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as may be provided for by the contracts) the amount
of the payments required pursuant to this part to be
made to providers of services.
‘‘(B) Making payments described in subpara-
graph (A).
‘‘(C) Provision of consultative services to insti-
tutions or agencies to enable them to establish and
maintain fiscal records necessary for purposes of
this part and otherwise to qualify as providers of
services.
‘‘(D) Serving as a center for, and communicate
to individuals entitled to benefits under this part
and to providers of services, any information or in-
structions furnished to the agency or organization by
the Secretary, and serve as a channel of communica-
tion from individuals entitled to benefits under this
part and from providers of services to the Secretary.
‘‘(E) Making such audits of the records of pro-
viders of services as may be necessary to ensure that
proper payments are made under this part.
‘‘(F) Performance of the functions described
under subsection (d).
‘‘(G) Performance of such other functions as
are necessary to carry out the purposes of this part.
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‘‘(2) As used in this title and title XI, the term ‘fiscal
intermediary’ means an agency or organization with a con-
tract under this section.’’.
(2) Subsections (d) and (e) of section 1816 (42
U.S.C. 1395h) are amended to read as follows:
‘‘(d) Each provider of services shall have a fiscal
intermediary that—
‘‘(1) acts as a single point of contact for the
provider of services under this part,
‘‘(2) makes its services sufficiently available to
meet the needs of the provider of services, and
‘‘(3) is responsible and accountable for arrang-
ing the resolution of issues raised under this part by
the provider of services.
‘‘(e)(1)(A) The Secretary shall, at least every 5 years,
permit each provider of services (other than a home health
agency or a hospice program) to choose an agency or orga-
nization (from at least 3 proposed by the Secretary, of
which at least 1 shall have an office in the geographic area
of the provider of services, except as provided by subpara-
graph (B)(ii)(II)) as the fiscal intermediary under sub-
section (d) for that provider of services. If a contract with
that fiscal intermediary is discontinued, the Secretary
shall permit the provider of services to choose under the
same conditions from 3 other agencies or organizations.
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‘‘(B)(i) The Secretary, in carrying out subparagraph
(A), shall permit a group of hospitals (or a group of an-
other class of providers other than home health agencies
or hospice programs) under common ownership by, or con-
trol of, a particular entity to choose one agency or organi-
zation (from at least 3 proposed by the Secretary) as the
fiscal intermediary under subsection (d) for all the provid-
ers in that group if the conditions specified in clause (ii)
are met.
‘‘(ii) The conditions specified in this clause are that—
‘‘(I) the group includes all the providers of serv-
ices of that class that are under common ownership
by, or control of, that particular entity, and
‘‘(II) all the providers of services in that group
agree that none of the agencies or organizations pro-
posed by the Secretary is required to have an office
in any particular geographic area.
‘‘(2) The Secretary, in evaluating the performance of
a fiscal intermediary, shall solicit comments from provid-
ers of services.’’.
(3)(A) 
Section 
1816(b)(1)(A) 
(42 
U.S.C.
1395h(b)(1)(A)) is amended by striking ‘‘after ap-
plying the standards, criteria, and procedures’’ and
inserting ‘‘after evaluating the ability of the agency
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or organization to fulfill the contract performance
requirements’’.
(B) The first sentence of section 1816(f)(1) (42
U.S.C. 1395h(f)(1)) is amended—
(i) by striking ‘‘develop standards, criteria,
and procedures’’ and inserting ‘‘, after public
notice and opportunity for comment, develop
contract performance requirements’’, and
(ii) by striking ‘‘, and the Secretary shall
establish standards and criteria with respect to
the efficient and effective administration of this
part’’.
(C) 
The 
second 
sentence 
of 
section
1842(b)(2)(A) 
(42 
U.S.C. 
1395u(b)(2)(A)) 
is
amended to read as follows: ‘‘The Secretary shall,
after public notice and opportunity for comment, de-
velop contract performance requirements for the effi-
cient and effective performance of contract obliga-
tions under this section.’’.
(D) 
Section 
1842(b)(2)(A) 
(42 
U.S.C.
1395u(b)(2)(A)) is amended by striking the third
sentence.
(E) 
Section 
1842(b)(2)(B) 
(42 
U.S.C.
1395u(b)(2)(B)) is amended in the matter preceding
clause (i) by striking ‘‘establish standards’’ and in-
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serting ‘‘develop contract performance require-
ments’’.
(F) 
Section 
1842(b)(2)(D) 
(42 
U.S.C.
1395u(b)(2)(D)) is amended by striking ‘‘standards
and criteria’’ each place is appears and inserting
‘‘contract performance requirements’’.
(4)(A) Section 1816(b) (42 U.S.C. 1395h(b)) is
amended in the matter preceding paragraph (1) by
striking ‘‘an agreement’’ and inserting ‘‘a contract’’.
(B) Paragraphs (1)(B) and (2)(A) of section
1816(b) (42 U.S.C. 1395h(b)) are each amended by
striking ‘‘agreement’’ and inserting ‘‘contract’’.
