In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.

[EX Q]: SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

    (a) Short Title.--This Act may be cited as the ``Tobacco Smuggling 
Eradication Act of 2002''.

          TITLE I--AMENDMENTS TO INTERNAL REVENUE CODE OF 1986

SEC. 101. AMENDMENT OF 1986 CODE.

    Except as otherwise expressly provided, whenever in this title an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Internal Revenue Code of 
1986.

SEC. 102. IMPROVED MARKING AND LABELING.

    (a) In General.--Subsection (b) of section 5723 (relating to marks, 
labels, and notices) is amended--
            (1) by striking ``, if any,'' and
            (2) by adding at the end the following: ``Such marks, 
        labels, and notices shall include marks and notices relating to 
        the following:
            ``(1) Identification.--The Secretary shall promulgate 
        regulations that require each manufacturer or importer of 
        tobacco products to legibly print a unique serial number on all 
        packages of tobacco products manufactured or imported for sale 
        or distribution. Such serial number shall be designed to enable 
        the Secretary to identify the manufacturer or importer of the 
        product, and the location and date of manufacture or 
        importation. The Secretary shall determine the size and 
        location of the serial number.
            ``(2) Marking requirements for exports.--Each package of a 
        tobacco product that is exported shall be marked for export 
        from the United States. The Secretary shall promulgate 
        regulations to determine the size and location of the mark and 
        under what circumstances a waiver of this paragraph shall be 
        granted.''.
    (b) Sales on Indian Reservations.--Section 5723 is amended by 
adding at the end the following new subsections:
    ``(f) Sales on Indian Reservations.--The Secretary, in consultation 
with the Secretary of the Interior, shall promulgate regulations that 
require that each package of a tobacco product that is sold on an 
Indian reservation (as defined in section 403(9) of the Indian Child 
Protection and Family Violence Prevention Act (25 U.S.C. 3202(9)) be 
labeled as such. Such regulations shall include requirements for the 
size and location of the label.
    ``(g) Definition of Package.--For purposes of this section, the 
term `package' means the innermost sealed container irrespective of the 
material from which such container is made, in which a tobacco product 
is placed by the manufacturer and in which such tobacco product is 
offered for sale to a member of the general public.''.

SEC. 103. WHOLESALERS REQUIRED TO HAVE PERMIT.

    Section 5712 (relating to application for permit) is amended by 
inserting ``, wholesaler,'' after ``manufacturer''.

SEC. 104. CONDITIONS OF PERMIT.

    Subsection (a) of section 5713 (relating to issuance of permit) is 
amended to read as follows:
    ``(a) Issuance.--
            ``(1) In general.--A person shall not engage in business as 
        a manufacturer, wholesaler, or importer of tobacco products or 
        as an export warehouse proprietor without a permit to engage in 
        such business. Such permit shall be issued in such form and in 
        such manner as the Secretary shall by regulation prescribe, to 
        every person properly qualified under sections 5711 and 5712. A 
        new permit may be required at such other time as the Secretary 
        shall by regulation prescribe.
            ``(2) Conditions.--The issuance of a permit under this 
        section shall be conditioned upon the compliance with the 
        requirements of this chapter and the Contraband Cigarette 
        Trafficking Act (18 U.S.C. chapter 114), and any regulations 
        issued pursuant to such statutes.''.

SEC. 105. RECORDS TO BE MAINTAINED.

    Section 5741 (relating to records to be maintained) is amended--
            (1) by inserting ``(a) In General.--'' before ``Every 
        manufacturer'',
            (2) by inserting ``every wholesaler,'' after ``every 
        importer,'',
            (3) by striking ``such records'' and inserting ``records 
        concerning the chain of custody of the tobacco products and 
        such other records'', and
            (4) by adding at the end the following new subsection:
    ``(b) Retailers.--Retailers shall maintain records of receipt of 
tobacco products, and such records shall be available to the Secretary 
for inspection and audit. An ordinary commercial record or invoice 
shall satisfy the requirements of this subsection if such record shows 
the date of receipt, from whom tobacco products were received, and the 
quantity of tobacco products received.''.

SEC. 106. REPORTS.

