I
104TH CONGRESS
2D SESSION
H. R. 3142
To establish a demonstration project to provide that the Department of
Defense may receive Medicare reimbursement for health care services
provided to certain Medicare-eligible covered military beneficiaries.
IN THE HOUSE OF REPRESENTATIVES
MARCH 21, 1996
Mr. HEFLEY introduced the following bill; which was referred to the Commit-
tee on Ways and Means, and in addition to the Committees on Com-
merce, and National Security, 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 establish a demonstration project to provide that the
Department of Defense may receive Medicare reimburse-
ment for health care services provided to certain Medi-
care-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.
This Act may be cited as the ‘‘Uniformed Services
Medicare Subvention Demonstration Project Act’’.
SEC. 2. DEFINITIONS.
For purposes of this Act:
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(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, including
a beneficiary under section 1074(a) of such title,
who is entitled to benefits under part A of title XVII
of the Social Security Act (42 U.S.C. 1395 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 au-
thority of chapter 55 of title 10, United States Code, prin-
cipally section 1097 of such title, and includes the com-
petitive selection of contractors to financially underwrite
the delivery of health care services under the Civilian
Health and Medical Program of the Uniformed Services.
(3) MILITARY
TREATMENT
FACILITY.—The term
‘‘military treatment facility’’ means a facility referred to
in section 1074(a) of title 10, United States Code.
SEC. 3. ESTABLISHMENT.
(a) IN GENERAL.—Not later than 180 days after the
date of the enactment of this Act, the Secretary of Defense
and the Secretary of Health and Human Services shall
jointly establish a demonstration project to provide the
Department of Defense with reimbursement, in accord-
ance with section 4, from the medicare program under
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title XVII of the Social Security Act (42 U.S.C. 1395 et
seq.) for health services provided to certain medicare-eligi-
ble covered military beneficiaries.
(b) GEOGRAPHIC
REGIONS.—The demonstration
project established under this section shall be conducted
in one or more geographic regions in which the TRICARE
program has been implemented.
(c) DURATION.—The demonstration project estab-
lished under this section shall be conducted for a period
not to exceed 2 years.
(d) REPORTING.—
(1) IN GENERAL.—
(A) FIRST
ANNUAL
REPORT.—Not later
than 15 months after the demonstration project
under this section has been established, the
Secretary of Defense and the Secretary of
Health and Human Services shall jointly submit
to Congress a report including the information
described in paragraph (2).
(B) FINAL REPORT.—Not later than 90
days after the termination of the demonstration
project, the Secretary shall jointly submit to
Congress a final report including the informa-
tion described in paragraph (2).
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(2) INFORMATION
DESCRIBED.—The informa-
tion described in this paragraph includes the follow-
ing:
(A) The number of medicare-eligible cov-
ered military beneficiaries opting to participate
in the demonstration project established under
this section instead of receiving health benefits
through another health insurance plan (includ-
ing through the medicare program).
(B) Whether, and in what manner, easier
access to the military treatment system affects
the number of medicare-eligible covered military
beneficiaries receiving health benefits under the
medicare program.
(C) A list of the health insurance plans
and programs that were the primary payers for
medicare-eligible covered military beneficiaries
during the year prior to such beneficiary’s par-
ticipation in the demonstration project and the
distribution of enrollment of such beneficiaries
in such plans and programs.
(D) The total number of medicare-eligible
covered military beneficiaries who participated
in the project during the preceding year and the
number of such beneficiaries who were entitled
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to benefits under part A of title XVIII of the
Social Security Act (42 U.S.C. 1395 et seq.)
and were not enrolled under part B of such
title.
(E) An identification of cost-shifting (if
any) among medical care programs as a result
of the demonstration project and a description
of the nature of any such cost-shifting.
(F) An analysis of how the demonstration
project affects the overall accessibility of the
military treatment system and the amount of
space available for point-of-service care and a
description of the unintended effects (if any)
upon the normal treatment priority system.
(G) A description of the difficulties (if any)
experienced by the Department of Defense in
managing the demonstration project.
(H) A description of the effects of the
demonstration project on military treatment fa-
cility readiness and training and the probable
effects of the project on overall Department of
Defense medical readiness and training.
(I) A description of the effects that the
demonstration project, if permanent, would be
expected to have on the overall budget of the
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military health care system and the budgets of
individual military treatment facilities.
(J) Whether the demonstration project af-
fects the cost to the Department of Defense of
prescription drugs or the accessibility, availabil-
ity, and cost of such drugs to program bene-
ficiaries.
SEC. 4. REIMBURSEMENT AMOUNTS.
(a) PAYMENT TO DEPARTMENT OF DEFENSE.—The
Secretary of Health and Human Services shall make
monthly payments to the Department of Defense from the
Federal Hospital Insurance Trust Fund and the Federal
Supplementary Medical Insurance Trust Fund (allocated
between each Trust Fund in an amount to be determined
by the Secretary of Health and Human Services based on
the relative weight that benefits from each Trust Fund
contribute to the amounts determined under this sub-
section) in an amount equal to the sum of—
(1) the payments determined under subsection
(b) with respect to medicare-eligible covered military
beneficiaries who are enrolled in the TRICARE pro-
gram; and
(2) the payments determined under subsection
(c) with respect to such beneficiaries who are not en-
rolled in the TRICARE program.
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(b) TRICARE PAYMENTS.—
(1) IN GENERAL.—The amount of payment de-
termined under this subsection is an amount equal
to 1⁄12 of the amount determined under paragraph
(2) for each medicare-eligible covered military bene-
ficiary enrolled during the year in the TRICARE
program in a geographic region in which the dem-
onstration project is in operation, but only if such
beneficiary’s enrollment is in excess of the minimum
enrollment number determined under subsection
(d)(1)(A) for such geographic region.
