A bill to amend title XVIII of the Social Security Act to establish a medicare demonstration project under which incentive payments are provided in certain areas in order to stabilize, maintain, or increase access to primary care services for individuals enrolled under part B of such title.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Medicare Incentive Access Act of 
2002''.

SEC. 2. INCENTIVE PAYMENT IN MEDICARE HEALTH PROFESSIONAL SHORTAGE 
              AREAS DEMONSTRATION PROJECT.

    Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is 
amended by adding at the end the following new section:

  ``incentive payments in medicare health professional shortage areas 
                         demonstration project

    ``Sec. 1897. (a) Establishment.--
            ``(1) In general.--The Secretary shall establish a 
        demonstration project under which--
                    ``(A) pursuant to paragraph (3), the Secretary 
                designates areas in a State selected under paragraph 
                (5) as medicare health professional shortage areas; and
                    ``(B) an incentive payment is provided under part B 
                to primary care physicians for each physician's service 
                (as defined in section 1861(q)) that is furnished in a 
                medicare health professional shortage area to an 
                individual enrolled under such part.
            ``(2) Primary care physician defined.--For purposes of this 
        section, the term `primary care physician' has the meaning 
        given such term for purposes of designating health professional 
        shortage areas under section 332(a) of the Public Health 
        Service Act (42 U.S.C. 254e(a)).
            ``(3) Designation of areas.--The Secretary shall designate 
        an area in a State selected under paragraph (5) as a medicare 
        health professional shortage area if the Secretary determines, 
        using the methodology established under subsection (b)(1)(B), 
        that individuals enrolled under part B and residing in the area 
        have inadequate access to primary care physicians.
            ``(4) Terms and conditions.--
                    ``(A) Incentive payment in addition to payment 
                otherwise made.--
                            ``(i) In general.--Subject to clause (ii), 
                        the incentive payment made under the 
                        demonstration project for a physician's service 
                        shall be in addition to the amount otherwise 
                        made for the service under part B.
                            ``(ii) No payments under the incentive 
                        payment program in a demonstration state during 
                        operation of the demonstration program.--
                        Subject to subparagraph (D), notwithstanding 
                        section 1833(m), during the operation of the 
                        demonstration project in a State selected under 
                        paragraph (5), the Secretary may not make any 
                        incentive payment to any physician under such 
                        section for any service furnished in any part 
                        of such State, regardless of--
                                    ``(I) whether the physician is 
                                eligible for bonus payments under the 
                                demonstration program; and
                                    ``(II) where the service was 
                                furnished in the State.
                    ``(B) Amount of incentive payment.--The amount of 
                the incentive payment for a physician's service 
                furnished under the demonstration project shall be an 
                amount equal to 40 percent of the payment amount for 
                the service under part B.
                    ``(C) No effect on amount of coinsurance an 
                individual is required to pay.--The amount of any 
                coinsurance that an individual enrolled under part B is 
                responsible for paying with respect to a physicians' 
                service furnished to the individual shall be determined 
                as if this section had not been enacted.
                    ``(D) No effect on payments to critical access 
                hospitals.--The amount of payment for outpatient 
                critical access services of a critical access hospital 
                under section 1834(g) shall be determined as if this 
                section had not been enacted.
            ``(5) Demonstration sites.--The Secretary shall conduct the 
        demonstration project in 5 States selected by the Secretary as 
        demonstration sites.
            ``(6) Automation of incentive payments.--
                    ``(A) In general.--Under the demonstration project, 
                incentive payments under paragraph (1)(B) to a primary 
                care physician shall be made automatically to the 
                physician rather than the physician being responsible 
                for determining when a payment is required to be made 
                under that paragraph.
                    ``(B) Incentive payment based on zip codes.--In 
                order to comply with subparagraph (A), the Secretary 
                shall establish procedures in which the amount of 
                payment otherwise made for a physician's service is 
                automatically increased by the amount of the incentive 
                payment under the demonstration project if the service 
                was furnished in any zip code that is entirely 
