I 
114TH CONGRESS 
1ST SESSION H. R. 1458 
To amend title XVIII of the Social Security Act to provide bundled payments 
for post-acute care services under parts A and B of Medicare, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 19, 2015 
Mr. MCKINLEY (for himself, Mr. TOM PRICE of Georgia, and Mr. MCNER-
NEY) introduced the following bill; which was referred to the Committee 
on Ways and Means, and in addition to the Committee on Energy and 
Commerce, 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 amend title XVIII of the Social Security Act to provide 
bundled payments for post-acute care services under 
parts A and B of Medicare, 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 ‘‘Bundling and Coordi-
nating Post-Acute Care Act of 2015’’ and as the 
‘‘BACPAC Act of 2015’’. 
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SEC. 2. PURPOSES. 
The purposes of this Act are to— 
(1) foster the delivery of high-quality post-acute 
care services in the most cost-effective manner pos-
sible; 
(2) preserve the ability of patients, with the 
guidance of their physicians, to select their preferred 
providers of post-acute care services; 
(3) promote competition among post-acute care 
providers on the basis of quality, cost, account-
ability, and customer service; 
(4) achieve long-term sustainability by ensuring 
operational stability through regional breadth and 
the engagement of experienced care PAC coordina-
tors; 
(5) advance innovation in fields including tele-
health, care coordination, medication management, 
and hospitalization avoidance; and 
(6) provide for the financial security of the 
Medicare program by achieving substantial program 
savings through maximized efficiencies, cost avoid-
ance, and outcomes improvement. 
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SEC. 3. PROVIDING BUNDLED PAYMENTS FOR POST-ACUTE 
CARE SERVICES UNDER PARTS A AND B OF 
MEDICARE. 
Title XVIII of the Social Security Act is amended by 
inserting after section 1866E (42 U.S.C. 1395cc–5) the 
following new section: 
‘‘PROVIDING BUNDLED PAYMENTS FOR POST-ACUTE CARE 
SERVICES 
‘‘SEC. 1866F. (a) IN GENERAL.—For a PAC bundle 
with respect to qualifying discharges occurring on or after 
January 1, 2017, instead of the payment otherwise pro-
vided under parts A and B, there shall be paid a single 
payment amount (determined under subsection (d) and as 
limited under paragraph (4) of such subsection) to be paid 
to a PAC coordinator (as described in subsection (c)) se-
lected by an individual under such subsection. 
‘‘(b) PAC-RELATED DEFINITIONS.—In this section: 
‘‘(1) PAC BUNDLE.—The term ‘PAC bundle’ 
means PAC services furnished to an individual dur-
ing a PAC period in a PAC area. 
‘‘(2) PAC SERVICES.— 
‘‘(A) IN GENERAL.—The term ‘PAC serv-
ices’ includes— 
‘‘(i) post-hospital extended care serv-
ices, subject to subparagraph (C)(i); 
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‘‘(ii) home health services, subject to 
clauses (ii) and (iii) of subparagraph (C); 
‘‘(iii) inpatient services provided in a 
rehabilitation facility, subject to subpara-
graph (C)(iii); 
‘‘(iv) inpatient hospital services pro-
vided by a long-term care hospital, subject 
to subparagraph (C)(iv); 
‘‘(v) durable medical equipment; 
‘‘(vi) outpatient physical therapy serv-
ices; 
‘‘(vii) outpatient occupational therapy 
services; 
‘‘(viii) outpatient prescription drugs 
and biologicals; and 
‘‘(ix) skilled nursing facility services. 
‘‘(B) EXCEPTIONS.—Such term does not 
include— 
‘‘(i) physicians’ services; 
‘‘(ii) hospice care; 
‘‘(iii) outpatient hospital services; 
‘‘(iv) ambulance services; 
‘‘(v) outpatient speech-language pa-
thology services; and 
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‘‘(vi) the items and services described 
in section 1861(s)(9). 
