H. R. 2015—205
‘‘(B) outpatient physical therapy services (which
includes outpatient speech-language pathology services)
and outpatient occupational therapy services furnished—
‘‘(i) by a hospital to an outpatient or to a hospital
inpatient who is entitled to benefits under part A but
has exhausted benefits for inpatient hospital services
during a spell of illness or is not so entitled to benefits
under part A, or
‘‘(ii) by another entity under an arrangement with
a hospital described in clause (i),
the amounts described in section 1834(k); and
‘‘(9) in the case of services described in section 1832(a)(2)(E)
that are not described in paragraph (8), the amounts described
in section 1834(k).’’.
(2) PAYMENT RATES.—Section 1834 (42 U.S.C. 1395m) is
amended by adding at the end the following new subsection:
‘‘(k) PAYMENT FOR OUTPATIENT THERAPY SERVICES AND COM-
PREHENSIVE OUTPATIENT REHABILITATION SERVICES.—
‘‘(1) IN GENERAL.—With respect to services described in
section 1833(a)(8) or 1833(a)(9) for which payment is deter-
mined under this subsection, the payment basis shall be—
‘‘(A) for services furnished during 1998, the amount
determined under paragraph (2); or
‘‘(B) for services furnished during a subsequent year,
80 percent of the lesser of—
‘‘(i) the actual charge for the services, or
‘‘(ii) the applicable fee schedule amount (as defined
in paragraph (3)) for the services.
‘‘(2) PAYMENT IN 1998 BASED UPON ADJUSTED REASONABLE
COSTS.—The amount under this paragraph for services is the
lesser of—
‘‘(A) the charges imposed for the services, or
‘‘(B) the adjusted reasonable costs (as defined in para-
graph (4)) for the services,
less 20 percent of the amount of the charges imposed for such
services.
‘‘(3) APPLICABLE
FEE
SCHEDULE
AMOUNT.—In this sub-
section, the term ‘applicable fee schedule amount’ means, with
respect to services furnished in a year, the amount determined
under the fee schedule established under section 1848 for such
services furnished during the year or, if there is no such fee
schedule established for such services, the amount determined
under the fee schedule established for such comparable services
as the Secretary specifies.
‘‘(4) ADJUSTED REASONABLE COSTS.—In paragraph (2), the
term ‘adjusted reasonable costs’ means, with respect to any
services, reasonable costs determined for such services, reduced
by 10 percent. The 10-percent reduction shall not apply to
services described in section 1833(a)(8)(B) (relating to services
provided by hospitals).
‘‘(5) UNIFORM CODING.—For claims for services submitted
on or after April 1, 1998, for which the amount of payment
is determined under this subsection, the claim shall include
a code (or codes) under a uniform coding system specified
by the Secretary that identifies the services furnished.
‘‘(6) RESTRAINT ON BILLING.—The provisions of subpara-
graphs (A) and (B) of section 1842(b)(18) shall apply to therapy
H. R. 2015—206
services for which payment is made under this subsection in
the same manner as they apply to services provided by a
practitioner described in section 1842(b)(18)(C).’’.
(3) 
CONFORMING
CHANGE
IN
BILLING.—Section
1866(a)(2)(A)(ii) (42 U.S.C. 1395cc(a)(2)(A)(ii)) is amended by
adding at the end the following: ‘‘In the case of services
described in section 1833(a)(8) or section 1833(a)(9) for which
payment is made under part B under section 1834(k), clause
(ii) of the first sentence shall be applied by substituting for
20 percent of the reasonable charge for such services 20 percent
of the lesser of the actual charge or the applicable fee schedule
amount (as defined in such section) for such services.’’.
(b) APPLICATION OF STANDARDS TO OUTPATIENT OCCUPATIONAL
AND PHYSICAL THERAPY SERVICES PROVIDED AS AN INCIDENT TO
A PHYSICIAN’S PROFESSIONAL SERVICES.—Section 1862(a), as amend-
ed by sections 4319(b), 4432(b), and 4507(a)(2)(B), (42 U.S.C.