    Section 5722 (relating to reports) is amended--
            (1) by inserting ``(a) In General.--'' before ``Every 
        manufacturer'', and
            (2) by adding at the end the following new subsection:
    ``(b) Reports By Export Warehouse Proprietors.--
            ``(1) In general.--Prior to exportation of tobacco products 
        from the United States, the export warehouse proprietor shall 
        submit a report (in such manner and form as the Secretary may 
        by regulation prescribe) to enable the Secretary to identify 
        the shipment and assure that it reaches its intended 
        destination.
            ``(2) Agreements with foreign governments.--Notwithstanding 
        section 6103 of this title, the Secretary is authorized to 
        enter into agreements with foreign governments to exchange or 
        share information contained in reports received from export 
        warehouse proprietors of tobacco products if--
                    ``(A) the Secretary believes that such agreement 
                will assist in--
                            ``(i) ensuring compliance with the 
                        provisions of this chapter or regulations 
                        promulgated thereunder, or
                            ``(ii) preventing or detecting violations 
                        of the provisions of this chapter or 
                        regulations promulgated thereunder, and
                    ``(B) the Secretary obtains assurances from such 
                government that the information will be held in 
                confidence and used only for the purposes specified in 
                clauses (i) and (ii) of subparagraph (A).
        No information may be exchanged or shared with any government 
        that has violated such assurances.''.

SEC. 107. FRAUDULENT OFFENSES.

    (a) In General.--Subsection (a) of section 5762 (relating to 
fraudulent offenses) is amended by striking paragraph (1) and 
redesignating paragraphs (2) through (6) as paragraphs (1) through (5), 
respectively.
    (b) Offenses Relating to Distribution of Tobacco Products.--Section 
5762 is amended--
            (1) by redesignating subsection (b) as subsection (c),
            (2) in subsection (c) (as so redesignated), by inserting 
        ``or (b)'' after ``(a)'', and
            (3) by inserting after subsection (a) the following new 
        subsection:
    ``(b) Offenses Relating to Distribution of Tobacco Products.--It 
shall be unlawful--
            ``(1) for any person to engage in the business as a 
        manufacturer or importer of tobacco products or cigarette 
        papers and tubes, or to engage in the business as a wholesaler 
        or an export warehouse proprietor, without filing the bond and 
        obtaining the permit where required by this chapter or 
        regulations thereunder;
            ``(2) for a manufacturer, importer, or wholesaler permitted 
        under this chapter intentionally to ship, transport, deliver, 
        or receive any tobacco products from or to any person other 
        than a person permitted under this chapter or a retailer, 
        except a permitted importer may receive foreign tobacco 
        products from a foreign manufacturer or a foreign distributor 
        that have not previously entered the United States;
            ``(3) for any person (other than the original manufacturer 
        of such tobacco products or an export warehouse proprietor 
        authorized to receive any tobacco products that have previously 
        been exported and returned to the United States) to receive any 
        tobacco products that have previously been exported and 
        returned to the United States;
            ``(4) for any export warehouse proprietor intentionally to 
        ship, transport, sell, or deliver for sale any tobacco products 
        to any person other than the original manufacturer of such 
        tobacco products, another export warehouse proprietor, or a 
        foreign purchaser;
            ``(5) for any person (other than a manufacturer or an 
        export warehouse proprietor permitted under this chapter) 
        intentionally to ship, transport, receive, or possess, for 
        purposes of resale, any tobacco product in packages marked 
        pursuant to regulations issued under section 5723, other than 
        for direct return to a manufacturer for repacking or for re-
        exportation or to an export warehouse proprietor for re-
        exportation;
            ``(6) for any manufacturer, importer, export warehouse 
        proprietor, or wholesaler permitted under this chapter to make 
        intentionally any false entry in, to fail willfully to make 
        appropriate entry in, or to fail willfully to maintain properly 
        any record or report that such person is required to keep as 
        required by this chapter or the regulations promulgated 
        thereunder; and
            ``(7) for any person to alter, mutilate, destroy, 
        obliterate, or remove any mark or label required under this 
        chapter upon a tobacco product held for sale, except pursuant 
        to regulations of the Secretary authorizing relabeling for 
        purposes of compliance with the requirements of this section or 
        of State law.
Any person violating any of the provisions of this subsection shall, 
upon conviction, be fined as provided in section 3571 of title 18, 
United States Code, imprisoned for not more than 5 years, or both.''.
    (c) Intentionally Defined.--Section 5762 is amended by adding at 
the end the following:
    ``(d) Definition of Intentionally.--For purposes of this section 
and section 5761, the term `intentionally' means doing an act, or 
omitting to do an act, deliberately, and not due to accident, 
inadvertence, or mistake, regardless of whether the person knew that 
the act or omission constituted an offense.''.