(2) AMOUNT DETERMINED.—The amount de-
termined under this paragraph is an amount equal
to—
(A) in the case of an individual entitled to
benefits under part A and enrolled under part
B of title XVIII of the Social Security Act, 93
percent of the average adjusted per capita cost
determined under section 1876(a)(4) of the So-
cial Security Act (42 U.S.C. 1395mm(a)(4)) for
such year; or
(B) in the case of an individual entitled to
benefits under part A and not enrolled under
part B of such title, an amount equal to the
amount determined under subparagraph (A) at-
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tributable to services covered by and expenses
otherwise reimbursable under part A of such
title only.
(c) TREATMENT AT A MILITARY TREATMENT FACIL-
ITY.—The amount of payment determined under this sub-
section is an amount equal to the sum of the Secretary’s
estimates of the amounts determined for each health serv-
ice (using a DRG equivalent and fee schedule equivalent
scale developed by the Secretary of Health and Human
Services) provided during the month for which the pay-
ment is made under subsection (a) to each medicare-eligi-
ble covered military beneficiary (other than a beneficiary
who is enrolled in the TRICARE program) in a military
treatment facility located in a geographic region in which
the demonstration project is in operation, but only if such
level is in excess of 1⁄12 of the minimum level of health
services described under subsection (d)(1)(B) for such ge-
ographic region.
(d) ESTABLISHMENT
OF BASE LEVEL
OF COV-
ERAGE.—
(1) IN GENERAL.—Prior to the establishment of
the demonstration project under this Act and subject
to paragraph (2), the Secretary of Defense and the
Secretary of Health and Human Services shall joint-
ly estimate, based on the best available data—
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(A) a minimum enrollment number of med-
icare-eligible covered military beneficiaries who
are required to enroll in the TRICARE pro-
gram during a year in each geographic region
in which the demonstration project is in oper-
ation before the Department of Defense may re-
ceive payment under subsection (a)(1); and
(B) a minimum level of health services
(using a DRG equivalent and fee schedule
equivalent scale developed by the Secretary of
Health and Human Services) provided to medi-
care-eligible covered military beneficiaries (other
than beneficiaries enrolled in the TRICARE
program) during a year through a military
treatment facility in each geographic region in
which the demonstration project is in operation
before the Department of Defense may receive
payment under subsection (a)(2).
(2) DETERMINATION
OF
BASELINE
COSTS.—
The Secretary of Defense and the Secretary of
Health and Human Services shall establish the mini-
mum enrollment number under paragraph (1)(A)
and the minimum level of health services under
paragraph (1)(B) such that the projected expendi-
tures by the Department of Defense for such num-
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ber of medicare-eligible covered military beneficiaries
and such level of services provided to such bene-
ficiaries by the Department of Defense is equivalent
to the projected expenditures that would have been
made by the Department for such beneficiaries if the
demonstration project under this Act had not been
established.
(3) UPPER REIMBURSEMENT LIMITS.—The Sec-
retary of Defense and the Secretary of Health and
Human Services shall jointly establish a maximum
number of medicare-eligible covered military bene-
ficiaries and maximum level of health services for
which payment may be made by the Secretary of
Health and Human services under subsection (a).
(e) TRICARE PROGRAM ENROLLMENT FEE WAIV-
ER.—The Secretary of Defense shall waive the enrollment
fee applicable to any individual enrolled in the TRICARE
program for whom reimbursement in the amount deter-
mined under subsection (b)(2)(A) is received under sub-
section (b)(1).
SEC. 5. MEDICARE SUBVENTION FUND.
(a) ESTABLISHMENT.—There is hereby established in
the Treasury of the United States a revolving fund known
as the Medicare Subvention Fund (hereafter in this sec-
tion referred to as the ‘‘Fund’’).
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(b) USE OF FUNDS.—The Fund shall be available to
the Secretary of Defense, as so provided in appropriations
Acts from funds otherwise appropriated to the Depart-
ment of Defense, and without fiscal year limitation—
(1) to make payments to the Secretary of
Health and Human Services for deposit into the
Federal Hospital Insurance Trust Fund and the
Federal Supplementary Medical Insurance Trust
Fund in order to reimburse such Funds for addi-
tional costs to such Trust Funds resulting from the
operation of the demonstration project established
under this Act;
(2) to provide for the participation of medicare-
eligible covered military beneficiaries in excess of the
maximum enrollment number and maximum level of
health services established under section 4(d)(1);
(3) to provide for payment of administrative ex-
penses associated with the demonstration project es-
tablished under this Act; and
(4) if amounts are available in the Fund after
expenditures are made under paragraphs (1)
through (3), for any other lawful purpose for which
the Secretary of Defense may expend funds.
(c) NO FUNDS AVAILABLE.—The Secretary of De-
fense may, if inadequate amounts are available in the
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Fund, limit the enrollment of medicare-eligible covered
military beneficiaries in the demonstration project estab-
lished under this Act.
(d) AUTHORIZATION
OF
APPROPRIATIONS.—For
each of fiscal years 1997 and 1998, there are authorized
to be appropriated from funds otherwise appropriated to
the Department of Defense, for deposit in the Fund such
sums as may be necessary to carry out the purposes de-
scribed in paragraphs (1) through (3) of subsection (c).
Any amounts appropriated in accordance with this sub-
section shall not be taken into account in establishing ap-
propriations levels for the Department of Defense health
affairs budget.
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