Medicare and Medicaid Patient and Program Protection Act of 1987
PL 100-93 (H.R.1444), enacted 08/18/1987

101 STAT. 680 
PUBLIC LAW 100-93—AUG. 18, 1987 
Aug. 18, 1987 
[H.R. 1444] 
Medicare and 
Medicaid 
Patient and 
Program 
Protection Act of 
1987. 
42 u s e 1305 
note. 
Public Law 100-93 
100th Congress 
•V3' 
An Act 
To amend titles XI, XVIII, and XIX of the Social Security Act to protect beneficiaries 
under the health care programs of that Act from unfit health care practitioners, 
and otherwise to improve the antifraud provisions relating to those programs. 
Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; REFERENCES IN ACT; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the "Medicare and 
Medicaid Patient and Program Protection Act of 1987". 
(b) AMENDMENTS TO THE SOCIAL SECURITY ACT.—Except as other-
wise specifically provided, whenever in this Act an amendment 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 that 
section or other provision of the Social Security Act. 
(c) TABLE OF CONTENTS.—The table of contents of this Act is as 
follows: 
Sec. 1. Short title; references in Act; table of contents. 
Sec. 2. Exclusion from medicare and State health care programs. 
Sec. 3. Civil monetary penalties. 
Sec. 4. Criminal penalties for acts involving medicare and State health care 
programs. 
Sec. 5. Information concerning sanctions taken by State licensing authorities against 
health care practitioners and providers. 
Sec. 6. Obligation of health care practitioners and providers. 
Sec. 7. Exclusion under the medicaid program. 
Sec. 8. Miscellaneous and conforming amendments. 
Sec. 9. Clarification of medicaid moratorium provisions of Deficit Reduction Act of 
1984. 
Sec. 10. Limitation of liability of medicare beneficiaries with respect to services 
furnished by excluded individuals and entities. 
Sec. 11. Definition of person with ownership or control interest. 
Sec. 12. Conditional approval of renal dialysis facilities. 
Sec. 13. Amendment relating to fraud involving medicare supplemental insurance. 
Sec. 14. Standards for anti-kickback provisions. 
Sec. 15. Effective dates. 
SEC. 2. EXCLUSION 
FROM 
MEDICARE 
AND STATE 
HEALTH 
CARE 
PROGRAMS. 
Section 1128 (42 U.S.C. 1320a-7) is amended to read as follows: 
EXCLUSION O F CERTAIN INDIVIDUALS AND ENTITIES FROM PARTICIPATION 
IN MEDICARE AND STATE HEALTH CARE PROGRAMS 
"SEC. 1128. (a) MANDATORY EXCLUSION.—The Secretary shall ex-
clude the following individuals and entities from participation in 
42 use 1395. 
any program under title XVIII and shall direct that the following 
individuals and entities be excluded from participation in any State 
health care program (as defined in subsection (h)): 
"(1) CONVICTION OF PROGRAM-RELATED CRIMES.—Any individ-
ual or entity that has been convicted of a criminal offense 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 681 
,: 
related to the delivery of an item or service under title XVIII or 
42 USC 1395. 
under any State health care program. 
"(2) CONVICTION RELATING TO PATIENT ABUSE.—Any individual 
or entity that has been convicted, under Federal or State law, of 
r; 
a criminal offense relating to neglect or abuse of patients in 
connection with the delivery of a health care item or service. 
"(b) PERMISSIVE EXCLUSION.—The Secretary may exclude the fol-
lowing individuals and entities from participation in any program 
under title XVIII and may direct that the following individuals and 
entities be excluded from participation in any State health care 
program: 
"(1) CONVICTION RELATING TO FRAUD.—Any individual 
or 
entity that has been convicted, under Federal or State law, in 
connection with the delivery of a health care item or service or 
with respect to any act or omission in a program operated by or 
{ 
financed in whole or in part by any Federal, State, or local 
j
f 
government agency, of a criminal offense relating to fraud, 
theft, embezzlement, breach of fiduciary responsibility, or other 
.
v
>
«
^
r
. ; ; • 
financial 
misconduct. 
"(2) CONVICTION RELATING TO OBSTRUCTION OF AN INVESTIGA- 
n
W
;
K
r >8in 
TiON.—Any individual or entity that has been convicted, under 
Federal or State law, in connection with the interference with 
or obstruction of any investigation into any criminal offense 
described in paragraph (1) or in subsection (a). 
"(3) CONVICTION RELATING TO CONTROLLED SUBSTANCE.—Any 
Drugs and drug 
individual or entity that has been convicted, under Federal or 
abuse. 
State law, of a criminal offense relating to the unlawful manu-
facture, distribution, prescription, or dispensing of a controlled 
substance. 
.„ :(*f:i .; 
i.i 
"(4) LICENSE REVOCATION OR SUSPENSION.—Any individual or 
entity— 
"(A) whose license to provide health care has been re-
; 
X 
voked or suspended by any State licensing authority, or 
who otherwise lost such a license, for reasons bearing on 
-.- 3- 
the individual's or entity's professional competence, profes-
gi \ 
sional performance, or financial integrity, or 
fj. 
"(B) who surrendered such a license while a formal dis- 
.u\ 
ciplinary proceeding was pending before such an authority 
,0.'"*'7"' 
.'0A 
and the proceeding concerned the individual's or entity's 
' "^' "= "' • 
ii i ; 
professional 
competence, 
professional 
performance, or 
financial 
integrity. 
"(5) EXCLUSION OR SUSPENSION UNDER FEDERAL OR STATE 
HEALTH CARE PROGRAM.—Any individual or entity which has 
?• . ' '.*' . • 
been suspended or excluded from participation, or otherwise 
sanctioned, under— 
s-:v q .^^i 
"(A) any Federal program, including programs of the 
m b- 
Department of Defense or the Veterans' Administration, 
girll 
involving the provision of health care, or 
"(B) a State health care program, 
for reasons bearing on the individual's or entity's professional 
competence, professional performance, or 
financial 
integrity. 
"(6) CLAIMS FOR EXCESSIVE CHARGES OR UNNECESSARY SERVICES 
AND FAILURE OF CERTAIN ORGANIZATIONS TO FURNISH MEDICALLY 
NECESSARY SERVICES.—Any individual or entity that the Sec-
retary determines— 
> ,;•; 
"(A) has submitted or caused to be submitted bills or 
requests for payment (where such bills or requests are 
101 STAT. 682 
42 u s e 1395. 
-P 
Contracts. 
42 u s e 1396b. 
42 u s e 1396. 
42 u s e 1396n. 
42 u s e 1395mm. 
Post, pp. 
686-688. 
Post, p. 689. 
42 u s e 1320a-3. 
Post, p. 692. 
PUBLIC LAW 100-93—AUG. 18, 1987 
based on charges or cost) under title XVIII or a State health 
care program containing charges (or, in applicable cases, 
requests for payment of costs) for items or services fur-
nished substantially in excess of such individual's or entity's 
usual charges (or, in applicable cases, substantially in 
excess of such individual's or entity's costs) for such items 
or services, unless the Secretary finds there is good cause 
for such bills or requests containing such charges or costs; 
"(B) has furnished or caused to be furnished items or 
services to patients (whether or not eligible for benefits 
under title XVIII or under a State health care program) 
substantially in excess of the needs of such patients or of a 
quality which fails to meet professionally recognized stand-
ards of health care; 
"(C) is— 
"(i) a health maintenance organization (as defined in 
section 1903(m)) providing items and services under a 
State plan approved under title XIX, or 
"(ii) an entity furnishing services under a waiver 
approved under section 1915(bKl), 
and has failed substantially to provide medically necessary 
items and services that are required (under law or the 
contract with the State under title XIX) to be provided to 
individuals covered under that plan or waiver, if the failure 
has adversely affected (or has a substantial likelihood of 
adversely affecting) these individuals; or 
"(D) is an entity providing items and services as an 
eligible organization under a risk-sharing contract under 
section 1876 and has failed substantially to provide medi-
cally necessary items and services that are required (under 
law or such contract) to be provided to individuals covered 
under the risk-sharing contract, if the failure has adversely 
affected (or has a substantial likelihood of adversely affect-
ing) these individuals. 
