Save America’s Rural Hospitals Act
Bill: H.R.6400 | Sponsor: Rep. Graves, Sam (R-MO)
Policy area: Health

Summary:
Save America's Rural Hospitals Act
This bill establishes and otherwise modifies payment requirements for rural health care providers under Medicare and Medicaid, including by (1) exempting Medicare payments to rural hospitals from sequestration, (2) making permanent certain payment increases for services in rural areas (e.g., Medicaid primary care services), and (3) permanently removing the 96-hour physician certification requirement for inpatient critical access hospital services under Medicare.

To amend titles XVIII and XIX of the Social Security Act to provide for 
enhanced payments to rural health care providers under the Medicare and 
               Medicaid programs, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Save America's 
Rural Hospitals Act''.
    (b) Findings.--Congress finds the following:
            (1) More than 60,000,000 individuals in rural areas of the 
        United States rely on rural hospitals and other providers as 
        critical access points to health care.
            (2) Access to health care is essential to communities that 
        Americans living in rural areas call home.
            (3) Americans living in rural areas are older, poorer, and 
        sicker than Americans living in urban areas.
            (4) Between January 2010 and January 1, 2021, 137 rural 
        hospitals closed in the United States, according to the 
        University of North Carolina's Cecil G. Sheps Center for Health 
        Services Research, and the rate of these closures is 
        increasing.
            (5) Four hundred and fifty-three hospitals are operating at 
        margins similar to those that have closed over the past decade. 
        Of those, 216 are considered most vulnerable to closure.
            (6) Rural Medicare beneficiaries already face a number of 
        challenges when trying to access health care services close to 
        home, including the weather, geography, and cultural, social, 
        and language barriers.
            (7) Approximately sixty percent of all primary care health 
        professional shortage areas are located in rural areas.
            (8) Seniors living in rural areas are forced to travel 
        significant distances for care.
            (9) On average, trauma victims in rural areas must travel 
        twice as far as victims in urban areas to the closest hospital, 
        and, as a result, 60 percent of trauma deaths occur in rural 
        areas, even though only 20 percent of Americans live in rural 
        areas.
            (10) With the 453 hospitals on the brink of closure, 
        millions of Americans living in rural areas are on the brink of 
        losing access to the closest emergency room.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
             TITLE I--RURAL PROVIDER PAYMENT STABILIZATION

                      Subtitle A--Rural Hospitals

Sec. 101. Eliminating Medicare sequestration for rural hospitals.
Sec. 102. Reversing cuts to reimbursement of bad debt for critical 
                            access hospitals (CAHs) and rural 
                            hospitals.
Sec. 103. Extending payment levels for low-volume hospitals and 
                            Medicare-dependent hospitals (MDHs).
Sec. 104. Reinstating revised diagnosis-related group payments for MDHs 
                            and sole community hospitals (SCHs).
Sec. 105. Reinstating hold harmless treatment for hospital outpatient 
                            services for SCHs.
                   Subtitle B--Other Rural Providers

Sec. 111. Making permanent increased Medicare payments for ground 
                            ambulance services in rural areas.
Sec. 112. Extending Medicaid primary care payments.
Sec. 113. Making permanent Medicare telehealth service enhancements for 
                            federally qualified health centers and 
                            rural health clinics.
Sec. 114. Creation of reporting requirements for provider-based rural 
                            health clinics.
              TITLE II--RURAL MEDICARE BENEFICIARY EQUITY

Sec. 201. Equalizing beneficiary copayments for services furnished by 
                            CAHs.
                      TITLE III--REGULATORY RELIEF

Sec. 301. Eliminating 96-hour physician certification requirement with 
                            respect to inpatient CAH services.
Sec. 302. Rebasing supervision requirements.
Sec. 303. Reforming practices of recovery audit contractors under 
                            Medicare.
                 TITLE IV--FUTURE OF RURAL HEALTH CARE

Sec. 401. Medicare rural hospital flexibility program grants.

             TITLE I--RURAL PROVIDER PAYMENT STABILIZATION

                      Subtitle A--Rural Hospitals

SEC. 101. ELIMINATING MEDICARE SEQUESTRATION FOR RURAL HOSPITALS.

    (a) In General.--Section 256(d)(7) of the Balanced Budget and 
Emergency Deficit Control Act of 1985 (2 U.S.C. 906(d)(7)) is amended 
by adding at the end the following:
                    ``(D) Rural hospitals.--Payments under part A or 
                part B of title XVIII of the Social Security Act with 
                respect to items and services furnished by a critical 
                access hospital (as defined in section 1861(mm)(1) of 
                such Act), a sole community hospital (as defined in 
                section 1886(d)(5)(D)(iii) of such Act), a Medicare-
                dependent, small rural hospital (as defined in section 
                1886(d)(5)(G)(iv) of such Act), or a subsection (d) 
                hospital located in a rural area (as defined in section 
                1886(d)(2)(D) of such Act).''.
    (b) Applicability.--The amendment made by this section applies with 
respect to orders of sequestration effective on or after the date that 
is 60 days after the date of the enactment of this Act.

SEC. 102. REVERSING CUTS TO REIMBURSEMENT OF BAD DEBT FOR CRITICAL 
              ACCESS HOSPITALS (CAHS) AND RURAL HOSPITALS.

    (a) Rural Hospitals.--Section 1861(v)(1)(T)(v) of the Social 
Security Act (42 U.S.C. 1395x(v)(1)(T)(v)) is amended by inserting 
before the period the following: ``or, in the case of a hospital 
located in a rural area, by 15 percent of such amount otherwise 
allowable''.
    (b) CAHs.--Section 1861(v)(1)(W)(ii) of the Social Security Act (42 
U.S.C. 1395x(v)(1)(W)(ii)) is amended by inserting after ``or (V)'' the 
following: ``, a critical access hospital''.
    (c) Applicability.--The amendments made by this section apply with 
respect to cost reporting periods beginning more than 60 days after the 
date of the enactment of this Act.

