(3) ELIMINATION
OF
REPORT
ON
AVERAGE
WHOLESALE PRICE.—Section 4556 of the Balanced
Budget Act of 1997 is amended—
(A) by striking subsection (c); and
(B) by redesignating subsection (d) as sub-
section (c).
(b) NO MARK-UP FOR PARENTERAL NUTRIENTS.—
(1) IN GENERAL.—Section 1881(b) (42 U.S.C.
1395rr(b)) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(12)(A) Intradialytic parenteral nutrients (including
related supplies and equipment), when provided to a pa-
tient determined to have end stage renal disease, shall not
be included as a dialysis service for purposes of payment
under any prospective payment amount or comprehensive
fee established under this section, and payment for such
item shall be made separately in the amount specified in
subparagraph (B).
‘‘(B)(i) The amount specified in this subparagraph
is 80 percent of the lowest of the following, less the appli-
cable deductible amount:
‘‘(I) The actual acquisition cost as defined in
clause (ii), to the person submitting the claim for
payment for the intradialytic parenteral nutrients.
‘‘(II) The average wholesale price of such nutri-
ents, as determined by the Secretary.
‘‘(III) For payments for nutrients furnished on
or after January 1, 2000, the median actual acquisi-
tion cost of all claims for payment for such nutrients
for the 12-month period beginning July 1, 1998.
The Secretary may adjust such median actual acqui-
sition cost to reflect changes in the cost of such nu-
trients due to inflation, to costs associated with the
proper administration of such nutrients, and such
other factors as the Secretary determines appro-
priate.
‘‘(ii) For purposes of clause (i), the term ‘actual ac-
quisition cost’ means, with respect to such nutrients, the
cost of the nutrients at the time of purchase. Such term
includes appropriate adjustments, as determined by the
Secretary, for all discounts, rebates, or any other benefit
in cash or in kind (including travel, equipment, or free
products). The Secretary shall include an additional pay-
ment for administrative, storage, and handling costs.
‘‘(iii) A physician, supplier, or other person may not
bill an individual enrolled under part B any amount other
than the payment amount specified in this subparagraph
(plus any applicable deductible and coinsurance amounts).
‘‘(C)(i) No payment shall be made under part B for
intradialytic parenteral nutrients to a physician, supplier,
or other person whose bill or request for payment for such
nutrients does not include a statement of the physician’s,
supplier’s, or other person’s actual acquisition cost.
‘‘(ii) A physician, supplier, or other person may not
bill an individual enrolled under part B any amount for
such nutrients for which payment may not be made pursu-
ant to clause (i).
‘‘(D) If a physician, supplier, or other person know-
ingly and willfully in repeated cases bills one or more indi-
viduals in violation of subparagraph (B)(iv) or (C)(ii), the
Secretary may apply sanctions against that physician, sup-
plier, or other person in accordance with section
1842(j)(2).’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) applies with respect to payments
for intradialytic parenteral nutrients provided on or
after January 1, 1998.
(c) USE OF NATIONAL DRUG CODE NUMBERS IN
MEDICARE CLAIMS.—
(1) IN GENERAL.—The Secretary of Health and
Human Services shall modify the standard claim
form used under part B of title XVIII of the Social
Security Act for physicians’ services so that the form
provides for the reporting of the national drug code
(NDC) number for any prescription drug for which
such a number has been assigned.
(2) DEADLINE; EFFECTIVE
DATE.—The Sec-
retary shall make the modification under paragraph
(1) in a manner so that the modified form applies
to claims submitted on or after such date (not later
than 6 months after the date of the enactment of
this Act) as the Secretary specifies.
SEC. 207. ADJUSTMENTS IN HOSPITAL PAYMENTS TO RE-
FLECT EXCESS PAYMENT RESULTING FROM A
FINANCIAL INTEREST WITH DOWN-STREAM
FACILITIES.
(a) IN GENERAL.—Section 1886(d)(5) (42 U.S.C.
