858
‘‘(A) the transfers to such account pursuant to
section 901(b)(2) during such month, exceed
‘‘(B) the payments during such month from the
employment security administration account pursu-
ant to section 901(b)(3) and (d).
If for any month the payments referred to in subpara-
graph (B) exceed the transfers referred to in subpara-
graph (A), proper adjustments shall be made in the
amounts subsequently transferred.’’.
SEC. 13273. EXTENSION OF REPORTING DATE FOR ADVI-
SORY COUNCIL.
In the case of the first Advisory Council on Unem-
ployment Compensation established under section 908 of
the Social Security Act, subsection (f) of such section 908
shall be applied—
(1) by substituting ‘‘3rd year’’ for ‘‘2d year’’ in
paragraph (1), and
(2) by substituting ‘‘February 1, 1995’’ for
‘‘February 1, 1994’’ in paragraph (2).
SEC. 13274. CLARIFICATION OF EMERGENCY UNEMPLOY-
MENT BENEFITS PROVISIONS.
(a) IN GENERAL.—Subclauses (II) and (III) of sec-
tion 102(b)(2)(A)(v) of the Emergency Unemployment
Compensation Act of 1991 are amended to read as follows:
859
‘‘(II) The requirements of this
subclause are met for any week if the
national rate of total unemployment
(seasonally adjusted) for each of the 2
most recent calendar months (not
averaged) for which data are pub-
lished before the close of such week is
less than 7 percent, and if the re-
quirements of subclause (III) are not
met for such week.
‘‘(III) The requirements of this
subclause are met for any week if the
national rate of total unemployment
(seasonally adjusted) for each of the 2
most recent calendar months (not
averaged) for which data are pub-
lished before the close of such week is
less than 6.8 percent.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply as if included in the amend-
ments made by section 101(b) of the Unemployment Com-
pensation Amendments of 1992.
860
SEC. 13275. MODIFICATIONS TO EXTENDED UNEMPLOY-
MENT PROGRAM.
(a) INCREASE
IN REIMBURSEMENT RATE.—Sub-
section (a) of section 204 of the Federal-State Extended
Unemployment Compensation Act of 1970 is amended by
striking ‘‘one-half’’ and inserting ‘‘75 percent’’.
(b) REPEAL
OF SPECIAL ELIGIBILITY REQUIRE-
MENTS.—Subsection (a) of section 202 of such Act is
amended—
(1) by striking paragraphs (3), (4), and (7),
(2) by redesignating paragraphs (5) and (6) as
paragraphs (3) and (4), respectively, and
(3) by striking ‘‘paragraphs (3), (4), and (5)’’
in paragraph (4) (as redesignated by paragraph (1)
of this subsection) and inserting ‘‘paragraph (3)’’.
(c) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by
this section shall apply to weeks beginning after Oc-
tober 2, 1993.
(2) SPECIAL RULE.—In the case of any State
the legislature of which has not been in session for
at least 30 calendar days (whether or not successive)
between the date of the enactment of this Act and
October 1, 1993, the amendment made by sub-
section (b) shall not be a requirement of the State
law of such State before the date 30 calendar days
861
after the 1st day on which such legislature is in ses-
sion on or after October 1, 1993.
SEC. 13276. EXTENSION OF CURRENT FEDERAL UNEM-
PLOYMENT RATE.
Section 3301 of the Internal Revenue Code of 1986
is amended—
(1) by striking ‘‘1996’’ in paragraph (1) and in-
serting ‘‘1998’’, and
(2) by striking ‘‘1997’’ in paragraph (2) and in-
serting ‘‘1999’’.
SEC. 13277. DISCLOSURE OF INFORMATION TO RAILROAD
RETIREMENT BOARD.
Section 6103(l)(1)(C) of the Internal Revenue Code
of 1986 is amended to read as follows:
‘‘(C) taxes imposed by chapters 22 and
23A, to the Railroad Retirement Board for pur-
poses of its administration of the Railroad Re-
tirement and Railroad Unemployment Insur-
ance Acts.’’.
862
CHAPTER 6—TECHNICAL PROVISIONS
SEC. 13281. CORRECTIONS RELATED TO THE INCOME SE-
CURITY AND HUMAN RESOURCES PROVI-
SIONS OF THE OMNIBUS BUDGET RECONCILI-
ATION ACT OF 1990.
(a) 
AMENDMENT
RELATED
TO
SECTION
5035(a)(2).—Section 5035(a)(2) of the Omnibus Budget
Reconciliation Act of 1990 (Public Law 101–508) is
amended by striking ‘‘a semicolon’’ and inserting
‘‘ ‘; and’ ’’.
(b) REPEAL
OF PROVISION INADVERTENTLY IN-
CLUDED.—Section 5057 of the Omnibus Budget Rec-
onciliation Act of 1990 (Public Law 101–508), and the
amendment made by such section, are hereby repealed,
and section 1139(d) of the Social Security Act shall be
applied and administered as if such section 5057 had
never been enacted.
(c) 
AMENDMENT
RELATED
TO
SECTION
5105(d)(1)(B).—Section 5105(d)(1)(B) of the Omnibus
Budget Reconciliation Act of 1990 (Public Law 101–508;
104 Stat. 1388–266) is amended to read as follows:
‘‘(B) TITLE
XVI.—Section 1631(a)(2)(F)
(42 U.S.C. 1383(a)(2)(F)), as so redesignated
by subsection (c)(2) of this section, is amended
to read as follows:
863
‘‘ ‘(F) The Secretary shall include as a part of the
annual report required under section 704 information with
respect to the implementation of the preceding provisions
of this paragraph, including—
‘‘ ‘(i) the number of cases in which the rep-
resentative payee was changed;
‘‘ ‘(ii) the number of cases discovered where
there has been a misuse of funds;
‘‘ ‘(iii) how any such cases were dealt with by
the Secretary;
‘‘ ‘(iv) the final disposition of such cases (in-
cluding any criminal penalties imposed); and
‘‘ ‘(v) such other information as the Secretary
determines to be appropriate.’.’’.
(d) 
AMENDMENT
RELATED
TO
SECTION
5105(a)(1)(B).—The 2nd paragraph of section 1631(a)
(42 U.S.C. 1383(a)) is amended by striking ‘‘(A)(i) Pay-
ments’’ and inserting ‘‘(2)(A)(i) Payments’’.
(e) AMENDMENTS RELATED TO SECTION 5105(b).—
Section 1631(a)(2)(C) (42 U.S.C. 1383(a)(2)(C)) is
amended—
(1) by striking clause (ii);
(2) by redesignating clauses (iii), (iv), and (v)
as clauses (ii), (iii), and (iv), respectively; and
864
(3) in clause (iv) (as so redesignated), by strik-
ing ‘‘(iii), and (iv)’’ and inserting ‘‘and (iii)’’.
(f) 
AMENDMENTS
RELATED
TO
SECTION
5107(a)(2)(B).—Section 
1631(c)(1)(B) 
(42 
U.S.C.
1383(c)(1)(B)) is amended by striking ‘‘paragraph (1)’’
each place such term appears and inserting ‘‘subpara-
graph (A)’’.
(g) 
AMENDMENT
RELATED
TO
SECTION
5109(a)(2).—Section 1631 (42 U.S.C. 1383) is amended
by redesignating the subsection (n) added by section
5109(a)(2) of the Omnibus Budget Reconciliation Act of
1990, as subsection (o).
(h) 
AMENDMENTS
RELATED
TO
SECTION
11115(b)(2).—Section 11115(b)(2) of the Omnibus Budg-
et Reconciliation Act of 1990 (Public Law 101–508) is
amended—
(1) in subparagraph (A), by striking ‘‘para-
graph (8)’’ and inserting ‘‘paragraph (9)’’;
(2) in subparagraph (B), by striking ‘‘para-
graph (9)’’ and inserting ‘‘paragraph (10)’’; and
(3) in subparagraph (C), by redesignating the
new paragraph added thereby as paragraph (11).
(i) 
AMENDMENT
RELATED
TO
SECTION
13101(d)(2).—Section 256(k)(2)(A) of the Balanced
865
Budget and Emergency Deficit Control Act of 1985 is
amended—
(1) by striking ‘‘—’’ the 2nd place it appears
and all that follows through ‘‘(I)’’; and
(2) by striking ‘‘; or’’ and all that follows
through ‘‘(II)’’ and inserting ‘‘, except that a State
may not be allotted an amount under this subpara-
graph that exceeds’’.
(j) EFFECTIVE DATE.—Each amendment made by
this section shall take effect as if included in the provision
of the Omnibus Budget Reconciliation Act of 1990 to
which the amendment relates at the time such provision
became law.
SEC. 13282. TECHNICAL CORRECTIONS RELATED TO THE
HUMAN RESOURCE AND INCOME SECURITY
PROVISIONS OF THE OMNIBUS BUDGET REC-
ONCILIATION ACT OF 1989.
(a) AMENDMENT RELATING TO SECTION 8004(a).—
Section 408(m)(2)(A) (42 U.S.C. 608(m)(2)(A)) is
amended by striking ‘‘a fiscal’’ and inserting ‘‘the fiscal’’.
(b) AMENDMENT RELATING TO SECTION 8006(a).—
Section 473(a)(6)(B) (42 U.S.C. 673(a)(6)(B)) is amend-
ed 
by 
striking 
‘‘474(a)(3)(B)’’ 
and 
inserting
‘‘474(a)(3)(C)’’.
866
(c) 
AMENDMENT
RELATING
TO
SECTION
8007(b)(3).—Subparagraph (D) of section 475(5) (42
U.S.C. 675(5)(D)) is amended by moving such subpara-
graph 2 ems to the right so that the left margin of such
subparagraph is aligned with the left margin of subpara-
graph (C) of such section.
(d) EFFECTIVE DATE.—Each amendment made by
this section shall take effect as if the amendment had been
included in the provision of the Omnibus Budget Rec-
onciliation Act of 1989 to which the amendment relates,
at the time the provision became law.
SEC. 13283. ELIMINATION OF OBSOLETE PROVISIONS RE-
LATING TO TREATMENT OF THE EARNED IN-
COME TAX CREDIT.
(a) TREATMENT OF EITC AS EARNED INCOME.—
Section 1612(a)(1) (42 U.S.C. 1382a(a)(1)) is amended
by striking subparagraph (C) and by redesignating sub-
paragraphs (D) and (E) as subparagraphs (C) and (D),
respectively.
(b) ADJUSTMENT OF BENEFITS DUE TO TREAT-
MENT OF EITC AS EARNED INCOME.—Section 1631(b)
(42 U.S.C. 1383(b)) is amended by striking paragraph (3)
and by redesignating paragraphs (4) and (5) as para-
graphs (3) and (4), respectively.
867
SEC. 13284. REDESIGNATION OF CERTAIN PROVISIONS.
Section 1631(e)(6) (42 U.S.C. 1383(e)(6)) is amend-
ed by redesignating subparagraphs (1) and (2) as sub-
paragraphs (A) and (B), respectively.
Subtitle C—Medicare Program
SEC. 13400. REFERENCES IN SUBTITLE; TABLE OF CON-
TENTS OF SUBTITLE.
(a) AMENDMENTS TO SOCIAL SECURITY ACT.—Ex-
cept as otherwise specifically provided, whenever in this
subtitle an amendment is expressed in terms of an amend-
ment to or repeal of a section or other provision, the ref-
erence shall be considered to be made to that section or
other provision of the Social Security Act.
(b) REFERENCES TO OBRA.—In this subtitle, the
terms ‘‘OBRA–1986’’, ‘‘OBRA–1987’’, ‘‘OBRA–1989’’,
and ‘‘OBRA–1990’’ refer to the Omnibus Budget Rec-
onciliation Act of 1986 (Public Law 99–509), the Omni-
bus Budget Reconciliation Act of 1987 (Public Law 100–
203), the Omnibus Budget Reconciliation Act of 1989
(Public Law 101–239), and the Omnibus Budget Rec-
onciliation Act of 1990 (Public Law 101–508), respec-
tively.
(c) TABLE OF CONTENTS OF SUBTITLE.—The table
of contents of this subtitle is as follows:
Sec. 13400. References in subtitle; table of contents of subtitle.
CHAPTER 1—PROVISIONS RELATING TO PART A
868
SUBCHAPTER A—ELIMINATION OF INFLATION UPDATE FOR SERVICES
PROVIDED UNDER PART A
Sec. 13401. Inpatient hospital services and hospice care.
Sec. 13402. Limits on per diem routine service costs for extended care services.
SUBCHAPTER B—OTHER PROVISIONS RELATING TO PART A
Sec. 13411. Wage index provisions.
Sec. 13412. Transition for hospital outlier thresholds.
Sec. 13413. Essential access community hospital (EACH) amendments.
Sec. 13414. Rural health transition grant program extension.
Sec. 13415. Regional referral center extension.
Sec. 13416. Medicare-dependent, small rural hospital payment extension.
Sec. 13417. Extension of regional floor.
Sec. 13418. Extension of rural hospital demonstration.
Sec. 13419. Hemophilia pass-through extension.
Sec. 13420. State hospital payment programs.
Sec. 13421. Psychology services in hospitals.
Sec. 13422. Graduate medical education payments in hospital-owned commu-
nity health centers.
Sec. 13423. Treatment of certain military facilities.
Sec. 13424. Epilepsy DRG.
Sec. 13425. Skilled nursing facility wage index.
Sec. 13426. Hospice notification to beneficiaries.
Sec. 13427. Reduction in part A premium for certain individuals with 30 or
more quarters of Social Security coverage.
Sec. 13428. Periodic updates to salary equivalency guidelines for physical ther-
apy and respiratory therapy services.
Sec. 13429. Extension of deadline for application for geographic classification
for certain reclassified hospitals.
Sec. 13430. Clarification of DRG payment window expansion; miscellaneous
and technical corrections.
CHAPTER 2—PROVISIONS RELATING TO PART B
SUBCHAPTER A—ELIMINATION OF INFLATION UPDATE
Sec. 13431. Elimination of inflation update for physician and related profes-
sional services.
Sec. 13432. Elimination of cost-of-living adjustments for certain items and
services.
Sec. 13433. Ambulatory surgical center services.
Sec. 13434. Other items and services under part B.
SUBCHAPTER B—PHYSICIANS’ SERVICES
Sec. 13441. Reinstating separate payment for the interpretation of electro-
cardiograms (EKGs).
Sec. 13442. Payments for new physicians and practitioners.
Sec. 13443. Retaining payment for actual anesthesia time.
Sec. 13444. Geographic cost of practice index refinements.
Sec. 13445. Extra-billing.
Sec. 13446. Relative values for pediatric services.
Sec. 13447. Antigens under physician fee schedule.
Sec. 13448. Administration of claims relating to physicians’ services.
Sec. 13449. Miscellaneous and technical corrections.
869
SUBCHAPTER C—AMBULATORY SURGICAL CENTER SERVICES
Sec. 13451. Designation of certain hospitals as eye or eye and ear hospitals.
Sec. 13452. Treatment of intraocular lenses.
Sec. 13453. Technical amendments.
SUBCHAPTER D—DURABLE MEDICAL EQUIPMENT
Sec. 13461. Certification of suppliers.
Sec. 13462. Prohibition against carrier forum shopping.
Sec. 13463. Restrictions on certain marketing and sales activities.
Sec. 13464. Anti-kickback clarification.
Sec. 13465. Limitations on beneficiary liability for noncovered services.
Sec. 13466. Adjustments for inherent reasonableness.
Sec. 13467. Treatment of nebulizers and aspirators.
Sec. 13468. Payment for ostomy supplies and other supplies.
Sec. 13469. Miscellaneous and technical corrections.
SUBCHAPTER E—OTHER PROVISIONS
Sec. 13471. Clarifying payments for medically directed certified registered
nurse anesthetist services.
Sec. 13472. Extension of Alzheimer’s disease demonstration projects.
Sec. 13473. Oral cancer drugs.
Sec. 13474. Part B premium for late enrollment.
Sec. 13475. Coverage 
of 
services 
of 
speech-language 
pathologists 
and
audiologists.
Sec. 13476. Extension of municipal health service demonstration projects.
Sec. 13477. Treatment of certain Indian health programs and facilities as Fed-
erally-qualified health centers.
Sec. 13478. Miscellaneous and technical corrections.
SUBCHAPTER F—PART B PREMIUM
Sec. 13481. Part B premium.
CHAPTER 3—PROVISIONS RELATING TO PARTS A AND B
SUBCHAPTER A—ELIMINATION OF UPDATES
Sec. 13501. Elimination of cost-of-living update in per resident amounts for di-
rect medical education.
Sec. 13502. Elimination of inflation update in cost limits for home health serv-
ices.
SUBCHAPTER B—MEDICARE SECONDARY PAYER PROVISIONS
Sec. 13511. Extension of transfer of data.
Sec. 13512. 3-year extension of medicare secondary payer to disabled bene-
ficiaries.
Sec. 13513. 3-year extension of 18-month rule for ESRD beneficiaries.
Sec. 13514. Medicare secondary payer reforms.
SUBCHAPTER C—PHYSICIAN OWNERSHIP AND REFERRAL
Sec. 13521. Application of medicare ban on self-referrals to all payers.
Sec. 13522. Extension of self-referral ban to additional specified services.
Sec. 13523. Exceptions for both ownership and compensation arrangements.
Sec. 13524. Exceptions related only to ownership or investment.
870
Sec. 13525. Exceptions related only to compensation arrangements.
Sec. 13526. Clarification concerning civil money penalty sanctions.
Sec. 13527. Requirements for group practice.
Sec. 13538. No Federal preemption of more restrictive State laws.
Sec. 13529. Miscellaneous provisions.
Sec. 13530. Effective dates.
SUBCHAPTER D—OTHER PROVISIONS
Sec. 13551. Direct graduate medical education.
Sec. 13552. Immunosuppressive drug therapy.
Sec. 13553. Reduction in payments for erythropoientin.
Sec. 13554. Qualified medicare beneficiary outreach.
Sec. 13555. Extension of social health maintenance organization demonstra-
tions.
Sec. 13556. Hospice notification to home health beneficiaries.
Sec. 13557. Interest payments.
Sec. 13558. Peer review organizations.
Sec. 13559. Health maintenance organizations.
Sec. 13560. Medicare administration budget process.
Sec. 13561. Other provisions.
CHAPTER 4—MEDICARE SUPPLEMENTAL INSURANCE POLICIES
Sec. 13571. Standards for medicare supplemental insurance policies.
CHAPTER 1—PROVISIONS RELATING TO
PART A
Subchapter A—Elimination of Inflation
Update for Services Provided Under Part A
SEC. 13401. INPATIENT HOSPITAL SERVICES AND HOSPICE
CARE.
Section 
1886(b)(3)(B)(iii) 
(42 
U.S.C.
1395ww(b)(3)(B)(iii)) is amended—
(1) by striking ‘‘(iii) For purposes of this sub-
paragraph’’ and inserting ‘‘(iii)(I) Except as pro-
vided in subclause (II), for purposes of this subpara-
graph’’, and
(2) by adding at the end the following new
subclause:
871
‘‘(II) For purposes of this subparagraph and section
1814(i)(1)(C)(ii), the ‘market basket percentage increase’,
with respect to cost reporting periods and discharges oc-
curring in fiscal year 1994 or 1995, is 0 percent.’’.
SEC. 13402. LIMITS ON PER DIEM ROUTINE SERVICE COSTS
FOR EXTENDED CARE SERVICES.
The Secretary of Health and Human Services shall
not provide for any increase, on the basis of inflation or
changes in the cost of goods and services, in the limits
on per diem routine service costs for extended care services
under section 1888 of the Social Security Act for cost re-
porting periods beginning during fiscal year 1994 or fiscal
year 1995.
Subchapter B—Other Provisions Relating to
Part A
SEC. 13411. WAGE INDEX PROVISIONS.
(a) WAGE INDEX HOLD HARMLESS PROTECTION.—
(1) IN GENERAL.—Section 1886(d)(8)(C) (42
U.S.C. 1395ww(d)(8)(C)) is amended by adding at
the end the following new clause:
‘‘(iv) The application of subparagraph (B) or a deci-
sion of the Medicare Geographic Classification Review
Board or the Secretary under paragraph (1) may not re-
sult in a reduction in an urban area’s wage index if—
872
‘‘(I) the urban area has a wage index below the
wage index for rural areas in the State in which it
is located; or
‘‘(II) the urban area is located in a State that
is composed of a single urban area.’’.
(2) NO
STANDARDIZED
AMOUNT
ADJUST-
MENT.—The Secretary of Health and Human Serv-
ices shall not revise the fiscal year 1992 or fiscal
year 1993 standardized amounts pursuant to sub-
sections (d)(3)(B) and (d)(8)(D) of section 1886 of
the Social Security Act to account for the amend-
ment made by paragraph (1).
(3) EFFECTIVE DATE.—The amendment made
by 
paragraph 
(1) 
shall 
apply 
to 
discharges
occurring—
(A) on or after October 1, 1991, in the
case of hospitals located in an urban area de-
scribed in section 1886(d)(8)(C)(iv)(I) of the
Social Security Act (as added by paragraph
(1)); and
(B) on or after the date of the enactment
of this Act, in the case of hospitals located in
an 
urban 
area 
described 
in 
section
1886(d)(8)(C)(iv)(II) of the Social Security Act
(as added by paragraph (1)).
873
(b) UPDATING STANDARDS FOR TREATING RURAL
COUNTIES AS URBAN COUNTIES BASED ON RATES OF
COMMUTATION.—
(1) IN GENERAL.—Section 1886(d)(8)(B) (42
U.S.C. 1395ww(d)(8)(B)) is amended—
(A) by striking ‘‘standards’’ each place it
appears and inserting ‘‘standards most recently
used’’, and
(B) by striking ‘‘published in the Federal
Register on January 3, 1980’’.
(2) HOLD
HARMLESS
FOR
COUNTIES
CUR-
RENTLY TREATED AS URBAN.—Any hospital that is
treated as being located in an urban metropolitan
statistical area pursuant to section 1886(d)(8)(B) of
the Social Security Act as of September 30, 1992,
shall continue to be so treated notwithstanding the
amendments made by paragraph (1).
(3) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall be effective on October 1,
1993.
(c) USE OF OCCUPATIONAL MIX IN GUIDELINES.—
(1) IN GENERAL.—Section 1886(d)(10)(D)(i)(I)
(42 U.S.C. 1395ww(d)(10)(D)(i)(I)) is amended by
inserting ‘‘(to the extent the Secretary determines
appropriate)’’ after ‘‘taking into account’’.
874
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect as if included in
the enactment of OBRA–1989.
SEC. 13412. TRANSITION FOR HOSPITAL OUTLIER THRESH-
OLDS.
Section 1886(d)(5)(A) (42 U.S.C. 1395ww(d)(5)(A))
is amended—
(1) in clause (i), by striking ‘‘The Secretary’’
and inserting ‘‘For discharges occurring during fis-
cal years ending on or before September 30, 1997,
the Secretary’’; and
(2) by adding at the end the following new
clauses:
‘‘(v) The Secretary shall provide that—
‘‘(I) the day outlier percentage for fiscal year
1995 shall be 75 percent of the day outlier percent-
age for fiscal year 1994;
‘‘(II) the day outlier percentage for fiscal year
1996 shall be 50 percent of the day outlier percent-
age for fiscal year 1994; and
‘‘(III) the day outlier percentage for fiscal year
1997 shall be 25 percent of the day outlier percent-
age for fiscal year 1994.
‘‘(vi) For purposes of this subparagraph, the term
‘day outlier percentage’ means, for a fiscal year, the per-
875
centage of the total additional payments made by the Sec-
retary under this subparagraph for discharges in that fis-
cal year which are additional payments under clause (i).’’.
SEC. 13413. ESSENTIAL ACCESS COMMUNITY HOSPITAL
(EACH) AMENDMENTS.
(a) 
INCREASING
NUMBER
OF
PARTICIPATING
STATES.—Section 1820(a)(1) (42 U.S.C. 1395i–4(a)(1))
is amended by striking ‘‘7’’ and inserting ‘‘9’’.
(b) TREATMENT OF INPATIENT HOSPITAL SERVICES
PROVIDED IN RURAL PRIMARY CARE HOSPITALS.—
(1) IN
GENERAL.—Section 1820(f)(1)(F) (42
U.S.C. 1395i–4(f)(1)(F)) is amended to read as
follows:
‘‘(F) subject to paragraph (4), provides not
more than 6 inpatient beds (meeting such con-
ditions as the Secretary may establish) for pro-
viding inpatient care to patients requiring sta-
bilization before discharge or transfer to a hos-
pital, except that the facility may not provide
any inpatient hospital services—
‘‘(i) to any patient whose attending
physician does not certify that the patient
may reasonably be expected to be dis-
charged or transferred to a hospital within
72 hours of admission to the facility; or
876
‘‘(ii) consisting of surgery or any
other service requiring the use of general
anesthesia (other than surgical procedures
specified by the Secretary under section
1833(i)(1)(A)), unless the attending physi-
cian certifies that the risk associated with
transferring the patient to a hospital for
such services outweighs the benefits of
transferring the patient to a hospital for
such services.’’.
(2) LIMITATION
ON
AVERAGE
LENGTH
OF
STAY.—Section 1820(f) (42 U.S.C. 1395i–4(f)) is
amended by adding at the end the following new
paragraph:
‘‘(4) LIMITATION ON AVERAGE LENGTH OF IN-
PATIENT STAYS.—The Secretary may terminate a
designation of a rural primary care hospital under
paragraph (1) if the Secretary finds that the average
length of stay for inpatients at the facility during
the previous year in which the designation was in ef-
fect exceeded 72 hours. In determining the compli-
ance of a facility with the requirement of the pre-
vious sentence, there shall not be taken into account
periods of stay of inpatients in excess of 72 hours
to the extent such periods exceed 72 hours because
877
transfer to a hospital is precluded because of inclem-
ent weather or other emergency conditions.’’.
(3) 
CONFORMING
AMENDMENT.—Section
1814(a)(8) (42 U.S.C. 1395f(a)(8)) is amended by
striking ‘‘such services’’ and all that follows and in-
serting ‘‘the individual may reasonably be expected
to be discharged or transferred to a hospital within
72 hours after admission to the rural primary care
hospital.’’.
(4) GAO REPORTS.—Not later than 2 years
after the date of the enactment of this Act, the
Comptroller General shall submit reports to Con-
gress on—
(A) the application of the requirements
under section 1820(f) of the Social Security Act
(as amended by this subsection) that rural pri-
mary care hospitals provide inpatient care only
to those individuals whose attending physicians
certify may reasonably be expected to be dis-
charged within 72 hours after admission and
maintain an average length of inpatient stay
during a year that does not exceed 72 hours;
and
(B) the extent to which such requirements
have resulted in such hospitals providing inpa-
878
tient care beyond their capabilities or have lim-
ited the ability of such hospitals to provide
needed services.