SEC. 103. EXTENDING PAYMENT LEVELS FOR LOW-VOLUME HOSPITALS AND 
              MEDICARE-DEPENDENT HOSPITALS (MDHS).

    (a) Extension of Increased Payments for MDHs.--
            (1) Extension of payment methodology.--Section 
        1886(d)(5)(G) of the Social Security Act (42 U.S.C. 
        1395ww(d)(5)(G)) is amended--
                    (A) in clause (i), by striking ``, and before 
                October 1, 2022''; and
                    (B) in clause (ii)(II), by striking ``, and before 
                October 1, 2022''.
            (2) Conforming amendments.--
                    (A) Extension of target amount.--Section 
                1886(b)(3)(D) of the Social Security Act (42 U.S.C. 
                1395ww(b)(3)(D)) is amended--
                            (i) in the matter preceding clause (i), by 
                        striking ``, and before October 1, 2022''; and
                            (ii) in clause (iv), by striking ``through 
                        fiscal year 2022'' and inserting ``or a 
                        subsequent fiscal year''.
                    (B) Extending the period during which hospitals can 
                decline reclassification as urban.--Section 13501(e)(2) 
                of the Omnibus Budget Reconciliation Act of 1993 (42 
                U.S.C. 1395ww note) is amended by striking ``fiscal 
                year 2000 through fiscal year 2022'' and inserting ``a 
                subsequent fiscal year''.
    (b) Extension of Increased Payments for Low-Volume Hospitals.--
Section 1886(d)(12) of the Social Security Act (42 U.S.C. 
1395ww(d)(12)) is amended--
            (1) in subparagraph (B)--
                    (A) in the header, by inserting ``for fiscal years 
                2005 through 2010'' after ``increase''; and
                    (B) in the matter preceding clause (i), by striking 
                ``and for discharges occurring in fiscal year 2023 and 
                subsequent fiscal years'';
            (2) in subparagraph (C)(i)--
                    (A) in the matter preceding subclause (I), by 
                striking ``through 2022'' and inserting ``and each 
                subsequent fiscal year'';
                    (B) in subclause (II), by adding at the end 
                ``and'';
                    (C) in subclause (III)--
                            (i) by striking ``fiscal years 2019 through 
                        2022'' and inserting ``fiscal year 2019 and 
                        each subsequent fiscal year''; and
                            (ii) by striking ``; and'' and inserting a 
                        period; and
                    (D) by striking subclause (IV); and
            (3) in subparagraph (D)--
                    (A) by amending the heading to read as follows: 
                ``Applicable percentage increase after fiscal year 
                2010'';
                    (B) in the matter preceding clause (i), by striking 
                ``in fiscal years 2011 through 2022'' and inserting 
                ``in fiscal year 2011 or a subsequent fiscal year''; 
                and
                    (C) in clause (ii), by striking ``each of fiscal 
                years 2019 through 2022'' and inserting ``fiscal year 
                2019 and each subsequent fiscal year''.

SEC. 104. REINSTATING REVISED DIAGNOSIS-RELATED GROUP PAYMENTS FOR MDHS 
              AND SOLE COMMUNITY HOSPITALS (SCHS).

    (a) Payments for MDHs and SCHs for Value-Based Incentive 
Programs.--Section 1886(o)(7)(D)(ii)(I) of the Social Security Act (42 
U.S.C. 1395ww(o)(7)(D)(ii)(I)) is amended by inserting ``and after 
fiscal year 2021'' after ``2013''.
    (b) Payments for MDHs and SCHs Under Hospital Readmissions 
Reduction Program.--Section 1886(q)(2)(B)(i) of the Social Security Act 
(42 U.S.C. 1395ww(q)(2)(B)(i)) is amended by inserting ``and after 
fiscal year 2021'' after ``2013''.

SEC. 105. REINSTATING HOLD HARMLESS TREATMENT FOR HOSPITAL OUTPATIENT 
              SERVICES FOR SCHS.

    Section 1833(t)(7)(D)(i) of the Social Security Act (42 U.S.C. 
1395l(t)(7)(D)(i)) is amended--
            (1) in the heading, by striking ``temporary'' and inserting 
        ``permanent'';
            (2) in subclause (II)--
                    (A) in the first sentence, by inserting ``and on or 
                after January 1, 2022,'' after ``January 1, 2013,''; 
                and
                    (B) in the second sentence, by inserting ``, and 
                during or after 2022'' after ``or 2012''; and
            (3) in subclause (III), in the first sentence, by inserting 
        ``and on or after January 1, 2022,'' after ``January 1, 
        2013,''.

                   Subtitle B--Other Rural Providers

SEC. 111. MAKING PERMANENT INCREASED MEDICARE PAYMENTS FOR GROUND 
              AMBULANCE SERVICES IN RURAL AREAS.

    Section 1834(l)(13) of the Social Security Act (42 U.S.C. 
1395m(l)(13)) is amended--
            (1) in the paragraph heading, by striking ``temporary 
        increase'' and inserting ``increase''; and
            (2) in subparagraph (A)--
                    (A) in the matter preceding clause (i), by striking 
                ``, and before January 1, 2023''; and
                    (B) in clause (i), by striking ``, and before 
                January 1, 2023''.

SEC. 112. EXTENDING MEDICAID PRIMARY CARE PAYMENTS.