SEC. 108. CIVIL PENALTIES.

    Subsection (a) of section 5761 (relating to civil penalties) is 
amended--
            (1) by striking ``willfully'' and inserting 
        ``intentionally'', and
            (2) by striking ``$1,000'' and inserting ``$10,000''.

SEC. 109. DEFINITIONS.

    (a) Export Warehouse Proprietor.--Subsection (i) of section 5702 
(relating to definition of export warehouse proprietor) is amended by 
inserting before the period the following: ``or any person engaged in 
the business of exporting tobacco products from the United States for 
purposes of sale or distribution. Any duty free store that sells, 
offers for sale, or otherwise distributes to any person in any single 
transaction more than 30 packages of cigarettes, or its equivalent for 
other tobacco products as the Secretary shall by regulation prescribe, 
shall be deemed an export warehouse proprietor under this chapter''.
    (b) Retailer; Wholesaler.--Section 5702 is amended by adding at the 
end the following:
    ``(p) Retailer.--The term `retailer' means any dealer who sells, or 
offers for sale, any tobacco product at retail. The term `retailer' 
includes any duty-free store that sells, offers for sale, or otherwise 
distributes at retail in any single transaction 30 or less packages, or 
its equivalent for other tobacco products.
    ``(q) Wholesaler.--The term `wholesaler' means any person engaged 
in the business of purchasing tobacco products for resale at wholesale, 
or any person acting as an agent or broker for any person engaged in 
the business of purchasing tobacco products for resale at wholesale.''.

SEC. 110. EFFECTIVE DATE.

    The amendments made by this title shall take effect on January 1, 
2003.

    TITLE II--AMENDMENTS TO THE CONTRABAND CIGARETTE TRAFFICKING ACT

SEC. 201. AMENDMENTS TO THE CONTRABAND CIGARETTE TRAFFICKING ACT.

    (a) Definitions.--Section 2341 of title 18, United States Code, is 
amended--
            (1) in paragraph (2)--
                    (A) by striking ``60,000'' and inserting 
                ``30,000'', and
                    (B) by inserting ``or importer'' after ``as a 
                manufacturer'';
            (2) in paragraph (4), by striking ``and'' at the end;
            (3) in paragraph (5), by striking the period and inserting 
        a semicolon; and
            (4) by adding at the end the following:
            ``(6) the term `tobacco product' means cigars, cigarettes, 
        smokeless tobacco, and pipe tobacco (as such terms are defined 
        in section 5701 of the Internal Revenue Code of 1986); and
            ``(7) the term `contraband tobacco product' means a 
        quantity of tobacco product that is equivalent to or more than 
        30,000 cigarettes as determined by regulation, which bear no 
        evidence of the payment of applicable State tobacco taxes in 
        the State where such tobacco products are found, if such State 
        requires a stamp, impression, or other indication to be placed 
        on packages or other containers of product to evidence payment 
        of tobacco taxes.''
    (b) Unlawful Acts.--Section 2342 of title 18, United States Code, 
is amended--
            (1) in subsection (a), by inserting ``or contraband tobacco 
        products'' before the period;
            (2) by amending subsection (b) to read as follows:
    ``(b)(1) It shall be unlawful for any person--
            ``(A) knowingly to make any false statement or 
        representation with respect to the information required by this 
        chapter to be kept in the records or reports of any person who 
        ships, sells, or distributes--
                    ``(i) any quantity of cigarettes in excess of 
                30,000 in a single transaction or in a series of 
                related transactions, or
                    ``(ii) tobacco products in such equivalent 
                quantities as shall be determined by regulation, or
            ``(B) knowingly to fail to maintain records or reports, 
        alter or obliterate required markings, or interfere with any 
        inspection, required under this chapter, with respect to such 
        quantity of cigarettes or other tobacco products.''; and
            (3) by adding at the end the following:
    ``(c) It shall be unlawful for any person knowingly to transport 
tobacco products under a false bill of lading or without any bill of 
lading.''.
    (c) Recordkeeping.--Section 2343 of title 18, United States Code, 
is amended--
            (1) in subsection (a), by striking ``60,000 in a single 
        transaction'' and inserting ``30,000 in a single transaction or 
        in a series of related transactions, or, in the case of other 
        tobacco products an equivalent quantity as determined by 
        regulation,'';
            (2) by amending the last sentence of subsection (a) to read 
        as follows: ``Except as provided in subsection (c) of this 
        section, nothing contained herein shall authorize the Secretary 
        to require reporting under this section.'';
            (3) in subsection (b), by striking ``60,000 in a single 
        transaction'' and inserting ``30,000 in a single transaction or 
        in a series of related transactions, or, in the case of other 
        tobacco products an equivalent quantity as determined by 
        regulation,''; and
            (4) by adding at the end the following:
    ``(c)(1) Any person who ships, sells, or distributes tobacco 
products for resale in interstate commerce, whereby such tobacco 
products are shipped into a State taxing the sale or use of such 
tobacco products or who advertises or offers tobacco products for such 
sale or transfer and shipment shall--
            ``(A) first file with the tobacco tax administrator of the 
        State into which such shipment is made or in which such 
        advertisement or offer is disseminated, a statement setting for 
        the person's name, and trade name (if any), and the address of 
        the person's principal place of business and of any other place 
        of business; and
            ``(B) not later than the 10th of each calendar month, file 
        with the tobacco tax administrator of the State into which such 
        shipment is made a memorandum or a copy of the invoice covering 
        each and every shipment of tobacco products made during the 
        previous calendar month into such State; the memorandum or 
        invoice in each case to include the name and address of the 
        person to whom the shipment was made, the brand, and the 
        quantity thereof.
    ``(2) The fact that any person ships or delivers for shipment any 
tobacco products shall, if such shipment is into a State in which such 
person has filed a statement with the tobacco tax administrator under 
paragraph (1)(A) of this subsection, be presumptive evidence that such 
tobacco products were sold, shipped, or distributed for resale by such 
person.
    ``(3) For purposes of this subsection--
            ``(A) the term `use' in addition to its ordinary meaning, 
        means consumption, storage, handling, or disposal of tobacco 
        products; and
            ``(B) the term `tobacco tax administrator' means the State 
        official authorized to administer tobacco tax laws of the 
        State.''.
    (d) Penalties.--Section 2344 of title 18, United States Code, is 
amended--
            (1) in subsection (b), by inserting ``or (c)'' after 
        ``section 2342(b)'' and by inserting ``or (c)'' after section 
        2343(a)''; and
            (2) by striking subsection (c) and inserting the following 
        new subsection:
    ``(c) Any contraband cigarettes or contraband tobacco products 
involved in any violation of the provisions of this chapter shall be 
subject to seizure and forfeiture, and all provisions of section 
9703(o) of title 31, United States Code, shall, so far as applicable, 
extend to seizures and forfeitures under the provisions of this 
chapter.''
    (e) Repeal.--The Act of October 19, 1949, entitled ``An Act to 
assist States in collecting sales and use taxes on cigarettes'', 63 
Stat. 884 (chapter 10A of title 15, U.S.C.), is hereby repealed.
[EX A]: Tobacco Smuggling Eradication Act of 2002 - Amends chapter 52 (Tobacco Products and Cigarette Papers and Tubes) of the Internal Revenue Code to require all packages of tobacco products to carry a unique legibly printed serial number by which the Secretary of the Treasury can identify the manufacturer or importer and the location and date of manufacture or importation. Requires tobacco products sold on Indian reservations to be labeled as such.Requires a tobacco wholesaler to have a permit and to maintain certain records.Requires export warehouse proprietors to file certain reports with the Secretary. Authorizes the Secretary to enter into certain tobacco related information agreements with foreign countries.Establishes new offenses relating to the distribution of tobacco.Raises the $1,000 civil penalty under chapter 52 to $10,000.Amends the Contraband Cigarette Trafficking Act to: (1) expand the applicability of such Act from cigarettes only to "tobacco product" (cigars, cigarettes, smokeless tobacco, and pipe tobacco); (2) define "contraband tobacco product" as a quantity of tobacco product that is equivalent to or more than 30,000 cigarettes (currently, 60,000) which bear no evidence of the payment of applicable State tobacco taxes; (3) establish new unlawful acts; and (4) require additional recordkeeping.Repeals Federal law provisions concerning reports required to State tobacco tax administrators by individuals engaged in interstate cigarette commerce.