(c) DESIGNATION OF HOSPITALS.—
(1) PERMITTING DESIGNATION OF HOSPITALS
LOCATED IN URBAN AREAS.—
(A) IN
GENERAL.—Section 1820 (42
U.S.C. 1395i–4) is amended—
(i) by striking paragraph (1) of sub-
section (e) and redesignating paragraphs
(2) through (6) as paragraphs (1) through
(5); and
(ii) in subsection (e)(1)(A) (as redes-
ignated by subparagraph (A))—
(I) by striking ‘‘is located’’ and
inserting ‘‘except in the case of a hos-
pital located in an urban area, is lo-
cated’’,
(II) by striking ‘‘, (ii)’’ and in-
serting ‘‘or (ii)’’,
(III) by striking ‘‘or (iii)’’ and all
that follows through ‘‘section,’’, and
(IV) in subsection (i)(1)(B), by
striking ‘‘paragraph (3)’’ and insert-
ing ‘‘paragraph (2)’’.
879
(B) NO CHANGE IN MEDICARE PROSPEC-
TIVE
PAYMENT.—Section 1886(d)(5)(D) (42
U.S.C. 1395ww(d)(5)(D)) is amended—
(i) in clause (iii)(III), by inserting ‘‘lo-
cated in a rural area and’’ after ‘‘that is’’,
and
(ii) in clause (v), by inserting ‘‘located
in a rural area and’’ after ‘‘in the case of
a hospital’’.
(2) PERMITTING HOSPITALS LOCATED IN AD-
JOINING STATES TO PARTICIPATE IN STATE PRO-
GRAM.—
(A) IN
GENERAL.—Section 1820 (42
U.S.C. 1395i–4) is amended—
(i) by redesignating subsection (k) as
subsection (l); and
(ii) by inserting after subsection (j)
the following new subsection:
‘‘(k) ELIGIBILITY OF HOSPITALS NOT LOCATED IN
PARTICIPATING
STATES.—Notwithstanding any other
provision of this section—
‘‘(1) for purposes of including a hospital or fa-
cility as a member institution of a rural health net-
work, a State may designate a hospital or facility
that is not located in the State as an essential access
880
community hospital or a rural primary care hospital
if the hospital or facility is located in an adjoining
State and is otherwise eligible for designation as
such a hospital;
‘‘(2) the Secretary may designate a hospital or
facility that is not located in a State receiving a
grant under subsection (a)(1) as an essential access
community hospital or a rural primary care hospital
if the hospital or facility is a member institution of
a rural health network of a State receiving a grant
under such subsection; and
‘‘(3) a hospital or facility designated pursuant
to this subsection shall be eligible to receive a grant
under subsection (a)(2).’’.
(B) CONFORMING AMENDMENTS.—(i) Sec-
tion 1820(c)(1) (42 U.S.C. 1395i–4(c)(1)) is
amended by striking ‘‘paragraph (3)’’ and in-
serting ‘‘paragraph (3) or subsection (k)’’.
(ii) Paragraphs (1)(A) and (2)(A) of sec-
tion 1820(i) (42 U.S.C. 1395i–4(i)) are each
amended—
(I) in clause (i), by striking ‘‘(a)(1)’’
and inserting ‘‘(a)(1) (except as provided
in subsection (k))’’, and
881
(II) in clause (ii), by striking ‘‘sub-
paragraph (B)’’ and inserting ‘‘subpara-
graph (B) or subsection (k)’’.
(d) SKILLED NURSING SERVICES IN RURAL PRIMARY
CARE HOSPITALS.—Section 1820(f)(3) (42 U.S.C. 1395i–
4(f)(3)) is amended by striking ‘‘because the facility’’ and
all that follows and inserting the following: ‘‘because, at
the time the facility applies to the State for designation
as a rural primary care hospital, there is in effect an
agreement between the facility and the Secretary under
section 1883 under which the facility’s inpatient hospital
facilities are used for the furnishing of extended care serv-
ices, except that the number of beds used for the furnish-
ing of such services may not exceed the total number of
licensed inpatient beds at the time the facility applies to
the State for such designation (minus the number of inpa-
tient beds used for providing inpatient care pursuant to
paragraph (1)(F)). For purposes of the previous sentence,
the number of beds of the facility used for the furnishing
of extended care services shall not include any beds of a
unit of the facility that is licensed as a distinct-part skilled
nursing facility at the time the facility applies to the State
for designation as a rural primary care hospital.’’.
(e) PAYMENT
FOR OUTPATIENT RURAL PRIMARY
CARE HOSPITAL SERVICES.—
882
(1) IMPLEMENTATION
OF
PROSPECTIVE
PAY-
MENT
SYSTEM.—Section 
1834(g) 
(42 
U.S.C.
1395m(g)) is amended—
(A) in paragraph (1), by striking ‘‘during
a year before 1993’’ and inserting ‘‘during a
year before the prospective payment system de-
scribed in paragraph (2) is in effect’’; and
(B) in paragraph (2), by striking ‘‘January
1, 1993,’’ and inserting ‘‘January 1, 1996,’’.
(2) NO USE OF CUSTOMARY CHARGE IN DETER-
MINING PAYMENT.—Section 1834(g)(1) (42 U.S.C.
1395m(g)(1)) is amended by adding at the end the
following:
‘‘The amount of payment shall be determined under
either method without regard to the amount of the
customary or other charge.’’.
(f) CLARIFICATION
OF PHYSICIAN STAFFING RE-
QUIREMENT FOR RURAL PRIMARY CARE HOSPITALS.—
Section 1820(f)(1)(H) (42 U.S.C. 1395i–4(f)(1)(H)) is
amended by striking the period and inserting the follow-
ing: ‘‘, except that in determining whether a facility meets
the requirements of this subparagraph, subparagraphs (E)
and (F) of that paragraph shall be applied as if any ref-
erence to a ‘physician’ is a reference to a physician as de-
fined in section 1861(r)(1).’’.
883
(g) TECHNICAL AMENDMENTS RELATING TO PART
A DEDUCTIBLE, COINSURANCE, AND SPELL
OF ILL-
NESS.—(1) Section 1812(a)(1) (42 U.S.C. 1395d(a)(1))
is amended—
(A) by striking ‘‘inpatient hospital services’’ the
first place it appears and inserting ‘‘inpatient hos-
pital services or inpatient rural primary care hos-
pital services’’;
(B) by striking ‘‘inpatient hospital services’’ the
second place it appears and inserting ‘‘such serv-
ices’’; and
(C) by striking ‘‘and inpatient rural primary
care hospital services’’.
(2) Sections 1813(a) and 1813(b)(3)(A) (42 U.S.C.
1395e(a), 1395e(b)(3)(A)) are each amended by striking
‘‘inpatient hospital services’’ each place it appears and in-
serting ‘‘inpatient hospital services or inpatient rural pri-
mary care hospital services’’.
(3) 
Section 
1813(b)(3)(B) 
(42 
U.S.C.
1395e(b)(3)(B)) is amended by striking ‘‘inpatient hos-
pital services’’ and inserting ‘‘inpatient hospital services,
inpatient rural primary care hospital services’’.
(4) Section 1861(a) (42 U.S.C. 1395x(a)) is
amended—
884
(A) in paragraphs (1), by striking ‘‘inpatient
hospital services’’ and inserting ‘‘inpatient hospital
services, inpatient rural primary care hospital serv-
ices’’; and
(B) in paragraph (2), by striking ‘‘hospital’’
and inserting ‘‘hospital or rural primary care hos-
pital’’.
(h) AUTHORIZATION OF APPROPRIATIONS.—Section
1820(k) (42 U.S.C. 1395i–4(k)) is amended by striking
‘‘1990, 1991, and 1992’’ and inserting ‘‘1990 through
1995’’.
(i) EFFECTIVE DATE.—The amendments made by
this section shall take effect on the date of the enactment
of this Act.
SEC. 13414. RURAL HEALTH TRANSITION GRANT PROGRAM
EXTENSION.
Section 4005(e)(9) of OBRA–1987 is amended—
(1) by striking ‘‘1989 and’’ and inserting
‘‘1989,’’; and
(2) by striking ‘‘1992’’ and inserting ‘‘1992
and $30,000,000 for each of fiscal years 1993
through 1997’’.
SEC. 13415. REGIONAL REFERRAL CENTER EXTENSION.
(a) EXTENSION OF CLASSIFICATION THROUGH FIS-
CAL YEAR 1994.—Effective on the date of the enactment
885
of this Act, section 6003(d) of such Act (42 U.S.C.
1395ww note) is amended by striking ‘‘October 1, 1992’’
and inserting ‘‘October 1, 1994’’.
(b) PERMITTING HOSPITALS TO DECLINE RECLASSI-
FICATION.—If any hospital fails to qualify as a rural refer-
ral center under section 1886(d)(5)(C) of the Social Secu-
rity Act as a result of a decision by the Medicare Geo-
graphic Classification Review Board under section
1886(d)(10) of such Act to reclassify the hospital as being
located in an urban area for fiscal year 1993 or fiscal year
1994, the Secretary of Health and Human Services
shall—
(1) notify such hospital of such failure to
qualify,
(2) provide an opportunity for such hospital to
decline such reclassification, and
(3) if the hospital declines such reclassification,
administer the Social Security Act (other than sec-
tion 1886(d)(8)(D)) for such fiscal year as if the de-
cision by the Review Board had not occurred.
(c) REQUIRING LUMP-SUM RETROACTIVE PAYMENT
FOR HOSPITALS LOSING CLASSIFICATION.—
(1) IN GENERAL.—In the case of an affected
regional referral center (as described in paragraph
(2)), the Secretary of Health and Human Services
886
shall make a lump sum payment to the center equal
to the difference between the aggregate payment
made to the center under section 1886 of such Act
(excluding 
outlier 
payments 
under 
subsection
(d)(5)(A) of such section) during the period of appli-
cability described in paragraph (3) and the aggre-
gate payment that would have been made to the cen-
ter under such section if, during the period of appli-
cability, the center was classified a regional referral
center under section 1886(d)(5)(C) of such Act.
(2) AFFECTED CENTERS DESCRIBED.—In para-
graph (1), an ‘‘affected regional referral center’’ is
a hospital classified as regional referral center under
section 1886(d)(5)(C) of the Social Security Act as
of September 30, 1992, that was not classified as
such a center after such date but would have been
so classified if the reference in section 6003(d) of
OBRA–1989 to ‘‘October 1, 1992,’’ had been
deemed a reference to ‘‘October 1, 1994,’’.
(3) PERIOD OF APPLICABILITY.—In paragraph
(1), the ‘‘period of applicability’’ is the period that
begins on October 1, 1992, and ends on the date of
the enactment of this Act.
887
SEC. 13416. MEDICARE-DEPENDENT, SMALL RURAL HOS-
PITAL PAYMENT EXTENSION.
(a) EXTENSION OF ADDITIONAL PAYMENTS.—Effec-
tive on the date of the enactment of this Act, section
1886(d)(5)(G) 
(42 
U.S.C. 
1395ww(d)(5)(G)) 
is
amended—
(1) in clause (i) in the matter preceding
subclause (I)—
(A) by inserting ‘‘(or portion thereof)’’
after ‘‘cost reporting period’’, and
(B) by striking ‘‘March 31, 1993,’’ and all
that follows and inserting the following: ‘‘Sep-
tember 30, 1994, in the case of a subsection (d)
hospital which is a medicare-dependent, small
rural hospital, payment under paragraph (1)(A)
shall be equal to the sum of the amount deter-
mined under clause (ii) and the amount deter-
mined under paragraph (1)(A)(iii).’’;
(2) by redesignating clauses (ii) and (iii) as
clauses (iii) and (iv); and
(3) by inserting after clause (i) the following
new clause:
‘‘(ii) The amount determined under this clause is—
‘‘(I) for discharges occurring during the first 3
12-month cost reporting periods that begin on or
after April 1, 1990, the amount by which the hos-
888
pital’s target amount for the cost reporting period
(as defined in subsection (b)(3)(D)) exceeds the
amount determined under paragraph (1)(A)(iii); and
‘‘(II) for discharges occurring during any subse-
quent cost reporting period (or portion thereof), 50
percent of the amount by which the hospital’s target
amount for the cost reporting period (as defined in
subsection (b)(3)(D)) exceeds the amount deter-
mined under paragraph (1)(A)(iii).’’.
(b) PERMITTING HOSPITALS TO DECLINE RECLASSI-
FICATION.—If any hospital fails to qualify as a medicare-
dependent, 
small 
rural 
hospital 
under 
section
1886(d)(5)(G)(i) of the Social Security Act as a result of
a decision by the Medicare Geographic Classification Re-
view Board under section 1886(d)(10) of such Act to re-
classify the hospital as being located in an urban area for
fiscal year 1993 or fiscal year 1994, the Secretary of
Health and Human Services shall—
(1) notify such hospital of such failure to
qualify,
(2) provide an opportunity for such hospital to
decline such reclassification, and
(3) if the hospital declines such reclassification,
administer the Social Security Act (other than sec-
889
tion 1886(d)(8)(D)) for such fiscal year as if the de-
cision by the Review Board had not occurred.
(c) REQUIRING
LUMP-SUM
RETROACTIVE
PAY-
MENT.—
(1) IN GENERAL.—In the case of a hospital
treated as a medicare dependent, small rural hos-
pital under section 1886(d)(5)(G) of the Social Se-
curity Act, the Secretary of Health and Human
Services shall make a lump sum payment to the hos-
pital equal to the difference between the aggregate
payment made to the hospital under section 1886 of
such Act (excluding outlier payments under sub-
section (d)(5)(A) of such section) during the period
of applicability described in paragraph (2) and the
aggregate payment that would have been made to
the hospital under such section if, during the period
of applicability, section 1886(d)(5)(G) of such Act
had been applied as if—
(A) the reference in clause (i) to ‘‘March
31, 1993,’’ had been deemed a reference to
‘‘September 30, 1994,’’; and
(B) the amendments made by subsection
(a) had been in effect.
(2) PERIOD OF APPLICABILITY.—In paragraph
(1), the ‘‘period of applicability’’ is, with respect to
890
a hospital, the period that begins on the first day of
the hospital’s first 12-month cost reporting period
that begins after April 1, 1992, and ends on the
date of the enactment of this Act.
SEC. 13417. EXTENSION OF REGIONAL FLOOR.
Section 
1886(d)(1)(A)(iii) 
(42 
U.S.C.
1395ww(d)(1)(A)(iii)) is amended by striking ‘‘September
30, 1993’’ and inserting ‘‘September 30, 1996’’.
SEC. 13418. EXTENSION OF RURAL HOSPITAL DEMONSTRA-
TION.
Section 4008(i)(1) of OBRA–1990 is amended by
adding at the end the following new sentence: ‘‘The Sec-
retary shall continue any such demonstration project until
at least December 31, 1995.’’.
SEC. 13419. HEMOPHILIA PASS-THROUGH EXTENSION.
Effective as if included in the enactment of OBRA–
1989, section 6011(d) of such Act is amended by striking
‘‘2 years after the date of enactment of this Act’’ and
inserting ‘‘September 30, 1994’’.
SEC. 13420. STATE HOSPITAL PAYMENT PROGRAMS.
In the case of a State hospital reimbursement system
that meets the requirements of section 1814(b)(3) of the
Social Security Act, no other provision of law shall be con-
strued as preventing the system from providing that pay-
891
ment for services covered under the system be made on
the basis of rates provided for under the system.
SEC. 13421. PSYCHOLOGY SERVICES IN HOSPITALS.
Section 1861(e)(4) (42 U.S.C. 1395x(e)(4)) is
amended by striking ‘‘physician;’’ and inserting ‘‘physi-
cian, except that a patient receiving qualified psychologist
services (as defined in subsection (ii)) may be under the
care of a clinical psychologist with respect to such services
to the extent permitted under State law;’’.
SEC. 13422. GRADUATE MEDICAL EDUCATION PAYMENTS IN
HOSPITAL-OWNED COMMUNITY HEALTH CEN-
TERS.
Section 
1886(d)(5)(B)(iv) 
(42 
U.S.C.
1395ww(d)(5)(B)(iv)) is amended by inserting after ‘‘the
hospital’’ the following: ‘‘or providing services at any en-
tity receiving a grant under section 330 of the Public
Health Service Act that is under the ownership or control
of the hospital (if the hospital incurs all, or substantially
all, of the costs of the services furnished to the hospital
by such interns and residents)’’.
SEC. 13423. TREATMENT OF CERTAIN MILITARY FACILI-
TIES.
(a) COVERAGE OF SERVICES PROVIDED IN CERTAIN
UNIFORMED SERVICES TREATMENT FACILITIES.—
892
(1) IN GENERAL.—The Secretary of Health and
Human Services may not take any recoupment ac-
tion to recover amounts that were paid by the Unit-
ed States under title XVIII of the Social Security
Act to the facilities described in paragraph (2) (or
to other individuals or entities with whom such fa-
cilities had entered into agreements to provide serv-
ices under such title) for services provided during
the period beginning October 1, 1986, and ending
December 31, 1989, except to the extent that funds
were obligated to the Uniformed Services Treatment
Facilities program to fulfill such an action pursuant
to title VI of the Department of Defense Appropria-
tions Act, 1993.
(2) FACILITIES DESCRIBED.—The facilities re-
ferred to in paragraph (1) are the hospitals de-
scribed in section 248c of title 42, United States
Code, that are located in Boston, Massachusetts;
Baltimore, Maryland; and Seattle, Washington.
(b) STUDY OF JOINT MEDICAL FACILITIES.—
(1) STUDY.—The Secretary of Health and
Human Services, in consultation with the Secretary
of Defense and the Secretary of Veterans Affairs,
shall conduct a study of the feasibility and desirabil-
ity of establishing joint medical facilities among the
893
Department of Defense, the Department of Veter-
ans’ Affairs, and other public and private entities,
and shall include in such study an analysis of the
need to make changes in the medicare and medicaid
programs (including facility certification standards
under such programs) in order to facilitate the es-
tablishment of such joint medical facilities.
(2) REPORT.—Not later than October 1, 1993,
the Secretary of Health and Human Services shall
submit a report to Congress on the study conducted
under paragraph (1).
SEC. 13424. EPILEPSY DRG.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall review the diagnosis-related groups
established pursuant to section 1886(d)(4) of the Social
Security Act that are assigned to discharges of patients
with intractable epilepsy, including patients whose admis-
sions involve intensive neurodiagnostic monitoring, and
shall revise, for discharges occurring on or after October
1, 1994, the assignment of discharges to such groups as
the Secretary considers appropriate to account for the re-
source requirements of such patients.
(b) CONSULTATION REQUIREMENTS.—In carrying
out subsection (a), the Secretary shall consult with the
Prospective Payment Assessment Commission and na-
894
tional organizations representing individuals with epilepsy
or individuals and entities providing specialized medical
services to such individuals related to the treatment of
epilepsy.
SEC. 13425. SKILLED NURSING FACILITY WAGE INDEX.
(a) IN GENERAL.—Not later than 1 year after the
date of the enactment of this Act, the Secretary of Health
and Human Services shall begin to collect data on em-
ployee compensation and paid hours of employment in
skilled nursing facilities for the purpose of constructing
a skilled nursing facility wage index adjustment to the
routine service cost limits required under section
1888(a)(4) of the Social Security Act.
(b) PROPAC REPORT.—The Prospective Payment
Assessment Commission shall, by March 1, 1994, study
and report to the Congress on the impact of applying rou-
tine per diem cost limits for skilled nursing facilities on
a regional basis.
SEC. 13426. HOSPICE NOTIFICATION TO BENEFICIARIES.
(a) HOSPITALS.—Section 1861(ee)(2)(D) (42 U.S.C.
1395x(ee)(2)(D)) is amended by inserting ‘‘, including
hospice services,’’ after ‘‘post-hospital services’’.
(b) NURSING FACILITIES.—Section 1819(c)(1)(B)
(42 U.S.C. 1395i–3(c)(1)(B)) is amended—
(1) by striking ‘‘and’’ at the end of clause (ii);
895
(2) by striking the period at the end of clause
(iii) and inserting ‘‘; and’’; and
(3) by inserting after clause (iii) the following
new clause:
‘‘(iv) inform each resident who is enti-
tled to benefits under this title, orally and
in writing at the time of admission to the
facility, of the entitlement of individuals to
hospice care under section 1812(a)(4) (un-
less there is no hospice program providing
hospice care for which payment may be
made under this title within the geographic
area of the facility and it is not the com-
mon practice of the facility to refer pa-
tients to hospice programs located outside
such geographic area).’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to services furnished on or after
the first day of the first month beginning more than one
year after the date of the enactment of this Act.
SEC. 13427. REDUCTION IN PART A PREMIUM FOR CERTAIN
INDIVIDUALS WITH 30 OR MORE QUARTERS
OF SOCIAL SECURITY COVERAGE.
(a) IN
GENERAL.—Section 1818(d) (42 U.S.C.
1395i–2(d)) is amended—
896
(1) in the second sentence of paragraph (2), by
striking ‘‘Such amount’’ and inserting ‘‘Subject to
paragraph (4), the amount of an individual’s month-
ly premium under this section’’; and
(2) by adding at the end the following new
paragraph:
‘‘(4)(A) In the case of an individual described in sub-
paragraph (B), the monthly premium for a month shall
be reduced by the applicable reduction percent specified
in the following table:
The applicable reduction
‘‘For a month in:
percent is:
1994 .........................................................................................
25 percent
1995 .........................................................................................
30 percent
1996 .........................................................................................
35 percent
1997 .........................................................................................
40 percent
1998 or subsequent year ..........................................................
45 percent.
‘‘(B) An individual described in this subparagraph
with respect to a month is an individual who establishes
to the satisfaction of the Secretary that, as of the last
day of the previous month, the individual—
‘‘(i) had at least 30 quarters of coverage under
title II;
‘‘(ii) was married (and had been married for
the previous 1 year period) to an individual who had
at least 30 quarters of coverage under such title;
‘‘(iii) had been married to an individual for a
period of at least 1 year (at the time of the individ-
897
ual’s death) if at such time the individual had at
least 30 quarters of coverage under such title; and
‘‘(iv) is divorced from an individual and had
been married to the individual for a period of at
least 10 years (at the time of the divorce) if at such
time the individual had at least 30 quarters of cov-
erage under such title.’’.
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply to monthly premiums under section
1818 of the Social Security Act for months beginning with
January 1, 1994.
SEC. 13428. PERIODIC UPDATES TO SALARY EQUIVALENCY
GUIDELINES FOR PHYSICAL THERAPY AND
RESPIRATORY THERAPY SERVICES.
(a) IN GENERAL.—Section 1861(v)(5) (42 U.S.C.
1395x(v)(5)) is amended by adding at the end the follow-
ing new subparagraph:
‘‘(C) Using the most recent available data, the Sec-
retary shall update, not less often than every 3 years, the
salary equivalency guidelines used under subparagraph
(A) with respect to physical therapy and respiratory
therapy services.’’.
(b) EFFECTIVE DATE.—The Secretary of Health and
Human Services shall first update the salary equivalency
guidelines, under the amendment made by subsection (a),
898
by not later than December 31, 1993. Such updated
guidelines shall apply to cost reporting periods beginning
on or after July 1, 1993.
SEC. 13429. EXTENSION OF DEADLINE FOR APPLICATION
FOR GEOGRAPHIC CLASSIFICATION FOR CER-
TAIN RECLASSIFIED HOSPITALS.
Notwithstanding section 1886(d)(10)(C)(ii) of the
Social Security Act, a hospital may submit an application
to the Medicare Geographic Classification Review Board
requesting a change in geographic classification for fiscal
year 1994 after the first day of fiscal year 1993 if—
(1) the hospital’s geographic classification for
fiscal year 1994 was changed from urban to rural as
a result of the issuance of the Revised Statistical
Definitions for Metropolitan Areas established by
the Office of Management and Budget on December
28, 1992 (pursuant to OMB Bulletin No. 93-05);
and
(2) the hospital submits the application not
later than 60 days after the date of the enactment
of this Act.
899
SEC. 13430. CLARIFICATION OF DRG PAYMENT WINDOW EX-
PANSION; MISCELLANEOUS AND TECHNICAL
CORRECTIONS.
(a) CLARIFICATION OF DRG PAYMENT WINDOW EX-
PANSION.—The first sentence of section 1886(a)(4) (42
U.S.C. 1395ww(a)(4)) is further amended by striking
‘‘and includes’’ and inserting ‘‘and (in the case of a sub-
section (d) hospital) includes’’.
(b) TECHNICAL CORRECTION RELATING TO RESI-
DENT
ASSESSMENT
IN
NURSING
HOMES.—Section
1819(b)(3)(C)(i)(I) (42 U.S.C. 1395i–3(b)(3)(C)(i)(I)) is
amended by striking ‘‘not later than’’ before ‘‘14 days’’.
(c) 
CLERICAL
CORRECTIONS.—(1) 
Section
1814(i)(1)(C)(i) (42 U.S.C. 1395f(i)(1)(C)(i)) is amended
by striking ‘‘1990,,’’ and inserting ‘‘1990,’’.
(2) 
Section 
1816(f)(2)(A)(ii) 
(42 
U.S.C.
1396h(f)(2)(A)(ii)) is amended by striking ‘‘such agency’’
and inserting ‘‘such agency’s’’.
(3) 
Section 
1886(d)(1)(A)(iii) 
(42 
U.S.C.
1395ww(d)(1)(A)(iii)) is amended by striking ‘‘, the sum
of’’ and inserting ‘‘is equal to the sum of’’.
900
CHAPTER 2—PROVISIONS RELATING TO
PART B
Subchapter A—Elimination of Inflation
Update
SEC. 13431. ELIMINATION OF INFLATION UPDATE FOR PHY-
SICIAN AND RELATED PROFESSIONAL SERV-
ICES.
(a) NO INCREASE IN INDEX.—Section 1848(d)(3)(A)
(42 U.S.C. 1395w–4(d)(3)(A)) is amended—
(1) in clause (i), by striking ‘‘clause (iii)’’ and
inserting ‘‘clauses (iii) and (iv)’’, and
(2) by adding at the end the following new
clause:
‘‘(iv) NO
INCREASE
IN
INDEX
FOR
1994 OR 1995.—In applying clause (i) for
services furnished on or after January 1,
1994, the percentage increase in the ap-
propriate update index for each of 1994
and 1995 shall be 0 percent.’’.
(b) NO INCREASE IN MEI FOR 1994 AND 1995.—Sec-
tion 1842(b)(4)(E) (42 U.S.C. 1395u(b)(4)(E)) is amend-
ed by adding at the end the following new clause:
‘‘(vi) For purposes of this part for items and services
furnished in 1994 or 1995, the percentage increase in the
MEI is 0 percent.’’.