    (a) In General.--Section 1902(a)(13)(C) of the Social Security Act 
(42 U.S.C. 1396a(a)(13)(C)) is amended by inserting after ``2014'' the 
following: ``(or, in the case of primary care services furnished by a 
physician located in a rural area, as defined in section 1886(d)(2)(D), 
furnished in any year)''.
    (b) Applicability.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendment made by this section applies to services furnished in 
        a year beginning on or after the date of the enactment of this 
        Act.
            (2) Exception if state legislation required.--In the case 
        of a State plan for medical assistance under title XIX of the 
        Social Security Act which the Secretary of Health and Human 
        Services determines requires State legislation (other than 
        legislation appropriating funds) in order for the plan to meet 
        the additional requirement imposed by the amendment made by 
        this section, the State plan shall not be regarded as failing 
        to comply with the requirements of such title solely on the 
        basis of its failure to meet this additional requirement before 
        the first day of the first calendar quarter beginning after the 
        close of the first regular session of the State legislature 
        that begins after the date of the enactment of this Act. For 
        purposes of the previous sentence, in the case of a State that 
        has a 2-year legislative session, each year of such session 
        shall be deemed to be a separate regular session of the State 
        legislature.

SEC. 113. MAKING PERMANENT MEDICARE TELEHEALTH SERVICE ENHANCEMENTS FOR 
              FEDERALLY QUALIFIED HEALTH CENTERS AND RURAL HEALTH 
              CLINICS.

    Paragraph (8) of section 1834(m) of the Social Security Act (42 
U.S.C. 1395m(m)) is amended--
            (1) in the paragraph heading, be striking ``during 
        emergency period'';
            (2) in the matter preceding subparagraph (A), by striking 
        ``During the emergency period described in section 
        1135(g)(1)(B)'' and inserting ``Beginning on the first day of 
        the emergency period described in section 1135(g)(1)(B)'';
            (3) in subparagraph (A)(ii), by striking ``determined under 
        subparagraph (B)'' and inserting ``determined, for services 
        furnished during the emergency period described in section 
        1135(g)(1)(B), under subparagraph (B) and, for services 
        furnished after such period, as an amount equal to the amount 
        that such center or clinic would have been paid under this 
        title had such service been furnished without the use of a 
        telecommunications system''; and
            (4) in subparagraph (B)--
                    (A) by striking ``payment rule'' and all that 
                follows through ``The Secretary shall'' and inserting 
                ``payment rule.--The Secretary shall''; and
                    (B) by redesignating clause (ii) as subparagraph 
                (C) and moving such subparagraph as so redesignated 2 
                ems to the left.

SEC. 114. CREATION OF REPORTING REQUIREMENTS FOR PROVIDER-BASED RURAL 
              HEALTH CLINICS.

    (a) In General.--Not later than two years after the date of the 
enactment of this Act, the Secretary of Health and Human Services (in 
this section referred to as the ``Secretary'') shall, taking into 
account the recommendations made pursuant to subsection (b), implement 
a voluntary Medicare provider-based rural health clinic quality 
reporting program, in accordance with this section, under which--
            (1) provider-based rural health clinics established on or 
        after January 1, 2021, may voluntarily comply with reporting 
        requirements described in subsection (b)(2); and
            (2) payments under title XVIII to such clinics complying 
        with such requirements are provided in accordance with 
        subsection (d).
    (b) Consultation.--Not later than one year after the date of the 
enactment of this Act, the Secretary, acting through the Administrator 
for Centers for Medicare & Medicaid Services, the Federal Office of 
Rural Health Policy, and the Agency for Healthcare Research and 
Quality, shall consult with relevant stakeholders--
            (1) to review rural health clinic data collection processes 
        and quality measurers identified for rural health clinics by 
        the National Quality Forum and other national quality-
        monitoring systems; and
            (2) to make recommendations to the Secretary for voluntary 
        reporting requirements for the Secretary to implement under the 
        eligible professional Merit-based Incentive Payment System 
        under section 1848(q) of the Social Security Act (42 U.S.C. 
        1395w-4) for provider-based rural health clinics established on 
        or after January 1, 2021.
    (c) Collaboration.--In implementing the voluntary Medicare 
provider-based rural health clinic quality reporting program, the 
Secretary shall consult with a diverse group of rural health clinic 
stakeholders, which shall include--
            (1) the National Quality Forum, or such other standard-
        setting organizations specified by the Secretary;
            (2) relevant State and local public agencies, including 
        State offices of rural health;
            (3) established provider-based rural health clinics, 
        including those in the application process;
            (4) small rural hospitals with 50 beds or less;
            (5) organizations representing provider-based rural health 
        clinics; and
            (6) organizations representing rural health care.
    (d) Conditions.--Under the voluntary Medicare provider-based rural 
health clinic quality reporting program the Secretary shall provide 
that in the case of a provider-based rural health clinic described in 
subsection (a)(1) that voluntarily complies with the reporting 
requirements described in subsection (b)(2), with respect to a year--
            (1) reimbursement rates under title XVIII of the Social 
        Security Act for rural health services furnished by such clinic 
        during such year shall be consistent with reimbursement rates 
        under such title for such services furnished by a provider-
        based rural health clinic established before December 31, 2020; 
        and
            (2) the provisions of section 1833(f)(3) of such Act (42 
        U.S.C. 1395l(f)(3)) shall not apply with respect to such clinic 
        and such year.
    (e) Grants for Technical Assistance.--
            (1) In general.--Section 1820(g)(3) of the Social Security 
        Act (42 U.S.C. 1395i-4(g)(3)) is amended--
                    (A) in subparagraph (A)--
                            (i) by striking ``Balanced Budget Act of 
                        1997 and'' and inserting ``Balanced Budget Act 
                        of 1997,''; and
                            (ii) by inserting before the period at the 
                        end the following: ``, and to provide to such 
                        small rural hospitals that participate in the 
                        voluntary Medicare provider-based rural health 
                        clinic quality reporting program established 
                        pursuant to section 114 of the Save America's 
                        Rural Hospitals Act technical assistance 
                        necessary to so participate in such program''; 
                        and
                    (B) in subparagraph (E)--
                            (i) by striking ``and to participate in 
                        delivery system reforms'' and inserting ``, to 
                        participate in delivery system reforms''; and
                            (ii) by inserting before the period at the 
                        end the following: ``, and in the case of small 
                        rural hospitals that participate in the 
                        voluntary Medicare provider-based rural health 
                        clinic quality reporting program established 
                        pursuant to section 114 of the Save America's 
                        Rural Hospitals Act, for technical assistance 
                        necessary to so participate in such program''.
            (2) Funding.--In addition to amounts otherwise made 
        available for grants under section 1820(g)(3) of the Social 
        Security Act, there is appropriated to the Secretary of Health 
        and Human Services, out of any monies in the Treasury not 
        otherwise appropriated, $15,000,000 for the period of fiscal 
        years 2022 through 2026 to provide grants under such section to 
        small rural hospitals that participate in the voluntary 
        Medicare provider-based rural health clinic quality reporting 
        program established pursuant to this section for technical 
        assistance necessary to so participate in such program.