(C) The first sentence of section 1816(c)(1) (42
U.S.C. 1395h(c)(1)) is amended by striking ‘‘An
agreement’’ and inserting ‘‘A contract’’.
(D) The last sentence of section 1816(c)(1) (42
U.S.C. 1395h(c)(1)) is amended by striking ‘‘an
agreement’’ and inserting ‘‘a contract’’.
(E) 
Section 
1816(c)(2)(A) 
(42 
U.S.C.
1395h(c)(2)(A)) is amended in the matter preceding
clause (i) by striking ‘‘agreement’’ and inserting
‘‘contract’’.
(F) 
Section 
1816(c)(3)(A) 
(42 
U.S.C.
1395h(c)(3)(A)) is amended by striking ‘‘agree-
ment’’ and inserting ‘‘contract’’.
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(G) The first sentence of section 1816(f)(1) (42
U.S.C. 1395h(f)(1)) is amended by striking ‘‘an
agreement’’ and inserting ‘‘a contract’’.
(H) Section 1816(h) (42 U.S.C. 1395h(h)) is
amended—
(i) by striking ‘‘An agreement’’ and insert-
ing ‘‘A contract’’, and
(ii) by striking ‘‘the agreement’’ each place
it appears and inserting ‘‘the contract’’.
(I) Section 1816(i)(I) (42 U.S.C. 1395h(i)(1))
is amended by striking ‘‘an agreement’’ and insert-
ing ‘‘a contract’’.
(J) Section 1816(j) (42 U.S.C. 1395h(j)) is
amended by striking ‘‘An agreement’’ and inserting
‘‘A contract’’.
(K) Section 1816(k) (42 U.S.C. 1395h(k)) is
amended by striking ‘‘An agreement’’ and inserting
‘‘A contract’’.
(L) Section 1842(a) (42 U.S.C. 1395u(a)) is
amended in the matter preceding paragraph (1) is
amended by striking ‘‘agreements’’ and inserting
‘‘contracts’’.
(M) 
Section 
1842(h)(3)(A) 
(42 
U.S.C.
1395u(h)(3)(A)) is amended by striking ‘‘an agree-
ment’’ and inserting ‘‘a contract’’.
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(5) Section 1816(f)(1) (42 U.S.C. 1395h(f)(1))
is amended by striking the second sentence.
(6)(A) 
Section 
1816(c)(2)(A) 
(42 
U.S.C.
1395h(c)(2)(A)) is amended in the matter preceding
clause (i) by inserting ‘‘that provides for making
payments under this part’’ after ‘‘this section’’.
(B) 
Section 
1816(c)(3)(A) 
(42 
U.S.C.
1395h(c)(3)(A)) is amended by inserting ‘‘that pro-
vides for making payments under this part’’ after
‘‘this section’’.
(C) Section 1816(k) (42 U.S.C. 1395h(k)) is
amended by inserting ‘‘(as appropriate)’’ after ‘‘sub-
mit’’.
(D) Section 1842(a) (42 U.S.C. 1395u(a)) is
amended in the matter preceding paragraph (1) by
striking ‘‘some or all of the following functions’’ and
inserting ‘‘any or all of the following functions, or
parts of those functions’’.
(E) The first sentence of section 1842(b)(2)(C)
(42 U.S.C. 1395u(b)((2)(C)) is amended by insert-
ing ‘‘(as appropriate)’’ after ‘‘carriers’’.
(F) 
Section 
1842(b)(3) 
(42 
U.S.C.
1395u(b)(3)) is amended in the matter preceding
subparagraph (A) by inserting ‘‘(as appropriate)’’
after ‘‘contract’’.
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(G) 
Section 
1842(b)(7)(A) 
(42 
U.S.C.
1395u(b)(7)(A)) is amended in the matter preceding
clause (i) by striking ‘‘the carrier’’ and inserting ‘‘a
carrier’’.
(H) 
Section 
1842(b)(11)(A) 
(42 
U.S.C.
1395u(b)(11)(A)) is amended in the matter preced-
ing clause (i) by inserting ‘‘(as appropriate)’’ after
‘‘each carrier’’.
(I) Section 1842(h)(2) (42 U.S.C. 1395u(h)(2))
is amended in the first sentence by inserting ‘‘(as
appropriate)’’ after ‘‘shall’’.
(J) 
Section 
1842(h)(5)(A) 
(42 
U.S.C.
1395u(h)(5)(A)) is amended by inserting ‘‘(as ap-
propriate)’’ after ‘‘carriers’’.
(7)(A) 
Section 
1816(c)(2)(C) 
(42 
U.S.C.
1395h(c)(2)(C)) is amended by striking ‘‘hospital,
rural primary care hospital, skilled nursing facility,
home health agency, hospice program, comprehen-
sive outpatient rehabilitation facility, or rehabilita-
tion agency’’ and inserting ‘‘provider of services’’.