1395y(a)) is amended—
(1) by striking ‘‘or’’ at the end of paragraph (18);
(2) by striking the period at the end of paragraph (19)
and inserting ‘‘; or’’; and
(3) by inserting after paragraph (19) the following:
‘‘(20) in the case of outpatient occupational therapy services
or outpatient physical therapy services furnished as an incident
to a physician’s professional services (as described in section
1861(s)(2)(A)), that do not meet the standards and conditions
(other than any licensing requirement specified by the Sec-
retary) under the second sentence of section 1861(p) (or under
such sentence through the operation of section 1861(g)) as
such standards and conditions would apply to such therapy
services if furnished by a therapist.’’.
(c) APPLYING FINANCIAL LIMITATION TO ALL REHABILITATION
SERVICES.—Section 1833(g) (42 U.S.C. 1395l(g)) is amended—
(1) in the first sentence, by striking ‘‘services described
in the second sentence of section 1861(p)’’ and inserting ‘‘phys-
ical therapy services of the type described in section 1861(p),
but not described in section 1833(a)(8)(B), and physical therapy
services of such type which are furnished by a physician or
as incident to physicians’ services’’, and
(2) in the second sentence, by striking ‘‘outpatient occupa-
tional therapy services which are described in the second sen-
tence of section 1861(p) through the operation of section
1861(g)’’ and inserting ‘‘occupational therapy services (of the
type that are described in section 1861(p) (but not described
in section 1833(a)(8)(B)) through the operation of section 1861(g)
and of such type which are furnished by a physician or as
incident to physicians’ services)’’.
(d) INDEXING LIMITATION.—
(1) IN GENERAL.—Section 1833(g) (42 U.S.C. 1395l(g)), as
amended by subsection (c), is further amended—
(A) by striking ‘‘$900’’ each place it appears and insert-
ing ‘‘the amount specified in paragraph (2) for the year’’,
(B) by inserting ‘‘(1)’’ after ‘‘(g)’’,
(C) by designating the last sentence as a paragraph
(3), and
(D) by inserting before paragraph (3), as so designated,
the following:
‘‘(2) The amount specified in this paragraph—
H. R. 2015—207
‘‘(A) for 1999, 2000, and 2001, is $1,500, and
‘‘(B) for a subsequent year is the amount specified in this
paragraph for the preceding year increased by the percentage
increase in the MEI (as defined in section 1842(i)(3)) for such
subsequent year;
except that if an increase under subparagraph (B) for a year is
not a multiple of $10, it shall be rounded to the nearest multiple
of $10.’’.
(2) REPORT.—By not later than January 1, 2001, the Sec-
retary of Health and Human Services shall submit to Congress
a report that includes recommendations on the establishment
of a revised coverage policy of outpatient physical therapy serv-
ices and outpatient occupational therapy services under the
Social Security Act based on classification of individuals by
diagnostic category and prior use of services, in both inpatient
and outpatient settings, in place of the uniform dollar limita-
tions specified in section 1833(g) of such Act, as amended
by paragraph (1). The recommendations shall include how such
a system of durational limits by diagnostic category might
be implemented in a budget-neutral manner.
(e) EFFECTIVE DATES.—
(1) The amendments made by subsections (a)(1), (a)(2),
and (b) apply to services furnished on or after January 1,
1998, including portions of cost reporting periods occurring
on or after such date, except that section 1834(k) of the Social
Security Act (as added by subsection (a)(2)) shall not apply
to services described in section 1833(a)(8)(B) of such Act (as
added by subsection (a)(1)) that are furnished during 1998.
(2) The amendments made by subsections (a)(3) and (c)
apply to services furnished on or after January 1, 1999.
(3) The amendments made by subsection (d)(1) apply to
expenses incurred on or after January 1, 1999.