              TITLE II--RURAL MEDICARE BENEFICIARY EQUITY

SEC. 201. EQUALIZING BENEFICIARY COPAYMENTS FOR SERVICES FURNISHED BY 
              CAHS.

    (a) In General.--Section 1866(a)(2)(A) of the Social Security Act 
(42 U.S.C. 1395cc(a)(2)(A)) is amended by adding at the end the 
following: ``In the case of outpatient critical access hospital 
services for which payment is made under section 1834(g), clause (ii) 
of the first sentence shall be applied by substituting `20 percent of 
the lesser of the actual charge or the payment basis under this part 
for such services if the critical access hospital were treated as a 
hospital' for `20 per centum of the reasonable charges for such items 
and services'.''.
    (b) Applicability.--The amendment made by this section applies with 
respect to services furnished during a year that begins more than 60 
days after the date of the enactment of this Act.

                      TITLE III--REGULATORY RELIEF

SEC. 301. ELIMINATING 96-HOUR PHYSICIAN CERTIFICATION REQUIREMENT WITH 
              RESPECT TO INPATIENT CAH SERVICES.

    (a) In General.--Section 1814(a) of the Social Security Act (42 
U.S.C. 1395f(a)) is amended--
            (1) in paragraph (6), by adding ``and'' at the end;
            (2) in paragraph (7)(E), by striking ``; and'' and 
        inserting a period; and
            (3) by striking paragraph (8).
    (b) Applicability.--The amendments made by this section apply with 
respect to services furnished during a year that begins more than 60 
days after the date of the enactment of this Act.

SEC. 302. REBASING SUPERVISION REQUIREMENTS.

