I 
108TH CONGRESS 
1ST SESSION H. R. 2664
To provide for Medicare reimbursement for health care services provided 
to Medicare-eligible veterans in facilities of the Department of Veterans 
Affairs. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 8, 2003
Mrs. KELLY introduced the following bill; which was referred to the Com-
mittee on Ways and Means, and in addition to the Committees on Energy 
and Commerce and Veterans’ Affairs, for a period to be subsequently de-
termined 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 Medicare reimbursement for health care serv-
ices provided to Medicare-eligible veterans in facilities 
of the Department of Veterans Affairs.
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 ‘‘Veterans Medicare Re-
imbursement Act of 2003’’.
SEC. 2. ESTABLISHMENT OF MEDICARE SUBVENTION FOR 
VETERANS. 
Section 1862 of the Social Security Act (42 U.S.C. 
1395y) is amended by inserting after subsection (c) the 
following new subsection: 
‘‘(d) MEDICARE SUBVENTION FOR VETERANS.—
‘‘(1) ESTABLISHMENT OF PROCEDURE FOR RE-
IMBURSEMENT.—
‘‘(A) IN
GENERAL.—The administering 
Secretaries shall establish a procedure under 
which the Secretary shall reimburse the Sec-
retary of Veterans Affairs, from the trust 
funds, for medicare health care services fur-
nished to medicare-eligible veterans. 
‘‘(B) REQUIREMENTS.—Under the proce-
dure—
‘‘(i) the administering Secretaries 
shall certify, that any Department of Vet-
erans Affairs medical facility that fur-
nishes medicare health care services for 
which the Secretary of Veterans Affairs is 
reimbursed under this subsection has suffi-
cient—
‘‘(I) resources and expertise to 
provide the health care benefits re-
quired to be provided to beneficiaries; 
and 
‘‘(II) information and billing sys-
tems in place to ensure accurate and 
timely submission of claims for health 
care benefits to the Secretary; 
‘‘(ii) the Secretary shall have access to 
all data of the Department of Veterans Af-
fairs that the Secretary determines is nec-
essary to verify accuracy in billing and 
claims information; and 
‘‘(iii) the Secretary shall waive re-
quirements for conditions of participation 
otherwise applicable to a provider of serv-
ices, physician, practitioner, supplier, or 
facility under this title in the case of a De-
partment of Veterans Affairs medical facil-
ity consistent with paragraph (3). 
‘‘(C) RESTRICTION ON NEW OR EXPANDED 
FACILITIES.—No new Veterans Affairs medical 
facilities may be built or expanded with funds 
received under this subsection. 
‘‘(2) COST-SHARING.—The amount of reim-
bursement for medicare health care services to the 
Secretary of Veterans Affairs for medicare health
care services shall be reduced by amounts attrib-
utable to applicable deductible, coinsurance, and 
cost-sharing requirements under this title. 
‘‘(3) MEDICARE REQUIREMENTS.—
‘‘(A) WAIVER.—The Secretary shall waive 
any requirements referred to in paragraph 
(1)(B)(iii) (relating to requirements for condi-
tions of participation) in the case of a Depart-
ment of Veterans Affairs medical facility, or ap-
prove equivalent or alternative ways of meeting 
such a requirement, but only if such waiver or 
approval—
‘‘(i) reflects the unique status of the 
Department of Veterans Affairs as an 
agency of the Federal Government; and 
‘‘(ii) is necessary to carry out, or im-
prove the efficiency of, to provide for reim-
bursement for medicare health care serv-
ices under this subsection. 
‘‘(B) WAIVER
OF
PROHIBITION
ON
PAY-
MENTS
TO
FEDERAL
PROVIDERS
OF
SERV-
ICES.—The prohibition of payments to Federal 
providers of services under sections 1814(c) and 
1835(d), and paragraphs (2) and (3) of sub-
section (a), shall not apply.
‘‘(4) VERIFICATION OF ELIGIBILITY.—
‘‘(A) IN GENERAL.—The Secretary of Vet-
erans Affairs shall establish procedures for de-
termining whether an individual is a medicare-
eligible veteran. 
‘‘(B) RESTRICTION.—No reimbursement 
shall be made under this subsection for any 
medicare health care service provided to an in-
dividual unless the individual has been deter-
mined to be a medicare-eligible veteran pursu-
ant to the procedures established under sub-
paragraph (A). 
‘‘(5) DATA
REQUIREMENTS.—Reimbursements 
for medicare health care services furnished to medi-
care-eligible veterans may not be made until such 
time as the administering Secretaries certify to Con-
gress that the—
‘‘(A) cost accounting and related trans-
action systems of the Veterans Health Adminis-
tration provide cost information and encounter 
data regarding health care delivered at each 
Department of Veterans Affairs medical facility 
on an inpatient and outpatient basis; and
‘‘(B) cost information and encounter data 
provided by such systems is accurate, reliable, 
and consistent across all facilities. 