‘‘(C) NONAPPLICATION OF CERTAIN COV-
ERAGE LIMITATIONS.— 
‘‘(i) WAIVER
OF
SKILLED
NURSING 
FACILITY
THREE
DAY
STAY
REQUIRE-
MENT.—In applying subparagraph (A)(i), 
the 3-day stay requirement described in 
section 1861(i) (requiring that an individ-
ual’s inpatient stay in a discharging hos-
pital be for a duration of not less than 3 
consecutive days) shall not apply. 
‘‘(ii) WAIVER
OF
HOMEBOUND
RE-
QUIREMENT
FOR
HOME
HEALTH
SERV-
ICES.—In applying subparagraph (A)(ii), 
the 
requirements 
cited 
in 
sections 
1814(a)(2)(C) and 1835(a)(2)(A) that 
home health services are or were required 
because the individual is or was confined to 
the home of the individual shall not apply. 
‘‘(iii) WAIVER OF FACE-TO-FACE DOC-
UMENTATION REQUIREMENT.—In applying 
the subparagraph (A)(ii), the requirements 
cited 
in 
sections 
1814(a)(2)(C) 
and 
1835(a)(2)(A) that the face-to-face en-
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counter described in each such section 
must be documented shall not apply. 
‘‘(iv) NONAPPLICATION OF REHABILI-
TATION FACILITY PERCENTAGE REQUIRE-
MENT.—In applying subparagraph (A)(iii), 
any requirement that a specified percent-
age of the inpatient population served by 
the facility require intensive rehabilitation 
services for treatment of one or more of 
the 
conditions 
specified 
in 
section 
412.29(b)(2) of title 42, Code of Federal 
Regulations, as of December 19, 2013, 
shall not apply. 
‘‘(v) NONAPPLICATION OF LONG-TERM 
CARE
HOSPITAL
PERCENTAGE
REQUIRE-
MENT.—In applying subparagraph (A)(iv), 
any requirement that a specified percent-
age of the discharged Medicare inpatient 
population of the long-term care hospital 
or its satellite facility be admitted to the 
hospital or its satellite facility from its co- 
located hospital shall not apply. 
‘‘(vi) 
NONAPPLICATION
OF
SUCH 
OTHER
REQUIREMENTS
AS
DETERMINED 
BY
THE
SECRETARY.—In applying sub-
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paragraph (A), any other such requirement 
that the Secretary determines it is nec-
essary not to apply in order to ensure ap-
propriate implementation of this section 
shall not apply. 
‘‘(3) PAC PERIOD.—The term ‘PAC period’ 
means the period beginning on the date of a quali-
fying discharge (as defined in paragraph (10)) and 
ending on the date that is the earlier of the fol-
lowing: 
‘‘(A) The date that is 90 days after the 
date of such discharge. 
‘‘(B) The date on which the individual is 
admitted to a hospital for purposes of receiving 
services for a condition that is not related to 
the condition for which the individual received 
the acute care inpatient hospital services de-
scribed in paragraph (10)(A). 
‘‘(4) PAC AREA.—The term ‘PAC area’ means 
an area with respect to which a PAC coordinator 
has a PAC agreement in effect under subsection 
(c)(1)(B). 
‘‘(5) PAC PHYSICIAN.—The term ‘PAC physi-
cian’ means, with respect to an individual receiving 
a PAC bundle, the physician who has primary re-
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sponsibility with respect to supervising the delivery 
of services during the course of a PAC period. 
‘‘(6) PAC PROVIDER.—The term ‘PAC pro-
vider’ means, with respect to PAC services, the pro-
vider of services or supplier furnishing such services. 
‘‘(7) PAC NETWORK AGREEMENT.—The term 
‘PAC network agreement’ means, in the case that an 
individual has selected a PAC coordinator under 
subsection (c)(4)(A) for the furnishing of PAC serv-
ices, an agreement of a PAC coordinator with one 
or more PAC providers to provide such services to 
such individual. 
‘‘(8) PAC READMISSION.—The term ‘PAC re-
admission’ means, with respect to an individual re-
ceiving a PAC bundle, the individual’s admission to 
a hospital within 90 days of the date of the quali-
fying discharge of the individual, for purposes of re-
ceiving services for a condition that is related to the 
condition for which the individual received the acute 
care inpatient hospital services described in para-
graph (10)(A). 
‘‘(9) PAC ASSESSMENT TOOL.—The term ‘PAC 
assessment tool’ means the Continuity Assessment 
Record and Evaluation (CARE) tool (or such equiv-
alent assessment tool as the Secretary may specify). 
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‘‘(10) QUALIFYING
DISCHARGE.—Subject to 
subsection (e), the term ‘qualifying discharge’ means 
a discharge after receiving acute care inpatient hos-
pital services (as defined by the Secretary) in a sub-
section 
(d) 
hospital 
(as 
defined 
in 
section 
1886(d)(1)(B)) for which the discharge plan in-
cludes the furnishing of PAC services. 
‘‘(11) CRG.—The term ‘CRG’ means a condi-
tion-related group established under subsection 
(d)(1). 
‘‘(c) PAC COORDINATORS.— 
‘‘(1) IN GENERAL.—In this section, the term 
‘PAC coordinator’ means a hospital, PAC provider, 
insurer, third-party administrator, or combination of 
hospital and PAC provider that— 
‘‘(A) is certified, under a process estab-
lished by the Secretary, as meeting appropriate 
requirements specified by the Secretary, includ-
ing the requirements specified in paragraph (2); 
and 
‘‘(B) has entered into and has in effect a 
PAC agreement with the Secretary described in 
paragraph (3). 
For purposes of subparagraph (A), an entity that 
meets the requirements specified in paragraph (2) 
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directly or indirectly (including through an arrange-
ment with one or more insurance providers or bene-
fits administrators) shall be considered as meeting 
the requirements specified in such paragraph. 
‘‘(2) REQUIREMENTS.—The requirements speci-
fied in this paragraph, with respect to an entity 
serving a PAC area, are the following: 
‘‘(A) FINANCIAL
SOLVENCY.—The entity 
has the capacity, and provides sufficient assur-
ances of solvency, to bear financial risk as a 
PAC coordinator under this section. 
‘‘(B) CAPACITY
TO
MANAGE
CARE
AND 
FUNDING.—The entity has the capability to 
manage the care and funding for PAC services 
in such area. 
‘‘(C) PAC NETWORK AGREEMENTS.— 
‘‘(i) NETWORK
CAPACITY
TO
SERVE 
PAC AREA.— 
‘‘(I) IN
GENERAL.—The entity 
has entered into PAC network agree-
ments with a sufficient number of 
PAC providers in a PAC area to meet, 
with respect to such area, such net-
work adequacy requirements as are 
established by the Secretary. 
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into such agreements that are 
such type of provider. 
‘‘(ii) LIMITATION ON BALANCE BILL-
ING.—Such a PAC network agreement 
shall provide that the PAC provider shall 
accept as payment in full for PAC services 
furnished by such PAC provider the appli-
cable amount described in paragraph 
(3)(C). 
‘‘(iii) QUALITY ASSURANCE.—Such a 
PAC network agreement shall provide that 
the PAC provider shall have in effect a 
written plan of quality assurance and im-
provement, and procedures implementing 
such plan, that meet such quality stand-
ards as the Secretary specifies. 
‘‘(D) CREDIT-WORTHINESS.—The entity 
has demonstrated credit-worthiness. 
‘‘(E) MEDICAL DIRECTOR.—The entity em-
ploys or contracts with a medical director who 
has an appropriate medical background. 
‘‘(F) 
PAC 
COORDINATOR
PERFORM-
ANCE.—The entity has in effect a written plan 
of quality assurance and improvement, and pro-
cedures implementing such plan, that meet such 
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quality standards as the Secretary may specify. 