    (a) Therapeutic Hospital Outpatient Services.--
            (1) Supervision requirements.--Section 1833 of the Social 
        Security Act (42 U.S.C. 1395l) is amended by adding at the end 
        the following new subsection:
    ``(ee) Physician Supervision Requirements for Therapeutic Hospital 
Outpatient Services.--
            ``(1) General supervision for therapeutic services.--Except 
        as may be provided under paragraph (2), insofar as the 
        Secretary requires the supervision by a physician or a non-
        physician practitioner for payment for therapeutic hospital 
        outpatient services (as defined in paragraph (5)(A)) furnished 
        under this part, such requirement shall be met if such services 
        are furnished under the general supervision (as defined in 
        paragraph (5)(B)) of the physician or non-physician 
        practitioner, as the case may be.
            ``(2) Exceptions process for high-risk or complex medical 
        services requiring a direct level of supervision.--
                    ``(A) In general.--Subject to the succeeding 
                provisions of this paragraph, the Secretary shall 
                establish a process for the designation of therapeutic 
                hospital outpatient services furnished under this part 
                that, by reason of complexity or high risk, require--
                            ``(i) direct supervision (as defined in 
                        paragraph (5)(C)) for the entire service; or
                            ``(ii) direct supervision during the 
                        initiation of the service followed by general 
                        supervision for the remainder of the service.
                    ``(B) Consultation with clinical experts.--
                            ``(i) In general.--Under the process 
                        established under subparagraph (A), before the 
                        designation of any therapeutic hospital 
                        outpatient service for which direct supervision 
                        may be required under this part, the Secretary 
                        shall consult with a panel of outside experts 
                        described in clause (ii) to advise the 
                        Secretary with respect to each such 
                        designation.
                            ``(ii) Advisory panel on supervision of 
                        therapeutic hospital outpatient services.--For 
                        purposes of clause (i), a panel of outside 
                        experts described in this clause is a panel 
                        appointed by the Secretary, based on 
                        nominations submitted by hospital, rural 
                        health, and medical organizations representing 
                        physicians, non-physician practitioners, and 
                        hospital administrators, as the case may be, 
                        that meets the following requirements:
                                    ``(I) Composition.--The panel shall 
                                be composed of at least 15 physicians 
                                and non-physician practitioners who 
                                furnish therapeutic hospital outpatient 
                                services for which payment is made 
                                under this part and who collectively 
                                represent the medical specialties that 
                                furnish such services, and of 4 
                                hospital administrators of hospitals 
                                located in rural areas (as defined in 
                                section 1886(d)(2)(D)) or critical 
                                access hospitals.
                                    ``(II) Practical experience 
                                required for physicians and non-
                                physician practitioners.--During the 
                                12-month period preceding appointment 
                                to the panel by the Secretary, each 
                                physician or non-physician practitioner 
                                described in subclause (I) shall have 
                                furnished therapeutic hospital 
                                outpatient services for which payment 
                                was made under this part.
                                    ``(III) Minimum rural 
                                representation requirement for 
                                physicians and non-physician 
                                practitioners.--Not less than 50 
                                percent of the membership of the panel 
                                that is comprised of physicians and 
                                non-physician practitioners shall be 
                                physicians or non-physician 
                                practitioners described in subclause 
                                (I) who practice in rural areas (as 
                                defined in section 1886(d)(2)(D)) or 
                                who furnish such services in critical 
                                access hospitals.
                            ``(iii) Application of faca.--The Federal 
                        Advisory Committee Act (5 U.S.C. 2 App.), other 
                        than section 14 of such Act, shall apply to the 
                        panel of outside experts appointed by the 
                        Secretary under clause (ii).
                    ``(C) Special rule for outpatient critical access 
                hospital services.--Insofar as a therapeutic outpatient 
                hospital service that is an outpatient critical access 
                hospital service is designated as requiring direct 
                supervision under the process established under 
                subparagraph (A), the Secretary shall deem the critical 
                access hospital furnishing that service as having met 
                the requirement for direct supervision for that service 
                if, when furnishing such service, the critical access 
                hospital meets the standard for personnel required as a 
                condition of participation under section 485.618(d) of 
                title 42, Code of Federal Regulations (as in effect on 
                the date of the enactment of this subsection).
                    ``(D) Consideration of compliance burdens.--Under 
                the process established under subparagraph (A), the 
                Secretary shall take into account the impact on 
                hospitals and critical access hospitals in complying 
                with requirements for direct supervision in the 
                furnishing of therapeutic hospital outpatient services, 
                including hospital resources, availability of hospital-
                privileged physicians, specialty physicians, and non-
                physician practitioners, and administrative burdens.
                    ``(E) Requirement for notice and comment 
                rulemaking.--Under the process established under 
                subparagraph (A), the Secretary shall only designate 
                therapeutic hospital outpatient services requiring 
                direct supervision under this part through proposed and 
                final rulemaking that provides for public notice and 
                opportunity for comment.
                    ``(F) Rule of construction.--Nothing in this 
                subsection shall be construed as authorizing the 
                Secretary to apply or require any level of supervision 
                other than general or direct supervision with respect 
                to the furnishing of therapeutic hospital outpatient 
                services.
            ``(3) Initial list of designated services.--The Secretary 
        shall include in the proposed and final regulation for payment 
        for hospital outpatient services for 2022 under this part a 
        list of initial therapeutic hospital outpatient services, if 
        any, designated under the process established under paragraph 
        (2)(A) as requiring direct supervision under this part.
            ``(4) Direct supervision by non-physician practitioners for 
        certain hospital outpatient services permitted.--