1395ww(d)(5)) is amended by adding at the end the fol-
lowing new subparagraph:
‘‘(K) In the case of a hospital that has a financial
relationship described in section 1866(a)(1)(S) with one
or more home health agencies or other entities, the Sec-
retary shall provide for such a payment adjustment as
may be necessary to ensure that the total payments under
this title to the hospital and such entities during a fiscal
year does not exceed the total payments that the Secretary
estimates would have been made under this title during
the fiscal year if the services furnished by such entities
had been furnished by entities with no such financial rela-
tionship to the hospital.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to payments during fiscal years
beginning with fiscal year 1999.
Subtitle B—Other Provisions
SEC. 211. INCLUSION OF COST OF HOME HEALTH SERVICES
IN EXPLANATION OF MEDICARE BENEFITS.
(a) IN GENERAL.—Section 1895 (42 U.S.C. 1395fff),
as added by section 4603(a) of the Balanced Budget Act
of 1997, is amended by adding at the end the following
new subsection:
‘‘(e) INCLUSION OF COSTS OF HOME HEALTH SERV-
ICES IN EXPLANATION OF MEDICARE BENEFITS.—The
Secretary shall provide that each explanation of benefits
provided under this title for home health services shall in-
clude the total amount that the home health agency or
other provider of such services billed for such services.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) apply to explanation of benefits provided
on and after the first day of the sixth month that begins
after the date of the enactment of this Act.
SEC. 212. PROHIBITION OF ‘‘COLD CALL’’ MARKETING FOR
MEDICARE+CHOICE 
PLANS 
AND 
HOME
HEALTH AGENCIES.
(a) 
MEDICARE+CHOICE
PLANS.—Section
1851(h)(4) (42 U.S.C. 1395w–21(h)(4)), as inserted by
section 4001 of the Balanced Budget Act of 1997, is
amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (A);
(2) by striking the period at the end of sub-
paragraph (B); and
(3) by adding at the end the following new sub-
paragraph:
‘‘(C) shall prohibit a Medicare+Choice or-
ganization from conducting, directly or indi-
rectly, door-to-door, telephonic, or other ‘cold-
call’ marketing of enrollment under this part.’’.
(b) HOME HEALTH AGENCIES.—Section 1891(a) (42
U.S.C. 1395bbb(a)) is amended by adding at the end the
following new paragraph:
‘‘(7) The agency does not conduct, directly or
indirectly, door-to-door, telephonic, or other ‘cold-
call’ marketing of home health services under this
title.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on the date of the enactment
of this Act and shall apply to contracts entered into or
renewed on or after such date.
TITLE III—PROVIDER
ENROLLMENT PROCESS; FEES
SEC. 301. FEES FOR AGREEMENTS WITH MEDICARE PRO-
VIDERS AND SUPPLIERS.
(a) FEES RELATED TO MEDICARE PROVIDER AND
SUPPLIER ENROLLMENT AND REENROLLMENT.—Section
1866 (42 U.S.C. 1395cc) is amended by adding at the
end the following:
‘‘(j) ENROLLMENT PROCEDURES AND FEES.—
‘‘(1) ENROLLMENT.—The Secretary may estab-
lish a procedure for enrollment (and periodic re-
enrollment) of individuals or entities that are not
providers of services subject to the provisions of sub-
section (a) but that furnish health care items or
services under this title.
‘‘(2) FEES.—The Secretary may impose fees for
initiation and renewal of provider agreements and
for enrollment and periodic reenrollment of other in-
dividuals and entities furnishing health care items or
services under this title, in amounts up to the full
amount which the Secretary reasonably estimates to
be sufficient to cover the Secretary’s costs related to
the process for initiating and reviewing such agree-
ments and enrollments. Fees collected pursuant to
this paragraph shall be credited to a special fund of
the United States Treasury, and shall remain avail-
able until expended, to the extent and in such
amounts as provided in advance in appropriations
acts, for necessary expenses for these purposes, in-
cluding costs of establishing and maintaining proce-
dures and records systems; processing applications;
and background investigations.’’.