901
SEC. 13432. ELIMINATION OF COST-OF-LIVING ADJUST-
MENTS FOR CERTAIN ITEMS AND SERVICES.
(a) CLINICAL
LABORATORY
SERVICES.—Section
1833(h)(2)(A)(ii) 
(42 
U.S.C. 
1395l(h)(2)(A)(ii)) 
is
amended—
(1) by striking ‘‘and’’ at the end of subclause
(II),
(2) by striking the period at the end of
subclause (III) and inserting ‘‘, and’’, and
(3) by adding at the end the following new
subclause:
‘‘(IV) the annual adjustment in the fee sched-
ules determined under clause (i) for each of the
years 1994 and 1995 shall be 0 percent.’’.
(b) 
DURABLE
MEDICAL
EQUIPMENT.—Section
1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended—
(1) in subparagraph (A), as amended by
13469(a), by striking ‘‘and’’ at the end;
(2) in subparagraph (B)—
(A) by striking ‘‘a subsequent year’’ and
inserting ‘‘1993’’, and
(B) by striking ‘‘June of the previous
year.’’ and inserting ‘‘June 1992,’’; and
(3) by adding at the end the following new sub-
paragraphs:
902
‘‘(C) for 1994 and 1995, no percentage
change, and
‘‘(D) for a subsequent year, the percentage
increase in the consumer price index for all
urban consumers (U.S. city average) for the 12-
month period ending with June of the previous
year.’’.
(c) 
ORTHOTICS
AND
PROSTHETICS.—Section
1834(h)(4)(A) (42 U.S.C. 1395m(h)(4)(A)) is amended—
(1) in clause (i), by striking ‘‘and’’;
(2) in clause (ii), by striking ‘‘a subsequent
year’’ and inserting ‘‘1992 and 1993’’; and
(3) by adding at the end the following new
clauses:
‘‘(iii) for 1994 and 1995, 0 percent,
and
‘‘(iv) for a subsequent year, the per-
centage increase in the consumer price
index for all urban consumers (United
States city average) for the 12-month pe-
riod ending with June of the previous
year;’’.
(d) REASONABLE CHARGE LIMITS
FOR ENTERAL
AND PARENTERAL NUTRIENTS, SUPPLIES AND EQUIP-
MENT.—In determining the amount of payment under
903
part B of title XVIII of the Social Security Act during
1994 and 1995, the charges determined to be reasonable
with respect to parenteral and enteral nutrients, supplies,
and equipment may not exceed the charges determined to
be reasonable with respect to such nutrients, supplies, and
equipment during 1993.
SEC. 13433. AMBULATORY SURGICAL CENTER SERVICES.
(a) ELIMINATION OF INFLATION UPDATE.—The Sec-
retary of Health and Human Services shall not provide
for any inflation update in the payment amounts under
subparagraphs (A) and (B) of section 1833(i)(2) of the
Social Security Act for fiscal year 1994 or for fiscal year
1995.
(b) 
CONFORMING
AMENDMENT.—Section
1833(i)(2)(C) (42 U.S.C. 1395l(i)(2)(C)), as added by
section 13453(a)(2)(B), is amended by striking ‘‘fiscal
year 1995’’ and inserting ‘‘fiscal year 1996’’.
SEC. 13434. OTHER ITEMS AND SERVICES UNDER PART B.
(a) RURAL HEALTH CLINIC SERVICES; FEDERALLY-
QUALIFIED HEALTH CENTER SERVICES; COMPREHEN-
SIVE OUTPATIENT REHABILITATION FACILITY SERV-
ICES.—In determining the amount of payment made for
rural health clinic services, Federally qualified health cen-
ter services, or comprehensive outpatient rehabilitation fa-
cility services furnished under part B of title XVIII of the
904
Social Security Act for services furnished on or after Jan-
uary 1, 1994, the Secretary of Health and Human Serv-
ices shall provide that any inflation update, in the applica-
ble limits used to determine the costs which are reasonable
and related to the cost of furnishing such services under
section 1833(a)(3) of such Act, that would otherwise have
applied for 1994 or for 1995 shall be deemed to be 0
percent.
(b) DIALYSIS SERVICES.—In determining the amount
of payment made for dialysis services furnished under part
B of title XVIII of the Social Security Act on or after
January 1, 1994, the Secretary of Health and Human
Services shall provide that any inflation update, in the
payment 
amounts 
determined 
under 
section
1881(b)(2)(B) of such Act or the rates determined under
section 1881(b)(7) of such Act, that would otherwise have
applied for 1994 or for 1995 shall be deemed to be 0
percent.
(c) OTHER PART B ITEMS AND SERVICES.—In deter-
mining the amount of payment made for an item or service
furnished under part B of title XVIII of the Social Secu-
rity Act on or after January 1, 1994, other than an item
or service to which a preceding provision of (or amend-
ment made by) this subchapter applies, the Secretary of
Health and Human Services shall provide that any infla-
905
tion update in the fee schedule amount for the item or
service established under such part B of such title, or (if
applicable) any applicable limit used to determine the ac-
tual charge, reasonable charge, or reasonable cost for the
item or service under such part, that would otherwise have
applied for 1994 or for 1995 shall be deemed to be 0
percent.
Subchapter B—Physicians’ Services
SEC. 13441. REINSTATING SEPARATE PAYMENT FOR THE
INTERPRETATION 
OF 
ELECTROCARDIO-
GRAMS (EKGS).
(a) IN GENERAL.—Paragraph (3) of section 1848(b)
(42 U.S.C. 1395w–4(b)) is amended to read as follows:
‘‘(3) TREATMENT
OF
INTERPRETATION
OF
ELECTROCARDIOGRAMS.—The Secretary—
‘‘(A) shall make separate payment under
this section for the interpretation of electro-
cardiograms performed or ordered to be per-
formed as part of or in conjunction with a visit
to or a consultation with a physician, and
‘‘(B) shall adjust the relative values estab-
lished for visits and consultations under sub-
section (c) so as not to include relative value
units for interpretations of electrocardiograms
906
in the relative value for visits and consulta-
tions.’’.
(b) 
ASSURING
BUDGET
NEUTRALITY.—Section
1848(c)(2) (42 U.S.C. 1395w–4(c)(2)) is amended by add-
ing at the end the following new subparagraph:
‘‘(E) 
BUDGET
NEUTRALITY
ADJUST-
MENTS.—The Secretary—
‘‘(i) shall reduce the relative values
for all services (other than anesthesia serv-
ices) established under this paragraph
(and, in the case of anesthesia services, the
conversion factor established by the Sec-
retary for such services) by such percent-
age as the Secretary determines to be nec-
essary so that, beginning in 1996, the
amendment made by section 13441(a) of
the Omnibus Budget Reconciliation Act of
1993 would not result in expenditures
under this section that exceed the amount
of such expenditures that would have been
made if such amendment had not been
made, and
‘‘(ii) shall reduce the amounts deter-
mined under subsection (a)(2)(B)(i)(I) by
such percentage as the Secretary deter-
907
mines to be required to assure that, taking
into account the reductions made under
clause (i), the amendment made by section
13441(a) of the Omnibus Budget Rec-
onciliation Act of 1993 would not result in
expenditures under this section in 1993
that exceed the amount of such expendi-
tures that would have been made if such
amendment had not been made.’’.
(c) CONFORMING AMENDMENTS.—Section 1848 (42
U.S.C. 1395w–4) is amended—
(1) in subsection (a)(2)(B)(i)(I), by inserting
‘‘and as adjusted under subsection (c)(2)(E)(ii)’’
after ‘‘for 1993’’;
(2) in subsection (c)(2)(A)(i), by adding at the
end the following: ‘‘Such relative values are subject
to adjustment under subparagraph (E)(i).’’; and
(3) in subsection (i)(1)(B), by adding at the
end 
‘‘including 
adjustments 
under 
subsection
(c)(2)(E),’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to services furnished on or after
January 1, 1994.
908
SEC. 13442. PAYMENTS FOR NEW PHYSICIANS AND PRACTI-
TIONERS.
(a) EQUAL TREATMENT OF NEW PHYSICIANS AND
PRACTITIONERS.—(1) 
Section 
1848(a) 
(42 
U.S.C.
1395w–4(a)) is amended by striking paragraph (4).
(2) Section 1842(b)(4) (42 U.S.C. 1395u(b)(4)) is
amended by striking subparagraph (F).
(b) BUDGET NEUTRALITY ADJUSTMENT.—Notwith-
standing any other provision of law, the Secretary of
Health and Human Services shall reduce the following val-
ues and amounts for 1993 (to be applied for that year
and subsequent years) by such uniform percentage as the
Secretary determines to be required to assure that the
amendments made by subsection (a) will not result in ex-
penditures under part B of title XVIII of the Social Secu-
rity Act in 1993 that exceed the amount of such expendi-
tures that would have been made if such amendments had
not been made:
(1) The relative values established under section
1848(c) of such Act for services (other than anesthe-
sia services) and, in the case of anesthesia services,
the conversion factor established under section 1848
of such Act for such services.
(2) The amounts determined under section
1848(a)(2)(B)(i)(I) of such Act.
909
(3) The prevailing charges or fee schedule
amounts to be applied under such part for services
of a health care practitioner (as defined in section
1842(b)(4)(F)(ii)(I) of such Act, as in effect before
the date of the enactment of this Act).
(c) CONFORMING AMENDMENTS.—Section 1848 (42
U.S.C. 1395w–4), as amended by section 13441(c), is
amended—
(1) in subsection (a)(2)(B)(i)(I), by inserting
‘‘and section 13442(b) of the Omnibus Budget Rec-
onciliation Act of 1993’’ after ‘‘(c)(2)(E)(ii)’’ after
‘‘for 1993’’;
(2) in subsection (c)(2)(A)(i), by inserting ‘‘and
section 13442(b) of the Omnibus Budget Reconcili-
ation Act of 1993’’ after ‘‘under subparagraph
(E)(i)’’; and
(3) in subsection (i)(1)(B), by inserting ‘‘and
section 13442(b) of the Omnibus Budget Reconcili-
ation Act of 1993’’ after ‘‘under subsection
(c)(2)(E)’’.
(d) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
910
SEC. 13443. RETAINING PAYMENT FOR ACTUAL ANESTHE-
SIA TIME.
(a) PHYSICIANS’ SERVICES.—Section 1848(b)(2)(B)
(42 U.S.C. 1395w–4(b)(2)(B)) is amended by adding at
the end the following: ‘‘The Secretary may not modify the
methodology in effect as of January 1, 1992, for determin-
ing the amount of time that may be billed for such services
under this section.’’.
(b) SERVICES OF CERTIFIED REGISTERED NURSE
ANESTHETISTS.—Section 
1833(l)(1)(B) 
(42 
U.S.C.
1395l(l)(1)(B)) is amended by adding at the end the fol-
lowing: ‘‘The Secretary may not modify the methodology
in effect as of January 1, 1992, for determining the
amount of time that may be billed for such services under
this section.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take apply to services furnished on or
after the date of the enactment of this Act.
SEC. 13444. GEOGRAPHIC COST OF PRACTICE INDEX RE-
FINEMENTS.
(a) REQUIRING CONSULTATION WITH REPRESENTA-
TIVES OF PHYSICIANS IN REVIEWING GEOGRAPHIC AD-
JUSTMENT FACTORS.—Section 1848(e)(1)(C) (42 U.S.C.
1395w–4(e)(1)(C)) is amended by striking ‘‘shall review’’
and inserting ‘‘shall, in consultation with appropriate rep-
resentatives of physicians, review’’.
911
(b) USE OF MOST RECENT DATA IN GEOGRAPHIC
ADJUSTMENT.—Section 1848(e)(1) (42 U.S.C. 1395w–
4(e)(1)) is amended by adding at the end the following
new subparagraph:
‘‘(D) USE OF RECENT DATA.—In estab-
lishing indices and index values under this
paragraph, the Secretary shall use the most re-
cent data available relating to practice ex-
penses, malpractice expenses, and physician
work effort in different fee schedule areas.’’.
(c) DEADLINE
FOR INITIAL REVIEW
AND REVI-
SION.—The Secretary of Health and Human Services
shall first review and revise geographic adjustment factors
under section 1848(e)(1)(C) of the Social Security Act by
not later than January 1, 1995. Not later than April 1,
1994, the Secretary shall study and report to report to
the Committee on Finance of the Senate and the Commit-
tee on Ways and Means and the Committee on Energy
and Commerce of the House of Representatives on the
construction of the geographic cost of practice index under
section 1848(e)(1)(A)(i) of such Act.
(d) REPORT ON REVIEW PROCESS.—Not later than
1 year after the date of the enactment of this Act, the
Secretary of Health and Human Services shall study and
report to the Committee on Finance of the Senate and
912
the Committee on Ways and Means and the Committee
on Energy and Commerce of the House of Representatives
on—
(1) the data necessary to review and revise the
indices established under section 1848(e)(1)(A) of
the Social Security Act, including—
(A) the shares allocated to physicians’
work effort, practice expenses (other than mal-
practice expenses), and malpractice expenses;
(B) the weights assigned to the input com-
ponents of such shares; and
(C) the index values assigned to such com-
ponents;
(2) any limitations on the availability of data
necessary to review and revise such indices at least
every three years;
(3) ways of addressing such limitations, with
particular attention to the development of alternative
data sources for input components for which current
index values are based on data collected less fre-
quently than every three years; and
(4) the costs of developing more accurate and
timely data.
(e) DEVELOPMENT OF CRITERIA FOR USE IN DE-
TERMINING PAYMENT LOCALITIES.—The Physician Pay-
913
ment Review Commission shall conduct a study to develop
criteria that would be used to refine the fee schedule areas
that are used within States, in applying geographic adjust-
ment factors for computing payment amounts, under sec-
tion 1848 of the Social Security Act. The Commission
shall include a report on such study in its recommenda-
tions submitted to the Congress under section 1845(b) of
such Act in 1994.
SEC. 13445. EXTRA-BILLING.
(a) ENFORCEMENT AND UNIFORM APPLICATION.—
(1) ENFORCEMENT.—Paragraph (1) of section
1848(g) (42 U.S.C. 1395w–4(g)) is amended to read
as follows:
‘‘(1) LIMITATION ON ACTUAL CHARGES.—
‘‘(A) IN
GENERAL.—In the case of a
nonparticipating physician or nonparticipating
supplier or other person (as defined in section
1842(i)(2)) who does not accept payment on an
assignment-related basis for a physician’s serv-
ice furnished with respect to an individual en-
rolled under this part, the following rules apply:
‘‘(i) 
APPLICATION
OF
LIMITING
CHARGE.—No person may bill or collect an
actual charge for the service in excess of
914
the limiting charge described in paragraph
(2) for such service.
‘‘(ii) NO
LIABILITY
FOR
EXCESS
CHARGES.—No person is liable for pay-
ment of any amounts billed for the service
in excess of such limiting charge.
‘‘(iii) 
CORRECTION
OF
EXCESS
CHARGES.—If such a physician, supplier,
or other person bills, but does not collect,
an actual charge for a service in violation
of clause (i), the physician, supplier, or
other person shall reduce on a timely basis
the actual charge billed for the service to
an amount not to exceed the limiting
charge for the service.
‘‘(iv) REFUND
OF
EXCESS
COLLEC-
TIONS.—If such a physician, supplier, or
other person collects an actual charge for
a service in violation of clause (i), the phy-
sician, supplier, or other person shall pro-
vide on a timely basis a refund to the indi-
vidual charged in the amount by which the
amount collected exceeded the limiting
charge for the service. The amount of such
a refund shall be reduced to the extent the
915
individual has an outstanding balance owed
by the individual to the physician.
‘‘(B) SANCTIONS.—If a physician, supplier,
or other person—
‘‘(i) knowingly and willfully bills or
collects for services in violation of subpara-
graph (A)(i) on a repeated basis, or
‘‘(ii) fails to comply with clause (iii)
or (iv) of subparagraph (A) on a timely
basis,
the Secretary may apply sanctions against the
physician, supplier, or other person in accord-
ance with paragraph (2) of section 1842(j). In
applying this subparagraph, paragraph (4) of
such section applies in the same manner as
such paragraph applies to such section and any
reference in such section to a physician is
deemed also to include a reference to a supplier
or other person under this subparagraph.
‘‘(C) TIMELY BASIS.—For purposes of this
paragraph, a correction of a bill for an excess
charge or refund of an amount with respect to
a violation of subparagraph (A)(i) in the case of
a service is considered to be provided ‘on a
timely basis’, if the reduction or refund is made
916
not later than 30 days after the date the physi-
cian, supplier, or other person is notified by the
carrier under this part of such violation and of
the requirements of subparagraph (A).’’.
(2) UNIFORM APPLICATION OF EXTRA-BILLING
LIMITS TO PHYSICIANS’ SERVICES.—
(A) IN GENERAL.—Section 1848(g)(2)(C)
(42 U.S.C. 1395w–4(g)(2)(C)) is amended by
inserting ‘‘or for nonparticipating suppliers or
other persons’’ after ‘‘nonparticipating physi-
cians’’.
(B) CONFORMING
DEFINITION.—Section
1842(i)(2) 
(42 
U.S.C. 
1395u(i)(2)) 
is
amended—
(i) by striking ‘‘, and the term’’ and
inserting ‘‘; the term’’, and
(ii) by inserting before the period at
the end the following: ‘‘; and the term
‘nonparticipating supplier or other person’
means a supplier or other person (exclud-
ing a provider of services) that is not a
participating physician or supplier (as de-
fined in subsection (h)(1))’’.
917
(b) PRE-PAYMENT SCREENING OF CLAIMS.—Sub-
paragraph (G) of section 1842(b)(3) (42 U.S.C.
1395u(b)(3)) is amended to read as follows:
‘‘(G) will, for a service that is furnished with
respect to an individual enrolled under this part,
that is not paid on an assignment-related basis, and
that is subject to a limiting charge under section
1848(g)—
‘‘(i) determine, prior to making payment,
whether the amount billed for such service ex-
ceeds the limiting charge applicable under sec-
tion 1848(g)(2);
‘‘(ii) notify the physician, supplier, or other
person periodically (but not less often than once
every 30 days) of determinations that amounts
billed exceeded such applicable limiting charges;
and
‘‘(iii) provide for prompt response to in-
quiries of physicians, suppliers, and other per-
sons concerning the accuracy of such limiting
charges for their services;’’.
(c) INFORMATION ON EXTRA-BILLING LIMITS.—
(1) PART OF EXPLANATION OF MEDICARE BEN-
EFITS.—Section 
1842(h)(7) 
(42 
U.S.C.
1395u(h)(7)) is amended—
918
(A) by striking ‘‘and’’ at the end of sub-
paragraph (B),
(B) in subparagraph (C), by striking ‘‘shall
include’’ and by striking the period at the end
and inserting ‘‘, and’’, and
(C) by adding at the end the following new
subparagraph:
‘‘(D) in the case of services for which the billed
amount exceeds the limiting charge imposed under
section 1848(g), information regarding such applica-
ble limiting charge (including information concern-
ing 
the 
right 
to 
a 
refund 
under 
section
1848(g)(1)(A)(iv)).’’.
(2) REPORT ON CHARGES IN EXCESS OF LIMIT-
ING
CHARGE.—Section 1848(g)(6)(B) (42 U.S.C.
1395w–4(g)(6)(B)) is amended by inserting ‘‘the ex-
tent to which actual charges exceed limiting charges,
the number and types of services involved, and the
average amount of excess charges and’’ after ‘‘report
to the Congress’’.
(d) 
APPLYING
THE
LIMITING
CHARGE
TO
NONPHYSICIAN SERVICES PROVIDED UNDER THE PHYSI-
CIAN FEE SCHEDULE.—Section 1848 (42 U.S.C. 1395w–
4) is amended—
919
(1) in subsection (a)(3), by inserting ‘‘AND SUP-
PLIERS’’ after ‘‘PHYSICIANS’’, and by inserting ‘‘or a
nonparticipating supplier or other person’’ after
‘‘nonparticipating physician’’ and by adding at the
end the following: ‘‘In the case of physicians’ serv-
ices (including services which the Secretary excludes
pursuant to subsection (j)(3)) of a nonparticipating
physician, supplier, or other person for which pay-
ment is made under this part on a basis other than
the fee schedule amount, the payment shall be based
on 95 percent of the payment basis for such services
furnished by a participating physician, supplier, or
other person.’’;
(2) in subsection (g)(1)(A), as amended by sub-
section (a), in the matter before clause (i), by insert-
ing ‘‘(including services which the Secretary excludes
pursuant to subsection (j)(3))’’ after ‘‘a physician’s
service’’;
(3) in subsection (g)(2)(D), by inserting ‘‘(or, if
payment under this part is made on a basis other
than the fee schedule under this section, 95 percent
of the other payment basis)’’ after ‘‘subsection (a)’’;
(4) in subsection (g)(3)(B)—
(A) by inserting after the first sentence the
following: ‘‘ No person is liable for payment of
920
any amounts billed for such a service in viola-
tion of the previous sentence.’’, and
(B) in the last sentence, by striking ‘‘pre-
vious sentence’’ and inserting ‘‘first sentence’’;
(5) in subsection (h)—
(A) by inserting ‘‘or nonparticipating sup-
plier or other person furnishing physicians’
services (as defined in section 1848(j)(3))’’
after ‘‘physician’’ the first place it appears,
(B) by inserting ‘‘, supplier, or other per-
son’’ after ‘‘physician’’ the second place it ap-
pears, and
(C) by inserting ‘‘, suppliers, and other
persons’’ after ‘‘physicians’’ the second place it
appears; and
(6) in subsection (j)(3), by inserting ‘‘, except
for purposes of subsections (a)(3), (g), and (h)’’
after ‘‘tests and’’.
(e) CLARIFICATION
OF MANDATORY ASSIGNMENT
RULES FOR CERTAIN PRACTITIONERS.—
(1) IN GENERAL.—Section 1842(b) (42 U.S.C.
1395u(b)), as amended by section 13449(e), is
amended by adding at the end the following new
paragraph:
921
‘‘(18)(A) Payment for any service furnished by a
practitioner described in subparagraph (C) and for which
payment may be made under this part on a reasonable
charge or fee schedule basis may only be made under this
part on an assignment-related basis.
‘‘(B) A practitioner described in subparagraph (C) or
other person may not bill (or collect any amount from)
the individual or another person for any service described
in subparagraph (A), except for deductible and coinsur-
ance amounts applicable under this part. No person is lia-
ble for payment of any amounts billed for such a service
in violation of the previous sentence. If a practitioner or
other person knowingly and willfully bills (or collects an
amount) for such a service in violation of such sentence,
the Secretary may apply sanctions against the practitioner
or other person in the same manner as the Secretary may
apply sanctions against a physician in accordance with
section 1842(j)(2) in the same manner as such section ap-
plies with respect to a physician. Paragraph (4) of section
1842(j) shall apply in this subparagraph in the same man-
ner as such paragraph applies to such section.
‘‘(C) A practitioner described in this subparagraph
is any of the following:
922
‘‘(i) A physician assistant, nurse practitioner, or
clinical nurse specialist (as defined in section
1861(aa)(5)).
‘‘(ii) A certified registered nurse anesthetist (as
defined in section 1861(bb)(2)).
‘‘(iii) A certified nurse-midwife (as defined in
section 1861(gg)(2)).
‘‘(iv) A clinical social worker (as defined in sec-
tion 1861(hh)(1)).
‘‘(v) A clinical psychologist (as defined by the
Secretary for purposes of section 1861(ii)).
‘‘(D) For purposes of this paragraph, a service fur-
nished by a practitioner described in subparagraph (C) in-
cludes any services and supplies furnished as incident to
the service as would otherwise be covered under this part
if furnished by a physician or as incident to a physician’s
service.’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 1833 (42 U.S.C. 1395l) is
amended—
(i) in subsection (l)(5), by striking
subparagraph (B) and redesignating sub-
paragraph (C) as subparagraph (B);
(ii) by striking subsection (p); and
923
(iii) in subsection (r), by striking
paragraph (3) and redesignating para-
graph (4) as paragraph (3).
(B) 
Section 
1842(b)(12) 
(42 
U.S.C.
1395u(b)(12)) is amended by striking subpara-
graph (C).
(f) MISCELLANEOUS
AND
TECHNICAL
AMEND-
MENTS.—Section 1833 (42 U.S.C. 1395l) is amended—
(1) in subsection (a)(1), as amended by section
13479(e)(2)—
(A) by striking ‘‘and’’ before ‘‘(O)’’, and
(B) by inserting before the semicolon at
the end the following: ‘‘, and (P) with respect
to services described in clauses (i), (ii) and (iv)
of section 1861(s)(2)(K), the amounts paid are
subject 
to 
the 
provisions 
of 
section
1842(b)(12)’’; and
(2) in subsection (h)(5)(D)—
(A) by striking ‘‘paragraphs (2) and (3)’’
and by inserting ‘‘paragraph (2)’’, and
(B) by adding at the end the following:
‘‘Paragraph (4) of such section shall apply in
this subparagraph in the same manner as such
paragraph applies to such section.’’.
(g) EFFECTIVE DATES.—
924
(1) ENFORCEMENT
AND
UNIFORM
APPLICA-
TION; MISCELLANEOUS
AND
TECHNICAL
AMEND-
MENTS.—The amendments made by subsections (a),
(d), and (f) shall apply to services furnished on or
after the date of the enactment of this Act; except
that such amendments made by subsections (a) and
(d) shall not apply to services of a nonparticipating
supplier or other person furnished before January 1,
1994.
(2) CARRIER
DETERMINATIONS.—The amend-
ments made by subsection (b) shall apply to con-
tracts as of January 1, 1994.
(3) EOMBS.—The amendments made by sub-
section (c)(1) shall apply to explanations of benefits
provided on or after January 1, 1994.
(4) REPORT.—The amendment made by sub-
section (c)(2) shall apply to reports for years begin-
ning with 1994.
(5) PRACTITIONERS.—The amendments made
by subsection (e) shall apply to services furnished on
or after January 1, 1994.
SEC. 13446. RELATIVE VALUES FOR PEDIATRIC SERVICES.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall fully develop, by not later than July
1, 1994, relative values for the full range of pediatric phy-
925
sicians’ services which are consistent with the relative val-
ues developed for other physicians’ services under section
1848(c) of the Social Security Act. In developing such val-
ues, the Secretary shall conduct such refinements as may
be necessary to produce appropriate estimates for such rel-
ative values.
(b) STUDY.—
(1) IN GENERAL.—The Secretary shall conduct
a study of the relative values for pediatric and other
services to determine whether there are significant
variations in the resources used in providing similar
services to different populations. In conducting such
study, the Secretary shall consult with appropriate
organizations representing pediatricians and other
physicians.