                    ``(A) In general.--Subject to the succeeding 
                provisions of this subsection, a non-physician 
                practitioner may directly supervise the furnishing of--
                            ``(i) therapeutic hospital outpatient 
                        services under this part, including cardiac 
                        rehabilitation services (under section 
                        1861(eee)(1)), intensive cardiac rehabilitation 
                        services (under section 1861(eee)(4)), and 
                        pulmonary rehabilitation services (under 
                        section 1861(fff)(1)); and
                            ``(ii) those hospital outpatient diagnostic 
                        services (described in section 1861(s)(2)(C)) 
                        that require direct supervision under the fee 
                        schedule established under section 1848.
                    ``(B) Requirements.--Subparagraph (A) shall apply 
                insofar as the non-physician practitioner involved 
                meets the following requirements:
                            ``(i) Scope of practice.--The non-physician 
                        practitioner is acting within the scope of 
                        practice under State law applicable to the 
                        practitioner.
                            ``(ii) Additional requirements.--The non-
                        physician practitioner meets such requirements 
                        as the Secretary may specify.
            ``(5) Definitions.--In this subsection:
                    ``(A) Therapeutic hospital outpatient services.--
                The term `therapeutic hospital outpatient services' 
                means hospital services described in section 
                1861(s)(2)(B) furnished by a hospital or critical 
                access hospital and includes--
                            ``(i) cardiac rehabilitation services and 
                        intensive cardiac rehabilitation services (as 
                        defined in paragraphs (1) and (4), 
                        respectively, of section 1861(eee)); and
                            ``(ii) pulmonary rehabilitation services 
                        (as defined in section 1861(fff)(1)).
                    ``(B) General supervision.--
                            ``(i) Overall direction and control of 
                        physician.--Subject to clause (ii), with 
                        respect to the furnishing of therapeutic 
                        hospital outpatient services for which payment 
                        may be made under this part, the term `general 
                        supervision' means such services that are 
                        furnished under the overall direction and 
                        control of a physician or non-physician 
                        practitioner, as the case may be.
                            ``(ii) Presence not required.--For purposes 
                        of clause (i), the presence of a physician or 
                        non-physician practitioner is not required 
                        during the performance of the procedure 
                        involved.
                    ``(C) Direct supervision.--
                            ``(i) Provision of assistance and 
                        direction.--Subject to clause (ii), with 
                        respect to the furnishing of therapeutic 
                        hospital outpatient services for which payment 
                        may be made under this part, the term `direct 
                        supervision' means that a physician or non-
                        physician practitioner, as the case may be, is 
                        immediately available (including by telephone 
                        or other means) to furnish assistance and 
                        direction throughout the furnishing of such 
                        services. Such term includes, with respect to 
                        the furnishing of a therapeutic hospital 
                        outpatient service for which payment may be 
                        made under this part, direct supervision during 
                        the initiation of the service followed by 
                        general supervision for the remainder of the 
                        service (as described in paragraph (2)(A)(ii)).
                            ``(ii) Presence in room not required.--For 
                        purposes of clause (i), a physician or non-
                        physician practitioner, as the case may be, is 
                        not required to be present in the room during 
                        the performance of the procedure involved or 
                        within any other physical boundary as long as 
                        the physician or non-physician practitioner, as 
                        the case may be, is immediately available.
                    ``(D) Non-physician practitioner defined.--The term 
                `non-physician practitioner' means an individual who--
                            ``(i) is a physician assistant, a nurse 
                        practitioner, a clinical nurse specialist, a 
                        clinical social worker, a clinical 
                        psychologist, a certified nurse midwife, or a 
                        certified registered nurse anesthetist, and 
                        includes such other practitioners as the 
                        Secretary may specify; and
                            ``(ii) with respect to the furnishing of 
                        therapeutic outpatient hospital services, meets 
                        the requirements of paragraph (4)(B).''.
            (2) Conforming amendment.--Section 1861(eee)(2)(B) of the 
        Social Security Act (42 U.S.C. 1395x(eee)(2)(B)) is amended by 
        inserting ``, and a non-physician practitioner (as defined in 
        section 1833(cc)(5)(D)) may supervise the furnishing of such 
        items and services in the hospital'' after ``in the case of 
        items and services furnished under such a program in a 
        hospital, such availability shall be presumed''.
    (b) Prohibition on Retroactive Enforcement of Revised 
Interpretation.--
            (1) Repeal of regulatory clarification.--The restatement 
        and clarification under the final rulemaking changes to the 
        Medicare hospital outpatient prospective payment system and 
        calendar year 2009 payment rates (published in the Federal 
        Register on November 18, 2008, 73 Fed. Reg. 68702 through 
        68704) with respect to requirements for direct supervision by 
        physicians for therapeutic hospital outpatient services (as 
        defined in paragraph (3)) for purposes of payment for such 
        services under the Medicare program shall have no force or 
        effect in law.
            (2) Hold harmless.--A hospital or critical access hospital 
        that furnishes therapeutic hospital outpatient services during 
        the period beginning on January 1, 2001, and ending on the 
        later of December 31, 2021, or the date on which the final 
        regulation promulgated by the Secretary of Health and Human 
        Services to carry out this section takes effect, for which a 
        claim for payment is made under part B of title XVIII of the 
        Social Security Act shall not be subject to any civil or 
        criminal action or penalty under Federal law for failure to 
        meet supervision requirements under the regulation described in 
        paragraph (1), under program manuals, or otherwise.
            (3) Therapeutic hospital outpatient services defined.--In 
        this subsection, the term ``therapeutic hospital outpatient 
        services'' means medical and other health services furnished by 
        a hospital or critical access hospital that are--
                    (A) hospital services described in subsection 
                (s)(2)(B) of section 1861 of the Social Security Act 
                (42 U.S.C. 1395x);
                    (B) cardiac rehabilitation services or intensive 
                cardiac rehabilitation services (as defined in 
                paragraphs (1) and (4), respectively, of subsection 
                (eee) of such section); or
                    (C) pulmonary rehabilitation services (as defined 
                in subsection (fff)(1) of such section).