(b) CLERICAL AMENDMENT.—The heading of such
section is amended to read as follows:
‘‘AGREEMENTS WITH PROVIDERS OF SERVICES AND EN-
ROLLMENT OF OTHER PERSONS FURNISHING SERV-
ICES’’.
SEC. 302. REQUIREMENTS AND FEES FOR ISSUANCE OF
STANDARD HEALTH CARE IDENTIFIERS.
Section 1173(b) (42 U.S.C. 1320d–2(b)) is amended
by adding at the end the following:
‘‘(3) REQUIREMENT TO FURNISH SOCIAL SECU-
RITY
NUMBERS
AND
EMPLOYER
IDENTIFICATION
NUMBERS.—The Secretary shall, as appropriate, re-
quire each such individual, employer, health plan,
and health care provider to provide its employer
identification number (assigned pursuant to section
6109 of the Internal Revenue Code of 1986) and so-
cial security account number (assigned under section
205(c)(2)(B)) as a condition to receiving a unique
health identifier.
‘‘(4) FEES.—The Secretary may impose fees for
issuing such identifiers, in amounts which the Sec-
retary reasonably estimates to be sufficient to cover
all costs to the Secretary associated with such activ-
ity. Physicians subject to fees under section 1842(r)
shall not be subject to fees under this paragraph.
Fees collected under this paragraph shall be credited
to a special fund of the United States Treasury, and
shall remain available until expended, to the extent
and in such amounts as provided in advance in ap-
propriations Acts, for costs incurred by the Sec-
retary in issuing such identifiers, including costs of
establishing and maintaining an automated database
and procedures, processing applications, and verify-
ing information provided.’’.
SEC. 303. ADMINISTRATIVE FEES FOR MEDICARE OVERPAY-
MENT COLLECTION.
(a) ADMINISTRATIVE FEES
FOR PROVIDERS
OF
SERVICES UNDER PART A.—Section 1815(d) (42 U.S.C.
1395g(d)) is amended by inserting ‘‘(1)’’ after ‘‘(d)’’ and
by adding at the end the following:
‘‘(2) If the payment of an excess described in para-
graph (1) is not made (or effected by offset) within 30
days of the date of the determination, an administrative
fee of 5 percent of the outstanding balance of the excess
(after application of paragraph (1)), or such lower amount
as an administrative law judge may determine upon an
appeal of the initial determination of the excess, shall be
imposed on the provider. The administrative fees so col-
lected shall be deposited into the Federal Hospital Insur-
ance Trust Fund.’’.
(b) ADMINISTRATIVE FEES
FOR PROVIDERS
OF
SERVICES OR OTHER PERSONS UNDER PART B.—Section
1833(j) (42 U.S.C. 1395l(j)) is amended by inserting
‘‘(1)’’ after ‘‘(j)’’ and by adding at the end the following
new paragraph:
‘‘(2) If the payment of an excess described in para-
graph (1) is not made (or effected by offset) within 30
days of the date of the determination, an administrative
fee of 5 percent of the outstanding balance of the excess
(after application of paragraph (1)), or such lower amount
as an administrative law judge may determine upon an
appeal of the initial determination of the excess, shall be
imposed on the provider, or other person receiving the ex-
cess. The administrative fees so collected shall be depos-
ited into the Federal Supplementary Medical Insurance
Trust Fund.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to final determinations made on
or after the date of the enactment of this Act.
TITLE IV—PAYMENT
IMPROVEMENTS
Subtitle A—Mental Health Partial
Hospitalization Services
SEC. 401. LIMITATION ON LOCATION OF PROVISION OF
SERVICES.
(a) IN GENERAL.—Section 1861(ff)(2) (42 U.S.C.
1395x(ff)(2)) is amended in the matter following subpara-
graph (I)—
(1) by striking ‘‘and furnished’’ and inserting
‘‘furnished’’; and
(2) by inserting before the period the following:
‘‘, and furnished other than in a skilled nursing fa-
cility or in an individual’s Personal Residence’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to partial hospitalization serv-
ices furnished on or after the first day of the third month
beginning after the date of the enactment of this Act.