For purposes of implementing the preceding 
sentence, the standards specified by the Sec-
retary shall address access to care, beneficiary 
choice, clinical quality of network providers, pa-
tient experience of care, care coordination, effi-
ciency, and such other domains as are identified 
by the Secretary. 
‘‘(3) TERMS OF PAC AGREEMENT.—The PAC 
agreement described in this paragraph between an 
entity and the Secretary shall, with respect to the 
PAC area specified under subparagraph (B), have 
such terms and conditions as are specified by the 
Secretary consistent with this section and shall in-
clude the following: 
‘‘(A) CARE COORDINATION.—With respect 
to an individual who selects the entity under 
paragraph (4)(A)— 
‘‘(i) the individual shall select one or 
more PAC providers in such area to fur-
nish, directly or indirectly, clinically appro-
priate 
PAC 
services 
(as 
determined 
through the use of the PAC assessment 
tool) to the individual; and 
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‘‘(ii) the entity shall coordinate the 
furnishing of all such services for the indi-
vidual. 
‘‘(B) PAC AREA
COVERED.—The PAC 
agreement shall specify the PAC area under the 
PAC agreement. 
‘‘(C) PAYMENT AMOUNT FOR PAC SERV-
ICES.—For PAC services furnished by a PAC 
provider and furnished with respect to a quali-
fying discharge, the entity shall pay the PAC 
provider under the PAC network agreement be-
tween the entity and the PAC provider— 
‘‘(i) with respect to such PAC services 
that are services for which the PAC pro-
vider would receive payment under this 
title without regard to this section, an 
amount that is not less than the amount 
that would otherwise be paid to such PAC 
provider under this title for such services; 
and 
‘‘(ii) with respect to such PAC serv-
ices that are services for which the PAC 
provider would not receive payment under 
this title without regard to this section, an 
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amount specified under such PAC network 
agreement; and 
‘‘(D) DISTRIBUTION OF SAVINGS.—Insofar 
as the payment amount to a PAC coordinator 
under subsection (d)(3) for a PAC bundle fur-
nished to an individual is greater than the ag-
gregate amounts paid to PAC providers under 
subparagraph (C) for such bundle for such indi-
vidual, the entity shall not retain an amount 
greater than 55 percent of such savings and 
shall pay an amount equivalent to— 
‘‘(i) not less than 15 percent of such 
savings to such PAC providers; 
‘‘(ii) not less than 15 percent of such 
savings to the PAC physician of the indi-
vidual; and 
‘‘(iii) in the case that there is no PAC 
readmission of the individual, not less than 
15 percent of such savings to the hospital 
discharging the individual immediately 
prior to the furnishing of such services. 
Payments shall be made under each of clauses 
(i), (ii), and (iii) to individuals and entities 
independent of whether payment may be made 
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to such an individual or entity under another 
such clause. 
‘‘(E) MAINTENANCE
OF
ADVISORY
COM-
MITTEE.—The entity shall maintain an advisory 
committee of PAC providers and of patient 
stakeholders to advise the entity regarding its 
activities under this section. 
‘‘(F) USE OF TECHNOLOGY.— 
‘‘(i) IN
GENERAL.—The entity shall 
utilize information technology to receive 
and maintain documentation regarding 
interactions between PAC providers that 
have entered into PAC network agreements 
with the entity and individuals who have 
selected the entity under paragraph (4)(A). 
‘‘(ii) FORMAT.—The entity shall re-
ceive and maintain the documentation de-
scribed in clause (i) in data fields that are 
in a format that allows and for such data 
fields to integrate with electronic medical 
records in a standardized manner (as de-
termined by the Secretary). 
‘‘(G) EVIDENCE-BASED GUIDELINES.—The 
entity shall encourage PAC providers that have 
entered into PAC network agreements with the 
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