
ural tendency to influence, or be capable of influ-
encing, the payment or receipt of money or prop-
erty.’’. 
(b) EXCLUSION OF RESPONSIBLE CORPORATE OFFI-
CIALS.—Section 1128(b) of the Social Security Act (42 
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U.S.C. 1320a–7(b)) is amended by striking clauses (i) and 
(ii) of paragraph (15)(A) and inserting the following: 
‘‘(i) who has or had a direct or indi-
rect ownership or control interest in a 
sanctioned entity at the time of and who 
knew or should have known (as defined in 
section 1128(i)(7)) of any of the conduct 
that formed a basis for the conviction or 
exclusion described in subparagraph (B); 
or 
‘‘(ii) who is or was an officer or man-
aging employee (as defined in section 
1126(b)) of such an entity at the time of 
any of the conduct that formed a basis for 
the conviction or exclusion so described.’’. 
(c) PAYMENT SUSPENSIONS.—Subsection (o)(1) of 
section 1862 of the Social Security Act (42 U.S.C. 1395y), 
as added by section 6402(h) of the Patient Protection and 
Affordable Care Act (Public Law 111–148), is amended 
by striking ‘‘may’’ and inserting ‘‘shall’’. 
(d) CIVIL MONETARY PENALTIES FOR FALSE STATE-
MENTS OR DELAYING INSPECTIONS.—Paragraph (9) of 
section 1128A(a) of the Social Security Act (42 U.S.C. 
1320a–7a(a)), as added by section 6408(a) of the Patient 
Protection and Affordable Care Act (Public Law 111– 
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148), is amended by inserting ‘‘or to timely provide infor-
mation in response to a request authorized by section 
1128J(b),’’ after ‘‘regulations),’’. 
SEC. 4. ENHANCED SCREENING, MEDICARE DATA-MINING 
SYSTEM; 
BIOMETRIC 
TECHNOLOGY 
PILOT 
PROGRAM. 
(a) 
ENHANCED
SCREENING.—Section 
1866(j)(2)(B)(ii) of the Social Security Act (42 U.S.C. 
1395cc(j)), as inserted by section 6401(a)(3) of the Pa-
tient Protection and Affordable Care Act (Public Law 
111–148), is amended by striking ‘‘may’’ and inserting 
‘‘shall’’. 
(b) ACCESS TO REAL TIME CLAIMS AND PAYMENT 
DATA.—Section 1128J(a)(2) of the Social Security Act, 
as added by section 6402(a) of the Patient Protection and 
Affordable Care Act (Public Law 111–148), is amended— 
(1) by inserting ‘‘including real time claims and 
payment data,’’ after ‘‘access to claims and payment 
data’’; and 
(2) by adding at the end the following sentence: 
‘‘In carrying out this section, the Inspector General 
of the Department of Health and Human Services, 
in consultation with the Attorney General, shall im-
plement mechanisms for the sharing of information 
about suspected fraud relating to the Federal health 
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care programs under titles XVIII, XIX, and XXI 
with other appropriate law enforcement officials.’’. 
(c) BIOMETRIC TECHNOLOGY PILOT PROGRAM.— 
(1) IN GENERAL.—By not later than one year 
after the date of the enactment of this Act, the Sec-
retary of Health and Human Services shall carry out 
a 5-year pilot program that implements biometric 
technology to ensure that individuals entitled to ben-
efits under part A of title XVIII of the Social Secu-
rity Act or enrolled under part B of such title are 
physically present at the time and place of receipt of 
certain items and services (specified by the Sec-
retary) for which payment may be made under such 
title. Under such pilot program the Secretary may 
provide for financial incentives to encourage vol-
untary participation of providers of services (as de-
fined in section 1861(u) of such Act) and suppliers 
(as defined in section 1861(d) of such Act). 
(2) REPORTS.—The Secretary of Health and 
Human Services shall, for each of the third, fourth, 
and fifth years of the pilot program under para-
graph (1), submit to Congress a report on the effec-
tiveness of the pilot program in reducing the occur-
rence of waste, fraud, and abuse in the Medicare 
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program under title XVIII of the Social Security 
Act. 
(3) AUTHORIZATION OF APPROPRIATIONS.—For 
purpose of carrying out paragraph (1), there is au-
thorized to be appropriated such sums as may be 
necessary. 
Æ 
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