SEC. 402. QUALIFICATIONS FOR COMMUNITY MENTAL
HEALTH CENTERS.
Section 1861(ff)(3)(B) (42 U.S.C. 1395x(ff)(3)(B))
is amended by striking ‘‘entity’’ and all that follows and
inserting the following: ‘‘entity that—
‘‘(i) provides the mental health services de-
scribed in paragraph (1) of section 1913(c) of the
Public Health Service Act;
‘‘(ii) meets applicable licensing or certification
requirements for community mental health centers
in the State in which it is located; and
‘‘(iii) meets such additional conditions as the
Secretary may specify to ensure (I) the health and
safety of individuals being furnished such services,
(II) the effective or efficient furnishing of such serv-
ices, and (III) the compliance of such entity with the
criteria described in such section.’’.
SEC. 403. RE-ENROLLMENT OF PROVIDERS OF CMHC PAR-
TIAL HOSPITALIZATION SERVICES.
(a) IN GENERAL.—With respect to each community
mental health center that furnishes partial hospitalization
services for which payment is made under title XVIII of
the Social Security Act, the Secretary of Health and
Human Services shall provide for periodic recertification
to ensure that the provision of such services complies with
section 1913(c) of the Public Health Service Act.
(b) DEADLINE FOR FIRST RE-CERTIFICATION.—The
first Re-certification under subsection (a) shall be com-
pleted not later than 1 year after the date of the enact-
ment of this Act.
SEC. 404. PROSPECTIVE PAYMENT SYSTEM FOR PARTIAL
HOSPITALIZATION SERVICES.
(a) ESTABLISHMENT OF SYSTEM.—Section 1833 (42
U.S.C. 1395l) is amended by inserting after subsection (o)
the following:
‘‘(p)(1) The Secretary may establish by regulation a
prospective payment system for partial hospitalization
services provided by a community mental health center or
by a hospital to its outpatients. The system shall provide
for appropriate payment levels for efficient centers and
take into account payment levels for similar services fur-
nished by other efficient entities.
‘‘(2) A prospective payment system established pur-
suant to paragraph (1) shall provide for payment amounts
for—
‘‘(A) the first year in which such system ap-
plies, at a level so that, as estimated by the Sec-
retary, the total aggregate payments under this part
(including payments attributable to deductibles and
coinsurance) are equal to the total aggregate pay-
ments that would have otherwise been made under
this part if such system had not been implemented;
and
‘‘(B) each subsequent year, in an amount equal
to the payment amount provided for under this
paragraph for the preceding year updated by the
percentage increase in the consumer price index for
all urban consumers (all items; United States city
average) for the 12-month period ending with Sep-
tember of that preceding year.’’.
(b) 
COINSURANCE.—Section 
1866(a)(2)(A) 
(42
U.S.C. 1395cc(a)(2)(A)) is amended by adding at the end
the following: ‘‘In the case of services described in section
1832(a)(2)(J), clause (ii) of the first sentence of this sub-
paragraph shall be applied by substituting the payment
basis established under section 1833(p) for the reasonable
charges.’’.
(c) 
CONFORMING
AMENDMENTS.—(1) 
Section
1832(a)(2) (42 U.S.C. 1395k(a)(2)) is amended—
(A) in subparagraph (B), by striking ‘‘or sub-
paragraph (I)’’ and inserting ‘‘, (I), or (J)’’; and
(B) in subparagraph (J), by striking ‘‘provided
by a community mental health center (as described
in section 1861(ff)(2)(B))’’.