‘‘(6) PAYMENTS BASED ON REGULAR MEDICARE 
PAYMENT RATES.—
‘‘(A) AMOUNT.—Subject to the succeeding 
provisions of this paragraph, the Secretary shall 
reimburse the Secretary of Veterans Affairs for 
health care benefits provided to medicare-eligi-
ble veterans at a rate equal to 100 percent of 
the amounts that otherwise would be payable 
under this title on a noncapitated basis for such 
service if the Department of Veterans Affairs 
medical facility were a provider of services, were 
participating in the medicare program, and im-
posed charges for such service. 
‘‘(B) EXCLUSION OF CERTAIN AMOUNTS.—
In computing the amount of payment under 
subparagraph (A), the following amounts shall 
be excluded: 
‘‘(i) DISPROPORTIONATE SHARE HOS-
PITAL ADJUSTMENT.—Any amount attrib-
utable to an adjustment under section 
1886(d)(5)(F).
‘‘(ii) DIRECT
GRADUATE
MEDICAL 
EDUCATION PAYMENTS.—Any amount at-
tributable to a payment under section 
1886(h). 
‘‘(iii) INDIRECT MEDICAL EDUCATION 
ADJUSTMENT.—Any amount attributable 
to 
the 
adjustment 
under 
section 
1886(d)(5)(B). 
‘‘(iv) PERCENTAGE OF CAPITAL PAY-
MENTS.—67 percent of any amounts at-
tributable to payments for capital-related 
costs under medicare payment policies 
under section 1886(g). 
‘‘(C) PERIODIC
PAYMENTS
FROM
MEDI-
CARE
TRUST
FUNDS.—Payments under this 
paragraph shall be made—
‘‘(i) on a periodic basis consistent 
with the periodicity of payments under this 
title; and 
‘‘(ii) in appropriate part, as deter-
mined by the Secretary, from the trust 
funds. 
‘‘(7) CREDITING OF PAYMENTS.—Any payment 
shall be deposited in the Department of Veterans Af-
fairs Medical Care Collections Fund established 
under section 1729A of title 38, United States Code. 
‘‘(8) RULES
OF
CONSTRUCTION.—Nothing in 
this subsection shall be construed— 
‘‘(A) as prohibiting the Inspector General 
of the Department of Health and Human Serv-
ices from investigating any matters regarding 
the expenditure of funds under this subsection, 
including compliance with the provisions of this 
title and all other relevant laws; or 
‘‘(B) as adding or requiring additional cri-
teria for eligibility for health care benefits fur-
nished to veterans by the Secretary of Veterans 
Affairs, as established under chapter 17 of title 
38, United States Code. 
‘‘(9) EVALUATION AND REPORTS.—The admin-
istering Secretaries shall conduct ongoing evalua-
tions of the procedure established under this sub-
section, and shall submit periodic reports to Con-
gress on—
‘‘(A) any savings or costs to the medicare 
program by reason of this subsection; and 
‘‘(B) effects of this subsection on access to 
care by medicare-eligible veterans. 
‘‘(10) DEFINITIONS.—In this subsection:
‘‘(A) ADMINISTERING SECRETARIES.—The 
term ‘administering Secretaries’ means the Sec-
retary and the Secretary of Veterans Affairs 
acting jointly. 
‘‘(B) MEDICARE
HEALTH
CARE
SERV-
ICES.—The term ‘medicare health care services’ 
means items or services covered under part A 
or B of this title. 
‘‘(C) MEDICARE-ELIGIBLE VETERAN.—The 
term ‘medicare-eligible veteran’ means an indi-
vidual who—
‘‘(i) is a veteran (as defined in section 
101 of title 38, United States Code) who 
is eligible for care and services under sec-
tion 1705(a) of title 38, United States 
Code; 
‘‘(ii) has attained age 65; 
‘‘(iii) is entitled to, or enrolled for, 
benefits under part A of this title; and 
‘‘(iv) is enrolled for benefits under 
part B of this title. 
‘‘(D) TRUST
FUNDS.—The term ‘trust 
funds’ means the Federal Hospital Insurance 
Trust Fund established in section 1817 and the
Federal 
Supplementary 
Medical 
Insurance 
Trust Fund established in section 1841. 
‘‘(E) DEPARTMENT OF VETERANS AFFAIRS 
MEDICAL FACILITY.—The term ‘Department of 
Veterans Affairs medical facility’ means a med-
ical facility as defined in section 8101(3) of title 
38, United States Code alone or in conjunction 
with other facilities under the jurisdiction of the 
Secretary of Veterans Affairs.’’.
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