"(7) FRAUD, KICKBACKS, AND OTHER PROHIBITED ACTIVITIES.— 
Any individual or entity that the Secretary determines has 
committed an act which is described in section 1128A or section 
1128B. 
"(8) ENTITIES CONTROLLED BY A SANCTIONED INDIVIDUAL.—Any 
entity with respect to which the Secretary determines that a 
person— 
"(A)(i) with an ownership or control interest (as defined 
in section 1124(a)(3)) in that entity, or 
"(ii) who is an officer, director, agent, or managing em-
ployee (as defined in section 1126(b)) of that entity— 
is a person— 
"(B)(i) who has been convicted of any offense described in 
subsection (a) or in paragraph (1), (2), or (3) of this 
subsection; 
"(ii) against whom a civil monetary penalty has been 
assessed under section 1128A; or 
"(iii) who has been excluded from participation under a 
program under title XVIII or under a State health care 
program. 
"(9) FAILURE TO DISCLOSE REQUIRED INFORMATION.—Any entity 
that did not fully and accurately make any disclosure required 
by section 1124 or section 1126. 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 683 
"(10) FAILURE TO SUPPLY REQUESTED INFORMATION ON SUB-
CONTRACTORS AND SUPPLIERS.—Any disclosing entity (as defined 
in section 1124(a)(2)) that fails to supply (within such period as 
may be specified by the Secretary in regulations) upon request 
specifically addressed to the entity by the Secretary or by the 
State agency administering or supervising the administration of 
a State health care program— 
"(A) full and complete information as to the ownership of 
a subcontractor (as defined by the Secretary in regulations) 
with whom the entity has had, during the previous 12 
months, business transactions in an aggregate amount in 
excess of $25,000, or 
"(B) full and complete information as to any significant 
business transactions (as defined by the Secretary in 
regulations), occurring during the five-year period ending 
on the date of such request, between the entity and any 
wholly owned supplier or between the entity and any 
subcontractor. 
"(11) 
FAILURE 
TO SUPPLY 
PAYMENT 
INFORMATION.—Any 
individual or entity furnishing items or services for which 
payment may be made under title XVIII or a State health care 
program that fails to provide such information as the Secretary 
or the appropriate State agency finds necessary to determine 
whether such payments are or were due and the amounts 
thereof, or has refused to permit such examination of its records 
by or on behalf of the Secretary or that agency as may be 
necessary to verify such information. 
"(12) FAILURE TO GRANT IMMEDIATE ACCESS.—Any individual 
or entity that fails to grant immediate access, upon reasonable 
request (as defined by the Secretary in regulations) to any of the 
following: 
"(A) To the Secretary, or to the agency used by the 
Secretary, for the purpose specified in the first sentence of 
section 1864(a) (relating to compliance with conditions of 
participation or payment). 
"(B) To the Secretary or the State agency, to perform the 
reviews and surveys required under State plans under para-
graphs (26), (31), and (33) of section 1902(a) and under 
section 1903(g). 
"(C) To the Inspector General of the Department of 
Health and Human Services, for the purpose of reviewing 
records, documents, and other data 
necessary to the 
performance of the statutory functions of the Inspector 
General. 
"(D) To a State medicaid fraud control unit (as defined in 
section 1903(q)), for the purpose of conducting activities 
described in that section. 
"(13) FAILURE TO TAKE CORRECTIVE ACTION.—Any hospital that 
fails to comply substantially with a corrective action required 
under section 1886(f)(2)(B). 
"(14) DEFAULT ON HEALTH EDUCATION LOAN OR SCHOLARSHIP 
OBLIGATIONS.—Any individual who the Secretary determines is 
in default on repayments of scholarship obligations or loans in 
connection with health professions education made or secured, 
in whole or in part, by the Secretary and with respect to whom 
the Secretary has taken all reasonable steps available to the 
Secretary to secure repayment of such obligations or loans. 
42 u s e 1320a-3. 
42 u s e 1395. 
42 u s e 1395aa. 
42 u s e 1396a. 
42 u s e 1396b. 
Health care 
facilities. 
42 u s e 1395WW. 
101 STAT. 684 
PUBLIC LAW 100-93—AUG. 18, 1987 
except that (A) the Secretary shall not exclude pursuant to this 
paragraph a physician who is the sole community physician or 
c j'.S:5ii j ;u i;; 
sole source of essential specialized services in a community if a 
State requests that the physician not be excluded, and (B) the 
Secretary shall take into account, in determining whether to 
exclude any other physician pursuant to this paragraph, access 
of beneficiaries to physician services for which payment may be 
42 use 1395, 
made under title XVIII or XIX. 
1^96. 
"(c) NOTICE, EFFECTIVE DATE, AND PERIOD OF EXCLUSION.—(1) An 
Post, p. 686. 
exclusion under this section or under section 1128A shall be effec-
tive at such time and upon such reasonable notice to the public and 
to the individual or entity excluded as may be specified in regula-
tions consistent with paragraph (2). 
"(2)(A) Except as provided in subparagraph (B), such an exclusion 
shall be effective with respect to services furnished to an individual 
on or after the effective date of the exclusion. 
"(B) Unless the Secretary determines that the health and safety of 
individuals receiving services warrants the exclusion taking effect 
earlier, an exclusion shall not apply to payments made under title 
^,^,c 
j.y 
XVIII or under a State health care program for— 
"(i) inpatient institutional services furnished to an individual 
who was admitted to such institution before the date of the 
exclusion, or 
"(ii) home health services and hospice care furnished to an 
individual under a plan of care established before the date of 
the exclusion, 
until the passage of 30 days after the effective date of the exclusion. 
"(3)(A) The Secretary shall specify, in the notice of exclusion 
under paragraph (1) and the written notice under section 1128A, the 
minimum period (or, in the case of an exclusion of an individual 
under subsection (b)(12), the period) of the exclusion. 
"(B) In the case of an exclusion under subsection (a), the minimum 
« cie8i Oc 
period of exclusion shall be not less than five years, except that, 
upon the request of a State, the Secretary may waive the exclusion 
under subsection (a)(1) in the case of an individual or entity that is 
the sole community physician or sole source of essential specialized 
' ; 
^ 
services in a community. The Secretary's decision whether to waive 
the exclusion shall not be reviewable. 
"(C) In the case of an exclusion of an individual under subsection 
(b)(12), the period of the exclusion shall be equal to the sum of— 
"(i) the length of the period in which the individual failed to 
grant the immediate access described in that subsection, and 
"(ii) an additional period, not to exceed 90 days, set by the 
Secretary. 
"(d) NOTICE TO STATE AGENCIES AND EXCLUSION UNDER STATE 
, 
J HEALTH CARE PROGRAMS.—(1) Subject to paragraph (3), the Sec-
'^[','"• ,*, retary shall exercise the authority under subsection (b) in a manner 
f < that results in an individual's or entity's exclusion from all the 
programs under title XVIII and all the State health care programs 
in which the individual or entity may otherwise participate. 
"(2) The Secretary shall promptly notify each appropriate State 
agency administering or supervising the administration of each 
State health care program (and, in the case of an exclusion effected 
pursuant to subsection (a) and to which section 304(a)(5) of the 
21 use 824. 
Controlled Substances Act may apply, the Attorney General)— 
••Hh. 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 685 
"(A) of the fact and circumstances of each exclusion effected 
against an individual or entity under this section or section 
1128A, and 
Post, p. 686. 
"(B) of the period (described in paragraph (3)) for which the 
State agency is directed to exclude the individual or entity from 
participation in the State health care program. 
*'(3)(A) Except as provided in subparagraph (B), the period of the 
exclusion under a State health care program under paragraph (2) 
shall be the same as any period of exclusion under a program under 
title XVIII. 
42 use 1395. 
"(B) The Secretary may waive an individual's or entity's exclusion 
under a State health care program under paragraph (2) if the 
Secretary receives and approves a request for the waiver with 
,, 
^,, 
respect to the individual or entity from the State agency administer-
ing or supervising the administration of the program. 
"(e) NOTICE TO STATE LICENSING AGENCIES.—The Secretary shall— 
"(1) promptly notify the appropriate State or local agency or 
authority having responsibility for the licensing or certification 
.. -.j,,, .» 
of an individual or entity excluded (or directed to be excluded) 
from participation under this section or section 1128A, of the 
fact and circumstances of the exclusion, 
"(2) request that appropriate investigations be made and 
sanctions invoked in accordance with applicable State law and 
policy, and 
"(3) request that the State or local agency or authority keep 
the Secretary and the Inspector General of the Department of 
Health and Human Services fully and currently informed with 
respect to any actions taken in response to the request. 
"(f) NOTICE, HEARING, AND JUDICIAL REVIEW.—(1) Subject to para-
graph (2), any individual or entity that is excluded (or directed to be 
excluded) from participation under this section is entitled to reason-
able notice and opportunity for a hearing thereon by the Secretary 
to the same extent as is provided in section 205(b), and to judicial 
42 USC 405. 
review of the Secretary's final decision after such hearing as is 
provided in section 205(g). 
"(2) Unless the Secretary determines that the health or safety of 
individuals receiving services warrants the exclusion taking effect 
earlier, any individual or entity that is the subject of an adverse 
determination under subsection (b)(7) shall be entitled to a hearing 
by an administrative law judge (as provided under section 205(b)) on 
the determination under subsection (b)(7) before any exclusion based 
upon the determination takes effect. 
"(3) The provisions of section 205(h) shall apply with respect to 
this section and sections 1128A and 1156 to the same extent as it is 
42 USC 1320c-5. 
applicable with respect to title II. 
42 USC 401. 
"(g) APPLICATION FOR TERMINATION OF EXCLUSION.—(1) An individ-
ual or entity excluded (or directed to be excluded) from participation 
under this section or section 1128A may apply to the Secretary, in 
the manner specified by the Secretary in regulations and at the end 
of the minimum period of exclusion provided under subsection (c)(3) 
and at such other times as the Secretary may provide, for termi-
nation of the exclusion effected under this section or section 1128A. 
"(2) The Secretary may terminate the exclusion if the Secretary 
determines, on the basis of the conduct of the applicant which 
occurred after the date of the notice of exclusion or which was 
unknown to the Secretary at the time of the exclusion, that— 
101 STAT. 686 
PUBLIC LAW 100-93—AUG. 18, 1987 
K 
"(A) there is no basis under subsection (a) or (b) or section 
Infra. 
j', 
1128A(a) for a Continuation of the exclusion, and 
^ 
"(B) there are reasonable assurances that the types of actions 
,,- which formed the basis for the original exclusion have not 
recurred and will not recur. 
"(3) The Secretary shall promptly notify each appropriate State 
agency administering or supervising the administration of each 
State health care program (and, in the case of an exclusion effected 
pursuant to subsection (a) and to which section 304(aX5) of the 
21 use 824. 
Controlled Substances Act may apply, the Attorney General) of the 
fact and circumstances of each termination of exclusion made under 
this subsection. 
"(h) DEFINITION OF STATE HEALTH CARE PROGRAM.—For purposes 
Post, p. 689. 
of this section and sections 1128A and 1128B, the term 'State health 
care program' means— 
42 use 1396. 
"(1) a State plan approved under title XIX, 
42 use 701. 
"(2) any program receiving funds under title V or from an 
allotment to a State under such title, or 
42 use 1397. 
"(3) any program receiving funds under title XX or from an 
allotment to a State under such title, 
"(i) CONVICTED DEFINED.—For purposes of subsections (a) and (b), a 
physician or other individual is considered to have been 'convicted' 
of a criminal offense— 
"(1) when a judgment of conviction has been entered against 
the physician or individual by a Federal, State, or local court, 
* 
regardless of whether there is an appeal pending or whether the 
judgment of conviction or other record relating to criminal 
conduct has been expunged; 
"(2) when there has been a finding of guilt against the physi-
cian or individual by a Federal, State, or local court; 
"(3) when a plea of guilty or nolo contendere by the physician 
or individual has been accepted by a Federal, State, or local 
court; or 
o i « ' * 
"(4) when the physician or individual has entered into partici-
pation in a first offender or other program where judgment of 
conviction has been withheld.". 
SEC. 3. CIVIL MONETARY PENALTIES. 
(a) GROUNDS FOR IMPOSITION.—(1) Section 1128A(a)(l) (42 U.S.C. 
1320a-7a(a)(l)) is amended by striking "the Secretary determines" 
and all that follows through "; or" and inserting ' the Secretary 
determines— 
"(A) is for a medical or other item or service that the 
person knows or has reason to know was not provided as 
o ,, - 
claimed, 
"(B) is for a medical or other item or service and the 
person knows or has reason to know the claim is false or 
^ 
fraudulent, 
"(C) is presented for a physician's service (or an item or 
service incident to a physician's service) by a person who 
knows or has reason to know that the individual who 
furnished (or supervised the furnishing of) the service— 
"(i) was not licensed as a physician, 
"(ii) was licensed as a physician, but such license had 
,, 
been obtained through a misrepresentation of material 
/ 
\ 
fact (including cheating on an examination required for 
licensing), or 
"(iii) represented to the patient at the time the 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 687 
service was furnished that the physician was certified 
in a medical specialty by a medical specialty board 
when the individual was not so certified, or 
"' 
"(D) is for a medical or other item or service furnished 
during a period in which the person was excluded under the 
program under which the claim was made pursuant to a 
determination by the Secretary under this section or under 
section 1128, 1156, 116O0t>) (as in effect on September 2, Ante, p. 680; 42 
1982), 1862(d) (as in effect on the date of the enactment of 
U^Sin^i^Qon" o 
the Medicare and Medicaid Patient and Program Protection 
^'^ ^^^ id^oc-9. 
Act of 1987), or 1866(b); or". 
Post, pp. 692,693. 
(2) Section 1128A(aX2) is amended— 
(A) in subparagraph (B) by inserting "(or other requirement of 
a State plan under title XIX)" after "State agency", and 
42 use 1396. 
(B) by inserting at the end "or (D) an agreement pursuant to 
section 1866(aXl)(G), or". 
(3) Subsection (a) of section 1128A is further amended— 
(A) by inserting after paragraph (2) and before the end matter 
of such subsection the following new paragraph: 
"(3) gives to any person, with respect to coverage under title 
XVIII of inpatient hospital services subject to the provisions of 
42 use 1395. 
section 1886, information that he knows or has reason to know 
Post, p. 693. 
is false or misleading, and that could reasonably be expected to 
influence the decision when to discharge such person or another 
individual from the hospital;", and 
(B) in the matter following paragraph (3)— 
(i) by inserting "(or, in cases under paragraph (3), $15,000 
for each individual with respect to whom false or mislead-
ing information was given)" before the period at the end of 
the first sentence, and 
t. 
(ii) by adding at the end thereof the following new sen-
tence: "In addition the Secretary may make a determina-
tion in the same proceeding to exclude the person from 
participation in the programs under title XVIII and to 
direct the appropriate State agency to exclude the person 
from participation in any State health care program.". 
(b) STATUTE OF LIMITATION ON ACTIONS.—Subsection (cXl) of sec-
tion 1128A (as redesignated by section 9313(cXl)(D) of the Omnibus 
,, 
. 
Budget Reconciliation Act of 1986) is amended by adding at the end 
the following new sentences: "The Secretary may not initiate an 
action under this section with respect to any claim later than six 
years after the date the claim was presented. The Secretary may 
initiate an action under this section by serving notice of the action 
in any manner authorized by Rule 4 of the Federal Rules of Civil 
Procedure.". 
28 use app. 
(c) CONFORMING AMENDMENT.—Subsections (c), (d), (g), and (h) of 
section 1128A are each amended by striking "penalty or assess-
ment" and inserting "penalty, assessment, or exclusion each place 
it appears. 
(d) PRO-RATED PAYMENT OF RECOVERIES TO STATE AGENCIES.— 
Subsection (f)(1)(A) of section 1128A is amended by striking "equal to 
the State's share of the amount paid by the State agency and 
inserting "bearing the same proportion to the total amount recov-
ered as the State's share of the amount paid by the State agency for 
such claim bears to the total amount paid". 
(e) NOTICE TO STATE AGENCIES.—Subsection (h) of section 1128A is 
further amended by inserting "the appropriate State agency or 
agencies administering or supervising the administration of State 
^4 
101 STAT. 688 
PUBLIC LAW 100-93—AUG. 18, 1987 
Ante, p. 680. 
health care programs (as defined in section 1128(h))," after "profes-
sional organization,", 
(f) APPLICATION OF SUBPOENA POWER AND INJUNCTIVE POWERS.— 
Ante, p. 686. 
Section 1128A is further amended by adding at the end the following 
new subsections: 
42 use 405. 
"(j) The provisions of subsections (d) and (e) of section 205 shall 
apply with respect to this section to the same extent as they are 
applicable with respect to title II. The Secretary may delegate the 
authority granted by section 205(d) (as made applicable to this 
section) to the Inspector General of the Department of Health and 
;... ... ,,.,, 
Human Services for purposes of any investigation under this 
section. 
"(k) Whenever the Secretary has reason to believe that any person 
A'.,: • 1 5't 
has engaged, is engaging, or is about to engage in any activity which 
makes the person subject to a civil monetary penalty under this 
section, the Secretary may bring an action in an appropriate district 
court of the United States (or, if applicable, a United States court of 
any territory) to enjoin such activity, or to enjoin the person from 
concealing, removing, encumbering, or disposing of assets which 
may be required in order to pay a civil monetary penalty if any such 
;- 
J 
penalty were to be imposed or to seek other appropriate relief.". 
' " 
SEC. 4. CRIMINAL PENALTIES FOR ACTS INVOLVING MEDICARE AND 
STATE HEALTH CARE PROGRAMS. 
(a) TECHNICAL AMENDMENTS.—Section 1909 (42 U.S.C. 1396h) is 
amended— 
> 
(1) by amending the heading to read as follows: 
, 
"CRIMINAL PENALTIES FOR ACTS INVOLVING MEDICARE OR STATE 
HEALTH CARE PROGRAMS"; 
(2) in subsection (a)(1), by striking "a State plan approved 
42 use 1395. 
under this title" and inserting "a program under title XVIII or 
a State health care program (as defined in section 1128(h))"; 
(3) in the matter in subsection (a) following paragraph (4), by 
striking "this title" the first place it appears and inserting "the 
program"; 
(4) in the last sentence of subsection (a), by striking "this 
42 use 1396. 
title" the first place it appears and inserting "title XIX", and by 
striking "this title" the second place it appears and inserting 
"that title"; 
(5) in paragraphs (1)(A), (1)(B), (2)(A), (2)(B), and (3)(A) of 
subsection (b), by striking "this title" and inserting "title XVIII 
or a State health care program" each place it appears; 
(6) in subsection (b)(3)— 
(A) by striking "and" at the end of subparagraph (A), 
(B) by striking the period at the end of subparagraph (B) 
and inserting "; and", and 
(C) by adding at the end the following: 
"(C) any amount paid by a vendor of goods or services to a 
person authorized to act as a purchasing agent for a group of 
individuals or entities who are furnishing services reimbursed 
under title XVIII or a State health care program i
f
— 
Contracts. 
"(i) the person has a written contract, with each such 
individual or entity, which specifies the amount to be paid 
the person, which amount may be a fixed amount or a fixed 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 689 
percentage of the value of the purchases made by each such 
individual or entity under the contract, and 
"(ii) in the case of an entity that is a provider of services 
(as defined in section 1861(u)), the person discloses (in such 
42 USC I395x. 
form and manner as the Secretary requires) to the entity 
and, upon request, to the Secretary the amount received 
from each such vendor with respect to purchases made by 
^ 
or on behalf of the entity.''; 
(7) in subsection (c), by striking "or home health agency (as 
those terms are employed in this title)" and inserting "home 
health agency, or other entity for which certification is required 
under title XVIII or a State health care program"; and 
42 USC 1395. 
(8) in subsection (d), by striking "this title" and inserting 
"title XIX" each place it appears. 
42 use 1396. 
(b) CRIMINAL PENALTIES FOR PHYSICIAN MISREPRESENTATIONS.— 
Subsection (a) of such section is further amended— 
(1) by striking "or" at the end of paragraph (3), 
(2) by inserting "or" at the end of paragraph (4), and 
(3) by inserting after paragraph (4) the following new 
paragraph: 
"(5) presents or causes to be presented a claim for a physi- Claims. 
clan's service for which payment may be made under a program 
under title XVIII or a State health care program and knows 
that the individual who furnished the service was not licensed 
as a physician,". 
(c) REDESIGNATION OF SECTION 1877(d) AS SECTION 1128B(e).— 
Subsection (d) of section 1877 (42 U.S.C. 1395nn) is redesignated as 
subsection (e) and is transferred and inserted in section 1909 at the 
end thereof. 
(d) REDESIGNATION OF SECTION 1909 AS SECTION 1128B.—Section 
1909, as amended by subsections (a), Ot)), and (c) of this section, is 
redesignated as section 1128B and is transferred to title XI and 
inserted immediately after section 1128A. 
(e) REPEAL.—Section 1877 (other than subsection (d) thereof which 
was transferred under subsection (c) of this section) is repealed. 
SEC. 5. INFORMATION CONCERNING SANCTIONS TAKEN BY STATE 
LICENSING AUTHORITIES AGAINST HEALTH CARE PRACTI-
TIONERS AND PROVIDERS. 
(a) MEDICAID PLAN REQUIREMENT.—Section 1902(a) (42 U.S.C. 
1396a(a)) is amended— 
Post, pp. 691,694. 
(1) by striking "and" at the end of paragraph (46), 
(2) by striking the period at the end of the paragraph (47) 
added by section 9407(a) of the Omnibus Budget Reconciliation 
Act of 1986 and inserting a semicolon and transferring and 42 USC I396a. 
inserting such paragraph after paragraph (46), 
(3) by striking the period at the end of the paragraph (47) 
added by section 11005(b) of the Anti-Drug Abuse Act of 1986 42 USC I396a. 
and inserting "; and", by redesignating such paragraph as 
^ 
paragraph (48), and by transferring and inserting such para-
graph after paragraph (47), and 
; yi ^ ^^sh, 
(4) by inserting after paragraph (48) the following new 
paragraph: 
i 'a 
- 
"(49) provide that the State will provide information and 
:^)ba '<^ 
access to certain information respecting sanctions taken against 
" 
health care practitioners and providers by State licensing 
authorities in accordance with section 1921.". 
Post, p. 690. 
42 USC 1396h. 
42 USC 
1320a-7b. 
42 USC 1301. 
101 STAT. 690 
PUBLIC LAW 100-93—AUG. 18, 1987 
(b) INFORMATION REQUIRED.—Title XIX is amended by redesignat-
42 use 1396s. 
ing section 1921 as section 1922 and inserting after section 1920 the 
following new section: 
"INFORMATION CONCERNING SANCTIONS TAKEN BY STATE LICENSING 
AUTHORITIES AGAINST HEALTH CARE PRACTITIONERS AND PROVIDERS 
42 u s e 1396r-2. 
"SEC. 
1921. (a) INFORMATION REPORTING REQUIREMENT.—The 
Ante, p. 689; 
requirement referred to in section 1902(a)(49) is that the State must 
post, pp. 691,694. provide for the following: 
"(1) INFORMATION REPORTING SYSTEM.—The State must have 
'' 
' 
in effect a system of reporting the following information with 
respect to formal proceedings (as defined by the Secretary in 
regulations) concluded against a health care practitioner or 
entity by any authority of the State (or of a political subdivision 
thereof) responsible for the licensing of health care practi-
tioners or entities: 
"(A) Any adverse action taken by such licensing author-
ity as a result of the proceeding, including any revocation 
or suspension of a license (and the length of any such 
suspension), reprimand, censure, or probation. 
"(B) Any dismissal or closure of the proceedings by reason 
of the practitioner or entity surrendering the license or 
leaving the State or jurisdiction. 
"(C) Any other loss of the license of the practitioner or 
entity, whether by operation of law, voluntary surrender, 
or otherwise. 
' 
' 
' 
"(2) ACCESS TO DOCUMENTS.—The State must provide the Sec-
retary (or an entity designated by the Secretary) with access to 
such documents of the authority described in paragraph (1) as 
may be necessary for the Secretary to determine the facts and 
circumstances concerning the actions and determinations de-
scribed in such paragraph for the purpose of carrying out this 
Act. 
"(b) FORM OF INFORMATION.—The information described in subsec-
tion (a)(1) shall be provided to the Secretary (or to an appropriate 
private or public agency, under suitable arrangements made by the 
Secretary with respect to receipt, storage, protection of confidential-
ity, and dissemination of information) in such a form and manner as 
the Secretary determines to be appropriate in order to provide for 
activities of the Secretary under this Act and in order to provide, 
directly or through suitable arrangements made by the Secretary, 
information— 
"(1) to agencies administering Federal health care programs, 
including private entities administering such programs under 
contract, 
, 
"(2) to licensing authorities described in subsection (a)(1), 
"(3) to State agencies administering or supervising the 
administration of State health care programs (as defined in 
section 1128(h)), 
If 
"(4) to utilization and quality control peer review organiza-
tions described in part B of title XI and to appropriate entities 
with contracts under section 1154(a)(4)(C) with respect to eligible 
organizations reviewed under the contracts, 
"(5) to State medicaid fraud control units (as defined in 
42USe 1396b. 
section 1903(q)), 
; t? 
c ^ 
..s ' = >i.. j ^ - 
.- 
v 
i 
^'1 
Ante, p. 680. 
42 u s e 1320c. 
42 u s e 1320C-3. 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 691 
"(6) to hospitals and other health care entities (as defined in 
section 431 of the Health Care Quality Improvement Act of 
1986), with respect to physicians or other licensed health care 
practitioners that have entered (or may be entering) into an 
employment or affiliation relationship with, or have applied for 
.; 
clinical privileges or appointments to the medical staff of, such 
hospitals or other health care entities (and such information 
shall be deemed to be disclosed pursuant to section 427 of, and 
b 
be subject to the provisions of, that Act), 
"(7) to the Attorney General and such other law enforcement 
officials as the Secretary deems appropriate, and 
"(8) upon request, to the Comptroller General, 
in order for such authorities to determine the fitness of individuals 
to provide health care services, to protect the health and safety of 
individuals receiving health care through such programs, and to 
protect the fiscal integrity of such programs. 
"(c) CONFIDENTIALITY OF INFORMATION PROVIDED.—The Secretary 
shall provide for suitable safeguards for the confidentiality of the 
information furnished under subsection (a). Nothing in this subsec-
tion shall prevent the disclosure of such information by a party 
which is otherwise authorized, under applicable State law, to make 
such disclosure. 
"(d) APPROPRIATE COORDINATION.—The Secretary shall provide for 
the maximum appropriate coordination in the implementation of 
subsection (a) of this section and section 422 of the Health Care 
Quality Improvement Act of 1986.". 
SEC. 6. OBLKJATION OV HP:ALTH CARE PRACTITIONERS AM) PROVIDERS. 
Section 1156 (42 U.S.C. 1320c-5) is amended— 
(1) by striking "title XVIII" and "such title" in subsection (a) 
and inserting "this Act" in each instance, and 
(2) by striking "title XVIII" in subsection (b) and inserting 
"this Act" each place it appears. 
SEC. 7. EXCLUSION UNDER THE MEDICAID PROGRAM. 
Section 1902 (42 U.S.C. 1396b) is amended by redesignating the 
subsection (1) added by section 3(b) of the Employment Opportunities 
for Disabled Americans Act as subsection (o) and by inserting after 
such subsection the following new subsection: 
"(p)(l) In addition to any other authority, a State may exclude any 
individual or entity for purposes of participating under the State 
plan under this title for any reason for which the Secretary could 
exclude the individual or entity from participation in a program 
under title XVIII under section 1128, 1128A, or 1866(b)(2). 
"(2) In order for a State to receive payments for medical assistance 
under section 1903(a), with respect to payments the State makes to a 
health maintenance organization (as defined in section 1903(m)) or 
to an entity furnishing services under a waiver approved under 
section 1915(b)(1), the State must provide that it will exclude from 
participation, as such an organization or entity, any organization or 
entity that— 
"(A) could be excluded under section 1128(b)(8) (relating to 
owners and managing employees who have been convicted of 
certain crimes or received other sanctions), or 
"(B) has, directly or indirectly, a substantial contractual rela-
tionship (as defined by the Secretary) with an individual or 
entity that is described in section 1128(b)(8)(B). 
Health care 
facilities. 
42 u s e 11151. 
42 u s e 11137. 
42 u s e 11132. 
42 u s e 1396a; 
ante, p. 689. 
42 u s e 1395; 
ante, p. 680; 
42 use 
1370a-7a, 
1395CC. 
42 u s e 1396b. 