CHAPTER 5—OTHER PAYMENT PROVISIONS
SEC. 4551. PAYMENTS FOR DURABLE MEDICAL EQUIPMENT.
(a) REDUCTION IN PAYMENT AMOUNTS FOR ITEMS OF DURABLE
MEDICAL EQUIPMENT.—
(1) FREEZE
IN
UPDATE
FOR
COVERED
ITEMS.—Section
1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended—
(A) in subparagraph (A), by striking ‘‘and’’ at the end;
(B) in subparagraph (B)—
(i) by striking ‘‘a subsequent year’’ and inserting
‘‘1993, 1994, 1995, 1996, and 1997’’, and
(ii) by striking the period at the end and inserting
a semicolon; and
(C) by adding at the end the following new subpara-
graphs:
‘‘(C) for each of the years 1998 through 2002, 0 percent-
age points; and
‘‘(D) for a subsequent year, the percentage increase
in the consumer price index for all urban consumers (U.S.
urban average) for the 12-month period ending with June
of the previous year.’’.
(2) UPDATE
FOR
ORTHOTICS
AND
PROSTHETICS.—Section
1834(h)(4)(A) (42 U.S.C. 1395m(h)(4)(A)) is amended—
H. R. 2015—208
(A) in clause (iii), by striking ‘‘, and’’ at the end and
inserting a semicolon;
(B) in clause (iv), by striking ‘‘a subsequent year’’ and
inserting ‘‘1996 and 1997’’; and
(C) by adding at the end the following new clauses:
‘‘(v) for each of the years 1998 through 2002, 1
percent, and
‘‘(vi) for a subsequent year, the percentage increase
in the consumer price index for all urban consumers
(United States city average) for the 12-month period
ending with June of the previous year;’’.
(b) PAYMENT FREEZE FOR PARENTERAL AND ENTERAL NUTRI-
ENTS, SUPPLIES, AND EQUIPMENT.—In determining the amount of
payment under part B of title XVIII of the Social Security Act
with respect to parenteral and enteral nutrients, supplies, and
equipment during each of the years 1998 through 2002, the charges
determined to be reasonable with respect to such nutrients, sup-
plies, and equipment may not exceed the charges determined to
be reasonable with respect to such nutrients, supplies, and equip-
ment during 1995.
(c) UPGRADED DURABLE MEDICAL EQUIPMENT.—
(1) IN
GENERAL.—Section 1834(a) (42 U.S.C. 1395m(a)),
as amended by section 4312(a), is amended by inserting after
paragraph (16) the following new paragraph:
‘‘(17) CERTAIN UPGRADED ITEMS.—
‘‘(A) INDIVIDUAL’S RIGHT TO CHOOSE UPGRADED ITEM.—
Notwithstanding any other provision of this title, the Sec-
retary may issue regulations under which an individual
may purchase or rent from a supplier an item of upgraded
durable medical equipment for which payment would be
made under this subsection if the item were a standard
item.
‘‘(B) PAYMENTS TO SUPPLIER.—In the case of the pur-
chase or rental of an upgraded item under subparagraph
(A)—
‘‘(i) the supplier shall receive payment under this
subsection with respect to such item as if such item
were a standard item; and
‘‘(ii) the individual purchasing or renting the item
shall pay the supplier an amount equal to the dif-
ference between the supplier’s charge and the amount
under clause (i).
In no event may the supplier’s charge for an upgraded
item exceed the applicable fee schedule amount (if any)
for such item.
‘‘(C) CONSUMER PROTECTION SAFEGUARDS.—Any regula-
tions under subparagraph (A) shall provide for consumer
protection standards with respect to the furnishing of
upgraded equipment under subparagraph (A). Such regula-
tions shall provide for—
‘‘(i) determination of fair market prices with
respect to an upgraded item;
‘‘(ii) full disclosure of the availability and price
of standard items and proof of receipt of such disclosure
information by the beneficiary before the furnishing
of the upgraded item;