or partially in a designated medicare health professional shortage area 
in a State selected under paragraph (5).
            ``(7) Duration.--The demonstration project shall be 
        conducted for a 3-year period. The period for establishing the 
        methodology under subsection (b) shall not be counted for 
        purposes determining such 3-year period.
    ``(b) Establishment of Methodology for Assisting Secretary in 
Designating Medicare Health Professional Shortage Areas.--
            ``(1) In general.--The Secretary shall select 1 or more 
        Federal rural health research centers within the Health 
        Resources Services Administration to establish a methodology to 
        assist the Secretary in designating areas within the States 
        selected under subsection (a)(5) as medicare health 
        professional shortage areas pursuant to subsection (a)(3).
            ``(2) Rules for establishing methodology.--
                    ``(A) In general.--The methodology established 
                under paragraph (1) shall address--
                            ``(i) how to measure the percentage of the 
                        total population in an area that consists of 
                        individuals enrolled under part B; and
                            ``(ii) the appropriate ratio of such 
                        individuals to primary care physicians in an 
                        area in order to ensure that such individuals 
                        have adequate access to services furnished by 
                        such physicians.
                    ``(B) Methodology may be similar to methodologies 
                used under the public health service act.--The 
                methodology established under paragraph (1) may be 
                similar to methodologies utilized by the Secretary for 
                designating areas, and population groups within areas, 
                as health professional shortage areas under section 
                332(a) of the Public Health Service Act (42 U.S.C. 
                254e(a)).
                    ``(C) Consultation.--The Federal rural health 
                research centers selected under paragraph (1) shall 
                consult with the State and local medical societies of 
                the States selected under subsection (a)(5) in 
                establishing the methodology under paragraph (1).
    ``(c) No Effect on Designation as a Health Professional Shortage 
Area.--Except as provided in subsection (a)(4)(A)(ii), the designation 
of an area as a medicare health professional shortage area under 
subsection (a)(3) shall have no effect on the designation of such area 
as a health professional shortage area under section 332(a) of the 
Public Health Service Act (42 U.S.C. 254e(a)).
    ``(d) Waiver Authority.--The Secretary may waive such requirements 
of title XI and this title as may be necessary for the purpose of 
carrying out the demonstration project.
    ``(e) Report.--
            ``(1) In general.--Not later than 6 months after the 
        completion of the demonstration project, the Secretary shall 
        submit to Congress a report on such project.
            ``(2) Contents.--The report submitted under paragraph (1) 
        shall contain--
                    ``(A) an evaluation of whether the demonstration 
                project has had the effect of stabilizing, maintaining, 
                or increasing access of individuals enrolled under part 
                B to physicians' services furnished by primary care 
                physicians, including whether the amount of the 
                incentive payment is adequate to stabilize, maintain, 
                or increase such access and if not, then what amount 
                will;
                    ``(B) a comparison of the effectiveness of the 
                demonstration project in stabilizing, maintaining, or 
                increasing such access with the effectiveness of other 
                Federal, State, and local programs, such as the 
                incentive program under section 1833(m), that are 
                designed to stabilize, maintain, or increase such 
                access;
                    ``(C) recommendations for such legislation and 
                administrative actions as the Secretary considers 
                appropriate; and
                    ``(D) any other items that the Secretary considers 
                appropriate.
    ``(f) Funding.--
            ``(1) Incentive payments.--The Secretary shall use funds in 
        the Federal Supplementary Medical Insurance Trust Fund under 
        section 1841 to make the incentive payments under this section.
            ``(2) Establishment of methodology.--
                    ``(A) In general.--There is authorized to be 
                appropriated $6,000,000 to establish the methodology 
                under subsection (b)(1).
                    ``(B) Availability.--Any amounts appropriated 
                pursuant to subparagraph (A) shall remain available 
                until expended.''.

Summary: Medicare Incentive Access Act of 2002 - Amends title XVIII (Medicare) of the Social Security Act (SSA) part B (Supplementary Medical Insurance) to establish a three-year demonstration project under which the Secretary of Health and Human Services shall: (1) select one or more Federal rural health research centers within the Health Resources Services Administration to develop a methodology for designating Medicare health professional shortage areas; (2) select five States as demonstration sites and designate Medicare health professional shortage areas in them; and (3) provide incentive payments to primary care physicians to service those shortage areas.