[EX Q]: SECTION l. SHORT TITLE.

    This Act may be cited as the ``Freedom of Access to Clinic 
Entrances Act of 1993''.

SEC. 2. FREEDOM OF ACCESS TO REPRODUCTIVE HEALTH SERVICES.

    Chapter 13 of title 18, United States Code, is amended by adding at 
the end the following:
``Sec. 248. Blocking access to reproductive health services
    ``(a) Prohibited Activities.--Whoever--
            ``(1) by force, threat of force, or physical obstruction, 
        intentionally injures, intimidates, or interferes with any 
        person, or attempts to do so, because that person or any other 
        person or class of persons is obtaining or providing 
        reproductive health services; or
            ``(2) intentionally damages or destroys the property of a 
        facility, or attempts to do so, because that facility provides 
        reproductive health services;
shall be punished as provided in subsection (b) of this section and 
also be subject to the civil remedy provided in subsection (c) of this 
section, except that a parent or legal guardian of a minor shall not be 
subject to any penalties or civil remedies under this section for such 
activities insofar as they are directed exclusively at that minor.
    ``(b) Penalties.--Whoever violates subsection (a) of this section 
shall--
            ``(1) in the case of a first offense, be fined under this 
        title or imprisoned not more than 1 year, or both; and
            ``(2) in the case of a second or subsequent offense after a 
        prior conviction under this section, be fined under this title 
        or imprisoned not more than 3 years, or both;
except that, if bodily injury results, the length of imprisonment shall 
be not more than 10 years, and if death results, it shall be for any 
term of years or for life.
    ``(c) Civil Actions.--
            ``(1) Right of action generally.--Any person who is 
        aggrieved by a violation of subsection (a) of this section may 
        in a civil action obtain relief under this subsection.
            ``(2) Action by attorney general.--If the Attorney General 
        has reasonable cause to believe that any person, or group of 
        persons, is aggrieved by a violation of subsection (a) of this 
        section, the Attorney General may in a civil action obtain 
        relief under this subsection.
            ``(3) Actions by state attorneys general.--If an attorney 
        general of a State has reasonable cause to believe that any 
        person or group of persons is aggrieved by a violation of 
        subsection (a) of this section, that attorney general may in a 
        civil action obtain relief under this subsection.
            ``(4) Relief.--In any action under this subsection, the 
        court may award any appropriate relief, including temporary, 
        preliminary or permanent injunctive relief, and compensatory 
        and punitive damages for each person aggrieved by the 
        violation. With respect to compensatory damages, the aggrieved 
        person may elect, at any time before the rendering of final 
        judgment, to recover, in lieu of actual damages, an award of 
        statutory damages in the amount of $5,000 per violation. The 
        court may award to the prevailing party, other than the United 
        States, reasonable fees for attorneys and expert witnesses.
    ``(d) Rules of Construction.--(1) Nothing in this section shall be 
construed to prohibit any expressive conduct (including peaceful 
picketing or other peaceful demonstration) protected from legal 
prohibition by the first article of amendment to the Constitution.
    ``(2) Nothing in this section shall be construed to interfere with 
the authority of States to enforce State or local laws regulating the 
provision of reproductive health services.
    ``(e) Non-Preemption.--Congress does not intend this section to 
provide the exclusive remedies with respect to the conduct prohibited 
by it, nor to preempt the legislation of the States that may provide 
such remedies.
    ``(f) Definitions.--As used in this section, the following 
definitions apply:
            ``(1) Reproductive health services.--The term `reproductive 
        health services' means reproductive health services provided in 
        a hospital, clinic, physician's office, or other facility, and 
        includes medical, surgical, counselling or referral services 
        relating to the human reproductive system.
            ``(2) Facility.--The term `facility' includes the building 
        or structure in which the facility is located.
            ``(3) Physical obstruction.--The term `physical 
        obstruction' means rendering impassable ingress to or egress 
        from a facility that provides reproductive health services, or 
        rendering passage to or from such facility unreasonably 
        difficult.
            ``(4) State.--The term `State' includes a State of the 
        United States, the District of Columbia, and any commonwealth, 
        territory, or possession of the United States.
            ``(5) Intimidate.--The term `intimidate' means to place a 
        person in reasonable apprehension of bodily harm to himself or 
        herself or to another.''.