(2) REPORT.—Not later than July 1, 1994, the
Secretary shall submit to Congress a report on the
study conducted under paragraph (1). Such report
shall include any appropriate recommendations re-
garding needed changes in coding or other payment
policies to ensure that payments for pediatric serv-
ices appropriately reflect the resources required to
provide these services.
926
SEC. 13447. ANTIGENS UNDER PHYSICIAN FEE SCHEDULE.
(a) IN GENERAL.—Section 1848(j)(3) (42 U.S.C.
1395w–4(j)(3)) is amended by inserting ‘‘(2)(G),’’ after
‘‘(2)(D),’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1995.
SEC. 13448. ADMINISTRATION OF CLAIMS RELATING TO
PHYSICIANS’ SERVICES.
(a) LIMITATION ON CARRIER USER FEES.—Section
1842(c) (42 U.S.C. 1395u(c)) is amended by adding at
the end the following new paragraph:
‘‘(4) Neither a carrier nor the Secretary may impose
a fee under this title—
‘‘(A) for the filing of claims related to physi-
cians’ services,
‘‘(B) for an error in filing a claim relating to
physicians’ services or for such a claim which is
denied,
‘‘(C) for any appeal under this title with respect
to physicians’ services,
‘‘(D) for applying for (or obtaining) a unique
identifier under subsection (r), or
‘‘(E) for responding to inquiries respecting phy-
sicians’ services or for providing information with re-
spect to medical review of such services.’’.
927
(b) CLARIFICATION OF PERMISSIBLE SUBSTITUTE
BILLING ARRANGEMENTS.—
(1) IN
GENERAL.—Clause (D) of section
1842(b)(6) (42 U.S.C. 1395u(b)(6)), as amended by
section 13449(f), is amended to read as follows:
‘‘(D) payment may be made to a physician for physi-
cians’ services (and services furnished incident to
such services) furnished by a second physician to pa-
tients of the first physician if (i) the first physician
is unavailable to provide the services; (ii) the services
are furnished pursuant to an arrangement between
the two physicians that (I) is informal and recip-
rocal, or (II) involves per diem or other fee-for-time
compensation for such services; (iii) the services are
not provided by the second physician over a continu-
ous period of more than 60 days; and (iv) the claim
form submitted to the carrier for such services in-
cludes the second physician’s unique identifier (pro-
vided under the system established under subsection
(r)) and indicates that the claim meets the require-
ments of this clause for payment to the first physi-
cian’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to services furnished on
or after the first day of the first month beginning
928
more than 60 days after the date of the enactment
of this Act.
SEC. 13449. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) OVERVALUED PROCEDURES (SECTION 4101 OF
OBRA–1990).—(1) 
Section 
1842(b)(16)(B)(iii) 
(42
U.S.C. 1395u(b)(16)(B)(iii)) is amended—
(A) by striking ‘‘, simple and subcutaneous’’,
(B) by striking ‘‘; small’’ and inserting ‘‘and
small’’,
(C) by striking ‘‘treatments;’’ the first place it
appears and inserting ‘‘and’’,
(D) by striking ‘‘lobectomy;’’,
(E) by striking ‘‘enterectomy; colectomy; chole-
cystectomy;’’,
(F) by striking ‘‘; transurerethral resection’’
and inserting ‘‘and resection’’, and
(G) by striking ‘‘sacral laminectomy;’’.
(2) Section 4101(b)(2) of OBRA–1990 is amended—
(A) in the matter before subparagraph (A), by
striking 
‘‘1842(b)(16)’’ 
and 
inserting
‘‘1842(b)(16)(B)’’, and
(B) in subparagraph (B)—
(i) by striking ‘‘, simple and subcutane-
ous’’,
929
(ii) by striking ‘‘(HCPCS codes 19160 and
19162)’’ and inserting ‘‘(HCPCS code 19160)’’,
and
(iii) by striking all that follows ‘‘(HCPCS
codes 92250’’ and inserting ‘‘and 92260).’’.
(b) RADIOLOGY
SERVICES
(SECTION
4102 
OF
OBRA–1990).—(1) Section 1834(b)(4) (42 U.S.C.
1395m(b)(4)) is amended by redesignating subparagraphs
(E) and (F) as subparagraphs (F) and (G), respectively.
(2) 
Section 
1834(b)(4)(D) 
(42 
U.S.C.
1395m(b)(4)(D)) is amended—
(A) in the matter before clause (i), by striking
‘‘shall be determined as follows:’’ and inserting
‘‘shall, subject to clause (vii), be reduced to the ad-
justed conversion factor for the locality determined
as follows:’’,
(B) in clause (iv), by striking ‘‘LOCAL ADJUST-
MENT.—Subject to clause (vii), the conversion factor
to be applied to’’ and inserting ‘‘ADJUSTED CONVER-
SION FACTOR.—The adjusted conversion factor for’’,
(C) in clause (vii), by striking ‘‘under this sub-
paragraph’’, and
(D) in clause (vii), by inserting ‘‘reduced under
this subparagraph by’’ after ‘‘shall not be’’.
930
(3) Section 4102(c)(2) of OBRA–1990 is amended
by striking ‘‘radiology services’’ and all that follows and
inserting ‘‘nuclear medicine services.’’.
(4) Section 4102(d) of OBRA–1990 is amended by
striking ‘‘new paragraph’’ and inserting ‘‘new subpara-
graph’’.
(5) 
Section 
1834(b)(4)(E) 
(42 
U.S.C.
1395m(b)(4)(E)) is amended by inserting ‘‘RULE FOR
CERTAIN SCANNING SERVICES.—’’ after ‘‘(E)’’.
(6) Section 1848(a)(2)(D)(iii) (42 U.S.C. 1395w–
4(a)(2)(D)(iii)) is amended by striking ‘‘that are subject
to section 6105(b) of the Omnibus Budget Reconciliation
Act of 1989’’ and by striking ‘‘provided under such sec-
tion’’ and inserting ‘‘provided under section 6105(b) of the
Omnibus Budget Reconciliation Act of 1989’’.
(c) ANESTHESIA
SERVICES
(SECTION
4103 OF
OBRA–1990).—(1) Section 4103(a) of OBRA–1990 is
amended by striking ‘‘REDUCTION IN FEE SCHEDULE’’
and inserting ‘‘REDUCTION IN PREVAILING CHARGES’’.
(2) 
Section 
1842(q)(1)(B) 
(42 
U.S.C.
1395u(q)(1)(B)) is amended—
(A) in the matter before clause (i), by striking
‘‘shall be determined as follows:’’ and inserting
‘‘shall, subject to clause (iv), be reduced to the ad-
931
justed prevailing charge conversion factor for the lo-
cality determined as follows:’’, and
(B) in clause (iii), by striking ‘‘Subject to
clause (iv), the prevailing charge conversion factor to
be applied in’’ and inserting ‘‘The adjusted prevail-
ing charge conversion factor for’’.
(d) ASSISTANTS AT SURGERY (SECTION 4107 OF
OBRA–1990).—(1) Section 4107(c) of OBRA–1990 is
amended by inserting ‘‘(a)(1)’’ after ‘‘subsection’’.
(2) Section 4107(a)(2) of OBRA–1990 is amended
by adding at the end the following: ‘‘In applying section
1848(g)(2)(D) of the Social Security Act for services of
an assistant-at-surgery furnished during 1991, the recog-
nized payment amount shall not exceed the maximum
amount specified under section 1848(i)(2)(A) of such Act
(as applied under this paragraph in such year).’’.
(e) TECHNICAL COMPONENTS OF DIAGNOSTIC SERV-
ICES (SECTION 4108 OF OBRA–1990).—Section 1842(b)
(42 U.S.C. 1395u(b)) is amended by redesignating para-
graph (18), as added by section 4108(a) of OBRA–1990,
as paragraph (17) and, in such paragraph, by inserting
‘‘, tests specified in paragraph (14)(C)(i),’’ after ‘‘diag-
nostic laboratory tests’’.
932
(f) RECIPROCAL BILLING ARRANGEMENTS (SECTION
4110 OF
OBRA–1990).—Section 1842(b)(6)(D) (42
U.S.C. 1395u(b)(6)(D)) is amended—
(1) by striking ‘‘visit services (including emer-
gency visits and related services)’’ and inserting
‘‘physicians’ services (and services furnished incident
to such services)’’;
(2) by striking ‘‘on an occasional, reciprocal
basis’’ and inserting ‘‘under an arrangement that is
informal and reciprocal or involves per diem or other
fee-for-time compensation for services’’;
(3) by striking ‘‘visit’’ in subclauses (i), (ii),
and (iv); and
(4) in subclause (iii), by striking ‘‘the claim’’
and all that follows through the comma at the end
and inserting ‘‘the claim meets the requirements of
this clause for payment to the first physician’’.
(g) STUDY OF AGGREGATION RULE FOR CLAIMS OF
SIMILAR
PHYSICIAN
SERVICES
(SECTION
4113 
OF
OBRA–1990).—Section 
4113 
of 
OBRA–1990 
is
amended—
(1) by inserting ‘‘of the Social Security Act’’
after ‘‘1869(b)(2)’’; and
(2) by striking ‘‘December 31, 1992’’ and in-
serting ‘‘December 31, 1993’’.
933
(h) STATEWIDE FEE SCHEDULES (SECTION 4117 OF
OBRA–1990).—Section 
4117 
of 
OBRA–1990 
is
amended—
(1) in subsection (a)—
(A) by striking ‘‘IN GENERAL.—’’, and
(B) by striking ‘‘, if the’’ and all that fol-
lows through ‘‘1991, ’’; and
(2) by striking subsections (b), (c), and (d).
(i) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—(1) The heading of section 1834(f) (42
U.S.C. 1395m(f)) is amended by striking ‘‘FISCAL YEAR’’.
(2)(A) Section 4105(b) of OBRA–1990 is amended—
(i) in paragraph (2), by striking ‘‘amendments’’
and inserting ‘‘amendment’’, and
(ii) in paragraph (3), by striking ‘‘amendments
made by paragraphs (1) and (2)’’ and inserting
‘‘amendment made by paragraph (1)’’.
(B) Section 1848(f)(2)(C) (42 U.S.C. 1395w–
4(f)(2)(C)) is amended by inserting ‘‘PERFORMANCE
STANDARD
RATES
OF
INCREASE
FOR
FISCAL
YEAR
1991.—’’ after ‘‘(C)’’.
(C) Section 4105(d) of OBRA–1990 is amended by
inserting ‘‘PUBLICATION OF PERFORMANCE STANDARD
RATES.—’’ after ‘‘(d)’’.
934
(3) 
Section 
1842(b)(4)(F) 
(42 
U.S.C.
1395u(b)(4)(F)) is amended—
(A) in clause (i), by striking ‘‘prevailing
charge’’ the first place it appears and inserting
‘‘customary charge’’; and
(B) in clause (ii)(III), by striking ‘‘second,
third, and fourth’’ and inserting ‘‘first, second, and
third’’.
(4) 
Section 
1842(b)(4)(F)(ii)(I) 
(42 
U.S.C.
1395u(b)(4)(F)(ii)(I)) is amended by striking ‘‘respiratory
therapist,’’.
(5) Section 4106(c) of OBRA–1990 is amended by
inserting 
‘‘of 
the 
Social 
Security 
Act’’ 
after
‘‘1848(d)(1)(B)’’.
(6) Section 4114 of OBRA–1990 is amended by
striking ‘‘patients’’ the second place it appears.
(7) Section 1848(e)(1)(C) (42 U.S.C. 1395w–
4(e)(1)(C)) is amended by inserting ‘‘date of the’’ after
‘‘since the’’.
(8) Section 4118(f)(1)(D) of OBRA–1990 is amend-
ed by striking ‘‘is amended’’.
(9) Section 4118(f)(1)(N)(ii) of OBRA–1990 is
amended by striking ‘‘subsection (f)(5)(A)’’ and inserting
‘‘subsection (f)(5)(A))’’.
935
(10) Section 1845(e) (42 U.S.C. 1395w–1(e)) is
amended—
(A) by striking paragraph (2); and
(B) by redesignating paragraphs (3), (4), and
(5) as paragraphs (2), (3), and (4).
(11) Section 4118(j)(2) of OBRA–1990 is amended
by striking ‘‘In section’’ and inserting ‘‘Section’’.
(12)(A) Section 1848(i)(3) (42 U.S.C. 1395w–
4(i)(3)) is amended by striking the space before the period
at the end.
(B) 
Section 
1834(a)(10)(B) 
(42 
U.S.C.
1395m(a)(10)(B)) is amended—
(i) by striking ‘‘apply to’’ and inserting ‘‘would
otherwise apply to’’, and
(ii) by inserting before the period at the end
‘‘but for the application of section 1848(i)(3)’’.
(j) EFFECTIVE DATE.—The amendments made by
this section and the provisions of this section shall take
effect as if included in the enactment of OBRA–1990.
Subchapter C—Ambulatory Surgical Center
Services
SEC. 13451. DESIGNATION OF CERTAIN HOSPITALS AS EYE
OR EYE AND EAR HOSPITALS.
(a) IN
GENERAL.—Section 1833(i) (42 U.S.C.
1395l(i)) is amended—
936
(1) in subparagraph (B)(ii)—
(A) by striking ‘‘the last sentence of this
clause’’ and inserting ‘‘paragraph (4)’’, and
(B) by striking the last sentence; and
(2) by inserting after paragraph (3) the follow-
ing new paragraph:
‘‘(4)(A) In the case of a hospital that—
‘‘(i) makes application to the Secretary and
demonstrates that it specializes in eye services or eye
and ear services (as determined by the Secretary),
‘‘(ii) receives more than 30 percent of its total
revenues from outpatient services, and
‘‘(iii) on October 1, 1987—
‘‘(I) was an eye specialty hospital or an eye
and ear specialty hospital, or
‘‘(II) was operated as an eye or eye and
ear unit (as defined in subparagraph (B)) of a
general acute care hospital which, on the date
of the application described in clause (i), oper-
ates less than 20 percent of the beds that the
hospital operated on October 1, 1987, and has
sold or otherwise disposed of a substantial por-
tion of the hospital’s other acute care oper-
ations,
937
the cost proportion and ASC proportion in effect under
subclauses (I) and (II) of paragraph (2)(B)(ii) for cost
reporting periods beginning in fiscal year 1988 shall re-
main in effect for cost reporting periods beginning on or
after October 1, 1988, and before January 1, 1995.
‘‘(B) For purposes of this subparagraph (A)(iii)(II),
the term ‘eye or eye and ear unit’ means a physically sepa-
rate or distinct unit containing separate surgical suites de-
voted solely to eye or eye and ear services.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to portions of cost reporting
periods beginning on or after January 1, 1994.
SEC. 13452. TREATMENT OF INTRAOCULAR LENSES.
(a) EXTENSION OF CAP ON PAYMENTS THROUGH
1994.—
(1) 
IN
GENERAL.—Section 
4151(c)(3) 
of
OBRA–1990 is amended by striking ‘‘December 31,
1992’’ and inserting ‘‘December 31, 1994’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) this subsection shall be effective as
if included in the enactment of OBRA–1990.
(b) STUDY OF COSTS OF INTRAOCULAR LENSES.—
(1) STUDY.—The Secretary of Health and
Human Services shall conduct a study, based on re-
cent data, of the acquisition costs to providers of
938
intraocular lenses provided to individuals enrolled
under part B of the medicare program and shall in-
clude in the study an analysis of the impact of the
availability of new technology lenses on such costs.
(2) REPORT.—Not later than 1 year after the
date of the enactment of this Act, the Secretary
shall submit a report on the study conducted under
paragraph (1) to the Committee on Finance of the
Senate and the Committees on Ways and Means and
Energy and Commerce of the House of Representa-
tives, and shall include in the report any rec-
ommendations the Secretary considers appropriate
regarding the determination of payment amounts for
intraocular lenses under part B of the medicare
program.
SEC. 13453. TECHNICAL AMENDMENTS.
(a) PAYMENT AMOUNTS FOR SERVICES FURNISHED
IN AMBULATORY SURGICAL CENTERS.—
(1) USE OF SURVEY TO DETERMINE INCURRED
COSTS.—Section 
1833(i)(2)(A)(i) 
(42 
U.S.C.
1395l(i)(2)(A)(i)) is amended by striking the comma
at the end and inserting the following: ‘‘, as deter-
mined in accordance with a survey (based upon a
representative sample of procedures and facilities)
taken not later than January 1, 1994, and every 5
939
years thereafter, of the actual audited costs incurred
by such centers in providing such services,’’.
(2) AUTOMATIC
APPLICATION
OF
INFLATION
ADJUSTMENT.—Section 
1833(i)(2) 
(42 
U.S.C.
1395l(i)(2)) is amended—
(A) in the second sentence of subpara-
graph (A) and the second sentence of subpara-
graph (B), by striking ‘‘and may be adjusted by
the Secretary, when appropriate,’’; and
(B) by adding at the end the following new
subparagraph:
‘‘(C) Notwithstanding the second sentence of sub-
paragraph (A) or the second sentence of subparagraph
(B), if the Secretary has not updated amounts established
under such subparagraphs with respect to facility services
furnished during a fiscal year (beginning with fiscal year
1995), such amounts shall be increased by the percentage
increase in the consumer price index for all urban consum-
ers (U.S. city average) for the 12-month period ending
with March of the preceding fiscal year.’’.
(3) CONSULTATION
REQUIREMENT.—The sec-
ond sentence of section 1833(i)(1) (42 U.S.C.
1395l(i)(1)) is amended by striking the period and
inserting the following: ‘‘, in consultation with ap-
propriate trade and professional organizations.’’.
940
(b) ADJUSTMENTS TO PAYMENT AMOUNTS FOR NEW
TECHNOLOGY INTRAOCULAR LENSES.—
(1) ESTABLISHMENT OF PROCESS FOR REVIEW
OF AMOUNTS.—Not later than 1 year after the date
of the enactment of this Act, the Secretary of
Health and Human Services (in this subsection re-
ferred to as the ‘‘Secretary’’) shall develop and im-
plement a process under which interested parties
may request review by the Secretary of the appro-
priateness of the reimbursement amount provided
under section 1833(i)(2)(A)(iii) of the Social Secu-
rity Act with respect to a class of new technology
intraocular lenses. For purposes of the preceding
sentence, an intraocular lens may not be treated as
a new technology lens unless it has been approved
by the Food and Drug Administration.
(2) FACTORS
CONSIDERED.—In determining
whether to provide an adjustment of payment with
respect to a particular lens under paragraph (1), the
Secretary shall take into account whether use of the
lens is likely to result in reduced risk of
intraoperative or postoperative complication or trau-
ma, accelerated postoperative recovery, reduced in-
duced astigmatism, improved postoperative visual
941
acuity, more stable postoperative vision, or other
comparable clinical advantages.
(3) NOTICE
AND
COMMENT.—The Secretary
shall publish notice in the Federal Register from
time to time (but no less often than once each year)
of a list of the requests that the Secretary has re-
ceived for review under this subsection, and shall
provide for a 30-day comment period on the lenses
that are the subjects of the requests contained in
such notice. The Secretary shall publish a notice of
his determinations with respect to intraocular lenses
listed in the notice within 90 days after the close of
the comment period.
(4) EFFECTIVE DATE OF ADJUSTMENT.—Any
adjustment of a payment amount (or payment limit)
made under this subsection shall become effective
not later than 30 days after the date on which the
notice with respect to the adjustment is published
under paragraph (3).
(c) TECHNICAL CORRECTION RELATING TO BLEND
AMOUNTS FOR AMBULATORY SURGICAL CENTER PAY-
MENTS.—
(1) IN GENERAL.—Subclauses (I) and (II) of
section 
1833(i)(3)(B)(ii) 
(42 
U.S.C.
1395l(i)(3)(B)(ii)) are each amended—
942
(A) by striking ‘‘for reporting’’ and insert-
ing ‘‘for portions of cost reporting’’; and
(B) by striking ‘‘and on or before’’ and in-
serting ‘‘and ending on or before’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall take effect as if included in
the enactment of OBRA–1990.
(d) TECHNICAL CORRECTION RELATED TO CATA-
RACT SURGERY.—Effective as if included in the enact-
ment of OBRA–1990, section 4151(c)(3) of such Act is
amended by striking ‘‘for the insertion of an intraocular
lens’’ and inserting ‘‘for an intraocular lens inserted’’.
Subchapter D—Durable Medical Equipment
SEC. 13461. CERTIFICATION OF SUPPLIERS.
(a) REQUIREMENTS.—
(1) IN
GENERAL.—Section 1834 (42 U.S.C.
1395m) is amended by adding at the end the follow-
ing new subsection:
‘‘(i) REQUIREMENTS FOR SUPPLIERS OF MEDICAL
EQUIPMENT AND SUPPLIES.—
‘‘(1) ISSUANCE
AND
RENEWAL
OF
SUPPLIER
NUMBER.—
‘‘(A) PAYMENT.—Except as provided in
subparagraph (C), no payment may be made
under this part after October 1, 1993, for items
943
furnished by a supplier of medical equipment
and supplies unless such supplier obtains (and
renews at such intervals as the Secretary may
require) a supplier number.
‘‘(B) STANDARDS FOR POSSESSING A SUP-
PLIER NUMBER.—A supplier may not obtain a
supplier number unless—
‘‘(i) for medical equipment and sup-
plies furnished on or after October 1,
1993, and on or before December 31,
1994, the supplier meets standards pre-
scribed by the Secretary; and
‘‘(ii) for medical equipment and sup-
plies furnished on or after January 1,
1995, the supplier meets revised standards
prescribed by the Secretary (in consulta-
tion with representatives of suppliers of
medical equipment and supplies, carriers,
and consumers) that shall include require-
ments that the supplier—
‘‘(I) comply with all applicable
State and Federal licensure and regu-
latory requirements;
‘‘(II) maintain a physical facility
on an appropriate site;
944
‘‘(III) have proof of appropriate
liability insurance; and
‘‘(IV) meet such other require-
ments as the Secretary may specify.
‘‘(C) EXCEPTION FOR ITEMS FURNISHED
AS
INCIDENT
TO
A
PHYSICIAN’S
SERVICE.—
Subparagraph (A) shall not apply with respect
to medical equipment and supplies furnished as
an incident to a physician’s service.
‘‘(D) PROHIBITION
AGAINST
MULTIPLE
SUPPLIER NUMBERS.—The Secretary may not
issue more than one supplier number to any
supplier of medical equipment and supplies un-
less the issuance of more than one number is
appropriate to identify subsidiary or regional
entities under the supplier’s ownership or con-
trol.
‘‘(E) PROHIBITION AGAINST DELEGATION
OF
SUPPLIER
DETERMINATIONS.—The Sec-
retary may not delegate (other than by contract
under section 1842) the responsibility to deter-
mine whether suppliers meet the standards nec-
essary to obtain a supplier number.
‘‘(2) CERTIFICATES OF MEDICAL NECESSITY.—
945
‘‘(A) STANDARDIZED CERTIFICATES.—Not
later than October 1, 1993, the Secretary shall,
in consultation with carriers under this part,
develop one or more standardized certificates of
medical necessity (as defined in subparagraph
(C)) for medical equipment and supplies for
which the Secretary determines that such a cer-
tificate is necessary.
‘‘(B) PROHIBITION AGAINST DISTRIBUTION
BY SUPPLIERS OF CERTIFICATES OF MEDICAL
NECESSITY.—
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), a supplier of medical
equipment and supplies may not distribute
to physicians or to individuals entitled to
benefits under this part for commercial
purposes any completed or partially com-
pleted certificates of medical necessity on
or after October 1, 1993.
‘‘(ii) EXCEPTION FOR CERTAIN BILL-
ING
INFORMATION.—Clause (i) shall not
apply with respect to a certificate of medi-
cal necessity for any item that is not con-
tained on the list of potentially overused
items developed by the Secretary under
946
subsection (a)(15)(A) to the extent that
such certificate contains only information
completed by the supplier of medical equip-
ment and supplies identifying such supplier
and the beneficiary to whom such medical
equipment and supplies are furnished, a
description of such medical equipment and
supplies, any product code identifying such
medical equipment and supplies, and any
other administrative information (other
than information relating to the bene-
ficiary’s medical condition) identified by
the Secretary. In the event a supplier pro-
vides a certificate of medical necessity con-
taining information permitted under this
clause, such certificate shall also contain
the fee schedule amount and the supplier’s
charge for the medical equipment or sup-
plies being furnished prior to distribution
of such certificate to the physician.
‘‘(iii) PENALTY.—Any supplier of
medical equipment and supplies who know-
ingly and willfully distributes a certificate
of medical necessity in violation of clause
(i) is subject to a civil money penalty in an
947
amount not to exceed $1,000 for each such
certificate of medical necessity so distrib-
uted. The provisions of section 1128A
(other than subsections (a) and (b)) shall
apply to civil money penalties under this
subparagraph in the same manner as they
apply to a penalty or proceeding under sec-
tion 1128A(a).
‘‘(C) DEFINITION.—For purposes of this
paragraph, the term ‘certificate of medical ne-
cessity’ means a form or other document con-
taining information required by the Secretary to
be submitted to show that a covered item is
reasonable and necessary for the diagnosis or
treatment of illness or injury or to improve the
functioning of a malformed body member.
‘‘(3) COVERAGE AND REVIEW CRITERIA.—
‘‘(A) DEVELOPMENT
AND
ESTABLISH-
MENT.—Not later than January 1, 1995, the
Secretary, in consultation with representatives
of suppliers of medical equipment and supplies,
individuals enrolled under this part, and appro-
priate medical specialty societies, shall develop
and establish uniform national coverage and
utilization review criteria for 200 items of medi-
948
cal equipment and supplies selected in accord-
ance with the standards described in subpara-
graph (B). The Secretary shall publish the cri-
teria as part of the instructions provided to fis-
cal intermediaries and carriers under this part
and no further publication, including publica-
tion in the Federal Register, shall be required.
‘‘(B) STANDARDS FOR SELECTING ITEMS
SUBJECT TO CRITERIA.—The Secretary may se-
lect an item for coverage under the criteria de-
veloped and established under subparagraph
(A) if the Secretary finds that—
‘‘(i) the item is frequently purchased
or rented by beneficiaries;
‘‘(ii) the item is frequently subject to
a determination that such item is not
medically necessary; or
‘‘(iii) the coverage or utilization cri-
teria applied to the item (as of the date of
the enactment of this subsection) is not
consistent among carriers.
‘‘(C) ANNUAL REVIEW AND EXPANSION OF
ITEMS SUBJECT TO CRITERIA.—The Secretary
shall annually review the coverage and utiliza-
tion of items of medical equipment and supplies
949
to determine whether items not included among
the items selected under subparagraph (A)
should be made subject to uniform national cov-
erage and utilization review criteria, and, if ap-
propriate, shall develop and apply such criteria
to such additional items.
‘‘(4) DEFINITION.—The term ‘medical equip-
ment and supplies’’ means—
‘‘(A) durable medical equipment (as de-
fined in section 1861(n));
‘‘(B) prosthetic devices (as described in
section 1861(s)(8));
‘‘(C) orthotics and prosthetics (as de-
scribed in section 1861(s)(9));
‘‘(D) surgical dressings (as described in
section 1861(s)(5));
‘‘(E) such other items as the Secretary
may determine; and
‘‘(F) for purposes of paragraphs (1) and
(3)—
‘‘(i) home dialysis supplies and equip-
ment 
(as 
described 
in 
section
1861(s)(2)(F)), and
‘‘(ii) immunosuppressive drugs (as de-
scribed in section 1861(s)(2)(J)).’’.
950
(2) CONFORMING AMENDMENT.—Effective October
1, 1993, paragraph (16) of section 1834(a) (42 U.S.C.
1395m(a)) is repealed.
(b) REPORT ON EFFECT OF UNIFORM CRITERIA ON
UTILIZATION OF ITEMS.—Not later than July 1, 1995,
the Secretary shall submit a report to the Committee on
Ways and Means and the Committee on Energy and Com-
merce of the House of Representatives and the Committee
on Finance of the Senate analyzing the impact of the uni-
form criteria established under section 1834(i)(3)(A) of
the Social Security Act (as added by subsection (a)) on
the utilization of items of medical equipment and supplies
by individuals enrolled under part B of the medicare pro-
gram.
(c) USE OF COVERED ITEMS BY DISABLED BENE-
FICIARIES.—
(1) IN GENERAL.—The Secretary of Health and
Human Services in consultation with representatives
of suppliers of durable medical equipment under
part B of the medicare program and individuals en-
titled to benefits under such program on the basis
of disability, shall conduct a study of the effects of
the methodology for determining payments for items
of such equipment under such part on the ability of
951
such individuals to obtain items of such equipment,
including customized items.
(2) REPORT.—Not later than May 1, 1994, the
Secretary shall submit a report to Congress on the
study conducted under paragraph (1), and shall in-
clude in the report such recommendations as the
Secretary considers appropriate to assure that dis-
abled medicare beneficiaries have access to items of
durable medical equipment.
(d) CRITERIA FOR TREATMENT OF ITEMS AS PROS-
THETICS DEVICES OR ORTHOTICS AND PROSTHETICS.—
Not later than July 1, 1994, the Secretary of Health and
Human Services shall submit a report to the Committees
on Ways and Means and Energy and Commerce of the
House of Representatives and the Committee on Finance
of the Senate describing prosthetic devices or orthotics
and prosthetics covered under part B of the medicare pro-
gram that do not require individualized or custom fitting
and adjustment to be used by a patient. Such report shall
include recommendations for an appropriate methodology
for determining the amount of payment for such items
under such program.
952
SEC. 13462. PROHIBITION AGAINST CARRIER FORUM SHOP-
PING.
(a) IN GENERAL.—Section 1834(a)(12) (42 U.S.C.
1395m(a)(12)) is amended to read as follows:
‘‘(12) 
USE
OF
CARRIERS
TO
PROCESS
CLAIMS.—
‘‘(A) DESIGNATION
OF
REGIONAL
CAR-
RIERS.—The Secretary may designate, by regu-
lation under section 1842, one carrier for one
or more entire regions to process all claims
within the region for covered items under this
section.
‘‘(B) 
PROHIBITION
AGAINST
CARRIER
SHOPPING.—(i) No supplier of a covered item
may present or cause to be presented a claim
for payment under this part unless such claim
is presented to the appropriate regional carrier
(as designated by the Secretary).
‘‘(ii) For purposes of clause (i), the term
‘appropriate regional carrier’ means the carrier
having jurisdiction over the geographic area
that includes the permanent residence of the
patient to whom the item is furnished.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to items furnished on or after
October 1, 1993.
953
(c) CLARIFICATION OF AUTHORITY TO DESIGNATE
CARRIERS FOR OTHER ITEMS AND SERVICES.—Nothing
in this subsection or the amendment made by this sub-
section may be construed to restrict the authority of the
Secretary of Health and Human Services to designate re-
gional carriers or modify claims jurisdiction rules with re-
spect to items or services under part B of the medicare
program that are not covered items under section 1834(a)
of the Social Security Act or prosthetic devices or orthotics
and prosthetics under section 1834(h) of such Act.
SEC. 13463. RESTRICTIONS ON CERTAIN MARKETING AND
SALES ACTIVITIES.
(a) PROHIBITING UNSOLICITED TELEPHONE CON-
TACTS FROM SUPPLIERS OF DURABLE MEDICAL EQUIP-
MENT TO MEDICARE BENEFICIARIES.—
(1) IN GENERAL.—Section 1834(a) (42 U.S.C.
1395m(a)) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(17) PROHIBITION
AGAINST
UNSOLICITED
TELEPHONE CONTACTS BY SUPPLIERS.—
‘‘(A) IN GENERAL.—A supplier of a cov-
ered item under this subsection may not contact
an individual enrolled under this part by tele-
phone regarding the furnishing of a covered
item to the individual (other than a covered
954
item the supplier has already furnished to the
individual) unless—
‘‘(i) the individual gives permission to
the supplier to make contact by telephone
for such purpose; or
‘‘(ii) the supplier has furnished a cov-
ered item under this subsection to the indi-
vidual during the 15-month period preced-
ing the date on which the supplier contacts
the individual for such purpose.
‘‘(B) PROHIBITING PAYMENT FOR ITEMS
FURNISHED
SUBSEQUENT
TO
UNSOLICITED
CONTACTS.—If a supplier knowingly contacts
an individual in violation of subparagraph (A),
no payment may be made under this part for
any item subsequently furnished to the individ-
ual by the supplier.
‘‘(C) EXCLUSION
FROM
PROGRAM
FOR
SUPPLIERS ENGAGING IN PATTERN OF UNSO-
LICITED
CONTACTS.—If a supplier knowingly
contacts individuals in violation of subpara-
graph (A) to such an extent that the supplier’s
conduct establishes a pattern of contacts in vio-
lation of such subparagraph, the Secretary shall
exclude the supplier from participation in the
955
programs under this Act, in accordance with
the procedures set forth in subsections (c), (f),
and (g) of section 1128.’’.
(2) REQUIRING
REFUND
OF
AMOUNTS
COL-
LECTED FOR DISALLOWED ITEMS.—Section 1834(a)
(42 U.S.C. 1395m(a)), as amended by paragraph
(1), is amended by adding at the end the following
new paragraph:
‘‘(18) REFUND OF AMOUNTS COLLECTED FOR
CERTAIN DISALLOWED ITEMS.—
‘‘(A) IN GENERAL.—If a nonparticipating
supplier furnishes to an individual enrolled
under this part a covered item for which no
payment may be made under this part by rea-
son of paragraph (17)(B), the supplier shall re-
fund on a timely basis to the patient (and shall
be liable to the patient for) any amounts col-
lected from the patient for the item, unless—
‘‘(i) the supplier establishes that the
supplier did not know and could not rea-
sonably have been expected to know that
payment may not be made for the item by
reason of paragraph (17)(B), or
‘‘(ii) before the item was furnished,
the patient was informed that payment
956
under this part may not be made for that
item and the patient has agreed to pay for
that item.
‘‘(B) SANCTIONS.—If a supplier knowingly
and willfully fails to make refunds in violation
of subparagraph (A), the Secretary may apply
sanctions against the supplier in accordance
with section 1842(j)(2).
‘‘(C) NOTICE.—Each carrier with a con-
tract in effect under this part with respect to
suppliers of covered items shall send any notice
of denial of payment for covered items by rea-
son of paragraph (17)(B) and for which pay-
ment is not requested on an assignment-related
basis to the supplier and the patient involved.
‘‘(D) TIMELY BASIS DEFINED.—A refund
under subparagraph (A) is considered to be on
a timely basis only if—
‘‘(i) in the case of a supplier who does
not request reconsideration or seek appeal
on a timely basis, the refund is made with-
in 30 days after the date the supplier re-
ceives a denial notice under subparagraph
(C), or
957
‘‘(ii) in the case in which such a re-
consideration or appeal is taken, the re-
fund is made within 15 days after the date
the supplier receives notice of an adverse
determination on reconsideration or ap-
peal.’’.
(b) CONFORMING AMENDMENT.—Section 1834(h)(3)
(42 U.S.C. 1395m(h)(3)) is amended by striking ‘‘Para-
graph (12)’’ and inserting ‘‘Paragraphs (12) and (17)’’.
(c) EFFECTIVE DATE.—The amendments made by
subsections (a) and (b) shall apply to items furnished after
the expiration of the 60-day period that begins on the date
of the enactment of this Act.
SEC. 13464. ANTI-KICKBACK CLARIFICATION.
(a) IN
GENERAL.—Section 1128B(b)(3)(B) (42
U.S.C. 1320a–7b(b)(3)(B)) is amended by inserting be-
fore the semicolon ‘‘(except that in the case of a contract
supply arrangement between any entity and a supplier of
medical supplies and equipment (as defined in section
1834(i)(4), but not including items described in subpara-
graph (F) of such section), such employment shall not be
considered bona fide to the extent that it includes tasks
of a clerical and cataloging nature in transmitting to sup-
pliers assignment rights of individuals eligible for benefits
958
under part B of title XVIII, or performance of
warehousing or stock inventory functions)’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply with respect to services fur-
nished on or after the first day of the first month that
begins after the expiration of the 60-day period beginning
on the date of the enactment of this Act.
SEC. 13465. LIMITATIONS ON BENEFICIARY LIABILITY FOR
NONCOVERED SERVICES.
(a) IN
GENERAL.—Section 1834(i) (42 U.S.C.
1395m(i)), as added by section 13461(a)(1), is amended—
(1) by redesignating paragraph (4) as para-
graph (5), and
(2) by inserting after paragraph (3) the follow-
ing new paragraph:
‘‘(4) LIMITATION ON PATIENT LIABILITY.—If a
supplier of medical equipment and supplies (as de-
fined in paragraph (5))—
‘‘(A) furnishes an item or service to a ben-
eficiary for which no payment may be made by
reason of paragraph (1);
‘‘(B) furnishes an item or service to a ben-
eficiary for which payment is denied in advance
under subsection (a)(15); or
959
‘‘(C) furnishes an item or service to a ben-
eficiary for which payment is denied under sec-
tion 1862(a)(1);
any expenses incurred for items and services fur-
nished to an individual by such a supplier not on an
assigned basis shall be the responsibility of such
supplier. The individual shall have no financial re-
sponsibility for such expenses and the supplier shall
refund on a timely basis to the individual (and shall
be liable to the individual for) any amounts collected
from the individual for such items or services. The
provisions of subsection (a)(18) shall apply to re-
funds required under the previous sentence in the
same manner as such provisions apply to refunds
under such subsection.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1128B(b)(3)(B) (42 U.S.C. 1320a–7b(b)(3)(B)), as
amended by section 13464(a), is amended by strik-
ing ‘‘1834(i)(4)’’ and inserting ‘‘1834(i)(5)’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to items or services furnished
on or after October 1, 1993.
960
SEC. 13466. ADJUSTMENTS FOR INHERENT REASONABLE-
NESS.
(a) ADJUSTMENTS
MADE
TO
FINAL
PAYMENT
AMOUNTS.—
(1) IN GENERAL.—Section 1834(a)(10)(B) (42
U.S.C. 1395m(a)(10)(B)) is amended by adding at
the end the following: ‘‘In applying such provisions
to payments for an item under this subsection, the
Secretary shall make adjustments to the payment
basis for the item described in paragraph (1)(B) if
the Secretary determines (in accordance with such
provisions and on the basis of prices and costs appli-
cable at the time the item is furnished) that such
payment basis is not inherently reasonable.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect on the date of the
enactment of this Act.
(b) ADJUSTMENT REQUIRED FOR CERTAIN ITEMS.—
(1) IN GENERAL.—In accordance with section
1834(a)(10)(B) of the Social Security Act (as
amended by subsection (a)), the Secretary of Health
and Human Services shall determine whether the
payment amounts for the items described in para-
graph (2) are not inherently reasonable, and shall
adjust such amounts in accordance with such section
if the amounts are not inherently reasonable.
961
(2) ITEMS DESCRIBED.—The items referred to
in paragraph (1) are decubitus care equipment,
transcutaneous electrical nerve stimulators, and any
other items considered appropriate by the Secretary.
SEC. 13467. TREATMENT OF NEBULIZERS AND ASPIRATORS.
(a) IN GENERAL.—Section 1834(a)(3)(A) (42 U.S.C.
1395m(a)(3)(A)) is amended by striking ‘‘ventilators, as-
pirators, IPPB machines, and nebulizers’’ and inserting
‘‘ventilators and IPPB machines’’.
(b) PAYMENT
FOR
ACCESSORIES
RELATING
TO
NEBULIZERS AND ASPIRATORS.—Section 1834(a)(2)(A)
(42 U.S.C. 1395m(a)) is amended—
(1) by striking ‘‘or’’ at the end of clause (i),
(2) by adding ‘‘or’’ at the end of clause (ii), and
(3) by inserting after clause (ii) the following
new clause:
‘‘(iii) which is an accessory used in
conjunction with a nebulizer or aspirator,’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to items furnished on or after Jan-
uary 1, 1994.
SEC. 13468. PAYMENT FOR OSTOMY SUPPLIES AND OTHER
SUPPLIES.
(a) OSTOMY SUPPLIES, TRACHEOSTOMY SUPPLIES,
AND UROLOGICALS.—
962
(1) IN
GENERAL.—Section 1834(h)(1) (42
U.S.C. 1395m(h)(1)) is amended by adding at the
end the following new subparagraph:
‘‘(E) EXCEPTION FOR CERTAIN ITEMS.—
Payment for ostomy supplies, tracheostomy
supplies, and urologicals shall be made in ac-
cordance with subparagraphs (B) and (C) of
section 1834(a)(2).’’.
(2) 
CONFORMING
AMENDMENT.—Section
1834(h)(1)(B) (42 U.S.C. 1395m(h)(1)(B)) is
amended by striking ‘‘subparagraph (C),’’ and in-
serting ‘‘subparagraphs (C) and (E),’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to items furnished on
or after January 1, 1994.
(b) SURGICAL DRESSINGS.—
(1) IN
GENERAL.—Section 1834 (42 U.S.C.
1395m), as amended by section 13461(a), is amend-
ed by adding at the end the following new sub-
section:
‘‘(j) PAYMENT FOR SURGICAL DRESSINGS.—
‘‘(1) IN GENERAL.—Payment under this sub-
section for surgical dressings (described in section
1861(s)(5)) shall be made in a lump sum amount
963
for the purchase of the item in an amount equal to
80 percent of the lesser of—
‘‘(A) the actual charge for the item; or
‘‘(B) a payment amount determined in ac-
cordance with the methodology described in
subparagraphs (B) and (C) of subsection (a)(2)
(except that in applying such methodology, the
national limited payment amount referred to in
such subparagraphs shall be initially computed
based on local payment amounts using average
reasonable charges for the 12-month period
ending December 31, 1992, increased by the
covered item updates described in such sub-
section for 1993 and 1994).
‘‘(2) EXCEPTIONS.—Paragraph (1) shall not
apply to surgical dressings that are—
‘‘(A) furnished as an incident to a physi-
cian’s professional service; or
‘‘(B) furnished by a home health agency.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1833(a)(1) (42 U.S.C. 1395l(a)(1)), as amended by
sections 13478(e)(2) and 13445(e)(1), is amended—
(A) by striking ‘‘and’’ before ‘‘(P)’’, and
(B) by inserting before the semicolon at
the end the following: ‘‘, and (Q) with respect
964
to surgical dressings, the amounts paid shall be
the 
amounts 
determined 
under 
section
1834(j);’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to items furnished on
or after January 1, 1994.
(c) REDUCTION
IN PAYMENTS
FOR TENS DE-
VICES.—
(1) IN GENERAL.—Section 1834(a)(1)(D) (42
U.S.C. 1395m(a)(1)(D)) is amended by striking ‘‘15
percent’’ the second place it appears and inserting
‘‘45 percent’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to items furnished on
or after January 1, 1994.
SEC. 13469. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) UPDATES
TO PAYMENT AMOUNTS.—Subpara-
graph 
(A) 
of 
section 
1834(a)(14) 
(42 
U.S.C.
1395m(a)(14)) is amended to read as follows:
‘‘(A) for 1991 and 1992, the percentage
increase in the consumer price index for all
urban consumers (U.S. city average) for the 12-
month period ending with June of the previous
year reduced by 1 percentage point; and’’.
965
(b) TREATMENT OF POTENTIALLY OVERUSED ITEMS
AND ADVANCED DETERMINATIONS OF COVERAGE.—
(1) IN GENERAL.—Effective on the date of the
enactment of this Act, section 1834(a)(15) (42
U.S.C. 1395m(a)(15)) is amended to read as
follows:
‘‘(15) SPECIAL TREATMENT FOR POTENTIALLY
OVERUSED ITEMS.—
‘‘(A) DEVELOPMENT OF LIST OF ITEMS BY
SECRETARY.—The Secretary shall develop and
periodically update a list of items for which
payment may be made under this subsection
that are potentially overused, and shall include
in such list seat-lift mechanisms, transcutane-
ous electrical nerve stimulators, motorized
scooters, decubitus care mattresses, and any
such other item determined by the Secretary to
be potentially overused on the basis of any of
the following criteria—
‘‘(i) the item is marketed directly to
potential patients;
‘‘(ii) the item is marketed with an
offer to potential patients to waive the
costs of coinsurance associated with the
item or is marketed as being available at
966
no cost to policyholders of a medicare sup-
plemental policy (as defined in section
1882(g)(1));
‘‘(iii) the item has been subject to a
consistent pattern of overutilization; or
‘‘(iv) a high proportion of claims for
payment for such item under this part may
not be made because of the application of
section 1862(a)(1).
‘‘(B) ITEMS SUBJECT TO SPECIAL CARRIER
SCRUTINY.—Payment may not be made under
this part for any item contained in the list de-
veloped by the Secretary under subparagraph
(A) unless the carrier has subjected the claim
for payment for the item to special scrutiny or
has followed the procedures described in para-
graph (11)(C) with respect to the item.’’.
(2) ADVANCE DETERMINATION BY CARRIERS.—
Effective January 1, 1994, section 1834(a)(11) (42
U.S.C. 1395m(a)) is amended by adding at the end
the following new subparagraph:
‘‘(C) CARRIER DETERMINATIONS FOR CER-
TAIN ITEMS IN ADVANCE.—A carrier shall de-
termine in advance whether payment for an
item may not be made under this subsection be-
967
cause of the application of section 1862(a)(1)
if—
‘‘(i) the item is a customized item
(other than inexpensive items specified by
the Secretary); or
‘‘(ii) the item is a specified covered
item under subparagraph (B).’’.
(3) INCLUSION
IN
CARRIER
PERFORMANCE
EVALUATIONS.—Effective for standards applied for
contract years beginning after the date of the enact-
ment of this Act, section 1842(c) (42 U.S.C.
1395u(c)), as amended by section 13448(a), is
amended by adding at the end the following new
paragraph:
‘‘(5) Each contract under this section which provides
for the disbursement of funds, as described in subsection
(a)(1)(B), shall require the carrier to meet criteria devel-
oped by the Secretary to measure the timeliness of carrier
responses to requests for payment of items described in
section 1834(a)(11)(C).’’.
(4) APPLICATION TO PROSTHETIC DEVICES AND
ORTHOTICS AND PROSTHETICS.—Section 1834(h)(3)
(42 U.S.C. 1395m(h)(3)) is amended by striking
‘‘paragraph (10) and paragraph (11)’’ and inserting
‘‘paragraphs (10) and (11)’’.
968
(c) STUDY OF VARIATIONS IN DURABLE MEDICAL
EQUIPMENT SUPPLIER COSTS.—
(1) COLLECTION AND ANALYSIS OF SUPPLIER
COST
DATA.—The Administration of the Health
Care Financing Administration shall, in consultation
with appropriate organizations, collect data on sup-
plier costs of durable medical equipment for which
payment may be made under part B of the medicare
program, and shall analyze such data to determine
the proportions of such costs attributable to the
service and product components of furnishing such
equipment and the extent to which such proportions
vary by type of equipment and by the geographic
region in which the supplier is located.
(2) DEVELOPMENT
OF
GEOGRAPHIC
ADJUST-
MENT INDEX; REPORTS.—Not later than January 1,
1995—
(A) the Administrator shall submit a re-
port to the Committees on Energy and Com-
merce and Ways and Means of the House of
Representatives and the Committee on Finance
of the Senate on the data collected and the
analysis conducted under paragraph (1), and
shall include in such report the Administrator’s
recommendations for a geographic cost adjust-
969
ment index for suppliers of durable medical
equipment under the medicare program and an
analysis of the impact of such proposed index
on payments under the medicare program; and
(B) the Comptroller General shall submit a
report to the Committees on Energy and Com-
merce and Ways and Means of the House of
Representatives and the Committee on Finance
of the Senate analyzing on a geographic basis
the supplier costs of durable medical equipment
under the medicare program.
(d) OXYGEN RETESTING.—Section 1834(a)(5)(E)
(42 U.S.C. 1395m(a)(5)(E)) is amended by striking ‘‘55’’
and inserting ‘‘56’’.
(e) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—(1) Section 4152(a)(3) of OBRA–1990
is amended by striking ‘‘amendment made by subsection
(a)’’ and inserting ‘‘amendments made by this sub-
section’’.
(2) Section 4152(c)(2) of OBRA–1990 is amended
by 
striking 
‘‘1395m(a)(7)(A)’’ 
and 
inserting
‘‘1395m(a)(7)’’.
(3) 
Section 
1834(a)(7)(A)(iii)(II) 
(42 
U.S.C.
1395m(a)(7)(A)(iii)(II)) is amended by striking ‘‘clause
(v)’’ and inserting ‘‘clause (vi)’’.
970
(4) 
Section 
1834(a)(7)(C)(i) 
(42 
U.S.C.
1395m(a)(7)(C)(i)) is amended by striking ‘‘or paragraph
(3)’’.
(5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is
amended by striking subparagraph (D).
(6) Section 4153(c)(1) of OBRA–1990 is amended
by striking ‘‘1834(a)’’ and inserting ‘‘1834(h)’’.
(7) Section 4153(d)(2) of OBRA–1990 is amended
by striking ‘‘Reconiliation’’ and inserting ‘‘Reconcili-
ation’’.
(8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is
amended by striking paragraph (6).
(B) Section 1834(a) (42 U.S.C. 1395m(a)) is
amended—
(i) in subparagraphs (A) and (B) of paragraph
(1), by striking ‘‘(2) through (7)’’ each place it
appears and inserting ‘‘(2) through (5) and (7)’’;
(ii) in paragraph (7), by striking ‘‘(2) through
(6)’’ and inserting ‘‘(2) through (5)’’;
(iii) in paragraph (8), by striking ‘‘paragraphs
(6) and (7)’’ each place it appears in the matter pre-
ceding subparagraph (A) and in subparagraph (C)
and inserting ‘‘paragraph (7)’’; and
(iv) in paragraph (8)(A)(i), by striking ‘‘de-
scribed—’’ and all that follows and inserting ‘‘de-
971
scribed in paragraph (7) equal to the average of the
purchase prices on the claims submitted on an as-
signment-related basis for the unused item supplied
during the 6-month period ending with December
1986.’’.
(9) The amendments made by this subsection shall
take effect as if included in the enactment of OBRA–1990.
Subchapter E—Other Provisions
SEC. 13471. CLARIFYING PAYMENTS FOR MEDICALLY DI-
RECTED CERTIFIED REGISTERED NURSE AN-
ESTHETIST SERVICES.
(a) IN GENERAL.—Section 1833(l)(4)(B) (42 U.S.C.
1395l(l)(4)(B)) is amended to read as follows:
‘‘(B) Except as provided in subparagraph (D), the
conversion factor used to determine the amount paid
under the fee schedule under this subsection for services
furnished by a certified registered nurse anesthetist who
is medically directed—
‘‘(i) in a year after 1993 and before 1997, shall
be $10.75, or
‘‘(ii) in a subsequent calendar year, shall be the
previous year’s conversion factor increased by the
update determined under section 1848(d)(3) for
physician anesthesia services for that year.’’.
972
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
SEC. 13472. EXTENSION OF ALZHEIMER’S DISEASE DEM-
ONSTRATION PROJECTS.
Section 9342 of OBRA–1986, as amended by section
4164(a)(2) of OBRA–1990, is amended—
(1) in subsection (c)(1), by striking ‘‘4 years’’
and inserting ‘‘5 years’’; and
(2) in subsection (f), —
(A) by striking ‘‘$55,000,000’’ and insert-
ing ‘‘$58,000,000’’, and
(B) by striking ‘‘$3,000,000’’ and insert-
ing ‘‘$5,000,000’’.
SEC. 13473. ORAL CANCER DRUGS.
(a) NEW COVERAGE OF CERTAIN SELF-ADMINIS-
TERED ANTICANCER DRUGS.—Section 1861(s)(2) (42
U.S.C. 
1395(s)(2)), 
as 
amended 
by 
section
13478(f)(8)(B), is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (N);
(2) by adding ‘‘and’’ at the end of subpara-
graph (O); and
(3) by adding at the end the following new sub-
paragraph:
973
‘‘(P) an oral drug (which is approved by the
Federal Food and Drug Administration) prescribed
for use as an anticancer chemotherapeutic agent for
a given indication, and containing an active ingredi-
ent (or ingredients), which is the same indication
and active ingredient (or ingredients) as a drug
which the carrier determines would be covered pur-
suant to subparagraph (A) or (B) if the drug could
not be self-administered;’’.
(b) 
UNIFORM
COVERAGE
OF
‘‘OFF-LABEL’’
ANTICANCER
DRUGS.—Section 1861(t) (42 U.S.C.
1395x(t)) is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(t)’’;
(2) by striking ‘‘(m)(5) of this section’’ and in-
serting ‘‘(m)(5) and paragraph (2)’’; and
(3) by adding at the end the following new
paragraph:
‘‘(2)(A) For purposes of paragraph (1), the term
‘drugs’ also includes any drugs or biologicals used in an
anticancer chemotherapeutic regimen for a medically ac-
cepted indication (as described in subparagraph (B)).
‘‘(B) In subparagraph (A), the term ‘medically ac-
cepted indication’, with respect to the use of a drug, in-
cludes any use which has been approved by the Food and
974
Drug Administration for the drug, and includes another
use of the drug if—
‘‘(i) the drug has been approved by the Food
and Drug Administration, and
‘‘(ii) the carrier involved determines, based
upon guidance provided by the Secretary to carriers
for determining medically accepted uses of drugs,
that the use is medically accepted taking into ac-
count the uses of such drug which are—
‘‘(I) included (or approved for inclusion) in
one or more of the following compendia: the
American Hospital Formulary Service-Drug In-
formation, the American Medical Association
Drug Evaluations, and the United States Phar-
macopoeia-Drug Information; or
‘‘(II) supported by clinical evidence in peer
reviewed medical literature appearing in publi-
cations which have been specifically approved
for purposes of this paragraph by the Sec-
retary.’’.
(c) STUDY OF MEDICARE COVERAGE OF PATIENT
CARE COSTS ASSOCIATED WITH CLINICAL TRIALS OF
NEW CANCER THERAPIES.—
(1) STUDY.—The Secretary of Health and
Human Services shall conduct a study of the effects
975
of expressly covering under the medicare program
the patient care costs for beneficiaries enrolled in
clinical trials of new cancer therapies, where the pro-
tocol for the trial has been approved by the National
Cancer Institute or meets similar scientific and ethi-
cal standards, including approval by an institutional
review board. The study shall include—
(A) an estimate of the cost of such cov-
erage, taking into account the extent to which
medicare currently pays for such patient care
costs in practice;
(B) an assessment of the extent to which
such clinical trials represent the best available
treatment for the patients involved and of the
effects of participation in the trials on the
health of such patients;
(C) an assessment of whether progress in
developing new anticancer therapies would be
assisted by medicare coverage of such patient
care costs; and
(D) an evaluation of whether there should
be special criteria for the admission of medicare
beneficiaries (on account of their age or phys-
ical condition) to clinical trials for which medi-
care would pay the patient care costs.
976
(2) REPORT.—Not later than 2 years after the
date of the enactment of this Act, the Secretary of
Health and Human Services shall submit a report
on the study conducted under paragraph (1) to the
Committee on Ways and Means and the Committee
on Energy and Commerce of the House of Rep-
resentatives and the Committee on Finance of the
Senate. Such report shall include recommendations
as to the coverage under the medicare program of
patient care costs of beneficiaries enrolled in clinical
trials of new cancer therapies.
(d) EFFECTIVE DATE.—The amendments made by
subsections (a) and (b) shall apply to items furnished on
or after January 1, 1994.
SEC. 13474. PART B PREMIUM PAYMENTS FOR LATE EN-
ROLLMENT.
(a) LIMITATION ON MEDICARE PART B LATE EN-
ROLLMENT PENALTY.—
(1) IN
GENERAL.—Section 1839 (42 U.S.C.
1395r) is amended by adding at the end the follow-
ing new subsection:
‘‘(g) The percent increase in premiums under sub-
section (b) due to late enrollment under this part shall
not exceed 25 percent in the case of an individual who
is an annuitant described in subparagraph (A) or (B) of
977
section 8901(3) of title 5, United States Code (including
an 
individual 
or 
survivor 
described 
in 
section
8906(g)(2)(A) of such title) for a month if—
‘‘(1) during the individual’s initial enrollment
period under section 1837(d)—
‘‘(A) the individual was enrolled in a group
health 
plan 
(as 
defined 
in 
section
1862(b)(1)(A)(v)) that provided coverage of
items and services for which payment may be
made under this part, and
‘‘(B) the individual elected not to enroll (or
to be deemed enrolled) under this section; and
‘‘(2) due to a change of coverage under such
plan, there is no coverage during the month under
such plan with respect to items and services for
which payment may be made under this part unless
the individual is enrolled under this part.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to premiums for
months beginning with January 1992.
(b) PAYMENT OF PART B PREMIUM LATE ENROLL-
MENT PENALTIES BY STATES.—Section 1839 (42 U.S.C.
1395r), as amended by subsection (a), is further amended
by adding at the end the following new subsection:
978
‘‘(h)(1) Upon the request of a State, the Secretary
may enter into an agreement with the State under which
the State agrees to pay on a quarterly or other periodic
basis to the Secretary (to be deposited in the Treasury
to the credit of the Federal Supplementary Medical Insur-
ance Trust Fund) an amount equal to the amount of the
part B late enrollment premium increases with respect to
the premiums for eligible individuals (as defined in para-
graph (3)(A)).
‘‘(2) No part B late enrollment premium increase
shall apply to an eligible individual for premiums for
months for which the amount of such an increase is pay-
able under an agreement under paragraph (1).
‘‘(3) In this subsection:
‘‘(A) The term ‘eligible individual’ means an in-
dividual who is enrolled under this part B and who
is within a class of individuals specified in the agree-
ment under paragraph (1).
‘‘(B) The term ‘part B late enrollment premium
increase’ means any increase in a premium as a re-
sult of the application of subsection (b).’’.
SEC. 13475. COVERAGE OF SERVICES OF SPEECH-LAN-
GUAGE PATHOLOGISTS AND AUDIOLOGISTS.
(a) SERVICES DEFINED.—Section 1861 (42 U.S.C.
1395x), as amended by section 13478(f)(8)(E), is amend-
979
ed by inserting after subsection (kk) the following new
subsection:
‘‘Speech-Language Pathology Services; Audiology
Services
‘‘(ll)(1) The term ‘speech-language pathology serv-
ices’ means such speech, language, and related function
assessment and rehabilitation services furnished by a
qualified speech-language pathologist as the speech-lan-
guage pathologist is legally authorized to perform under
State law (or the State regulatory mechanism provided by
State law) as would otherwise be covered if furnished by
a physician.
‘‘(2) The term ‘audiology services’ means such hear-
ing and balance assessment services furnished by a quali-
fied audiologist as the audiologist is legally authorized to
perform under State law (or the State regulatory mecha-
nism provided by State law).
‘‘(3) In this subsection:
‘‘(A) The term ‘qualified speech-language pa-
thologist’ means an individual with a master’s or
doctoral degree in speech-language pathology who
has performed not less than 9 months of supervised
full-time speech-language pathology services after
obtaining such degree and who—
980
‘‘(i) is licensed (or is otherwise certified) as
a speech-language pathologist by the State in
which the individual furnishes such services, or
‘‘(ii) in the case of an individual who fur-
nishes services in a State which does not pro-
vide for the licensing (or other form of certifi-
cation) of speech-language pathologists, has
successfully completed a national clinical com-
petency examination in speech-language pathol-
ogy approved by the Secretary.
‘‘(B) The term ‘qualified audiologist’ means an
individual with a master’s or doctoral degree in
audiology who has performed not less than 9 months
of supervised full-time audiology services after ob-
taining such degree and who—
‘‘(i) is licensed (or is otherwise certified) as
an audiologist by the State in which the individ-
ual furnishes such services, or
‘‘(ii) in the case of an individual who fur-
nishes services in a State which does not pro-
vide for the licensing (or other form of certifi-
cation) of audiologists, has successfully com-
pleted a national clinical competency examina-
tion in audiology approved by the Secretary.’’.
981
(b) CONFORMING AMENDMENTS RELATING TO MED-
ICARE TREATMENT OF SPEECH AND LANGUAGE SERV-
ICES.—
(1) 
EXTENDED
CARE
SERVICES.—Section
1861(h)(3) (42 U.S.C. 1395x(h)(3)) is amended by
striking ‘‘, occupational, or speech therapy’’ and in-
serting ‘‘or occupational therapy or speech-language
pathology services’’.
(2) 
HOME
HEALTH
SERVICES.—Section
1861(m)(2) (42 U.S.C. 1395x(m)(2)) is amended by
striking ‘‘, occupational, or speech therapy’’ and in-
serting ‘‘or occupational therapy or speech-language
pathology services’’.
(3) OUTPATIENT
PHYSICAL
THERAPY
SERV-
ICES.—The fourth sentence of section 1861(p) (42
U.S.C. 1395x(p)) is amended by striking ‘‘speech
pathology services’’ and inserting ‘‘speech-language
pathology services’’.
(4) COMPREHENSIVE OUTPATIENT REHABILITA-
TION FACILITY SERVICES.—Section 1861(cc)(1)(B)
(42 U.S.C. 1395x(cc)(1)(B)) is amended by striking
‘‘speech pathology services’’ and inserting ‘‘speech-
language pathology services’’.
(5) HOSPICE
CARE.—Section 1861(dd)(1)(B)
(42 U.S.C. 1395x(dd)(1)(B)) is amended by striking
982
‘‘therapy or speech-language pathology’’ and insert-
ing ‘‘therapy, or speech-language pathology serv-
ices’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on January 1, 1994.
SEC. 13476. EXTENSION OF MUNICIPAL HEALTH SERVICE
DEMONSTRATION PROJECTS.
Section 9215 of the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended by section 6135
of OBRA–1989, is amended—
(1) by striking ‘‘December 31, 1993’’ and in-
serting ‘‘December 31, 1997’’, and
(2) in the second sentence, by inserting after
‘‘beneficiary costs,’’ the following: ‘‘costs to the med-
icaid program and other payers, access to care, out-
comes, beneficiary satisfaction, utilization differences
among the different populations served by the
projects,’’.
SEC. 13477. TREATMENT OF CERTAIN INDIAN HEALTH PRO-
GRAMS 
AND 
FACILITIES 
AS 
FEDERALLY-
QUALIFIED HEALTH CENTERS.
(a) IN GENERAL.—Section 1861(aa)(4) (42 U.S.C.
1395x(aa)(4)) is amended—
(1) by striking ‘‘or’’ at the end of subparagraph
(B);
983
(2) by striking the period at the end of sub-
paragraph (C) and inserting ‘‘; or’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(D) is an outpatient health program or facility
operated by a tribe or tribal organization under the
Indian Self-Determination Act or by an urban In-
dian organization receiving funds under title V of
the Indian Health Care Improvement Act.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
January 1, 1994.
SEC. 13478. MISCELLANEOUS AND TECHNICAL CORREC-
TIONS.
(a) REVISION OF INFORMATION ON PART B CLAIMS
FORMS.—Section 1833(q)(1) (42 U.S.C. 1395l(q)(1)) is
amended—
(1) by striking ‘‘provider number’’ and inserting
‘‘unique physician identification number’’; and
(2) by striking ‘‘and indicate whether or not the
referring physician is an interested investor (within
the meaning of section 1877(h)(5))’’.
(b) CONSULTATION FOR SOCIAL WORKERS.—Effec-
tive with respect to services furnished on or after January
1, 1991, section 6113(c) of OBRA–1989 is amended—
984
(1) by inserting ‘‘and clinical social worker
services’’ after ‘‘psychologist services’’; and
(2) by striking ‘‘psychologist’’ the second and
third place it appears and inserting ‘‘psychologist or
clinical social worker’’.
(c) REPORTS
ON
HOSPITAL
OUTPATIENT
PAY-
MENT.—(1) OBRA–1989 is amended by striking section
6137.
(2) Section 1135(d) (42 U.S.C. 1320b–5(d)) is
amended—
(A) by striking paragraph (6); and
(B) in paragraph (7)—
(i) by striking ‘‘systems’’ each place it ap-
pears and inserting ‘‘system’’; and
(ii) by striking ‘‘paragraphs (1) and (6)’’
and inserting ‘‘paragraph (1)’’.
(d) RADIOLOGY AND DIAGNOSTIC SERVICES PRO-
VIDED IN HOSPITAL OUTPATIENT DEPARTMENTS.—(1)
Effective as if included in the enactment of OBRA–1989,
section 
1833(n)(1)(B)(i)(II) 
(42 
U.S.C.
1395l(n)(1)(B)(i)(II)) is amended—
(A) by inserting ‘‘and for services described in
subsection (a)(2)(E)(ii) furnished on or after Janu-
ary 1, 1992’’ after ‘‘1989’’; and
985
(B) by striking ‘‘1842(b)’’ and inserting
‘‘1842(b) (or, in the case of services furnished on or
after January 1, 1992, under section 1848)’’.
(2) Effective as if included in the enactment of
OBRA–1989, section 1833(n)(1)(B)(i)(II) (42 U.S.C.
1395l(n)(1)(B)(i)(II)) is amended by striking ‘‘January 1,
1989’’ and inserting ‘‘April 1, 1989’’.
(e) PAYMENTS TO NURSE PRACTITIONERS IN RURAL
AREAS (SECTION 4155 OF OBRA–1990).—(1) Section
1861(s)(2)(K)(iii) (42 U.S.C. 1395x(s)(2)(K)(iii)) is
amended—
(A) by striking ‘‘subsection (aa)(3)’’ and insert-
ing ‘‘subsection (aa)(5)’’; and
(B) by striking ‘‘subsection (aa)(4)’’ and insert-
ing ‘‘subsection (aa)(6)’’.
(2) Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is
amended—
(A) by striking ‘‘and’’ before ‘‘(N)’’; and
(B) with respect to the matter inserted by sec-
tion 4155(b)(2)(B) of OBRA–1990—
(i) by striking ‘‘(M)’’ and inserting ‘‘, and
(O)’’, and
(ii) by transferring and inserting it (as
amended) immediately before the semicolon at
the end.
986
(3) Section 1833(r)(1) (42 U.S.C. 1395l(r)(1)) is
amended—
(A) by striking ‘‘ambulatory’’ each place it ap-
pears and inserting ‘‘or ambulatory’’; and
(B) by striking ‘‘center,’’ and inserting ‘‘cen-
ter’’.
(4) Section 1833(r)(2)(A) (42 U.S.C. 1395l(r)(2)(A))
is amended by striking ‘‘subsection (a)(1)(M)’’ and insert-
ing ‘‘subsection (a)(1)(O)’’.
(5) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is
amended by striking ‘‘subsection (s)(2)(K)(i)’’ and insert-
ing ‘‘clauses (i) or (iii) of subsection (s)(2)(K)’’.
(6) Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is
amended by striking ‘‘this Act’’ and inserting ‘‘this title’’.
(7) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is
amended by striking ‘‘1861(s)(2)(K)(i)’’ and inserting
‘‘1861(s)(2)(K)(i) or 1861(s)(2)(K)(iii)’’.
(8) 
Section 
1866(a)(1)(H) 
(42 
U.S.C.
1395cc(a)(1)(H)) 
is 
amended 
by 
striking
‘‘1861(s)(2)(K)(i)’’ and inserting ‘‘1861(s)(2)(K)(i) or
1861(s)(2)(K)(iii)’’.
(f) 
OTHER
MISCELLANEOUS
AND
TECHNICAL
AMENDMENTS.—
(1) IMMEDIATE ENROLLMENT IN PART B BY IN-
DIVIDUALS
COVERED
BY
AN
EMPLOYMENT-BASED
987
PLAN.—(A) Subparagraphs (A) and (B) of section
1837(i)(3) (42 
U.S.C. 
1395p(i)(3)) 
are 
each
amended—
(i) by striking ‘‘beginning with the first
day of the first month in which the individual
is no longer enrolled’’ and inserting ‘‘including
each month during any part of which the indi-
vidual is enrolled’’; and
(ii) by striking ‘‘and ending seven months
later’’ and inserting ‘‘ending with the last day
of the eighth consecutive month in which the in-
dividual is at no time so enrolled’’.
(B) Paragraphs (1) and (2) of section 1838(e)
(42 U.S.C. 1395q(e)) are amended to read as fol-
lows:
‘‘(1) in any month of the special enrollment pe-
riod in which the individual is at any time enrolled
in a plan (specified in subparagraph (A) or (B), as
applicable, of section 1837(i)(3)) or in the first
month following such a month, the coverage period
shall begin on the first day of the month in which
the individual so enrolls (or, at the option of the in-
dividual, on the first day of any of the following
three months), or
988
‘‘(2) in any other month of the special enroll-
ment period, the coverage period shall begin on the
first day of the month following the month in which
the individual so enrolls.’’.
(C) The amendments made by subparagraphs
(A) and (B) shall take effect on the first day of the
first month that begins after the expiration of the
120-day period that begins on the date of the enact-
ment of this Act.
(2) BLEND AMOUNTS FOR AMBULATORY SUR-
GICAL CENTER PAYMENTS.—Subclauses (I) and (II)
of 
section 
1833(i)(3)(B)(ii) 
(42 
U.S.C.
1395l(i)(3)(B)(ii)) are each amended—
(A) by striking ‘‘for reporting’’ and insert-
ing ‘‘for portions of cost reporting’’; and
(B) by striking ‘‘and on or before’’ and in-
serting ‘‘and ending on or before’’.
(3) CLINICAL DIAGNOSTIC LABORATORY TESTS
(SECTION 4154 OF OBRA–1990).—Section 4154(e)(5)
of OBRA–1990 is amended by striking ‘‘(1)(A)’’ and
inserting ‘‘(1)(A),’’.
(4) SEPARATE PAYMENT UNDER PART B FOR
CERTAIN SERVICES (SECTION 4157 OF OBRA–1990).—
Section 4157(a) of OBRA–1990 is amended by
striking ‘‘(a) SERVICES
OF’’ and all that follows
989
through ‘‘Section’’ and inserting ‘‘(a) TREATMENT
OF SERVICES
OF CERTAIN HEALTH PRACTITION-
ERS.—Section’’.
(5) CERTIFIED
REGISTERED
NURSE
ANES-
THETISTS
(SECTION
4160
OF
OBRA–1990).—Section
1833(l)(4)(B)(ii)(VII) 
(42 
U.S.C.
1395l(l)(4)(B)(ii)(VII)) is amended by striking
‘‘1997’’ and inserting ‘‘1996’’.
(6) COMMUNITY HEALTH CENTERS AND RURAL
HEALTH CLINICS (SECTION 4161 OF OBRA–1990).—
(A) The fourth sentence of section 1861(aa)(2) (42
U.S.C. 1395x(aa)(2)) is amended—
(i) by striking ‘‘certification’’ the first
place it appears and inserting ‘‘approval’’; and
(ii) by striking ‘‘the Secretary’s approval
or disapproval of the certification’’ and insert-
ing ‘‘Secretary’s approval or disapproval’’.
(B) Section 4161(a)(7)(B) of OBRA–1990 is
amended by inserting ‘‘and to the Committee on Fi-
nance of the Senate’’ after ‘‘Representatives’’.
(7) SCREENING MAMMOGRAPHY (SECTION 4163
OF
OBRA–1990).—Section 4163 of OBRA–1990 is
amended—
(A) by adding at the end of subsection (d)
the following new paragraph:
990
‘‘(3) The amendment made by paragraph
(2)(A)(iv) shall apply to screening pap smears per-
formed on or after July 1, 1990.’’; and
(B) in subsection (e), by striking ‘‘The
amendments’’ and inserting ‘‘Except as pro-
vided in subsection (d)(3), the amendments’’.
(8) INJECTABLE DRUGS FOR TREATMENT OF
OSTEOPOROSIS.—
(A) 
CLARIFICATION
OF
DRUGS
COV-
ERED.—The 
section 
1861(jj) 
(42 
U.S.C.
1395x(jj)) inserted by section 4156(a)(2) of
OBRA–1990 is amended—
(i) in the matter preceding paragraph
(1), by striking ‘‘a bone fracture related
to’’; and
(ii) in paragraph (1), by striking ‘‘pa-
tient’’ and inserting ‘‘individual has suf-
fered a bone fracture related to post-meno-
pausal osteoporosis and that the individ-
ual’’.
(B) LIMITING COVERAGE TO DRUGS PRO-
VIDED BY HOME HEALTH AGENCIES.—(i) The
section 1861(jj) (42 U.S.C. 1395x(jj)) inserted
by section 4156(a)(2) of OBRA–1990 is
991
amended by striking ‘‘if’’ and inserting ‘‘by a
home health agency if’’.
(ii) 
Section 
1861(m)(5) 
(42 
U.S.C.
1395x(m)(5)) is amended by striking ‘‘but ex-
cluding’’ 
and 
inserting 
‘‘and 
a 
covered
osteoporosis drug (as defined in subsection
(kk), but excluding other’’.
(iii) 
Section 
1861(s)(2) 
(42 
U.S.C.
1395x(s)(2)) is amended—
(I) by adding ‘‘and’’ at the end of
subparagraph (N), and
(II) by striking subparagraph (O) and
redesignating subparagraph (P) as sub-
paragraph (O).
(C) PAYMENT
BASED
ON
REASONABLE
COST.—Section 
1833(a)(2) 
(42 
U.S.C.
1395l(a)(2)) is amended—
(i) in subparagraph (A), by striking
‘‘health services’’ and inserting ‘‘health
services (other than covered osteoporosis
drug (as defined in section 1861(kk)))’’;
(ii) by striking ‘‘and’’ at the end of
subparagraph (D);
(iii) by striking the semicolon at the
end and inserting ‘‘; and’’; and
992
(iv) by adding at the end the following
new subparagraph:
‘‘(F) with respect to covered osteoporosis
drug (as defined in section 1861(kk)) furnished
by a home health agency, 80 percent of the rea-
sonable cost of such service, as determined
under section 1861(v);’’.
(D) APPLICATION
OF
PART
B
DEDUCT-
IBLE.—Section 
1833(b)(2) 
(42 
U.S.C.
1395l(b)(2)) is amended by striking ‘‘services’’
and inserting ‘‘services (other than covered
osteoporosis 
drug 
(as 
defined 
in 
section
1861(kk)))’’.
(E) COVERED OSTEOPOROSIS DRUG (SEC-
TION 4156 OF OBRA–1990).—Section 1861 (42
U.S.C. 1395x) is amended, in the subsection
(jj) inserted by section 4156(a)(2) of OBRA–
1990, by striking ‘‘(jj) The term’’ and inserting
‘‘(kk) The term’’.
(9) OTHER
MISCELLANEOUS
AND
TECHNICAL
CORRECTIONS (SECTION 4164 OF OBRA–1990).—
(A) OWNERSHIP
DISCLOSURE
REQUIRE-
MENTS.—(i) 
Section 
1124A(a)(2)(A) 
(42
U.S.C. 1320a–3a(a)(2)(A)) is amended by
striking ‘‘of the Social Security Act’’.
993
(ii) Section 4164(b)(4) of OBRA–1990 is
amended by striking ‘‘paragraph’’ and inserting
‘‘paragraphs’’.
(B) DIRECTORY
OF
UNIQUE
PHYSICIAN
IDENTIFIER
NUMBERS.—Section 4164(c) of
OBRA–1990 is amended by striking ‘‘publish’’
and inserting ‘‘publish, and shall periodically
update,’’.
(g) EFFECTIVE DATE.—Except as otherwise provided
in this section, the amendments made by this section shall
take effect as if included in the enactment of OBRA–1990.
Subchapter F—Part B Premium
SEC. 13481. PART B PREMIUM.
Section 1839(e) (42 U.S.C. 1395r(e)) is amended—
(1) in paragraph (1)(A), by inserting ‘‘and for
each month in 1996 and 1997’’ after ‘‘January
1991’’, and
(2) in paragraph (2), by striking ‘‘1991’’ and
inserting ‘‘1998’’.
994
CHAPTER 3—PROVISIONS RELATING TO
PARTS A AND B
Subchapter A—Elimination of Updates
SEC. 13501. ELIMINATION OF COST-OF-LIVING UPDATE IN
PER RESIDENT AMOUNTS FOR DIRECT MEDI-
CAL EDUCATION.
Section 1886(h)(2)(D) (42 U.S.C. 1395ww(h)(2)(D))
is amended by inserting ‘‘(other than in the case of cost
reporting periods beginning during fiscal year 1994 or fis-
cal year 1995)’’ after ‘‘updated’’.
SEC. 13502. ELIMINATION OF INFLATION UPDATE IN COST
LIMITS FOR HOME HEALTH SERVICES.
The Secretary of Health and Human Services shall
not provide for any increase, on the basis of inflation or
changes in the cost of goods and services, in the per visit
cost limits for home health services under section
1861(v)(1)(L) of the Social Security Act for cost reporting
periods beginning during fiscal year 1994 or fiscal year
1995.
Subchapter B—Medicare Secondary Payer
Provisions
SEC. 13511. EXTENSION OF TRANSFER OF DATA.
(a) EXTENSION OF DATA MATCH PROGRAM.—
995
(1) Section 1862(b)(5)(C)(iii) of the Social Se-
curity Act (42 U.S.C. 1395y(b)(5)(C)(iii)) is amend-
ed by striking ‘‘1995’’ and inserting ‘‘1998’’.
(2) Section 6103(l)(12)(F) of the Internal Rev-
enue Code of 1986 is amended—
(A) in clause (i), by striking ‘‘1995’’ and
inserting ‘‘1998’’,
(B) in clause (ii)(I), by striking ‘‘1994’’
and inserting ‘‘1997’’, and
(C) in clause (ii)(II), by striking ‘‘1995’’
and inserting ‘‘1998’’.
(b) SECONDARY PAYER EXEMPTION FOR MEMBERS
OF RELIGIOUS ORDERS.—Effective as if included in the
enactment of OBRA–1989, section 6202(e)(2) of such Act
is amended by adding at the end the following: ‘‘Such
amendment also shall apply to items and services fur-
nished before such date with respect to secondary payer
cases which the Secretary of Health and Human Services
had not identified as of such date.’’.
(c) PERMITTING
THE USE
OF MINIMUM INCOME
THRESHOLDS.—
(1) Section 6103(l)(12)(B)(i) of the Internal
Revenue Code of 1986 is amended by inserting ‘‘,
above an amount (if any) specified by the Secretary
996
of Health and Human Services,’’ after ‘‘section
3401(a))’’.
(2) The matter in section 6103(l)(12)(B)(ii) of
such Code preceding subclause (I) is amended by in-
serting ‘‘, above an amount (if any) specified by the
Secretary of Health and Human Services,’’ after
‘‘wages’’.
(3) The heading to section 6103(l)(12) of such
Code is amended by striking ‘‘TAXPAYER IDENTITY’’
and inserting ‘‘RETURN’’.
SEC. 13512. 3-YEAR EXTENSION OF MEDICARE SECONDARY
PAYER TO DISABLED BENEFICIARIES.
Section 
1862(b)(1)(B)(iii) 
(42 
U.S.C.
1395y(b)(1)(B)(iii)) is amended by striking ‘‘1995’’ and
inserting ‘‘1998’’.
SEC. 13513. 3-YEAR EXTENSION OF 18-MONTH RULE FOR
ESRD BENEFICIARIES.
Section 1862(b)(1)(C) (42 U.S.C. 1395y(b)(1)(C)) is
amended by striking ‘‘1996’’ and inserting ‘‘1999’’.
SEC. 13514. MEDICARE SECONDARY PAYER REFORMS.
(a) IMPROVING IDENTIFICATION OF MEDICARE SEC-
ONDARY PAYER SITUATIONS.—
(1) SURVEY OF BENEFICIARIES.—
997
(A) IN GENERAL.—Section 1862(b)(5) (42
U.S.C. 1395y(b)(5)) is amended by adding at
the end the following new subparagraph:
‘‘(D) 
OBTAINING
INFORMATION
FROM
BENEFICIARIES.—Before an individual applies
for benefits under part A or enrolls under part
B, the Administrator shall mail the individual a
questionnaire to obtain information on whether
the individual is covered under a primary plan
and the nature of the coverage provided under
the plan, including the name, address, and iden-
tifying number of the plan.’’.
(B) DISTRIBUTION OF QUESTIONNAIRE BY
CONTRACTOR.—The Secretary of Health and
Human Services shall enter into an agreement
with an entity not later than November 1,
1993, to distribute the questionnaire described
in section 1862(b)(5)(D) of the Social Security
Act (as added by subparagraph (A)).
(C) NO MEDICARE SECONDARY PAYER DE-
NIAL BASED ON FAILURE TO COMPLETE QUES-
TIONNAIRE.—Section 1862(b)(2) (42 U.S.C.
1395y(b)(2)) is amended by adding at the end
the following new subparagraph:
998
‘‘(C) TREATMENT OF QUESTIONNAIRES.—
The Secretary may not fail to make payment
under subparagraph (A) solely on the ground
that an individual failed to complete a question-
naire concerning the existence of a primary
plan.’’.
(2) MANDATORY
SCREENING
BY
PROVIDERS
AND SUPPLIERS UNDER PART B.—
(A) IN
GENERAL.—Section 1862(b) (42
U.S.C. 1395y(b)) is amended by adding at the
end the following new paragraph:
‘‘(6) SCREENING REQUIREMENTS FOR PROVID-
ERS AND SUPPLIERS.—
‘‘(A) IN GENERAL.—Notwithstanding any
other provision of this title, no payment may be
made for any item or service furnished under
part B unless the entity furnishing such item or
service completes (to the best of its knowledge
and on the basis of information obtained from
the individual to whom the item or service is
furnished) the portion of the claim form relat-
ing to the availability of other health benefit
plans.
‘‘(B) PENALTIES.—An entity that know-
ingly, willfully, and repeatedly fails to complete
999
a claim form in accordance with subparagraph
(A) or provides inaccurate information relating
to the availability of other health benefit plans
on a claim form under such subparagraph shall
be subject to a civil money penalty of not to ex-
ceed $2,000 for each such incident. The provi-
sions of section 1128A (other than subsections
(a) and (b)) shall apply to a civil money penalty
under the previous sentence in the same man-
ner as such provisions apply to a penalty or
proceeding under section 1128A(a).’’.
(B) EFFECTIVE
DATE.—The amendment
made by subparagraph (A) shall apply with re-
spect to items and services furnished on or
after January 1, 1994.
(b) IMPROVEMENTS
IN RECOVERY
OF PAYMENTS
FROM PRIMARY PAYERS.—
(1) SUBMISSION OF REPORTS ON EFFORTS TO
RECOVER ERRONEOUS PAYMENTS.—
(A) FISCAL INTERMEDIARIES UNDER PART
A.—Section 1816 (42 U.S.C. 1396h) is amend-
ed by adding at the end the following new sub-
section:
‘‘(k) An agreement with an agency or organization
under this section shall require that such agency or orga-
1000
nization submit an annual report to the Secretary describ-
ing the steps taken to recover payments made for items
or services for which payment has been or could be made
under 
a 
primary 
plan 
(as 
defined 
in 
section
1862(b)(2)(A)).’’.
(B) CARRIERS
UNDER
PART
B.—Section
1842(b)(3) 
(42 
U.S.C. 
1395u(b)(3)) 
is
amended—
(i) by striking ‘‘and’’ at the end of
subparagraph (H); and
(ii) by inserting after subparagraph
(H) the following new subparagraph:
‘‘(I) will submit annual reports to the Secretary
describing the steps taken to recover payments made
under this part for items or services for which pay-
ment has been or could be made under a primary
plan (as defined in section 1862(b)(2)(A)).’’.
(2) REQUIREMENTS UNDER CARRIER PERFORM-
ANCE EVALUATION PROGRAM.—
(A) FISCAL INTERMEDIARIES UNDER PART
A.—Section 
1816(f)(1)(A) 
(42 
U.S.C.
1396h(f)(1)(A)) is amended by striking ‘‘proc-
essing’’ and inserting ‘‘processing (including the
agency’s or organization’s success in recovering
payments made under this title for services for
1001
which payment has been or could be made
under a primary plan (as defined in section
1862(b)(2)(A)))’’.
(B) CARRIERS
UNDER
PART
B.—Section
1842(b)(2) (42 U.S.C. 1395u(b)(2)) is amended
by adding at the end the following new sub-
paragraph:
‘‘(D) In addition to any other standards and criteria
established by the Secretary for evaluating carrier per-
formance under this paragraph relating to avoiding erro-
neous payments, the Secretary shall establish standards
and criteria relating to the carrier’s success in recovering
payments made under this part for items or services for
which payment has been or could be made under a pri-
mary plan (as defined in section 1862(b)(2)(A)).’’.
(3) DEADLINE FOR REIMBURSEMENT BY PRI-
MARY PLANS.—
(A) 
IN
GENERAL.—Section
1862(b)(2)(B)(i) (42 U.S.C. 1395y(b)(2)(B)(i))
is amended by adding at the end the following
sentence: ‘‘If reimbursement is not made to the
appropriate Trust Fund before the expiration of
the 60-day period that begins on the date such
notice or other information is received, the Sec-
retary may charge interest (beginning with the
1002
date on which the notice or other information
is received) on the amount of the reimburse-
ment until reimbursement is made (at a rate
determined by the Secretary in accordance with
regulations of the Secretary of the Treasury
applicable to charges for late payments).’’.
(B) 
CONFORMING
AMENDMENT.—The
heading of clause (i) of section 1862(b)(2)(B) is
amended to read as follows: ‘‘REPAYMENT RE-
QUIRED.—’’.
(C) EFFECTIVE DATE.—The amendments
made by this paragraph shall apply to payments
for items and services furnished on or after the
date of the enactment of this Act.
(4) EFFECTIVE DATE.—The amendments made
by paragraphs (1) and (2) shall apply to contracts
with fiscal intermediaries and carriers under title
XVIII of the Social Security Act for years beginning
with 1994.
(c) APPLICATION OF AGGREGATION RULES.—
(1) WORKING
AGED.—Section 1862(b)(1)(A)
(42 U.S.C. 1395y(b)(1)(A)) is amended by adding at
the end the following new clause:
‘‘(vi) APPLICATION OF AGGREGATION
RULES.—All employers treated as a single
1003
employer under subsection (a) or (b) of
section 52 of the Internal Revenue Code of
1986 shall be treated as a single employer
for purposes of this subparagraph.’’.
(2) 
DISABLED
INDIVIDUALS.—Section
5000(b)(2) of the Internal Revenue Code of 1986
(relating to large group health plans) is amended by
adding at the end the following: ‘‘All employers
treated as a single employer under subsection (a) or
(b) of section 52 shall be treated as a single em-
ployer for purposes of this paragraph.’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall take effect 90 days after the
date of the enactment of this Act.
(d) APPLICATION OF EXCISE TAX TO FAILURE TO
REIMBURSE FEDERAL GOVERNMENT.—
(1) IN GENERAL.—Section 5000(c) of the Inter-
nal Revenue Code of 1986 (relating to nonconform-
ing group health plans) is amended by striking ‘‘of
section 1862(b)(1)’’ and inserting ‘‘of paragraph (1),
or with the requirements of paragraph (2), of section
1862(b)’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to demands for repay-
1004
ment issued after the date of the enactment of this
Act.
(e) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—
(1) The sentence in section 1862(b)(1)(C)
added by section 4203(c)(1)(B) of OBRA–1990 is
amended—
(A) by striking ‘‘on or before’’ and insert-
ing ‘‘before’’, and
(B) by striking ‘‘clauses (i) and (ii)’’ and
inserting ‘‘this subparagraph’’.
(2) Effective as if included in the enactment of
OBRA–1989, section 1862(b)(1) is amended—
(A) 
in 
subparagraphs 
(A)(v) 
and
(B)(iv)(II), by inserting ‘‘, without regard to
section 5000(d) of such Code’’ before the period
at the end of each subparagraph;
(B) in subparagraph (A)(iii), by striking
‘‘current calendar year or the preceding cal-
endar year’’ and inserting ‘‘current calendar
year and the preceding calendar year’’; and
(C) in the matter in subparagraph (C)
after clause (ii), by striking ‘‘taking into ac-
count that’’ and inserting ‘‘paying benefits sec-
ondary to this title when’’.
1005
(3) Effective as if included in the enactment of
OBRA–1989, section 1862(b)(5)(C)(i) (42 U.S.C.
1395y(b)(5)(C)(i)) 
is 
amended 
by 
striking
‘‘6103(l)(12)(D)(iii)’’ 
and 
inserting
‘‘6103(l)(12)(E)(iii)’’.
(4) Section 4203(c)(2) of OBRA–1990 is
amended—
(A) by striking ‘‘the application of clause
(iii)’’ and inserting ‘‘the second sentence’’;
(B) by striking ‘‘on individuals’’ and all
that follows through ‘‘section 226A of such
Act’’;
(C) in clause (ii), by striking ‘‘clause’’ and
inserting ‘‘sentence’’;
(D) in clause (v), by adding ‘‘and’’ at the
end; and
(E) in clause (vi)—
(i) by inserting ‘‘of such Act’’ after
‘‘1862(b)(1)(C)’’, and
(ii) by striking the period at the end
and inserting the following: ‘‘, without re-
gard to the number of employees covered
by such plans.’’.
1006
(5) Section 4203(d) of OBRA–1990 is amended
by striking ‘‘this subsection’’ and inserting ‘‘this
section’’.
(6) Except as provided in paragraphs (2) and
(3), the amendments made by this subsection shall
be effective as if included in the enactment of
OBRA–1990.
Subchapter C—Physician Ownership and
Referral
SEC. 13521. APPLICATION OF MEDICARE BAN ON SELF-RE-
FERRALS TO ALL PAYERS.
(a) IN GENERAL.—Section 1877 (42 U.S.C. 1395nn)
is amended—
(1) in subsection (a)—
(A) in paragraph (1)(A), by striking ‘‘for
which payment otherwise may be made under
this title’’ and inserting ‘‘for which a charge is
imposed’’, and
(B) in paragraph (1)(B), by striking
‘‘under this title’’;
(2) by amending paragraph (1) of subsection
(g) to read as follows:
‘‘(1) DENIAL OF PAYMENT.—No payment may
be made under this title, under another Federal
health care program, or under a State health care
1007
program (as defined in section 1128(h)) for a des-
ignated health service for which a claim is presented
in violation of subsection (a)(1)(B). No individual,
third party payer, or other entity is liable for pay-
ment for designated health services for which a
claim is presented in violation of such subsection.’’;
and
(3) in subsection (g)(3), by striking ‘‘for which
payment may not be made under paragraph (1)’’
and inserting ‘‘for which such a claim may not be
presented under subsection (a)(1)’’.
(b) CONFORMING AMENDMENT TO REPORTING RE-
QUIREMENT.—Section 1877(f) (42 U.S.C. 1395nn(f)) is
amended—
(1) by striking ‘‘for which payment may be
made under this title’’ each place it appears and in-
serting ‘‘for which a charge is imposed’’, and
(2) by striking the third sentence.
SEC. 13522. EXTENSION OF SELF-REFERRAL BAN TO ADDI-
TIONAL SPECIFIED SERVICES.
Section 1877 (42 U.S.C. 1395nn) is amended—
(1) by striking ‘‘clinical laboratory service’’,
‘‘clinical laboratory services’’, and ‘‘CLINICAL LAB-
ORATORY
SERVICES’’ and inserting ‘‘designated
health service’’, ‘‘designated health services’’, and
1008
‘‘DESIGNATED
HEALTH
SERVICES’’, respectively,
each place each appears in subsections (a)(1),
(b)(2)(A)(ii), (b)(4), (d)(1), (d)(2), (d)(3), (f),
(g)(1), and (h)(7)(B); and
(2) by adding at the end the following new sub-
section:
‘‘(i) DESIGNATED HEALTH SERVICES DEFINED.—In
this section, the term ‘designated health services’ means
any of the following items or services:
‘‘(1) clinical laboratory services;
‘‘(2) physical and occupational therapy services;
‘‘(3) radiology services, including magnetic reso-
nance imaging, computerized axial tomography
scans, and ultrasound services;
‘‘(4) radiation therapy services;
‘‘(5) durable medical equipment;
‘‘(6) parenteral and enteral nutrition equipment
and supplies;
‘‘(7) prosthetic devices and orthotics and pros-
thetics;
‘‘(8) outpatient prescription drugs;
‘‘(9) home infusion therapy services, home dial-
ysis, and home health services;
‘‘(10) ambulance services;
‘‘(11) inpatient and outpatient hospital services;
1009
‘‘(12) comprehensive outpatient rehabilitation
facility services;
‘‘(13) contact lenses and eyeglasses; and
‘‘(14) hearing aids.’’.
SEC. 13523. EXCEPTIONS FOR BOTH OWNERSHIP AND COM-
PENSATION ARRANGEMENTS.
(a) MODIFICATION TO EXCEPTION FOR IN-OFFICE
ANCILLARY SERVICES.—Section 1877(b)(2) (42 U.S.C.
1395nn(b)(2)) is amended—
(1) by inserting ‘‘(other than durable medical
equipment, parenteral and enteral nutrition equip-
ment and supplies, and ambulance services)’’ after
‘‘services’’ the first place it appears, and
(2) in subparagraph (A)(ii)(II), by striking
‘‘centralized provision’’ and inserting ‘‘provision of
some or all’’.
(b) MODIFICATION
OF RURAL PROVIDER EXCEP-
TION.—
(1) IN GENERAL.—Section 1877(b) (42 U.S.C.
1395nn(b)) is amended—
(A) by redesignating paragraph (5) as
paragraph (6), and
(B) by inserting after paragraph (4) the
following new paragraph:
1010
‘‘(5) RURAL PROVIDERS.—In the case of des-
ignated health services if—
‘‘(A) the entity furnishing the services is in
a 
rural 
area 
(as 
defined 
in 
section
1886(d)(2)(D)), and
‘‘(B) substantially all of the services (as
defined by the Secretary) furnished by the en-
tity are furnished to individuals who reside in
such a rural area.’’.
(2) 
CONFORMING
AMENDMENTS.—Section
1877(d) (42 U.S.C. 1395nn(d)) is amended—
(A) by striking paragraph (2), and
(B) by redesignating paragraph (3) as
paragraph (2).
SEC. 13524. EXCEPTIONS RELATED ONLY TO OWNERSHIP
OR INVESTMENT.
(a) 
PUBLICLY-TRADED
SECURITIES.—Section
1877(c)(2) (42 U.S.C. 1395nn(c)(2)) is amended by strik-
ing ‘‘total assets’’ and inserting ‘‘stockholder equity’’.
(b) RURAL PROVIDERS.—For amendment to excep-
tion relation to rural providers, see section 13523(b).
SEC. 13525. EXCEPTIONS RELATED ONLY TO COMPENSA-
TION ARRANGEMENTS.
(a) RENTAL OF OFFICE SPACE AND EQUIPMENT.—
1011
(1) IN
GENERAL.—Paragraph (1) of section
1877(e) (42 U.S.C. 1395nn(e)) is amended to read
as follows:
‘‘(1) RENTAL OF OFFICE SPACE; RENTAL OF
EQUIPMENT.—
‘‘(A) OFFICE SPACE.—Payments made by
a lessee to a lessor for the use of premises if—
‘‘(i) the lease is set out in writing,
signed by the parties, and specifies the
premises covered by the lease,
‘‘(ii) the aggregate space rented or
leased does not exceed that which is rea-
sonable and necessary for the legitimate
business purposes of the lease or rental
and is used exclusively by the lessee when
being used by the lessee,
‘‘(iii) the lease provides for a term of
rental or lease for at least one year,
‘‘(iv) the aggregate rental charges
over the term of the lease are set in ad-
vance, are consistent with fair market
value, and are not determined in a manner
that takes into account the volume or value
of any referrals or other business gen-
erated between the parties,
1012
‘‘(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
‘‘(vi) the lease covers all of the prem-
ises leased between the parties for the
period of the lease, and
‘‘(vii) the compensation arrangement
meets such other requirements as the Sec-
retary may impose by regulation as needed
to protect against program or patient
abuse.
‘‘(B) EQUIPMENT.—Payments made by a
lessee of equipment to the lessor of the equip-
ment for the use of the equipment if—
‘‘(i) the lease is set out in writing,
signed by the parties, and specifies the
equipment covered by the lease,
‘‘(ii) the equipment rented or leased
does not exceed that which is reasonable
and necessary for the legitimate business
purposes of the lease or rental and is used
exclusively by the lessee when being used
by the lessee,
‘‘(iii) the lease provides for a term of
rental or lease of at least one year,
1013
‘‘(iv) the aggregate rental charges
over the term of the lease are set in ad-
vance, are consistent with fair market
value, and are not determined in a manner
that takes into account the volume or value
of any referrals or other business gen-
erated between the parties,
‘‘(v) the lease would be commercially
reasonable even if no referrals were made
between the parties,
‘‘(vi) the lease covers all of the equip-
ment leased between the parties for the
period of the lease, and
‘‘(vii) the compensation arrangement
meets such other requirements as the Sec-
retary may impose by regulation as needed
to protect against program or patient
abuse.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1877(h) (42 U.S.C. 1395nn(h)) is amended by strik-
ing paragraphs (5) and (6).
(b) BONA FIDE EMPLOYMENT RELATIONSHIPS.—
Section 1877(e) (42 U.S.C. 1395nn(e)) is amended—
(1) in paragraph (2)—
1014
(A) by striking ‘‘EMPLOYMENT’’ and all
that follows through ‘‘if’’ and inserting ‘‘BONA
FIDE
EMPLOYMENT
RELATIONSHIPS.—Any
amount paid by an employer to a physician (or
immediate family member) who has a bona fide
employment relationship with the employer for
the provision of services if ’’;
(B) in subparagraphs (A), (B), and (D),
by striking ‘‘arrangement’’ and inserting ‘‘em-
ployment’’;
(C) in subparagraph (C), by striking ‘‘to
the hospital’’; and
(D) by adding at the end the following:
‘‘Subparagraph (B)(ii) shall not be construed as pro-
hibiting the payment of remuneration in the form of
shares of overall profits or in the form of a produc-
tivity bonus based on services performed personally
by the physician or family member, if the amount of
the remuneration is not determined in a manner
that takes into account directly the volume or value
of any referrals by the referring physician.’’; and
(2) in paragraph (5)(A), by striking ‘‘in the
same manner as they apply to a hospital’’.
(c) PERSONAL SERVICE ARRANGEMENTS.—
1015
(1) IN
GENERAL.—Paragraph (3) of section
1877(e) (42 U.S.C. 1395nn(e)) is amended to read
as follows:
‘‘(3) PERSONAL SERVICE ARRANGEMENTS.—Re-
muneration from an entity under an arrangement
if—
‘‘(A) the arrangement is set out in writing,
signed by the parties, and specifies the services
covered by the arrangement,
‘‘(B) the arrangement covers all of the
services to be provided by the physician (or
family member) to the entity,
‘‘(C) the aggregate services contracted for
do not exceed those that are reasonable and
necessary for the legitimate business purposes
of the arrangement,
‘‘(D) the term of the arrangement is for at
least one year,
‘‘(E) the compensation to be paid over the
term of the arrangement is set in advance, does
not exceed fair market value, and is not deter-
mined in a manner that takes into account di-
rectly or indirectly the volume or value of any
referrals or other business generated between
the parties,
1016
‘‘(F) the services to be performed under
the arrangement do not involve the counseling
or promotion of a business arrangement or
other activity that violates any State or Federal
law, and
‘‘(G) the arrangement meets such other re-
quirements as the Secretary may impose by reg-
ulation as needed to protect against program or
patient abuse.’’.
(2) HEALTH
SERVICES
FURNISHED
UNDER
CERTAIN
HOSPITAL
ARRANGEMENTS.—Section
1877(e) (42 U.S.C. 1395nn(e)) is amended by add-
ing at the end the following new paragraph:
‘‘(7) CERTAIN
GROUP
PRACTICE
ARRANGE-
MENTS WITH A HOSPITAL.—
‘‘(A) IN GENERAL.—An arrangement be-
tween a hospital and a group for the provision
of designated health services by the group but
billed in the name of the hospital if—
‘‘(i) the group would be a group prac-
tice, but for the fact that it bills for such
services in the name of the hospital;
‘‘(ii) with respect to services provided to an
inpatient of the hospital, the arrangement is
1017
pursuant to the provision of inpatient hospital
services under section 1861(b)(3);
‘‘(iii) the arrangement began before De-
cember 19, 1989, and has continued in effect
without interruption since such date;
‘‘(iv) the group provides substantially all of
the designated health services furnished under
the arrangement to the hospital’s patients;
‘‘(v) the arrangement is pursuant to an
agreement that is set out in writing and that
specifies the services to be provided by the par-
ties and the compensation for services provided
under the agreement;
‘‘(vi) the compensation paid over the term
of the agreement is consistent with fair market
value and the compensation per unit of services
is fixed in advance and is not determined in a
manner that takes into account the volume or
value of any referrals or other business gen-
erated between the parties;
‘‘(vii) the compensation is provided pursu-
ant to an agreement which would be commer-
cially reasonable even if no referrals were made
to the entity; and
1018
‘‘(viii) the arrangement between the parties
meets such other requirements as the Secretary
may impose by regulation as needed to protect
against program or patient abuse.’’.
(d) PHYSICIAN RECRUITMENT.—Section 1877(e)(4)
(42 U.S.C. 1395nn(e)(4)) is amended—
(1) by redesignating subparagraphs (A) through
(C) as subparagraph (B) through (D), and
(2) by inserting before subparagraph (B), as so
redesignated, the following new subparagraph:
‘‘(A) the remuneration arrangement is set
out in writing, signed by the parties, and speci-
fies the benefits provided by the hospital, the
terms under which the benefits are to be pro-
vided, and the obligations of the parties,’’.
(e) ISOLATED TRANSACTIONS.—Section 1877(e)(5)
(42 U.S.C. 1395nn(e)(5)) is amended—
(1) by striking ‘‘ISOLATED’’ and inserting
‘‘ONE-TIME’’,
(2) by striking ‘‘isolated’’ and inserting ‘‘one-
time’’, and
(3) by inserting ‘‘or practice’’ after ‘‘one-time
sale of property’’.
(f) NEW EXCEPTION
FOR PAYMENTS
BY PHYSI-
CIAN.—Section 1877(e) (42 U.S.C. 1395nn(e)), as amend-
1019
ed by subsection (c)(2), is further amended by adding at
the end the following new paragraph:
‘‘(8) PAYMENTS BY A PHYSICIAN FOR ITEMS
AND SERVICES.—Payments made by a physician—
‘‘(A) to a laboratory in exchange for the
provision of clinical laboratory services, or
‘‘(B) to an entity as compensation for
other items or services if the items or services
are furnished at a price that is consistent with
fair market value.’’.
SEC. 13526. CLARIFICATION CONCERNING CIVIL MONEY
PENALTY SANCTIONS.
Section 1877(g)(3) (42 U.S.C. 1395nn(g)(3)) is
amended by inserting ‘‘(including a referring physician)’’
after ‘‘Any person’’.
SEC. 13527. REQUIREMENTS FOR GROUP PRACTICE.
(a) 
ADDITIONAL
REQUIREMENTS.—Section
1877(h)(4) (42 U.S.C. 1395nn(h)(4)) is amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (C);
(2) by redesignating subparagraphs (A), (B),
(C), and (D) as clauses (i), (ii), (iii), and (vii),
respectively;
(3) by inserting ‘‘(A)’’ after ‘‘.—’’;
1020
(4) by inserting after clause (iii), as so redesig-
nated, the following:
‘‘(iv) subject to subparagraph (B), no phy-
sician who is a member of the group receives
compensation based on the volume or value of
referrals by the physician;
‘‘(v) there are no less than, on average, 5
physicians for each office location (as defined in
subparagraph (C)), except where there is only a
single office location for the entire group prac-
tice;
‘‘(vi) members of the group personally con-
duct no less than 75 percent of the physician-
patient encounters of the group practice; and’’;
and
(5) by adding at the end the following new sub-
paragraphs:
‘‘(B) A physician in a group practice may be
paid a share of overall profits of the group or a pro-
ductivity bonus (based on services personally per-
formed or personally supervised by the physician or
by another physician in the group) so long as the
share or bonus is not determined in any manner
which is directly related to the volume or value of
referrals by that physician.
1021
‘‘(C)(i) Except as provided in clauses (ii)
through (iv), the term ‘office location’ means an of-
fice where physician services are offered to patients.
‘‘(ii) Such term does not include a location con-
sisting solely of a diagnostic facility, nursing facility,
or treatment facility (such as a physical or occupa-
tional therapy center), or administrative services af-
filiated with the group practice.
‘‘(iii) Any office location which is located imme-
diately adjacent to another office location shall be
treated as the same office location.
‘‘(iv) The term ‘office location’ does not include
an office located in a rural area (as defined in sec-
tion 1886(d)(2)(D)) if at least 85 percent of the
physician services at the location are provided to in-
dividuals who reside in such a rural area.’’.
(b) USE OF BILLING NUMBERS, ETC.—Section 1877
(42 U.S.C. 1395nn) is amended—
(1) in subsection (b)(2)(B), by inserting ‘‘under
a billing number assigned to the group practice’’
after ‘‘member’’,
(2) in subsection (h)(4)(A)(ii), as redesignated
by subsection (a)(2), by inserting ‘‘and under a bill-
ing number assigned to the group’’ after ‘‘in the
name of the group’’, and
1022
(3) in subsection (h)(4)(A)(iii), as redesignated
by subsection (a)(2), by striking ‘‘by members of the
group’’.
(c) TREATMENT OF CERTAIN FACULTY PRACTICE
PLANS.—The last sentence of section 1877(h)(4)(A) (42
U.S.C. 1395nn(h)(4)(A)), as redesignated by subsection
(a)(2), is amended by inserting ‘‘, institution of higher
education, or medical school’’ after ‘‘hospital’’.
SEC. 13538. NO FEDERAL PREEMPTION OF MORE RESTRIC-
TIVE STATE LAWS.
Section 1877 (42 U.S.C. 1395nn), as amended by
section 13522(2), is amended by adding at the end the
following new subsection:
‘‘(j) NO FEDERAL PREEMPTION OF MORE RESTRIC-
TIVE STATE LAWS.—Nothing in this section shall preempt
provisions of State law—
‘‘(1) that relate to referrals not covered by this
section, or
‘‘(2) that relate to referrals covered by this sec-
tion and are more restrictive with respect to such re-
ferrals than the provisions of this section.’’.
SEC. 13529. MISCELLANEOUS PROVISIONS.
(a) INDIRECT FINANCIAL RELATIONSHIPS.—The last
sentence of section 1877(a)(2) (42 U.S.C. 1395nn(a)(2))
is amended by inserting before the period the following:
1023
‘‘and includes an interest in an entity that holds an owner-
ship or investment in another entity’’.
(b) MINOR
REMUNERATION.—Section 1877(h)(1)
(42 U.S.C. 1395nn(h)(1)) is amended—
(1) in subparagraph (A), by inserting before the
period at the end the following: ‘‘(other than an ar-
rangement involving only remuneration described in
subparagraph (C))’’, and
(2) by adding at the end the following new sub-
paragraph:
‘‘(C) Remuneration described in this subpara-
graph is any remuneration consisting of any of the
following:
‘‘(i) The forgiveness of amounts owed for
inaccurate tests or procedures, mistakenly per-
formed tests or procedures, or the correction of
minor billing errors.
‘‘(ii) The provision of items, devices, or
supplies that are used solely to—
‘‘(I) collect, transport, process, or
store specimens for the entity providing
the item, device, or supply, or
‘‘(II) communicate the results of tests
or procedures for such entity.’’.
1024
(c) REFERRING PHYSICIAN.—Section 1877(h)(7)(C)
(42 U.S.C. 1395nn(h)(7)(C)) is amended—
(1) by inserting ‘‘a request by a radiologist for
diagnostic radiology services, and a request by a ra-
diation oncologist for radiation therapy,’’ after ‘‘ex-
amination services,’’, and
(2) by inserting ‘‘, radiologist, or radiation
oncologist’’ after ‘‘pathologist’’ the second place it
appears.
(d) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—Section 1877 (42 U.S.C. 1395nn) is further
amended—
(1) in the next to last sentence of subsection
(f)—
(A) by striking ‘‘provided’’ and inserting
‘‘furnished’’, and
(B) by striking ‘‘provides’’ and inserting
‘‘furnish’’;
(2) in the last sentence of subsection (f)—
(A) by striking ‘‘providing’’ each place it
appears and inserting ‘‘furnishing’’,
(B) by striking ‘‘with respect to the provid-
ers’’ and inserting ‘‘with respect to the enti-
ties’’, and
1025
(C) by striking ‘‘diagnostic imaging serv-
ices of any type’’ and inserting ‘‘magnetic reso-
nance imaging, computerized axial tomography
scans, and ultrasound services’’; and
(3) in subsection (a)(2)(B), by striking ‘‘sub-
section (h)(1)(A)’’ and inserting ‘‘subsection (h)(1)’’.
SEC. 13530. EFFECTIVE DATES.
(a) EXPANSION OF PAYERS AND SERVICES.—The
amendments made by sections 13521 and 13522 shall
apply with respect to a referral by a physician made on
or after December 31, 1994.
(b) OTHER PROVISIONS.—
(1) IN GENERAL.—Except as provided in this
subsection, the amendments made by sections 13523
through 13529 shall apply to referrals made on or
after January 1, 1992.
(2) DELAY IN EFFECTIVENESS FOR MORE RE-
STRICTIVE PROVISIONS.—The amendments made by
the following sections shall apply with respect to a
referral by a physician made on or after December
31, 1994:
(A) Section 13523(b) (relating to the rural
provider exception).
(B) Section 13524(a) (relating to publicly-
traded securities).
1026
(C)(i) Section 13525(a) (relating to an ex-
ception for office rental and equipment), other
than the exception relating to equipment.
(ii) Section 13525(c)(1) (relating to excep-
tion for personal services arrangements).
(iii) Section 13525(d) (relating to physi-
cian recruitment).
(D) Section 13526 (relating to civil money
penalty).
(E) Section 13527 (relating to require-
ments for group practices), other than sub-
section (c) (relating to faculty plans).
(F) Section 13528 (relating to non-pre-
emption).
(G) Section 13529(a) (relating to indirect
financial relationships).
Subchapter D—Other Provisions
SEC. 13551. DIRECT GRADUATE MEDICAL EDUCATION.
(a) ADJUSTMENT IN GME BASE-YEAR COSTS OF
FEDERAL INSURANCE CONTRIBUTIONS ACT.—
(1) IN GENERAL.—In determining the amount
of payment to be made under section 1886(h) of the
Social Security Act in the case of a hospital de-
scribed in paragraph (2) for cost reporting periods
beginning on or after October 1, 1992, the Secretary
1027
of Health and Human Services shall redetermine the
approved FTE resident amount to reflect the
amount that would have been paid the hospital if,
during the hospital’s base cost reporting period, the
hospital had been liable for FICA taxes or for con-
tributions to the retirement system of a State, a po-
litical subdivision of a State, or an instrumentality
of such a State or political subdivision with respect
to interns and residents in its medical residency
training program.
(2) HOSPITALS
AFFECTED.—A hospital de-
scribed in this paragraph is a hospital that did not
pay FICA taxes with respect to interns and resi-
dents in its medical residency training program dur-
ing the hospital’s base cost reporting period, but is
required to pay FICA taxes or make contributions to
a retirement system described in paragraph (1) with
respect to such interns and residents because of the
amendments made by section 11332(b) of OBRA–
1990.
(3) DEFINITIONS.—In this subsection:
(A) The ‘‘base cost reporting period’’ for a
hospital is the hospital’s cost reporting period
that began during fiscal year 1984.
1028
(B) The term ‘‘FICA taxes’’ means, with
respect to a hospital, the taxes under section
3111 of the Internal Revenue Code of 1986.
(b) PUBLICLY-FUNDED FAMILY PRACTICE RESI-
DENCY PROGRAMS.—
(1) IN
GENERAL.—Section 1886(h)(5) (42
U.S.C. 1395ww(h)(5)) is amended by adding at the
end the following new subparagraph:
‘‘(I) ADJUSTMENTS FOR CERTAIN FAMILY
PRACTICE RESIDENCY PROGRAMS.—
‘‘(i) IN GENERAL.—In the case of an
approved medical residency training pro-
gram (meeting the requirements of clause
(ii)) of a hospital which received payments
from the United States, a State, or a polit-
ical subdivision of a State or an instrumen-
tality of such a State or political subdivi-
sion (other than payments under this title
or a State plan under title XIX) for the
program during the cost reporting period
that began during fiscal year 1984, the
Secretary shall—
‘‘(I) provide for an average
amount under paragraph (2)(A) that
takes into account the Secretary’s es-
1029
timate of the amount that would have
been recognized as reasonable under
this title if the hospital had not re-
ceived such payments, and
‘‘(II) reduce the payment amount
otherwise provided under this sub-
section in an amount equal to the pro-
portion of such program payments
during the cost reporting period in-
volved that is allocable to this title.
‘‘(ii) ADDITIONAL
REQUIREMENTS.—
A hospital’s approved medical residency
program meets the requirements of this
clause if—
‘‘(I) the program is limited to
training for family and community
medicine;
‘‘(II) the program is the only ap-
proved medical residency program of
the hospital; and
‘‘(III) the average amount deter-
mined under paragraph (2)(A) for the
hospital (as determined without re-
gard to the increase in such amount
1030
described in clause (i)(I)) does not ex-
ceed $10,000.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to payments under sec-
tion 1886(h) of the Social Security Act for cost re-
porting periods beginning on or after October 1,
1990.
(c) PREVENTIVE CARE RESIDENCIES.—
(1) ELIGIBILITY OF PREVENTIVE CARE RESI-
DENCY
PROGRAMS
FOR
EXPANDED
INITIAL
RESI-
DENCY
PERIODS.—Section 1886(h)(5)(F)(ii) (42
U.S.C. 1395ww(h)(5)(F)(ii)) is amended by insert-
ing after ‘‘fellowship program’’ the following: ‘‘or a
preventive care residency or fellowship program’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to cost reporting
periods beginning on or after October 1, 1993.
SEC. 13552. IMMUNOSUPPRESSIVE DRUG THERAPY.
Section 1861(s)(2)(J) (42 U.S.C. 1395x(s)(2)(J)) is
amended by striking ‘‘title, within’’ and all that follows
and inserting the following: ‘‘title, but only in the case of
drugs furnished—
‘‘(i) before 1994, within 12 months after
the date of the transplant procedure,
1031
‘‘(ii) during 1994, within 18 months after
the date of the transplant procedure,
‘‘(iii) during 1995, within 24 months after
the date of the transplant procedure,
‘‘(iv) during 1996, within 30 months after
the date of the transplant procedure, and
‘‘(v) during any year after 1997, within 36
months after the date of the transplant proce-
dure;’’.
SEC. 
13553. 
REDUCTION 
IN 
PAYMENTS 
FOR
ERYTHROPOIENTIN.
(a) IN GENERAL.—Section 1881(b)(11)(B)(ii)(I) (42
U.S.C. 1395rr(b)(11)(B)(ii)(I)) is amended—
(1) by striking ‘‘1991’’ and inserting ‘‘1994’’;
and
(2) by striking ‘‘$11’’ and inserting ‘‘$10’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall apply to erythropoietin furnished on
or after January 1, 1994.
SEC. 13554. QUALIFIED MEDICARE BENEFICIARY OUT-
REACH.
The Secretary of Health and Human Services shall
establish and implement a method for obtaining informa-
tion from newly eligible medicare beneficiaries that may
be used to determine whether such beneficiaries may be
1032
eligible for medical assistance for medicare cost-sharing
under State medicaid plans as qualified medicare bene-
ficiaries, and for transmitting such information to the
State in which such a beneficiary resides.
SEC. 13555. EXTENSION OF SOCIAL HEALTH MAINTENANCE
ORGANIZATION DEMONSTRATIONS.
(a) EXTENSION
OF CURRENT WAIVERS.—Section
4018(b) of OBRA–1987, as amended by section
4207(b)(4)(B) of OBRA–1990, is amended—
(1) in paragraph (1) by striking ‘‘December 31,
1995’’ and inserting ‘‘December 31, 1997’’; and
(2) in paragraph (4) by striking ‘‘March 31,
1996’’ and inserting ‘‘March 31, 1998’’.
(b) EXPANSION
OF
DEMONSTRATIONS.—Section
2355 of the Deficit Reduction Act of 1984 is amended—
(1) in the last sentence of subsection (a) by
striking ‘‘12 months’’ and inserting ‘‘36 months’’;
and
(2) in subsection (b)(1)(B)—
(A) by striking ‘‘or’’ at the end of clause
(iii); and
(B) by redesignating clause (iv) as clause
(v) and inserting after clause (iii) the following
new clause:
1033
‘‘(iv) integrating acute and chronic
care management for patients with end-
stage renal disease through expanded com-
munity care case management services
(and for purposes of a demonstration
project conducted under this clause, any
requirement under a waiver granted under
this section that a project disenroll individ-
uals who develop end-stage renal disease
shall not apply); or’’.
(c) EXPANSION
OF NUMBER
OF MEMBERS PER
SITE.—The Secretary of Health and Human Services may
not impose a limit of less than 12,000 on the number of
individuals that may participate in a project conducted
under section 2355 of the Deficit Reduction Act of 1984.
(d) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—
(1) The section following section 4206 of
OBRA–1990 is amended by striking ‘‘SEC. 4027.’’
and inserting ‘‘SEC. 4207.’’, and in this subtitle is
referred to as section 4207 of OBRA–1990.
(2) Section 2355(b)(1)(B) of the Deficit Reduc-
tion 
Act 
of 
1984, 
as 
amended 
by 
section
4207(b)(4)(B)(ii) of OBRA–1990, is amended—
1034
(A) by striking ‘‘12907(c)(4)(A)’’ and in-
serting ‘‘4207(b)(4)(B)(i)’’, and
(B) by striking ‘‘feasibilitly’’ and inserting
‘‘feasibility’’.
(3) Section 4207(b)(4)(B)(iii)(III) of OBRA–
1990 is amended by striking the period at the end
and inserting a semicolon.
(4) Subsections (c)(3) and (e) of section 2355
of the Deficit Reduction Act of 1984, as amended by
section 4207(b)(4)(B) of OBRA–1990, are each
amended by striking ‘‘12907(c)(4)(A)’’ each place it
appears and inserting ‘‘4207(b)(4)(B)’’.
(5) Section 4207(c)(2) of OBRA–1990 is
amended by striking ‘‘the Committee on Ways and
Means’’ each place it appears and inserting ‘‘the
Committees on Ways and Means and Energy and
Commerce’’.
(6) Section 4207(d) of OBRA–1990 is amended
by redesignating the second paragraph (3) (relating
to effective date) as paragraph (4).
(7) Section 4207(i)(2) of OBRA–1990 is
amended—
(A) by striking the period at the end of
clause (iii) and inserting a semicolon, and
1035
(B) in clause (v), by striking ‘‘residents’’
and inserting ‘‘patients’’.
(8) Section 4207(j) of OBRA–1990 is amended
by striking ‘‘title’’ each place it appears and insert-
ing ‘‘subtitle’’.
(e) EFFECTIVE DATE.—The amendments made by
this section shall take effect as if included in the enact-
ment of OBRA–90.
SEC. 13556. HOSPICE NOTIFICATION TO HOME HEALTH
BENEFICIARIES.
(a) IN GENERAL.—Section 1891(a)(1) (42 U.S.C.
1395bbb(a)(1)) is amended by adding at the end the fol-
lowing new subparagraph:
‘‘(H) The right, in the case of a resident
who is entitled to benefits under this title, to be
fully informed orally and in writing (at the time
of coming under the care of the agency) of the
entitlement of individuals to hospice care under
section 1812(a)(4) (unless there is no hospice
program providing hospice care for which pay-
ment may be made under this title within the
geographic area of the facility and it is not the
common practice of the agency to refer patients
to hospice programs located outside such geo-
graphic area).’’.
1036
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to services furnished on or after
the first day of the first month beginning more than one
year after the date of the enactment of this Act.
SEC. 13557. INTEREST PAYMENTS.
(a) IN GENERAL.—Sections 1816(c)(2)(B)(ii)(IV)
and 1842(c)(2)(B)(ii)(IV) of the Social Security Act shall
be applied with respect to claims received in the 12-month
period beginning October 1, 1992, by substituting ‘‘30 cal-
endar days’’ for ‘‘24 calendar days’’ and ‘‘17 calendar
days’’.
(b) EFFECTIVE DATE.—Subsection (a) shall be in ef-
fect during the period that begins on the date of the enact-
ment of this Act and ends on September 30, 1993.
SEC. 13558. PEER REVIEW ORGANIZATIONS.
(a) REPEAL OF PRO PRECERTIFICATION REQUIRE-
MENT FOR CERTAIN SURGICAL PROCEDURES.—
(1) IN
GENERAL.—Section 1164 (42 U.S.C.
1320c–13) is repealed.
(2) CONFORMING AMENDMENTS.—
(A) Section 1154 (42 U.S.C. 1320c–3) is
amended—
(i) in subsection (a), by striking para-
graph (12), and
1037
(ii) in subsection (d), by striking
‘‘(and except as provided in section
1164)’’.
(B) Section 1833 (42 U.S.C. 1395l) is
amended—
(i) in subsection (a)(1)(D)(i), by strik-
ing ‘‘, or for tests furnished in connection
with obtaining a second opinion required
under section 1164(c)(2) (or a third opin-
ion, if the second opinion was in disagree-
ment with the first opinion)’’;
(ii) in subsection (a)(1), by striking
clause (G);
(iii) in subsection (a)(2)(A), by strik-
ing ‘‘, to items and services (other than
clinical diagnostic laboratory tests) fur-
nished in connection with obtaining a sec-
ond 
opinion 
required 
under 
section
1164(c)(2) (or a third opinion, if the sec-
ond opinion was in disagreement with the
first opinion),’’;
(iv) in subsection (a)(2)(D)(i)—
(I) by striking ‘‘basis,’’ and in-
serting ‘‘basis or’’, and
1038
(II) by striking ‘‘, or for tests
furnished in connection with obtaining
a second opinion required under sec-
tion 1164(c)(2) (or a third opinion, if
the second opinion was in disagree-
ment with the first opinion)’’;
(v) in subsection (a)(3), by striking
‘‘and for items and services furnished in
connection with obtaining a second opinion
required under section 1164(c)(2), or a
third opinion, if the second opinion was in
disagreement with the first opinion)’’; and
(vi) in the first sentence of subsection
(b), by striking ‘‘(4)’’ and all that follows
through ‘‘and (5)’’ and inserting and (4)’’.
(C) Section 1834(g)(1)(B) (42 U.S.C.
1395m(g)(1)(B)) is amended by striking ‘‘and
for items and services furnished in connection
with obtaining a second opinion required under
section 1164(c)(2), or a third opinion, if the
second opinion was in disagreement with the
first opinion)’’.
(D) Section 1862(a) (42 U.S.C. 1395y(a))
is amended—
1039
(i) by adding ‘‘or’’ at the end of para-
graph (14),
(ii) by striking ‘‘; or’’ at the end of
paragraph (15) and inserting a period, and
(iii) by striking paragraph (16).
(E) 
The 
third 
sentence 
of 
section
1866(a)(2)(A) (42 U.S.C. 1395w(a)(2)(A)) is
amended by striking ‘‘, with respect to items
and services furnished in connection with ob-
taining a second opinion required under section
1164(c)(2) (or a third opinion, if the second
opinion was in disagreement with the first opin-
ion),’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to services provided on
or after the date of the enactment of this Act.
(b) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—(1) The third sentence of section 1156(b)(1) (42
U.S.C. 1320c–5(b)(1)) is amended by striking ‘‘whehter’’
and inserting ‘‘whether’’.
(2) Section 1154(a)(9)(B) (42 U.S.C. 1320c–
3(a)(9)(B)) is amended by striking ‘‘this subsection’’ and
inserting ‘‘section 1156(a)’’.
1040
(3) Section 4205(d)(2)(B) of OBRA–1990 is amend-
ed by striking ‘‘amendments’’ and inserting ‘‘amend-
ment’’.
(4) Section 1160(d) (42 U.S.C. 1320c–9(d)) is
amended by striking ‘‘subpena’’ and inserting ‘‘subpoena’’.
(5) Section 4205(e)(2) of OBRA–1990 is amended
by striking ‘‘amendments’’ and inserting ‘‘amendment’’
and by striking ‘‘all’’.
(6)(A) Except as provided in subparagraph (B), the
amendments made by this subsection shall take effect as
if included in the enactment of OBRA–1990.
(B) The amendment made by paragraph (2) (relating
to the requirement on reporting of information to State
licensing boards) shall take effect on the date of the enact-
ment of this Act.
SEC. 13559. HEALTH MAINTENANCE ORGANIZATIONS.
(a) ADJUSTMENT IN MEDICARE CAPITATION PAY-
MENTS TO ACCOUNT FOR REGIONAL VARIATIONS IN AP-
PLICATION OF SECONDARY PAYER PROVISIONS.—
(1) IN
GENERAL.—Section 1876(a)(4) (42
U.S.C. 1395mm(a)(4)) is amended by adding at the
end the following new sentence: ‘‘In establishing the
adjusted average per capita cost for a geographic
area, the Secretary shall take into account the dif-
ferences between the proportion of individuals in the
1041
area with respect to whom there is a group health
plan that is a primary plan (within the meaning of
section 1862(b)(2)(A)) compared to the proportion
of all such individuals with respect to whom there is
such a group health plan.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall apply to contracts entered
into for years beginning with 1994.
(b) REVISIONS
IN
THE PAYMENT METHODOLOGY
FOR RISK CONTRACTORS.—Section 4204(b) of OBRA–
1990 is amended to read as follows:
‘‘(b) REVISIONS IN THE PAYMENT METHODOLOGY
FOR RISK CONTRACTORS.—(1)(A) Not later than October
1, 1993, the Secretary of Health and Human Services (in
this subsection referred to as the ‘Secretary’) shall submit
a proposal to the Congress that provides for revisions to
the payment method to be applied in years beginning with
1995 for organizations with a risk-sharing contract under
section 1876(g) of the Social Security Act.
‘‘(B) In proposing the revisions required under sub-
paragraph (A) the Secretary shall consider—
‘‘(i) the difference in costs associated with med-
icare beneficiaries with differing health status and
demographic characteristics; and
1042
‘‘(ii) the effects of using alternative geographic
classifications on the determinations of costs associ-
ated with beneficiaries residing in different areas.
‘‘(2) Not later than 3 months after the date of sub-
mittal of the proposal under paragraph (1), the Comptrol-
ler General shall review the proposal and shall report to
Congress on the appropriateness of the proposed modifica-
tions.’’.
(c) MISCELLANEOUS
AND
TECHNICAL
CORREC-
TIONS.—(1) 
Section 
1876(a)(3) 
(42 
U.S.C.
1395mm(a)(3)) is amended by striking ‘‘subsection
(c)(7)’’ and inserting ‘‘subsections (c)(2)(B)(ii) and
(c)(7)’’.
(2) Section 4204(c)(3) of OBRA–1990 is amended
by striking ‘‘for 1991’’ and inserting ‘‘for years beginning
with 1991’’.
(3) Section 4204(d)(2) of OBRA–1990 is amended
by striking ‘‘amendment’’ and inserting ‘‘amendments’’.
(4) 
Section 
1876(a)(1)(E)(ii)(I) 
(42 
U.S.C.
1395mm(a)(1)(E)(ii)(I)) is amended by striking the
comma after ‘‘contributed to’’.
(5) Section 4204(e)(2) of OBRA–1990 is amended
by striking ‘‘(which has a risk-sharing contract under sec-
tion 1876 of the Social Security Act)’’.
1043
(6) Section 4204(f)(4) of OBRA–1990 is amended by
striking ‘‘final’’.
(7) 
Section 
1862(b)(3)(C) 
(42 
U.S.C.
1395y(b)(3)(C)) is amended—
(A) in the heading, by striking ‘‘PLAN’’ and in-
serting ‘‘PLAN OR A LARGE GROUP HEALTH PLAN’’;
(B) by striking ‘‘group health plan’’ and insert-
ing ‘‘group health plan or a large group health
plan’’;
(C) by striking ‘‘, unless such incentive is also
offered to all individuals who are eligible for cov-
erage under the plan’’; and
(D) by striking ‘‘the first sentence of subsection
(a) and other than subsection (b)’’ and inserting
‘‘subsections (a) and (b)’’.
(8) The amendments made by this subsection shall
take effect as if included in the enactment of OBRA–1990.
SEC. 13560. MEDICARE ADMINISTRATION BUDGET PROC-
ESS.
(a) ADJUSTMENTS.—Section 251(b)(2) of the Bal-
anced Budget and Emergency Deficit Control Act of 1985
is amended by redesignating subparagraphs (E) and (F)
as subparagraphs (F) and (G), respectively, and by insert-
ing after subparagraph (D) the following new subpara-
graph:
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‘‘(E) 
MEDICARE
ADMINISTRATIVE
COSTS.—To the extent that appropriations are
enacted that provide additional new budget au-
thority (as compared with a base level of
$1,526,000,000 for new budget authority) for
the administration of the Medicare program by
fiscal intermediaries and carriers pursuant to
sections 1816 and 1842(a) of title XVIII of the
Social Security Act, the adjustment for that
year shall be that amount, but shall not
exceed—
‘‘(i) 
for 
fiscal 
year 
1994,
$198,000,000 in new budget authority and
$198,000,000 in outlays; and
‘‘(ii) 
for 
fiscal 
year 
1995,
$220,000,000 in new budget authority and
$220,000,000 in outlays; and
the prior-year outlays resulting from these appro-
priations of budget authority and additional adjust-
ments equal to the sum of the maximum adjust-
ments that could have been made in preceding fiscal
years under this subparagraph.’’.
(b) CONFORMING AMENDMENTS.—
(1) Section 603(a) of the Congressional Budget
Act of 1974 is amended by striking ‘‘section
1045
251(b)(2)(E)(i)’’ 
and 
inserting 
‘‘section
251(b)(2)(F)(i)’’.
(2) Section 606(d) of the Congressional Budget
Act of 1974 is amended—
(A) in paragraph (1)(A) by striking ‘‘sec-
tion 251(b)(2)(E)(i)’’ and inserting ‘‘section
251(b)(2)(F)(i)’’; and
(B) 
in 
paragraph 
(2), 
by 
inserting
‘‘251(b)(2)(E),’’ after ‘‘251(b)(2)(D),’’.
SEC. 13561. OTHER PROVISIONS.
(a) SURVEY AND CERTIFICATION REQUIREMENTS.—
(1) Section 1864 (42 U.S.C. 1395aa) is amended—
(A) in subsection (e), by striking ‘‘title’’ and in-
serting ‘‘title (other than any fee relating to section
353 of the Public Health Service Act)’’; and
(B) in the first sentence of subsection (a), by
striking ‘‘1861(s) or’’ and all that follows through
‘‘Service Act,’’ and inserting ‘‘1861(s),’’.
(2) An agreement made by the Secretary of Health
and Human Services with a State under section 1864(a)
of the Social Security Act may include an agreement that
the services of the State health agency or other appro-
priate State agency (or the appropriate local agencies) will
be utilized by the Secretary for the purpose of determining
1046
whether a laboratory meets the requirements of section
353 of the Public Health Service Act.
(b) HOME DIALYSIS DEMONSTRATION TECHNICAL
CORRECTION.—Section 
4202 
of 
OBRA–1990 
is
amended—
(1) in subsection (b)(1)(A), by striking ‘‘home
hemodialysis staff assistant’’ and inserting ‘‘quali-
fied home hemodialysis staff assistant (as described
in subsection (d))’’;
(2) in subsection (b)(2)(B)(ii)(I), by striking
‘‘(as adjusted to reflect differences in area wage
levels);
(3) 
in 
subsection 
(c)(1)(A), 
by 
striking
‘‘skilled’’; and
(4) in subsection (c)(1)(E), by striking ‘‘(b)(4)’’
and inserting ‘‘(b)(2)’’.
(c) OTHER TECHNICAL AMENDMENTS.—(1) Section
1833 (42 U.S.C. 1395l) is amended by redesignating the
subsection (r) added by section 4206(b)(2) of OBRA–
1990 as subsection (s).
(2) Section 1866(f)(1) (42 U.S.C. 1395cc(f)(1)) is
amended by striking ‘‘1833(r)’’ and inserting ‘‘1833(s)’’.
(3) Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is
amended by moving subparagraph (O), as redesignated by