42 u s e 1396n. 
Contracts. 
101 STAT. 692 
PUBLIC LAW 100-93—AUG. 18, 1987 
"^^^^ '• 
"(3) As used in this subsection, the term 'exclude' includes the 
refusal to enter into or renew a participation agreement or the 
'"-'- 
termination of such an agreement.". 
SEC. 8. MISCKLLANEOUS AM) CONFORMING AMENDMP^NTS. 
(a) MATERNAL AND CHILD HEALTH PROGRAM.—Section 504(b) (42 
^
^ U.S.C. 704(b)) is amended— 
' 
* ^^ 
(1) by striking "or" at the end of paragraph (4), 
*-
(2) by striking the period at the end of paragraph (5) and 
'^^' inserting "; or", and 
(3) by adding at the end thereof the following new paragraph: 
"(6) payment for any item or service (other than an emer-
, ' 
gency item or service) furnished— 
•' 
"(A) by an individual or entity during the period when 
' > such individual or entity is excluded pursuant to section 
^ 
rate, 
pp. 680, 
1128 or section 1128A from participation in the program 
686. 
under this title, or 
"(B) at the medical direction or on the prescription of a 
physician during the period when the physician is excluded 
pursuant to section 1128 or section 1128A from participa-
•^hj^ >
* 
tion in the program under this title and when the person 
furnishing such item or service knew or had reason to know 
^^' 
of the exclusion (after a reasonable time period after 
reasonable notice has been furnished to the person).". 
(b) DISCLOSURE REQUIREMENTS.—(1) Subsection (a) of section 1126 
; I' • 'X. J sf 
(42 U.S.C. 1320a-5) is amended— 
(A) in the first sentence, by striking "or other institution" and 
all that follows through the period at the end and inserting "or 
other entity (other than an individual practitioner or group of 
~' practitioners) shall be required to disclose to the Secretary or to 
the appropriate State agency the name of any person that is a 
^>'' person described in subparagraphs (A) and (B) of section 
1128(b)(8).", and 
(B) in the second sentence, bv striking "institution, organiza-
tion, or agency" and inserting ' entity". 
(2) Subsection (b) of such section is amended by striking "institu-
tion, organization, or agency" and inserting "entity" each place it 
'••'[''' 
' ' 
appears. 
(c) MEDICARE PAYMENTS.—(1) Section 1862 (42 U.S.C. 1395y) is 
amended— 
', 
' 
(A) by repealing subsection (d), and 
(B) by amending subsection (e) to read as follows: 
"(e) No payment may be made under this title with respect to 
any item or service (other than an emergency item or service) 
furnished— 
;,. 
"(1) by an individual or entity during the period when such 
individual or entity is excluded pursuant to section 1128 or 
•^ 
• 
section 1128A from participation in the program under this 
'' ' * 
title; or 
•f> 
"(2) at the medical direction or on the prescription of a 
physician during the period when he is excluded pursuant to 
^'' 
section 1128 or section 1128A from participation in the program 
'•J ' under this title and when the person furnishing such item or 
service knew or had reason to know of the exclusion (after a 
aasijn . 
reasonable time period after reasonable notice has been fur-
nished to the person).". 
(2) Section 1842(j) (42 U.S.C. 1395u(j)) is amended— 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 693 
(A) in paragraph (2)— 
(i) by amending subparagraph (A) to read as follows: 
"(A) excluding a physician from participation in the programs 
under this title for a period not to exceed 5 years, in accordance 
with the procedures of subsections (c), (f), and (g) of section 1128, Ante, p. 680. 
or", and 
(ii) by striking "barred from participation in the pro-
gram" in the second sentence and inserting "excluded from 
participation in the programs"; and 
(B) by striking "bar" in paragraph (3)(A) and inserting 
"exclude". 
(3) Section l'862(h)(4) (42 U.S.C. 1395y(h)(4)) is amended by striking 
"paragraphs (2) and (3) of subsection (d)" and inserting "subsections 
(c), (0, and (g) of section 1128". 
(4) Paragraph (3) of section 1886(f) (42 U.S.C. 1395ww(f)) is 
amended to read as follows: 
"(3) The provisions of subsections (c) through (g) of section 1128 
shall apply to determinations made under paragraph (2) in the same 
manner as they apply to exclusions effected 
under section 
1128(b)(13).". 
(d) TERMINATION OF PROVIDER AGREEMENTS UNDER MEDICARE.— 
Section 1866 (42 U.S.C. 1395cc) is amended— 
(1) in subsection (a)— 
(A) by striking paragraph (3), and 
(B) by redesignating paragraph (4) as paragraph (3); 
(2) by amending subsection (b) to read as follows: 
"(b)(1) A provider of services may terminate an agreement with 
the Secretary under this section at such time and upon such notice 
to the Secretary and the public as may be provided in regulations, 
except that notice of more than six months shall not be required. 
"(2) The Secretary may refuse to enter into an agreement under 
this section or, upon such reasonable notice to the provider and the 
public as may be specified in regulations, may refuse to renew or 
- i -»^ 
may terminate such an agreement after the Secretary— 
"(A) has determined that the provider fails to comply substan-
tially with the provisions of the agreement, with the provisions 
of this title and regulations thereunder, or with a corrective 
action required under section 1886(f)(2)(B), 
"(B) has determined that the provider fails substantially to 
meet the applicable provisions of section 1861, or 
42 USC 1395x. 
"(C) has excluded the provider from participation in a pro-
gram under this title pursuant to section 1128 or section 1128A. 42 USC 
"(3) A termination of an agreement or a refusal to renew an 
1320a-7a. 
agreement under this subsection shall become effective on the same 
date and in the same manner as an exclusion from participation 
under the programs under this title becomes effective under section 
1128(c)."; 
(3) in paragraphs (1) and (3) of subsection (c), by striking "an 
agreement filed under this title by a provider of services has 
been terminated by the Secretary" and inserting "the Secretary 
has terminated or has refused to renew an agreement under 
this title with a provider of services"; 
(4) by inserting "or nonrenewal" in subsection (c) after 
"termination" each place it appears; and 
(5) by adding at the end the following new subsection: 
"(h)(1) Except as provided in paragraph (2), an institution or 
agency dissatisfied with a determination by the Secretary that it is 
101 STAT. 694 
PUBLIC LAW 100-93—AUG. 18, 1987 
not a provider of services or with a determination described in 
subsection (b)(2) shall be entitled to a hearing thereon by the 
Secretary (after reasonable notice) to the same extent as is provided 
42 use 405. 
in section 205(b), and to judicial review of the Secretary's final 
decision after such hearing as is provided in section 205(g). 
"(2) An institution or agency is not entitled to separate notice and 
Ante, p. 680. 
opportunity for a hearing under both section 1128 and this section 
with respect to a determination or determinations based on the 
same underlying facts and issues.", 
(e) CONFORMING AMENDMENT.—Section 1869 (42 U.S.C. 1395ff) is 
amended by striking subsection (c). 
42 use 1396a; 
(f) MEDICAID PLAN REVISIONS.—Section 1902(a) (42 U.S.C. l396b(a)) 
ante, pp. 689, 
jg amended— 
(1) in paragraph (23), by inserting "subsection (g) and in" after 
"except as provided in", 
(2) in paragraph (38), by striking "respectively, (A)" and all 
that follows up to the semicolon at the end and inserting "the 
information described in section 1128(b)(9)", and 
(3) in paragraph (39)— 
-
>
.
