I
105TH CONGRESS
1ST SESSION
H. R. 406
To establish the Independent Commission on Medicare to make recommenda-
tions on how to best match the structure of the Medicare program
with the funding made available for the program by Congress, to provide
for expedited consideration in Congress of the Commission’s recommenda-
tions, and to establish a default process for meeting Congressional spend-
ing targets for the Medicare program if Congress rejects the Commis-
sion’s recommendations.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 9, 1997
Mr. ENGLISH of Pennsylvania (for himself, Mr. MCHALE, Mr. SAXTON, Mr.
CANADY of Florida, Mr. GRAHAM, Mr. EHLERS, and Mr. LOBIONDO) in-
troduced the following bill; which was referred to the Committee on Ways
and Means, and in addition to the Committees on Commerce, Rules, and
the Budget, 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 establish the Independent Commission on Medicare to
make recommendations on how to best match the struc-
ture of the Medicare program with the funding made
available for the program by Congress, to provide for
expedited consideration in Congress of the Commission’s
recommendations, and to establish a default process for
meeting Congressional spending targets for the Medicare
program if Congress rejects the Commission’s rec-
ommendations.
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 ‘‘Commission to Save
Medicare Act of 1997’’.
TITLE I—INDEPENDENT
COMMISSION ON MEDICARE
SEC. 101. ESTABLISHMENT OF COMMISSION.
(a) IN GENERAL.—There is established a commission
to be known as the Independent Commission on Medicare
(hereinafter in this Act referred to as the ‘‘Commission’’).
(b) MEMBERSHIP.—
(1) COMPOSITION.—The Commission shall be
composed of 7 members appointed by the President,
by and with the advice and consent of the Senate.
(2) CHAIR.—The President shall designate one
of the members to chair the Commission.
(3) QUALIFICATIONS.—The membership of the
Commission shall consist of individuals with national
recognition for expertise in fields related to health
care.
(c) TERMS.—
(1) IN GENERAL.—Except as provided in para-
graphs (2) and (3), each member of the Commission
shall be appointed for a term of 9 years.
(2) TERMS OF INITIAL APPOINTMENT.—As des-
ignated by the President at the time of appointment,
of the members first appointed—
(A) 3 shall be appointed for a term of 3
years; and
(B) 3 shall be appointed for a term of 6
years.
(3) VACANCIES.—Any member appointed to fill
a vacancy occurring before the expiration of the
term for which the member’s predecessor was ap-
pointed shall be appointed only for the remainder of
that term. A vacancy in the Commission shall not
affect its powers, but shall be filled in the manner
in which the original appointment was made.
(4) EXCLUSIVE
EMPLOYMENT.—During the
term of appointment, members shall serve as em-
ployees of the Federal Government and shall hold no
other employment.
(5) COMPENSATION OF MEMBERS.—Each mem-
ber of the Commission (other than the chair) shall
receive an annual salary at the annual rate payable
from time to time for level IV of the Executive
Schedule. The chair of the Commission, during the
period of service as chair, shall receive an annual
salary at the annual rate payable from time to time
for level III of the Executive Schedule.
(6) REMOVAL.—A member of the Commission
may be removed by the President only for neglect of
duty or malfeasance in office.
(d) MEETINGS.—Each meeting of the Commission
shall be open to the public, except that the Commission
may meet in executive session to address matters relating
to personnel and other internal matters of the Commission
unrelated to the duties specified in section 102.
(e) STAFF.—
(1) IN GENERAL.—The Commission shall ap-
point a Director, who shall be paid at a rate the
Commission considers appropriate. The Director
may appoint and fix the pay of such additional per-
sonnel as the Director (with the approval of the
Chair of the Commission) considers appropriate,
without regard to provisions of title 5, United States
Code, governing appointments in the competitive
service.
(2) EXPERTS AND CONSULTANTS.—The Com-
mission may procure temporary and intermittent
services under section 3109(b) of title 5, United
States Code.
(3) STAFF OF FEDERAL AGENCIES.—Upon re-
quest of the Director, the head of any Federal de-
partment or agency may detail, on a reimbursable
basis, any of the personnel of that department or
agency to the Commission to assist it in carrying out
its duties under this Act.
(f) POWERS.—
(1) HEARINGS AND SESSIONS.—The Commis-
sion may, for the purpose of carrying out its duties
under this Act, hold hearings, sit and act at times
and places, take testimony, and receive evidence as
the Commission considers appropriate. The Commis-
sion may administer oaths or affirmations to wit-
nesses appearing before it.
(2) POWERS OF MEMBERS AND AGENTS.—Any
member or agent of the Commission may, if author-
ized by the Commission, take any action which the
Commission is authorized to take by this section.
(3) OBTAINING OFFICIAL DATA.—The Commis-
sion may secure directly from any department or
agency of the United States information necessary
to enable it to carry out this Act. Upon request of
the Chair of the Commission, the head of that de-
partment or agency shall furnish that information to
the Commission.
(4) GIFTS, BEQUESTS, AND
DEVISES.—The
Commission may accept, use, and dispose of gifts,
bequests, or devises of services or property, both real
and personal, for the purpose of aiding or facilitat-
ing the work of the Commission. Gifts, bequests, or
devises of money and proceeds from sales of other
property received as gifts, bequests, or devises shall
be deposited in the Treasury and shall be available
for disbursement upon order of the Chair of the
Commission.
(5) MAILS.—The Commission may use the
United States mails in the same manner and under
the same conditions as other departments and agen-
cies of the United States.
(6) ADMINISTRATIVE
SUPPORT
SERVICES.—
Upon the request of the Commission, the Adminis-
trator of General Services shall provide to the Com-
mission, on a reimbursable basis, the administrative
support services necessary for the Commission to
carry out its duties under this Act.
SEC. 102. DUTIES OF THE COMMISSION.
(a) IN GENERAL.—The Commission shall—
(1) transmit to Congress and the President
during December of each year (beginning with 1997)
a report on the aspects of the Medicare program
specified in subsection (b); and
(2) transmit to Congress during July of each
year (beginning with 1998) a report containing spe-
cific recommendations on the matters specified in
subsection (c).
(b) ASPECTS OF MEDICARE.—
(1) IN GENERAL.—The report transmitted pur-
suant to subsection (a)(1) during December of a
year shall include information on the following:
(A) The total outlays made under the med-
icare program for each of the 10 most recently
completed fiscal years.
(B) Projections of the outlays under such
program for the fiscal year beginning on Octo-
ber 1 of the next calendar year and each of the
4 succeeding fiscal years, on an aggregate and
a per capita basis.
(C) Projections of the actuarial value of
the package of benefits provided to medicare
beneficiaries for each of the fiscal years speci-
fied in subparagraph (B), on an aggregate and
a per capita basis.
(D) A comparison of each of the projec-
tions made under subparagraph (B) for a fiscal
year with the projections made for the year
under subparagraph (C).
(E) The health status of medicare bene-
ficiaries, the access of beneficiaries to health
services covered under the medicare program,
and the utilization of such services by bene-
ficiaries.
(F) Methods to improve the methodologies
used to determine the payments made under
the medicare program to or on behalf of medi-
care beneficiaries (including the use of risk ad-
justment in the determination of the amount of
such payments) and methods to encourage effi-
ciency and cost-effectiveness in the delivery of
health care services.
(G) Such other matters as the Commission
determines to be appropriate.
(2) ACTUARIAL
VALUE
DEFINED.—For pur-
poses of projecting the actuarial value of the pack-
age of benefits provided to medicare beneficiaries
under paragraph (1)(C), the Commission shall deter-
mine actuarial value by measuring the costs of re-
sources used to provide health care services covered
under the medicare program and adjusting such
costs to take into account—
(A) inflation in the costs of health care
services and all costs generally;
(B) demographic changes in the population
of beneficiaries, including population growth,
age distribution, health status, and access to
care;
(C) changes in the mix and intensity of
services provided to beneficiaries and the sites
at which services are furnished;
(D) scientific and technological advances;
(E) the quality of care provided, including
the effect on quality of the overutilization of
services and other factors;
(F) other factors affecting the demand of
beneficiaries for services; and
(G) such other factors as the Commission
considers appropriate.
(c) RECOMMENDATIONS
ON
CONTROLLING
OUT-
LAYS.—The report transmitted to Congress pursuant to
subsection (a)(2) during July of a year shall include spe-
cific recommendations on changes in the medicare pro-
gram, including changes in eligibility, benefits (including
the mode of delivery of such benefits), cost-sharing, or
payments made to or on behalf of beneficiaries, sufficient
to ensure that total outlays for the program for the fiscal
year beginning on the following October 1 do not exceed
the limit established for that fiscal year under section 201,
except that such recommendations may not include
changes relating to the payment of payroll taxes for fi-
nancing the program.
SEC. 103. EXPEDITED CONGRESSIONAL CONSIDERATION
OF RECOMMENDATIONS.
(a) IN GENERAL.—The recommendations submitted
by the Commission under section 102(c) for a fiscal year
shall take effect if a joint resolution (described in sub-
section (b)) approving such recommendations is enacted,
in accordance with the provisions of subsection (c), before
the first day of the fiscal year.
(b) JOINT RESOLUTION OF APPROVAL.—A joint res-
olution described in this subsection means only a joint res-
olution which is introduced within the 10-day period be-
ginning on the date on which the Commission submits rec-
ommendations under section 102(c) and—
(1) which does not have a preamble;
(2) the matter after the resolving clause of
which is as follows: ‘‘That Congress approves the
recommendations of the Independent Commission on
Medicare concerning methods to control outlays
under the medicare program for fiscal year
, as submitted by the Commission on
deemed a reference to an appropriate Committee of
the House of Representatives (specified by the
Speaker of the House of Representatives at the time
of submission of recommendations by the Commis-
sion under section 102(c)) and any reference to the
Committee on Armed Services of the Senate shall
be deemed a reference to an appropriate Committee
of the Senate (specified by the majority leader of
the Senate at the time of submission of rec-
ommendations by the Commission under section
102(c)); and
(2) any reference to the date on which the
President transmits a report shall be deemed a ref-
erence to the date on which the Commission submits
recommendations under section 102(c).
SEC. 104. NO TERMINATION OF COMMISSION.
Section 14(a)(2)(B) of the Federal Advisory Commit-
tee Act (5 U.S.C. App.; relating to the termination of advi-
sory committees) shall not apply to the Commission.
TITLE 
II—CONTROLLING 
OUT-
LAYS UNDER MEDICARE PRO-
GRAM
SEC. 201. ESTABLISHMENT OF ANNUAL LIMITS ON OUT-
LAYS.
Not later than April 15 of each year (beginning with
1998), Congress shall in the concurrent resolution on the
budget for the fiscal year beginning on the following Octo-
ber 1 establish a limit on total outlays to be made under
the medicare program for the fiscal year.
SEC. 202. ENFORCEMENT OF LIMITS THROUGH SEQUES-
TRATION.
(a) IN GENERAL.—Part C of the Balanced Budget
and Emergency Deficit Control Act of 1985 (2 U.S.C. 900
et seq.) is amended by inserting after section 252 the fol-
lowing new section:
‘‘SEC. 252A. SEQUESTRATION WITH RESPECT TO MEDICARE.
‘‘(a) SEQUESTRATION.—If, with respect to a fiscal
year (beginning with fiscal year 1999), Congress has not
enacted a joint resolution under section 103(b) of the
Commission to Save Medicare Act of 1997 before the first
day of the fiscal year, there shall be a sequestration to
eliminate any budgetary excess in the medicare program
as described in subsection (b).
‘‘(b) ELIMINATING A BUDGETARY EXCESS.—
‘‘(1) IN GENERAL.—Outlays under the medicare
program shall be reduced during a fiscal year as
provided by paragraph (2), as necessary to eliminate
any amount by which estimated outlays under the
program in the year exceed the limit for such out-
lays established for the year by Congress pursuant
to section 201 of the Commission to Save Medicare
Act of 1997.
‘‘(2) REDUCTIONS
DESCRIBED.—In carrying
out paragraph (1), the President shall—
‘‘(A) reduce payments made under the
medicare program by a uniform percentage suf-
ficient to reduce 50 percent of the amount de-
scribed in paragraph (1); and
‘‘(B) increase premiums, deductibles, co-
payments, and coinsurance required to be paid
under the program by a uniform percentage
sufficient to reduce 50 percent of the amount
described in paragraph (1).
‘‘(c) PART-YEAR APPROPRIATIONS AND OMB ESTI-
MATES.—Paragraphs (4) and (7) of section 251(a) shall
apply to sequestration of amounts under this section in
the same manner as those paragraphs apply to discre-
tionary appropriations and sequestrations under that sec-
tion.
‘‘(d) COORDINATION
WITH
OTHER
SEQUESTRA-
TION.—
‘‘(1) IN
GENERAL.—Reductions under sub-
section (b) for a fiscal year shall supersede any re-
duction otherwise made under section 252 or 253.
‘‘(2) REPORTS.—On the dates specified in sec-
tion 254(a), OMB and CBO shall issue preview, up-
date, and final reports on medicare sequestration
under this section. Such reports shall specify—
‘‘(A) the estimated amount described in
subsection (b)(1) for the fiscal year;
‘‘(B) the estimated uniform percentage de-
scribed in subsection (b)(2)(A) of the fiscal
year; and
‘‘(C) the estimated uniform percentage de-
scribed in subsection (b)(2)(B) of the fiscal
year.
‘‘(3) RULES
FOR
APPLICATION
OF
REDUC-
TIONS.—The provisions of section 256(d) shall apply
to reductions under this section.’’.
(b) CLERICAL AMENDMENT.—The table of contents
for part C of the Balanced Budget and Emergency Deficit
Control Act of 1985 (2 U.S.C. 900 et seq.) is amended
by inserting after the item relating to section 252 the fol-
lowing:
‘‘Sec. 252A. Sequestration with respect to medicare.’’.
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