SEC. 303. REFORMING PRACTICES OF RECOVERY AUDIT CONTRACTORS UNDER 
              MEDICARE.

    (a) Elimination of Contingency Fee Payment System.--Section 1893(h) 
of the Social Security Act (42 U.S.C. 1395ddd(h)) is amended--
            (1) in paragraph (1), by inserting ``, for recovery 
        activities conducted during a fiscal year before fiscal year 
        2022'' after ``Under the contracts''; and
            (2) by adding at the end the following new paragraph:
            ``(11) Payment for recovery activities performed after 
        fiscal year 2021.--
                    ``(A) In general.--Under the contracts, subject to 
                paragraphs (B) and (C), payment shall be made to 
                recovery audit contractors for recovery activities 
                conducted during fiscal year 2022 and each fiscal year 
                thereafter in the same manner, and from the same 
                amounts, as payment is made to eligible entities under 
                contracts entered into for recovery activities 
                conducted during fiscal year 2021 under subsection (a).
                    ``(B) Prohibition on incentive payments.--Under the 
                contracts, payment made to a recovery audit contractor 
                for recovery activities conducted during fiscal year 
                2022 or any fiscal year thereafter may not include any 
                incentive payments.
                    ``(C) Performance accountability.--
                            ``(i) In general.--Under the contracts, 
                        payment made to a recovery audit contractor for 
                        recovery activities conducted during fiscal 
                        year 2022 or any fiscal year thereafter shall, 
                        in the case that the contractor has a complex 
                        audit denial overturn rate at the end of such 
                        fiscal year (as calculated under the 
                        methodology described in clause (iv)) that is 
                        0.1 or greater, be reduced in an amount 
                        determined in accordance with clause (ii).
                            ``(ii) Payment reductions.--
                                    ``(I) Sliding scale of amount of 
                                reductions.--The Secretary shall 
                                establish, for purposes of determining 
                                the amount of a reduction in payment to 
                                a recovery audit contractor under 
                                clause (i) for recovery activities 
                                conducted during fiscal year, a linear 
                                sliding scale of payment reductions for 
                                recovery audit contractors for such 
                                fiscal year. Under such linear sliding 
                                scale, the amount of such a reduction 
                                in payment to a recovery audit 
                                contractor for a fiscal year shall be 
                                calculated in a manner that provides 
                                for such reduction to be greater than 
                                the reduction for such fiscal year for 
                                recovery audit contractors that have 
                                complex audit denial overturn rates at 
                                the end of such fiscal year (as 
                                calculated under the methodology 
                                described in clause (iv)) that are 
                                lower than the complex audit denial 
                                overturn rate of the contractor at the 
                                end of such fiscal year (as so 
                                calculated).
                                    ``(II) Manner of collecting 
                                reduction.--The Secretary may assess 
                                and collect the reductions in payment 
                                to recovery audit contractors under 
                                clause (i) in such manner as the 
                                Secretary may specify (such as by 
                                reducing the amount paid to the 
                                contractor for recovery activities 
                                conducted during a fiscal year or by 
                                assessing the reduction as a separate 
                                penalty payment to be paid to the 
                                Secretary by the contractor with 
                                respect to each complex audit denial 
                                issued by the contractor that is 
                                overturned on appeal).
                            ``(iii) Timing of determinations of payment 
                        reductions.--The Secretary shall, with respect 
                        to a recovery audit contractor, determine not 
                        later than six months after the end of a fiscal 
                        year--
                                    ``(I) whether to reduce payment to 
                                the recovery audit contractor under 
                                clause (i) for recovery activities 
                                conducted during such fiscal year; and
                                    ``(II) in the case that the 
                                Secretary determines to so reduce 
                                payment to the contractor, the amount 
                                of such payment reduction.
                            ``(iv) Methodology for calculation of 
                        overturned complex audit denial overturn 
                        rate.--
                                    ``(I) Calculation of overturn 
                                rate.--The Secretary shall calculate a 
                                complex audit denial overturn rate for 
                                a recovery audit contractor for a 
                                fiscal year by--
                                            ``(aa) determining, with 
                                        respect to the contract entered 
                                        into under paragraph (1) by the 
                                        contractor, the number of 
                                        complex audit denials issued by 
                                        the contractor under the 
                                        contract (including denials 
                                        issued before such fiscal year 
                                        and during such fiscal year) 
                                        that are overturned on appeal; 
                                        and
                                            ``(bb) dividing the number 
                                        determined under item (aa) by 
                                        the number of complex audit 
                                        denials issued by the 
                                        contractor under such contract 
                                        (including denials issued 
                                        before such fiscal year and 
                                        during such fiscal year).
                                    ``(II) Fairness and transparency.--
                                The Secretary shall calculate the 
                                percentage described in subclause (I) 
                                in a fair and transparent manner.
                                    ``(III) Accounting for subsequently 
                                overturned appeals.--The Secretary 
                                shall calculate the percentage 
                                described in subclause (I) in a manner 
                                that accounts for the likelihood that 
                                complex audit denials issued by the 
                                contractor for such fiscal year will be 
                                overturned on appeal in a subsequent 
                                fiscal year.
                                    ``(IV) Complex audit denial 
                                defined.--In this subparagraph, the 
                                term `complex audit denial' means a 
                                denial by a recovery audit contractor 
                                of a claim for payment under this title 
                                submitted by a hospital, psychiatric 
                                hospital, or critical access hospital 
                                that is so denied by the contractor 
                                after the contractor has--
                                            ``(aa) requested that the 
                                        hospital, psychiatric hospital, 
                                        or critical access hospital, in 
                                        order to support such claim for 
                                        payment, provide supporting 
                                        medical records to the 
                                        contractor; and
                                            ``(bb) reviewed such 
                                        medical records in order to 
                                        determine whether an improper 
                                        payment has been made to the 
                                        hospital, psychiatric hospital, 
                                        or critical access hospital for 
                                        such claim.
                                    ``(V) Overturned on appeal 
                                defined.--In this subparagraph, the 
                                term `overturned on appeal' means, with 
                                respect to a complex audit denial, a 
                                denial that is overturned on appeal at 
                                the reconsideration level, the 
                                redetermination level, or the 
                                administrative law judge hearing level.
                    ``(D) Application to existing contracts.--Not later 
                than 60 days after the date of the enactment of this 
                paragraph, the Secretary shall modify, as necessary, 
                each contract under paragraph (1) that the Secretary 
                entered into prior to such date of enactment in order 
                to ensure that payment with respect to recovery 
                activities conducted under such contract is made in 
                accordance with the requirements described in this 
                paragraph.''.
    (b) Elimination of One-Year Timely Filing Limit To Rebill Part B 
Claims.--
            (1) In general.--Section 1842(b) of the Social Security Act 
        (42 U.S.C. 1395u(b)) is amended by adding at the end the 
        following new paragraph:
            ``(20) Exception to the one-year timely filing limit for 
        certain rebilled claims.--
                    ``(A) In general.--In the case of a claim submitted 
                under this part by a hospital (as defined in 
                subparagraph (B)(i)) for hospital services with respect 
                to which there was a previous claim submitted under 
                part A as inpatient hospital services or inpatient 
                critical access hospital services that was denied by a 
                medicare contractor (as defined in subparagraph 
                (B)(ii)) because of a determination that the inpatient 
                admission was not medically reasonable and necessary 
                under section 1862(a)(1)(A), the deadline described in 
                this paragraph is 180 days after the date of the final 
                denial of such claim under part A.
                    ``(B) Definitions.--In this paragraph:
                            ``(i) Hospital.--The term `hospital' has 
                        the meaning given such term in section 1861(e) 
                        and includes a psychiatric hospital (as defined 
                        in section 1861(f)) and a critical access 
                        hospital (as defined in section 1861(mm)(1)).
                            ``(ii) Medicare contractor.--The term 
                        `medicare contractor' has the meaning given 
                        such term under section 1889(g), and includes a 
                        recovery audit contractor with a contract under 
                        section 1893(h).
                            ``(iii) Final denial.--The term `final 
                        denial' means--
                                    ``(I) in the case that a hospital 
                                elects not to appeal a denial described 
                                in subparagraph (A) by a medicare 
                                contractor, the date of such denial; or
                                    ``(II) in the case that a hospital 
                                elects to appeal a such a denial, the 
                                date on which such appeal is 
                                exhausted.''.
            (2) Conforming amendments.--
                    (A) Section 1835(a)(1) of the Social Security Act 
                (42 U.S.C. 1395n(a)(1)) is amended by inserting ``or, 
                in the case of a claim described in section 
                1842(b)(20), not later than the deadline described in 
                such paragraph'' after ``the date of service''.
                    (B) Section 1842(b)(3)(B) of the Social Security 
                Act (42 U.S.C. 1395u(b)(3)(B)) is amended in the flush 
                language following clause (ii) by inserting ``or, in 
                the case of a claim described in section 1842(b)(20), 
                not later than the deadline described in such 
                paragraph'' after ``the date of service''.
            (3) Applicability.--The amendments made by this subsection 
        apply to claims submitted under part B of title XVIII of the 
        Social Security Act for hospital services for which there was a 
        previous claim submitted under part A as inpatient hospital 
        services or inpatient critical access hospital services that 
        was subject to a final denial (as defined in paragraph 
        (20)(B)(iii) of section 1842(b) of such Act (42 U.S.C. 
        1395u(b))) on or after the date of the enactment of this Act.
    (c) Medical Documentation Considered for Medical Necessity Reviews 
of Claims for Inpatient Hospital Services.--Section 1862(a) of the 
Social Security Act (42 U.S.C. 1395y(a)) is amended by adding at the 
end the following new sentence: ``A determination under paragraph (1) 
of whether inpatient hospital services or inpatient critical access 
hospital services furnished to an individual on or after the date of 
the enactment of this sentence are reasonable and necessary shall be 
based solely upon information available to the admitting physician at 
the time of the inpatient admission of the individual for such 
inpatient services, as documented in the medical record.''.