L ,> 
(A) by striking "bar" and inserting "exclude", 
(B) by striking "person" and inserting "individual or 
entity" each place it appears, and 
(C) by inserting "or section 1128A" after "section 1128". 
(g) DENIAL OF FEDERAL FINANCIAL PARTICIPATION UNDER MEDIC-
AID.—Paragraph (2) of section 1903(i) (42 U.S.C. 1396b(i)) is amended 
to read as follows: 
"(2) with respect to any amount expended for an item or 
service (other than an emergency item or service) furnished— 
"(A) under the plan by any individual or entity during 
any period when the individual or entity is excluded from 
participation in the State plan under this title pursuant to 
Ante, p. 68d. 
, , 
section 1128 or section 1128A, or 
"(B) at the medical direction or on the prescription of a 
physician, during the period when such physician is ex-
f. r 
eluded pursuant to section 1128 or section 1128A from 
participation in the program under this title and when the 
person furnishing such item or service knew or had reason 
. A
T 
to know of the exclusion (after a reasonable time period 
* r,; :;.;; ::. 
after reasonable notice has been furnished to the person).". 
(h) MEDICAID CONFORMING AMENDMENTS.—(1) Subsection (n) of 
section 1903 (42 U.S.C. 1396b) is repealed. 
(2) Paragraph (2) of section 1915(a) (42 U.S.C. 1396n(a)) is amended 
to read as follows: 
"(2) Restricts for a reasonable period of time the provider or 
providers from which an individual (eligible for medical assistance 
for items or services under the State plan) can receive such items or 
services, if— 
"(A) the State has found, after notice and opportunity for 
a hearing (in accordance with procedures established by the 
State), that the individual has utilized such items or serv-
ices at a frequency or amount not medically necessary (as 
{?jl 
determined in accordance with utilization guidelines estab-
lished by the State), and 
"(B) under such restriction, individuals eligible for medi-
co 
cal assistance for such services have reasonable access 
?f 
(taking into account geographic location and reasonable 
travel time) to such services of adequate quality.". 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 695 
(i) TITLE XX.—Section 2005(a) (42 U.S.C. 1397d(a)) is amended— 
(1) by striking "or" at the end of paragraph (7), 
(2) by striking the period at the end of paragraph (8) and 
inserting "; or", and 
(3) by adding at the end thereof the following new paragraph: 
"(9) for payment for any item or service (other than an 
emergency item or service) furnished— 
"(A) by an individual or entity during the period when 
such individual or entity is excluded pursuant to section 
1128 or section 1128A from participation in the program 
Ante, pp. 680, 
under this title, or 
689. 
"(B) at the medical direction or on the prescription of a 
physician during the period when the physician is excluded 
' 
pursuant to section 1128 or section 1128A from participa-
tion in the program under this title and when the person 
furnishing such item or service knew or had reason to know 
of the exclusion (after a reasonable time period after 
reasonable notice has been furnished to the person).", 
(j) DENIAL, REVOCATION, OR SUSPENSION OF REGISTRATION TO 
MANUFACTURE, DISTRIBUTE, OR DISPENSE A CONTROLLED SUBSTANCE 
F
O
R ENTITIES EXCLUDED FROM THE MEDICARE PROGRAM.—Section 
304(a) of the Controlled Substances Act (21 U.S.C. 824(a)) is 
amended— 
* 
(1) by striking "or" at the end of paragraph (3), 
(2) by striking the period at the end of paragraph (4) and 
inserting "; or", and 
(3) by inserting after paragraph (4) the following new 
paragraph: 
' -
"(5) has been excluded (or directed to be excluded) from 
participation in a program pursuant to section 1128(a) of the 
Social Security Act. . 
.SEC. 9. CLARIFICATION OF MEDICAID MORATORIUM PROVISIONS OF 
DEFICIT REDUCTION ACT OF 1984. 
Section 2373(c) of the Deficit Reduction Act of 1984 (Public Law 
98-369; 98 Stat. 1112) is amended to read as follows: 
"(c)(1) The Secretary of Health and Human Services shall not take 
any compliance, disallowance, penalty, or other regulatory action 
against a State with respect to the moratorium period described in 
paragraph (2) by reason of such State's plan described in paragraph 
(5) under title XIX of the Social Security Act (including any part of 
the plan operating pursuant to section 1902(f) of such Act), or the 
operation thereunder, being determined to be in violation of clause 
(IV), 
(V), or 
(VI) of 
section 
1902(a)(10)(A)(ii) 
or 
section 
1902(a)(10)(C)(i)(III) of such Act on account of such plan's (or its 
operation) having a standard or methodology which the Secretary 
interprets as being less restrictive than the standard or methodology 
' r, 
required under such section, provided that such plan (or its oper-
ation) does not make ineligible any individual who would be eligible 
but for the provisions of this subsection. 
"(2) The moratorium period is the period beginning on October 1, 
1981, and ending 18 months after the date on which the Secretary 
submits the report required under paragraph (3). 
"(3) The Secretary shall report to the Congress within 12 months 
Reports. 
after the date of the enactment of this Act with respect to the 
appropriateness, and impact on States and recipients of medical 
assistance, of applying standards and methodologies utilized in cash 
State and local 
governments. 
42 u s e 1396a 
note. 
42 u s e 1396. 
42 u s e 1396a. 
101 STAT. 696 
PUBLIC LAW 100-93—AUG. 18, 1987 
Ante, pp. 689, 
694. 
assistance programs to those recipients of medical assistance who do 
not receive cash assistance, and any recommendations for changes 
in such requirements. 
"(4) No provision of law shall repeal or suspend the moratorium 
imposed by this subsection unless such provision specifically amends 
or repeals this subsection. 
"(5) In this subsection, a State plan is considered to include— 
"(A) any amendment or other change in the plan which is 
submitted by a State, or 
"(B) any policy or guideline delineated in the Medicaid oper-
ation or program manuals of the State which are submitted by 
the State to the Secretary, 
whether before or after the date of enactment of this Act and 
whether or not the amendment or change, or the operating or 
program manual was approved, disapproved, acted upon, or not 
acted upon by the Secretary. 
"(6) During the moratorium period, the Secretary shall implement 
(and shall not change by any administrative action) the policy in 
effect at the beginning of such moratorium period with respect to— 
"(A) the point in time at which an institutionalized individual 
must sell his home (in order that it not be counted as a 
resource); and 
"(B) the time period allowed for sale of a home of any such 
individual, 
who is an applicant for or recipient of medical assistance under the 
State plan as a medically needy individual (described in section 
1902(a)(10)(C) of the Social Security Act) or as an optional categori-
cally needy individual (described in section 1902(a)(10)(A)(ii) of such 
Act).". 
SEC. 10. LIMITATION OF LIABILITY OF MEDICARE BENEFICIARIES WITH 
* 
RESPECT TO SERVICES FURNISHED BY EXCLUDED INDIVID-
UALS AND ENTITIES. 
Title XVIII is amended by adding at the end the following new 
section: 
Claims. 
42 u s e 1395aaa. 
Ante, pp. 680, 
689; 42 USC 
1320C-5. 
42 USC 1320C-9. 
Ante, pp. 692, 
693. 