(2) Section 1833(a) (42 U.S.C. 1395l(a)) is amend-
ed—
(A) in paragraph (2) preceding subparagraph
(A), by striking ‘‘(H), and (I)’’ and inserting ‘‘(H),
(I), and (J)’’;
(B) by striking ‘‘and’’ at the end of paragraph
(8);
(C) by striking the period at the end of para-
graph (9) and inserting ‘‘; and’’; and
(D) by adding at the end the following new
paragraph:
‘‘(10) in the case of partial hospitalization serv-
ices, 80 percent of the payment basis under the pro-
spective payment system established under section
1833(p).’’.
(d) EFFECTIVE DATE.—The amendments made by
subsections (b) and (c) apply to services furnished on or
after January 1 of the first year that begins at least 6
months after the date on which regulations are issued
under section 1833(p) (42 U.S.C. 1395l(p)) as inserted
by subsection (a).
SEC. 405. DEMONSTRATION FOR EXPANDED PARTIAL HOS-
PITALIZATION SERVICES.
(a) ESTABLISHMENT.—
(1) IN GENERAL.—The Secretary of Health and
Human Services shall implement a demonstration
project (in this section referred to as the ‘‘project’’)
under part B of title XVIII of the Social Security
Act under which community mental health centers
may offer expanded partial hospitalization services
(described in paragraph (2)) for purposes of provid-
ing for a full continuum of ambulatory behavioral
health care services.
(2) ADDITIONAL
MENTAL
HEALTH
SERVICES
DESCRIBED.—For purposes of paragraph (1), the
expanded partial hospitalization services are out-
patient mental health services and such other mental
health services as the Secretary determines appro-
priate which are not partial hospitalization services
as defined in section 1861(ff)(1) of such Act (42
U.S.C. 1395x(ff)(1)).
(b) SELECTION OF CENTERS.—For purposes of im-
plementing such project, the Secretary shall select for par-
ticipation in the project community mental health centers
that serve populations in 3 different States, 1 of which
predominantly serves rural populations.
(c) CAPITATED PAYMENT.—Under this project, pay-
ment for expanded partial hospitalization services shall be
made on a capitated basis.
(d) WAIVER AUTHORITY.—The Secretary may waive
such provisions of title XVIII of the Social Security Act
as the Secretary deems necessary to conduct the project
established under this section.
(e) EVALUATION AND REPORT.—
(1) EVALUATION.—The Secretary shall evaluate
the project. Such evaluation shall include an exam-
ination of—
(A) the project’s effect on the health and
well-being of beneficiaries;
(B) any savings to the medicare program
by reason of capitated payments for partial hos-
pitalization services;
(C) the impact of basing payment for such
services on a capitated basis; and
(D) the project’s effect on utilization of in-
patient services (including inpatient mental
health services), and associated costs.
(2) REPORT.—Not later than 4 years after the
date of the enactment of this Act, the Secretary
shall submit to Congress a report containing a state-
ment of the findings and conclusions of the Sec-
retary pursuant to the evaluation conducted under
paragraph (1), together with any recommendations
for legislation the Secretary considers appropriate
with respect to—
(A) the provision of additional mental
health services by community mental health
centers under partial hospitalization services;
and
(B) payment for such services on a
capitated basis.
(f) DURATION.—The project shall be conducted for
a 3 year period.
Subtitle B—Rural Health Clinic
Services
SEC. 411. DECREASED BENEFICIARY COST SHARING FOR
RURAL HEALTH CLINIC SERVICES.
(a) IN GENERAL.—Section 1861(aa)(2) (42 U.S.C.
1395x(aa)(2)) is amended, in clause (ii) of the second sen-
tence, by striking ‘‘pursuant to subsections (a) and (b)
of section 1833’’ and inserting ‘‘described in section
1833(b) or clause (ii) of the first sentence of section
1866(a)(2)(A) (but in no case may any coinsurance
amount exceed 20 percent of the limit described in section
1833(f), and in no case may any coinsurance be imposed
for 
items 
and 
services 
described 
in 
subsection
(s)(10)(A))’’.
(b) CONFORMING AND TECHNICAL AMENDMENT.—
Paragraph (3) of section 1833(a) (42 U.S.C. 1395l(a)) is
amended to read as follows: