334 
within such class on a fee-for-service basis under the 
program under part B of title XVIII, including, as 
applicable, under a competitive acquisition program 
under section 1847 in an area of the State.’’. 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall be effective with respect to 
payments for items furnished on or after January 1, 
2020. 
(b) MEDICARE OMBUDSMAN.—Section 1808(c) of the 
Social Security Act (42 U.S.C. 1395b(c)), as amended by 
section 3101, is further amended by adding at the end 
the following new paragraph: 
‘‘(5) 
MONITORING
DME
REIMBURSEMENT 
UNDER MEDICAID.—The ombudsmen under each of 
paragraphs (1) and (4) shall evaluate the impact of 
the competitive acquisition program under section 
1847, 
including 
as 
applied 
under 
section 
1903(i)(27), on beneficiary health status and health 
outcomes.’’. 
SEC. 4002. EXCLUDING AUTHORIZED GENERICS FROM CAL-
CULATION 
OF 
AVERAGE 
MANUFACTURER 
PRICE. 
(a) IN GENERAL.—Subparagraph (C) of section 
1927(k)(1) of the Social Security Act (42 U.S.C. 1396r– 
8(k)(1)) is amended—
335 
(1) in the subparagraph heading, by striking 
‘‘INCLUSION’’ and inserting ‘‘EXCLUSION’’; 
(2) by striking ‘‘a new drug application’’ and 
inserting ‘‘the manufacturer’s new drug applica-
tion’’; and 
(3) by striking ‘‘inclusive’’ and inserting ‘‘exclu-
sive’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section take effect on October 1, 2015. 
SEC. 4003. MEDICARE PAYMENT INCENTIVE FOR THE TRAN-
SITION FROM TRADITIONAL X-RAY IMAGING 
TO 
DIGITAL 
RADIOGRAPHY 
AND 
OTHER 
MEDICARE IMAGING PAYMENT PROVISION. 
(a) PHYSICIAN FEE SCHEDULE.— 
(1) PAYMENT INCENTIVE FOR TRANSITION.— 
(A) IN GENERAL.—Section 1848(b) of the 
Social Security Act (42 U.S.C. 1395w–4(b)) is 
amended by adding at the end the following 
new paragraph: 
‘‘(9) SPECIAL RULE TO INCENTIVIZE TRANSI-
TION FROM TRADITIONAL X-RAY IMAGING TO DIG-
ITAL RADIOGRAPHY.— 
‘‘(A) LIMITATION ON PAYMENT FOR FILM 
X-RAY IMAGING SERVICES.—In the case of an 
imaging service (including the imaging portion
336 
of a service) that is an X-ray taken using film 
and that is furnished during 2017 or a subse-
quent year, the payment amount for the tech-
nical component (including the technical compo-
nent portion of a global service) of such service 
that would otherwise be determined under this 
section (without application of this paragraph 
and before application of any other adjustment 
under this section) for such year shall be re-
duced by 20 percent. 
‘‘(B) PHASED-IN LIMITATION ON PAYMENT 
FOR COMPUTED RADIOGRAPHY IMAGING SERV-
ICES.—In the case of an imaging service (in-
cluding the imaging portion of a service) that is 
an X-ray taken using computed radiography 
technology— 
‘‘(i) in the case of such a service fur-
nished during 2018, 2019, 2020, 2021, or 
2022, the payment amount for the tech-
nical component (including the technical 
component portion of a global service) of 
such service that would otherwise be deter-
mined under this section (without applica-
tion of this paragraph and before applica-
tion of any other adjustment under this
337 
section) for such year shall be reduced by 
7 percent; and 
‘‘(ii) in the case of such a service fur-
nished during 2023 or a subsequent year, 
the payment amount for the technical com-
ponent (including the technical component 
portion of a global service) of such service 
that would otherwise be determined under 
this section (without application of this 
paragraph and before application of any 
other adjustment under this section) for 
such year shall be reduced by 10 percent. 
‘‘(C) COMPUTED
RADIOGRAPHY
TECH-
NOLOGY DEFINED.—For purposes of this para-
graph, the term ‘computed radiography tech-
nology’ means cassette-based imaging which 
utilizes an imaging plate to create the image in-
volved. 
‘‘(D) IMPLEMENTATION.—In order to im-
plement this paragraph, the Secretary shall 
adopt appropriate mechanisms which may in-
clude use of modifiers.’’. 