SEC. 3. EFFECTIVE DATE.

    This Act takes effect on the date of the enactment of this Act, and 
shall apply only with respect to conduct occurring on or after such 
date.

SEC. 4. CLERICAL AMENDMENT.

    The table of sections at the beginning of chapter 13 of title 18, 
United States Code, is amended by adding at the end the following new 
item:

``248. Blocking access to reproductive health services.''.

            Passed the House of Representatives November 18, 1993.

            Attest:

                                           DONNALD K. ANDERSON,

                                                                 Clerk.
[EX A]: Freedom of Access to Clinic Entrances Act of 1993 - Amends the Federal criminal code to prohibit:  (1) intentionally injuring, intimidating, or interfering with any person by force, threat of force, or physical obstruction because that person or any other person or class of persons is obtaining or providing reproductive health services; or (2) intentionally damaging or destroying the property of a facility because that facility provides reproductive health services.  Subjects violators to specified penalties (including up to life imprisonment if death results) or civil remedies, except that a parent or legal guardian or a minor shall not be subject to such a penalty or remedy insofar as such activities are directed exclusively at that minor. Authorizes civil actions by aggrieved persons, the Attorney General, and State attorneys general for violations.  Specifies that in any such action:  (1) the court may award appropriate relief (including temporary, preliminary, or permanent injunctive relief) and compensatory and punitive damages for each person aggrieved by the violation; and (2) with respect to compensatory damages, the aggrieved person may elect, at any time before the rendering of final judgment, to recover an award of statutory damages in the amount of $5,000 per violation in lieu of actual damages.  Authorizes the court to award reasonable fees for attorneys and expert witnesses to the prevailing party, other than the United States. Specifies that:  (1) nothing in this Act shall be construed to prohibit any expressive conduct (including peaceful picketing or other peaceful demonstration) protected from legal prohibition by the first amendment or interfere with the authority of States to enforce State or local laws regulating the provision of reproductive health services; and (2) the Congress does not intend this Act to provide the exclusive remedies with respect to the conduct prohibited by it, nor to preempt State legislation that may provide such remedies.

[EX Q]: SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Protecting Medicare Investments for 
Seniors Everywhere Act (ProMISE Act)''.

SEC. 2. ADDITIONAL REIMBURSEMENTS FOR MEDICARE PROVIDERS IN LOW-
              REIMBURSEMENT STATES.

    Title XVIII of the Social Security Act is amended by adding at the 
end the following new section:

 ``additional reimbursements for providers in low-reimbursement states

    ``Sec. 1897. (a) Additional Reimbursement.--
            ``(1) In general.--Subject to section 1898(c), in the case 
        of an affected health care provider (as defined in subsection 
        (c)) that is located in a low-reimbursement State (as defined 
        in subsection (b)) and that furnishes items or services for 
        which payment may be made under part A or part B, in addition 
        to the amount otherwise paid under such part, there also shall 
        be paid to the provider under such part from the Federal 
        Hospital Insurance Trust Fund (in the case of payments under 
        part A) or from the Federal Supplementary Medical Insurance 
        Fund (in the case of payments under part B) an amount equal to 
        the payment adjustment percentage (specified in paragraph (2)) 
        of the payment amount for the service under such part.
            ``(2) Payment adjustment percentage.--In the case of a 
        provider located in a State for which the medicare 
        reimbursement ratio--
                    ``(A) is at least 94 percent, the payment 
                adjustment percentage is 1 percent;
                    ``(B) is at least 93 percent, but less than 94 
                percent, the payment adjustment percentage is 2 
                percent;
                    ``(C) is at least 92 percent, but less than 93 
                percent, the payment adjustment percentage is 3 
                percent;
                    ``(D) is at least 91 percent, but less than 92 
                percent, the payment adjustment percentage is 4 
                percent; or
                    ``(E) is less than 91 percent, the payment 
                adjustment percentage is 5 percent.
    ``(b) Low-Reimbursement State; Medicare Reimbursement Ratio 
Defined.--For purposes of this section:
            ``(1) Low-reimbursement state.--The term `low-reimbursement 
        State' means one of the 50 States or the District of Columbia 
        in which the medicare reimbursement ratio (as defined in 
        paragraph (2)) is less than 95 percent.
            ``(2) Medicare reimbursement ratio.--The term `medicare 
        reimbursement ratio' means, with respect to a State or the 
        District of Columbia, the ratio (expressed as a percentage) 
        of--
                    ``(A) the adjusted average per capita cost (as 
                determined under section 1876(a)(4)) for benefits under 
                parts A and B of this title (without regard to any 
                payment under this section) in the State or District; 
                to
                    ``(B) the United States per capita cost (as so 
                determined) for the 50 States and the District of 
                Columbia.
    ``(c) Affected Health Care Providers Covered.--For purposes of this 
section the term `affected health care provider' means a facility or 
professional that is within one of the following classes of health care 
providers or organizations:
            ``(1) Hospitals.
            ``(2) Physicians.
            ``(3) Skilled nursing facilities.
            ``(4) Home health agencies.
            ``(5) Medicare+Choice organizations offering 
        Medicare+Choice plans.
    ``(d) Effective Period.--This section shall apply to payments--
            ``(1) for hospitals, skilled nursing facilities, and home 
        health agencies, for fiscal years beginning with fiscal year 
        2004; or
            ``(2) for physicians and Medicare+Choice organizations, for 
        calendar years beginning with 2004.
    ``(e) Relation to Managed Care: Avoiding Duplication of 
Increases.--Payments under this section to affected health care 
providers other than Medicare+Choice organizations in an area shall not 
be taken into account for purposes of applying part C in that area.''.