                 TITLE IV--FUTURE OF RURAL HEALTH CARE

SEC. 401. MEDICARE RURAL HOSPITAL FLEXIBILITY PROGRAM GRANTS.

    Section 1820(g) of the Social Security Act (42 U.S.C. 1395i-4(g)) 
is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (C), by striking ``and'' at the 
                end;
                    (B) in subparagraph (D), by striking the period at 
                the end and inserting a semicolon; and
                    (C) by adding at the end the following new 
                subparagraphs:
                    ``(E) rural emergency hospitals providing support 
                for critical access hospitals to convert to rural 
                emergency hospitals to stabilize hospital emergency 
                services in their communities; and
                    ``(F) supporting certified rural health clinics for 
                maintaining and building business operations, 
                increasing financial indicators, addressing population 
                health, transforming services, and providing linkages 
                and services for behavioral health and substance use 
                disorders responding to public health emergencies.'';
            (2) by redesignating paragraphs (3) through (7) as 
        paragraphs (4) through (8), respectively;
            (3) after paragraph (2), by inserting the following new 
        paragraph:
            ``(3) Activities to support carrying out flex grants.--The 
        Secretary may award grants or cooperative agreements to 
        entities that submit to the Secretary applications, at such 
        time and in such form and manner and containing such 
        information as the Secretary specifies, for purposes of 
        supporting States and hospitals in carrying out the activities 
        under this subsection by providing technical assistance, data 
        analysis, and evaluation efforts.'';
            (4) in paragraph (4), as redesignated--
                    (A) in subparagraph (A), by inserting ``State 
                Offices of Rural Health on behalf of eligible 
                hospitals'' after ``award grants to'';
                    (B) by amending subparagraph (C) to read as 
                follows:
                    ``(C) Application.--The State Office of Rural 
                Health shall submit an application, on behalf of 
                eligible rural hospitals, to the Secretary on or before 
                such date and in such form and manner as the Secretary 
                specifies.'';
                    (C) by amending subparagraph (D), to read as 
                follows:
                    ``(D) Amount of grant.--A grant to a hospital under 
                this paragraph shall be determined on an equal national 
                distribution so that each hospital receives the same 
                amount of support related to the funds appropriated.'';
                    (D) by amending subparagraph (E), to read as 
                follows:
                    ``(E) Use of funds.--State Offices of Rural Health 
                and eligible hospitals may use the funds received 
                through a grant under this paragraph for the purchase 
                of computer software and hardware; the education and 
                training of hospital staff on billing, operational, 
                quality improvement and related value-focused efforts; 
                and other delivery system reform programs determined 
                appropriate by the Secretary.''; and
            (5) by adding at the end the following new paragraph:
            ``(9) Rural health transformation grants.--
                    ``(A) Grants.--The Secretary may award 5-year 
                grants to State Offices of Rural Health and to eligible 
                rural health care providers (as defined in subparagraph 
                (E)) on the transition to new models, including rural 
                emergency hospitals, extended stay clinics, 
                freestanding emergency departments, rural health 
                clinics, and integration of behavioral, oral health 
                services, telehealth and other transformational models 
                relevant to rural providers as such providers evolve to 
                better meet community needs and the changing health 
                care environment.
                    ``(B) Application.--An applicable rural health care 
                provider, in partnership with the State Office of Rural 
                Health in the State in which the rural health care 
                provider seeking a grant under this paragraph is 
                located, shall submit an application to the Secretary 
                on or before such date and in such form and manner as 
                the Secretary specifies.
                    ``(C) Additional requirements.--The Secretary may 
                not award a grant under this paragraph to an eligible 
                rural health care provider unless--
                            ``(i) local organizations or the State in 
                        which the hospital is located provides support 
                        (either direct or in kind); and there are 
                        letters of support from key State payers such 
                        as Medicaid and private insurance; and
                            ``(ii) the applicant describes in detail 
                        how the transition of the health care provider 
                        or providers will better meet local needs and 
                        be sustainable.
                    ``(D) Eligible rural health care provider 
                defined.--For purposes of this paragraph, the term 
                `eligible rural health care provider' includes a 
                critical access hospital, a certified rural health 
                clinic, a rural nursing home, skilled nursing facility, 
                emergency care provider, or other entity identified by 
                the Secretary. An eligible rural health care provider 
                may include other entities applying on behalf of a 
                group of providers such as a State Office of Rural 
                Health, a State or local health care authority, a rural 
                health network, or other entity identified by the 
                Secretary.''.
                                 <all>