(B) EXEMPTION
FROM
BUDGET
NEU-
TRALITY.—Section 1848(c)(2)(B)(v) of the So-
cial 
Security 
Act 
(42 
U.S.C. 
1395w–
338 
4(c)(2)(B)(v)) is amended by adding at the end 
the following new subclause: 
‘‘(X) REDUCED
EXPENDITURES 
ATTRIBUTABLE
TO
INCENTIVES
TO 
TRANSITION
TO
DIGITAL
RADIOG-
RAPHY.—Effective for fee schedules 
established beginning with 2017, re-
duced expenditures attributable to 
subparagraph (A) of subsection (b)(9) 
and effective for fee schedules estab-
lished beginning with 2018, reduced 
expenditures attributable to subpara-
graph (B) of such subsection.’’. 
(2) ELIMINATION
OF
APPLICATION
OF
MUL-
TIPLE PROCEDURE PAYMENT REDUCTION.— 
(A) IN GENERAL.—Section 1848(b)(4) of 
the Social Security Act (42 U.S.C. 1395w– 
4(b)(4)) is amended by adding at the end the 
following new subparagraph: 
‘‘(E) ELIMINATION
OF
APPLICATION
OF 
MULTIPLE
PROCEDURE
PAYMENT
REDUC-
TION.— 
‘‘(i) IN GENERAL.—For services fur-
nished on or after January 1, 2017, the 
Secretary shall not apply a multiple proce-
339 
dure payment reduction to the professional 
component of imaging services unless the 
Secretary has published as part of a Medi-
care Physician Fee Schedule Proposed 
Rule the empirical analysis described in 
clause (ii) with tables made available on 
the website of the Centers for Medicare & 
Medicaid Services. 
‘‘(ii) 
EMPIRICAL
ANALYSIS
DE-
SCRIBED.—The 
empirical 
analysis 
de-
scribed in this clause is an analysis of the 
Resource-Based Relative Value Scale Data 
Manager information or other information 
that is used to determine what, if any, effi-
ciencies exist within the professional com-
ponent of imaging services when two or 
more studies are furnished to the same in-
dividual on the same day. Such empirical 
analysis shall include— 
‘‘(I) information detailing which 
physician work activities overlap and 
the reductions applicable to such over-
lap; 
‘‘(II) a discussion of the clinical 
aspects that informed the assignment
341 
‘‘(F) PAYMENT INCENTIVE FOR THE TRAN-
SITION FROM TRADITIONAL X-RAY IMAGING TO 
DIGITAL
RADIOGRAPHY.—Notwithstanding the 
previous provisions of this subsection: 
‘‘(i) LIMITATION
ON
PAYMENT
FOR 
FILM
X-RAY
IMAGING
SERVICES.—In the 
case of an imaging service that is an X-ray 
taken using film and that is furnished dur-
ing 2017 or a subsequent year, the pay-
ment amount for such service (including 
the X-ray component of a packaged serv-
ice) that would otherwise be determined 
under this section (without application of 
this paragraph and before application of 
any other adjustment under this sub-
section) for such year shall be reduced by 
20 percent. 
‘‘(ii) PHASED-IN LIMITATION ON PAY-
MENT FOR COMPUTED RADIOGRAPHY IM-
AGING SERVICES.—In the case of an imag-
ing service that is an X-ray taken using 
computed radiography technology (as de-
fined in section 1848(b)(9)(C))— 
‘‘(I) in the case of such a service 
furnished during 2018, 2019, 2020,
342 
2021, or 2022, the payment amount 
for such service (including the X-ray 
component of a packaged service) that 
would otherwise be determined under 
this section (without application of 
this paragraph and before application 
of any other adjustment under this 
subsection) for such year shall be re-
duced by 7 percent; and 
‘‘(II) in the case of such a service 
furnished during 2023 or a subse-
quent year, the payment amount for 
such service (including the X-ray com-
ponent of a packaged service) that 
would otherwise be determined under 
this section (without application of 
this paragraph and before application 
of any other adjustment under this 
subsection) for such year shall be re-
duced by 10 percent. 
‘‘(iii) APPLICATION WITHOUT REGARD 
TO BUDGET NEUTRALITY.—The reductions 
made under this paragraph—
343 
‘‘(I) shall not be considered an 
adjustment under paragraph (2)(E); 
and 
‘‘(II) shall not be implemented in 
a budget neutral manner. 