(B) Section 1816(j) (42 U.S.C. 1395h)(j)) is
amended in the matter preceding paragraph (1) by
striking ‘‘for home health services, extended care
services, or post-hospital extended care services’’.
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(8) Section 1842(a)(3) (42 U.S.C. 1395u(a)(3))
is amended by inserting ‘‘(to and from individuals
enrolled under this part and to and from physicians
and other entities that furnish items and services)’’
after ‘‘communication’’.
(c) ELIMINATION OF SPECIAL PROVISIONS FOR TER-
MINATIONS OF CONTRACTS.—
(1) Section 1816(b) (42 U.S.C. 1395h(b)) is
amended in the matter preceding paragraph (1) is
amended by striking ‘‘or renew’’.
(2) The last sentence of section 1816(c)(1) (42
U.S.C. 1395h(c)(1)) is amended by striking ‘‘or re-
newing’’.
(3) Section 1816(f)(1) (42 U.S.C. 1395h(f)(1))
is amended—
(A) by striking ‘‘, renew, or terminate’’,
and
(B) by striking ‘‘, whether the Secretary
should assign or reassign a provider of services
to an agency or organization,’’.
(4) Section 1816(g) (42 U.S.C. 1395h(g)) is re-
pealed.
(5) The last sentence of section 1842(b)(2)(A)
(42 U.S.C. 1395u(b)(2)(A)) is amended by striking
‘‘or renewing’’.
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(6) Section 1842(b) (42 U.S.C. 1395u(b)) is
amended by striking paragraph (5).
(d) REPEAL OF FISCAL INTERMEDIARY REQUIRE-
MENTS
THAT
ARE
NOT
COST-EFFECTIVE.—Section
1816(f)(2) (42 U.S.C. 1395h(f)(2)) is amended to read
as follows:
‘‘(2) The contract performance requirements
developed under paragraph (1) shall include, with
respect to claims for services furnished under this
part by any provider of services other than a hos-
pital, whether such agency or organization is able to
process 75 percent of reconsiderations within 60
days and 90 percent of reconsiderations within 90
days.’’.
(e) REPEAL OF COST REIMBURSEMENT REQUIRE-
MENTS.—
(1) The first sentence of section 1816(c)(1) (42
U.S.C. 1395h(c)(1)) is amended—
(A) by striking the comma after ‘‘appro-
priate’’ and inserting ‘‘and’’, and
(B) by striking ‘‘subsection (a)’’ and all
that follows through the period and inserting
‘‘subsection (a).’’.
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(2) Section 1816(c)(1) (42 U.S.C. 1395h(c)(1))
is further amended by striking the second and third
sentences.
(3) The first sentence of section 1842(c)(1) (42
U.S.C. 1395u(c)(1)) is amended—
(A) by striking ‘‘shall provide’’ the first
place it appears and inserting ‘‘may provide’’,
and
(B) by striking ‘‘this part’’ and all that fol-
lows through the period and inserting ‘‘this
part.’’.
(4) Section 1842(c)(1) (42 U.S.C. 1395u(c)(1))
is further amended by striking the second and third
sentences.
(5) Section 2326(a) of the Deficit Reduction
Act of 1984 is repealed.
(f) COMPETITION REQUIRED FOR NEW CONTRACTS
AND IN CASES OF POOR PERFORMANCE.—
(1) Section 1816(c) (42 U.S.C. 1395h(c)) is
amended by adding at the end the following new
paragraph:
‘‘(4)(A) A contract with a fiscal intermediary
under this section may be renewed from term to
term without regard to any provision of law requir-
ing competition if the fiscal intermediary has met or
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exceeded the performance requirements established
in the current contract.
‘‘(B) Functions may be transferred among fis-
cal intermediaries without regard to any provision of
law requiring competition.’’.
(2) Section 1842(b)(1) (42 U.S.C. 1395u(b)(1))
is amended to read as follows:
‘‘(b)(1)(A) A contract with a carrier under subsection
(a) may be renewed from term to term without regard to
any provision of law requiring competition if the carrier
has met or exceeded the performance requirements estab-
lished in the current contract.
‘‘(B) Functions may be transferred among carriers
without regard to any provision of law requiring competi-
tion.’’.
(g) WAIVER OF COMPETITIVE REQUIREMENTS FOR
INITIAL CONTRACTS.—
(1) Contracts that have periods that begin dur-
ing the 1-year period that begins on the first day of
the fourth calendar month that begins after the date
of enactment of this Act may be entered into under
section 1816(a) of the Social Security Act (42
U.S.C. 1395h(a)) without regard to any provision of
law requiring competition.
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(2) The amendments made by subsection (f)
apply to contracts that have periods beginning after
the end of the 1-year period specified in paragraph
(1).
(h) EFFECTIVE DATES.—
(1) The amendments made by subsection (c)
apply to contracts that have periods ending on, or
after, the end of the third calendar month that be-
gins after the date of enactment of this Act.
(2) The amendments made by subsections (a),
(b), (d), and (e) apply to contracts that have periods
beginning after the third calendar month that begins
after the date of enactment of this Act.
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