I
105TH CONGRESS
1ST SESSION
H. R. 414
To authorize the use of the Medicare trust funds to reimburse the Department
of Defense for certain health care services provided to Medicare-eligible
covered military beneficiaries.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 9, 1997
Mr. HEFLEY (for himself, Mr. WATTS of Oklahoma, Mr. NORWOOD, Mr. TAY-
LOR of Mississippi, Mr. FILNER, Mr. ENSIGN, Mr. BONILLA, Mr. BART-
LETT of Maryland, Mr. ABERCROMBIE, Mr. GONZALEZ, Mr. RAMSTAD,
Mr. CONDIT, Mr. GOODLATTE, Mr. LEWIS of Kentucky, Mr. BALLENGER,
Mr. BEREUTER, Mr. CUNNINGHAM, Mr. CLEMENT, Mr. HERGER, Mr.
STEARNS, Mr. DAN SCHAEFER of Colorado, and Mr. HOYER) introduced
the following bill; which was referred to the Committee on Ways and
Means, and in addition to the Committees on Commerce and National Se-
curity, 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 authorize the use of the Medicare trust funds to reim-
burse the Department of Defense for certain health care
services provided to Medicare-eligible covered military
beneficiaries.
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
‘‘Uniformed Services Medicare Subvention Program Act’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Establishment of subvention program.
Sec. 4. Determination of reimbursement amounts.
SEC. 2. DEFINITIONS.
For purposes of this Act:
(1) MEDICARE-ELIGIBLE
COVERED
MILITARY
BENEFICIARY.—The term ‘‘Medicare-eligible covered
military beneficiary’’ means a beneficiary under
chapter 55 of title 10, United States Code, who—
(A) is entitled to hospital insurance bene-
fits under part A of title XVIII of the Social
Security Act (42 U.S.C. 1395c et seq.); and
(B) is enrolled in the supplementary medi-
cal insurance program under part B of such
title (42 U.S.C. 1395j et seq.).
(2) 
TRICARE 
PROGRAM.—The 
term
‘‘TRICARE program’’ means the managed health
care program that is established by the Secretary of
Defense under the authority of chapter 55 of title
10, United States Code, principally section 1097 of
such title, and includes the competitive selection of
as may be necessary to incorporate provisions specifically
applicable to Medicare-eligible covered military bene-
ficiaries who enroll in the managed care option of the
TRICARE program.
(f) COST SHARING.—The Secretary of Defense may
establish cost sharing requirements for Medicare-eligible
covered military beneficiaries who enroll in the managed
care option of the TRICARE program and for whom reim-
bursement may be made under section 4.
(g) EXPANSION
OF SUBVENTION PROGRAM.—The
Secretaries may expand the subvention program to incor-
porate health care services provided to Medicare-eligible
covered military beneficiaries under the fee-for-service op-
tions of the TRICARE program if, in the report submitted
under section 713 of the National Defense Authorization
Act for Fiscal Year 1997 (Public Law 104–106; 110 Stat.
2591), the Secretaries determined that such expansion is
feasible and advisable.
SEC. 4. DETERMINATION OF REIMBURSEMENT AMOUNTS.
(a) REIMBURSEMENT
OF DEPARTMENT
OF DE-
FENSE.—
(1) BASIS OF PAYMENTS.—Beginning October
1, 1997, monthly payments to the Department of
Defense under the subvention program shall be
made from the Medicare program under title XVIII
of the Social Security Act (42 U.S.C. 1395 et seq.)
on the basis that payments are made under section
1876(a) of the such Act (42 U.S.C. 1395mm(a)).
(2) AMOUNT OF PAYMENTS.—The Secretary of
Health and Human Services shall make payments to
the Department of Defense from the Federal Hos-
pital Insurance Trust Fund and the Federal Supple-
mentary Medical Insurance Trust Fund (allocated
by the Secretary of Health and Human Services be-
tween each trust fund based on the relative weight
that each trust fund contributes to the required pay-
ment) at a per capita rate equal to 93 percent of the
applicable adjusted average per capita cost for each
Medicare-eligible covered military beneficiary en-
rolled in the managed care option of the TRICARE
program in excess of the number of such bene-
ficiaries calculated under subsection (b) for the De-
partment of Defense maintenance of health care ef-
fort.
(b) MAINTENANCE OF DEFENSE HEALTH CARE EF-
FORT.—
(1) MAINTENANCE
OF
EFFORT
REQUIRED.—
The Secretary of Defense shall maintain the Depart-
ment of Defense health care efforts for Medicare-eli-
gible covered military beneficiaries so as to avoid im-
posing on the Medicare program those costs that the
Department of Defense would be expected to incur
to provide health care services to Medicare-eligible
covered military beneficiaries in the absence of the
subvention program.
(2) ESTIMATE
OF
PRIOR
EFFORT.—For the
first fiscal year of the subvention program, the Sec-
retaries shall estimate the amount expended by the
Department of Defense for fiscal year 1997 for pro-
viding health care items and services (other than
pharmaceuticals provided to outpatients) to Medi-
care-eligible covered military beneficiaries. For sub-
sequent fiscal years, the amount so estimated shall
be adjusted for inflation, for differences between es-
timated and actual amounts expended, and for
changes in the Department of Defense health care
budget that exceed $100,000,000.
(3) TARGET FOR DEFENSE EFFORT.—On the
basis of the estimate made under paragraph (2), the
Secretaries shall establish monthly targets of the
number of Medicare-eligible covered military bene-
ficiaries for whom reimbursement will not be pro-
vided to the Department of Defense under sub-
section (a).
(c) PROTECTION OF MEDICARE PROGRAM AGAINST
INCREASED COSTS.—
(1) PURPOSE.—The purpose of this subsection
is to protect the Medicare program against costs in-
curred under subsection (a) in connection with the
provision of health care services to Medicare-eligible
covered military beneficiaries that would not have
been incurred by the medicare program in the ab-
sence of the reimbursement requirement.
(2) REVIEW BY COMPTROLLER GENERAL.—Not
later than December 31 of each year, the Comptrol-
ler General shall determine and submit to the Sec-
retaries and Congress a report on the extent, if any,
to which the costs of the Secretary of Defense under
the TRICARE program and the costs of the Sec-
retary of Health and Human Services under the
Medicare program have increased as a result of the
subvention program.
(3) ACTIONS TO PREVENT INCREASED COSTS.—
If the Secretaries determine that the trust funds
under title XVIII of the Social Security Act (42
U.S.C. 1395 et seq.) still incur excess costs as a re-
sult of the subvention program, the Secretaries shall
take such steps as may be necessary to offset those
excess costs (and prevent future excess costs), in-
cluding suspension or termination of the subvention
program, adjustment of the payment rate under sub-
section (a)(2), or an adjustment of the maintenance
of effort requirements of the Department of Defense
under subsection (b).
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