‘‘(iv) IMPLEMENTATION.—In order to 
implement this subparagraph, the Sec-
retary shall adopt appropriate mechanisms 
which may include use of modifiers.’’. 
SEC. 4004. TREATMENT OF INFUSION DRUGS FURNISHED 
THROUGH DURABLE MEDICAL EQUIPMENT. 
Section 1842(o)(1) of the Social Security Act (42 
U.S.C. 1395u(o)(1)) is amended— 
(1) in subparagraph (C), by inserting ‘‘(and in-
cluding a drug or biological described in subpara-
graph (D)(i) furnished on or after January 1, 
2017)’’ after ‘‘2005’’; and 
(2) in subparagraph (D)— 
(A) by striking ‘‘infusion drugs’’ and in-
serting ‘‘infusion drugs or biologicals’’ each 
place it appears; and 
(B) in clause (i)— 
(i) by striking ‘‘2004’’ and inserting 
‘‘2004, and before January 1, 2017’’; and 
(ii) by striking ‘‘for such drug’’.
344 
SEC. 4005. EXTENSION AND EXPANSION OF PRIOR AUTHOR-
IZATION FOR POWER MOBILITY DEVICES 
(PMDS) AND ACCESSORIES AND PRIOR AU-
THORIZATION AUDIT LIMITATIONS. 
Section 1834(a) of the Social Security Act (42 U.S.C. 
1395m(a)) is amended— 
(1) in paragraph (15), by adding at the end the 
following new subparagraph: 
‘‘(D) LIMITATION ON AUDITS AFTER AD-
VANCE DETERMINATION.—A claim for an item 
that has received a provisional affirmation 
under an advance determination under this 
paragraph or a prior authorization under para-
graph (23) shall not be subject to review under 
section 1893(h) but may be subject to audits 
for potential fraud, inappropriate utilization, 
changes in billing patterns, or information that 
could not have been considered during the ad-
vance determination (such as proof of item de-
livery).’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(23) PRIOR AUTHORIZATION FOR POWER MO-
BILITY
DEVICES
(PMDS)
AND
ACCESSORIES.—Not 
later than 90 days after the date of the enactment 
of this paragraph, the Secretary shall, using funds
345 
provided under paragraph (2) of section 402(a) of 
the Social Security Amendments of 1967 and other 
funds available to the Secretary— 
‘‘(A) extend at least through August 31, 
2018, the PMD Prior Authorization Dem-
onstration (being conducted under paragraph 
(1)(J) of such section); 
‘‘(B) begin to expand, as appropriate, such 
demonstration to include additional power mo-
bility devices and accessories as part of initial 
claims for payment under this part for such de-
vices; and 
‘‘(C) begin to expand such demonstration 
to such additional States or geographic areas as 
may be appropriate.’’. 
SEC. 4006. CIVIL MONETARY PENALTIES FOR VIOLATIONS 
RELATED 
TO 
GRANTS, 
CONTRACTS, 
AND 
OTHER AGREEMENTS. 
(a) IN GENERAL.—Section 1128A of the Social Secu-
rity Act (42 U.S.C. 1320a–7a) is amended by adding at 
the end the following new subsection: 
‘‘(o) Any person (including an organization, agency, 
or other entity, but excluding a program beneficiary, as 
defined in subsection (r)(4)) that, with respect to a grant,
346 
contract, or other agreement for which the Secretary of 
Health and Human Services provides funding— 
‘‘(1) knowingly presents or causes to be pre-
sented a specified claim (as defined in subsection 
(r)(6)) under such grant, contract, or other agree-
ment that the person knows or should know is false 
or fraudulent; 
‘‘(2) knowingly makes, uses, or causes to be 
made or used any false statement, omission, or mis-
representation of a material fact in any application, 
proposal, bid, progress report, or other document 
that is required to be submitted in order to directly 
or indirectly receive or retain funds provided in 
whole or in part by such Secretary pursuant to such 
grant, contract, or other agreement; 
‘‘(3) knowingly makes, uses, or causes to be 
made or used, a false record or statement material 
to a false or fraudulent specified claim under such 
grant, contract, or other agreement; 
‘‘(4) knowingly makes, uses, or causes to be 
made or used, a false record or statement material 
to an obligation to pay or transmit funds or property 
to such Secretary with respect to such grant, con-
tract, or other agreement, or knowingly conceals or 
knowingly and improperly avoids or decreases an ob-