LIMITATION OF LIABILITY OF BENEFICIARIES WITH RESPECT TO SERVICES 
FURNISHED BY EXCLUDED INDIVIDUALS AND ENTITIES 
"SEC. 1890. Where an individual eligible for benefits under this 
title submits a claim for payment for items or services furnished by 
an individual or entity excluded from participation in the programs 
under this title, pursuant to section 1128, 1128A, 1156, 1160 (as in 
effect on September 2, 1982), 1862(d) (as in effect on the date of the 
enactment of the Medicare and Medicaid Patient and Program 
Protection Act of 1987), or 1866, and such beneficiary did not know 
or have reason to know that such individual or entity was so 
excluded, then, to the extent permitted by this title, and notwith-
standing such exclusion, payment shall be made for such items or 
services. In each such case the Secretary shall notify the beneficiary 
of the exclusion of the individual or entity furnishing the items or 
services. Payment shall not be made for items or services furnished 
by an excluded individual or entity to a beneficiary after a reason-
able time (as determined by the Secretary in regulations) after the 
Secretary has notified the beneficiary of the exclusion of that 
individual or entity.". 
. , 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 697 
SEC. 11. DEFINITION OF PERSON WITH OWNERSHIP OR CONTROL 
INTEREST. 
Section 1124(a)(3)(A)(ii) (42 U.S.C. 1320a-3(a)(3)(A)(ii)) is amended 
by striking "$25,000 or". 
SEC. 12. CONDITIONAL APPROVAL OF RENAL DIALYSIS FACILITIES. 
Section 1881 (42 U.S.C. 1395rr) is amended by adding at the end 
the following new subsection: 
"(h)(1) In any case where the Secretary— 
"(A) finds that a renal dialysis facility is not in substantial 
compliance with requirements for such facilities prescribed 
" 
under subsection (b)(1)(A), 
;^ 
"(B) finds that the facility's deficiencies do not immediately 
' 
jeopardize the health and safety of patients, and 
"
• 
"(C) has given the facility a reasonable opportunity to correct 
its deficiencies, 
the Secretary may, in lieu of terminating approval of the facility, 
determine that payment under this title shall be made to the facility 
only for services furnished to individuals who were patients of the 
facility before the effective date of the notice. 
"(2) The Secretary's decision to restrict payments under this 
subsection shall be made effective only after such notice to the 
public and to the facility as may be prescribed in regulations, and 
shall remain in effect until (A) the Secretary finds that the facility is 
in substantial compliance with the requirements under subsection 
(b)(1)(A), or (B) the Secretary terminates the agreement under this 
title with the facility. 
"(3) A facility dissatisfied with a determination by the Secretary 
under paragraph (1) shall be entitled to a hearing thereon by the 
Secretary (after reasonable notice) to the same extent as is provided 
in section 205(b), and to judicial review of the Secretary's final 
decision after such hearing as is provided in section 205(g).". 
SEC. 13. AMENDMENT RELATING TO FRAUD INVOLVING MEDICARE 
SUPPLEMENTAL INSURANCE. 
Section 1882(d)(1) (42 U.S.C. 1395ss(d)(l)) is amended by striking 
"knowingly or willfully" and inserting "knowingly and willfully'. 
SEC. 14. STANDARDS FOR ANTI-KICKBACK PROVISIONS. 
(a) REGULATIONS.—The Secretary of Health and Human Services, 
in consultation with the Attorney General, not later than 1 year 
after the date of the enactment of this Act shall publish proposed 
regulations, and not later than 2 years after the date of the enact-
ment of this Act shall promulgate final regulations, specifying 
payment practices that shall not be treated as a criminal offense 
under section 1128B(b) of the Social Security Act and shall not serve 
as the basis for an exclusion under section 11280t>)(7) of such Act. 
Any practices specified in regulations pursuant to the preceding 
sentence shall be in addition to the practices described in subpara-
graphs (A) through (C) of section 1128B(b)(3). 
(b) CRIMINAL VIOLATION.—Section 1128B(b)(3), as amended and 
redesignated by section 4 of this Act, is further amended— 
(1) by striking "and" at the end of subparagraph (B), 
(2) by striking the period at the end of subparagraph (C) and 
inserting "; and", and 
(3) by adding at the end thereof the following new subpara-
graph: 
42 u s e 405. 
42 u s e 1320a-7b 
note. 
Ante, p. 689. 
Ante, p. 680. 
42 use 
1320a-7b. 
101 STAT. 698 
PUBLIC LAW 100-93—AUG. 18, 1987 
42 u s e 1320a-7 
note. 
Ante, p. 680. 
42 u s e 1396. 
State and local 
governments. 
Claims. 
Ante, p. 695. 
"(D) any payment practice specified by the Secretary in regu-
lations promulgated pursuant to section 14(a) of the Medicare 
and Medicaid Patient and Program Protection Act of 1987.". 
SEC. 15. EFFECTIVE DATES. 
(a) IN GENERAL.—Except as provided in subsections (b), (c), (d), and 
(e), the amendments made by this Act shall become effective at the 
end of the fourteen-day period beginning on the date of the enact-
ment of this Act and shall not apply to administrative proceedings 
commenced before the end of such period. 
(b) MANDATORY MINIMUM EXCLUSIONS APPLY PROSPECTIVELY.— 
Section 1128(c)(3)(B) of the Social Security Act (as amended by this 
Act), which requires an exclusion of not less than five years in the 
case of certain exclusions, shall not apply to exclusions based on 
convictions occurring before the date of the enactment of this Act. 
(c) EFFECTIVE DATE FOR CHANGES IN MEDICAID LAW.—(1) 
The 
amendments made by sections 5 and 8(f) apply (except as provided 
under paragraph (2)) to payments under title XIX of the Social 
Security Act for calendar quarters beginning more than thirty days 
after the date of the enactment of this Act, without regard to 
whether or not final regulations to carry out such amendment have 
been published by such date. 
(2) 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 requirements imposed by the amendments made by this 
Act, 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 these additional requirements 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. 
(3) Subsection (j) of section 1128A of the Social Security Act (as 
added by section 3(f) of this Act) takes effect on the date of the 
enactment of this Act. 
(d) PHYSICIAN MISREPRESENTATIONS.—Clauses (ii) and (iii) of sec-
tion 1128A(a)(l)(C) of the Social Security Act, as amended by section 
3(a)(1) of this Act, apply to claims presented for services performed 
on or after the effective date specified in subsection (a), without 
regard to the date the misrepresentation of fact was made. 
(e) CLARIFICATION OF MEDICAID MORATORIUM.—The amendments 
made by section 9 of this Act shall apply as though they were 
originally included in the enactment of section 2373(c) of the Deficit 
Reduction Act of 1984. 
PUBLIC LAW 100-93—AUG. 18, 1987 
101 STAT. 699 
(f) TREATMENT OF CERTAIN DENIALS OF PAYMENT.—For purposes of 
section 1128(b)(8)(B)(iii) of the Social Security Act (as amended by 
section 2 of this Act), a person shall be considered to have been 
excluded from participation under a program under title XVIII if 
42 USC 1395. 
payment to the person has been denied under section 1862(d) of the 
Social Security Act, as in effect before the effective date specified in 
Ante, p. 692. 
subsection (a). 
Approved August 18, 1987. 
3 A""'^^ 
k^mi'--
LEGISLATIVE HISTORY—H.R. 1444 (S. 661): 
HOUSE REPORTS: No. 100-85, Pt. 1 (Comm. on Energy and Commerce) and Pt. 2 
(Comm. on Ways and Means). 
SENATE REPORTS: No. 100-109 accompanying S. 661 (Comm. on Finance). 
C O N G R E S S I O N A L R E C O R D , Vol. 133 (1987): 
June 1, 2, considered and passed House. 
July 23, considered and passed Senate, amended, in lieu of S. 661. 
July 30, House concurred in Senate amendment.