SEC. 3. MEDICARE FINANCIAL INCENTIVE PROGRAM FOR HIGH QUALITY, LOW-COST 
              HEALTH CARE.

    Title XVIII of the Social Security Act is further amended by adding 
at the end the following new section:

  ``financial incentive program for high quality, low-cost health care

    ``Sec. 1898. (a) Ranking of States by Quality and Cost.--
            ``(1) In general.--The Secretary shall provide for the 
        ranking of States on measures of both quality and cost of 
        health care services under this title.
            ``(2) Process.--
                    ``(A) In general.--Within 1 year after the date of 
                the enactment of this section, the Secretary shall 
                submit to Congress a proposal for establishing such 
                measures of quality. The Secretary shall consult with 
                stakeholders in developing such proposal.
                    ``(B) Action.--If the Congress does not enact a law 
                within 90 legislative days after receiving such 
                proposal, the proposal shall become effective.
            ``(3) Cost.--In developing the measure based on cost, the 
        Secretary shall rely on the Secretary's measure of average 
        medicare spending per recipient in each State.
            ``(4) Annual evaluations.--The Secretary shall conduct 
        annually evaluations of States quality and cost of health care 
        services under this title.
    ``(b) Additional Bonus Payment.--
            ``(1) In general.--Subject to subsection (c), in the case 
        of a hospital or physician that is located in a State that is 
        ranked under subsection (a) among the top quartile of States in 
        quality and cost and that furnishes items or services for which 
        payment may be made under part A or part B, in addition to the 
        amount otherwise paid under such part, there also shall be paid 
        to the provider under such part from the Federal Hospital 
        Insurance Trust Fund (in the case of payments under part A) or 
        from the Federal Supplementary Medical Insurance Fund (in the 
        case of payments under part B) an amount equal to 5 percent of 
        the payment amount for the service under such part.
            ``(2) Authority to cover other providers.--The Secretary 
        may expand paragraph (1) to apply to other health care 
        providers and practitioners under this title, but shall not 
        effect such an expansion without reporting to Congress.
    ``(c) Aggregate Percentage Adjustment Limitation.--In no case shall 
the sum of the percentage increase under subsection (b) and the payment 
adjustment percentage under section 1897(a)(2) with respect to a State 
exceed 100 percent minus the medicare reimbursement ratio (as defined 
in section 1897(b)(2)) for that State. Any such percentage increase or 
adjustment shall be reduced on a pro-rata basis to the extent required 
to comply with the previous sentence.''.
[EX A]:
Protecting Medicare Investments for Seniors Everywhere Act (ProMISE Act) - Amends title XVIII (Medicare) of the Social Security Act to provide for: (1) additional reimbursements for Medicare providers in low-reimbursement States (where the Medicare reimbursement ratio of the adjusted average State per capita cost for part A and partr B benefits to the U.S. per capita cost is under 95 percent); and (2) a financial incentive program of bonus payments to providers in States with high quality, low-cost health care.