SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Diabetic Eye Disease Prevention Act 
of 2016''.

SEC. 2. MEDICARE DIABETIC EYE DISEASE PREVENTION AND EARLY TREATMENT 
              DEMONSTRATION PROJECT.

    Title XVIII of the Social Security Act is amended by inserting 
after section 1866E (42 U.S.C. 1395cc-5) the following new section:

  ``diabetic eye disease prevention and early treatment demonstration 
                                project

    ``Sec. 1866F.  (a) Establishment.--The Secretary shall conduct, 
during a 5-year period beginning no later than January 1, 2017, a 
diabetic eye disease prevention and early treatment demonstration 
project (in this section referred to as the `demonstration project') to 
provide incentives to primary care practices to refer to local eye 
doctors for comprehensive dilated eye exams--
            ``(1) diabetic Medicare beneficiaries at the time of their 
        diagnosis of diabetes; and
            ``(2) diabetic Medicare beneficiaries who have been 
        diagnosed with diabetes mellitus and have not received a 
        comprehensive dilated eye examination in the previous 5 years.
    ``(b) Requirement.--The demonstration project shall test the extent 
to which such incentives result in--
            ``(1) improving early detection and treatment of diabetes-
        related vision problems and the reduction of significant eye 
        and vision loss and blindness associated with delayed diagnosis 
        and treatment of diabetes-related eye and vision conditions;
            ``(2) reducing the cost of health care services covered 
        under this title; and
            ``(3) achieving beneficiary satisfaction.
    ``(c) Conduct of Project.--The demonstration project shall be 
conducted consistent with the following:
            ``(1) Identification of primary care practices.--The 
        demonstration project shall identify at least 100 primary care 
        practices, in each of at least 10 States which have high per 
        capita costs of diabetes care for diabetic Medicare 
        beneficiaries, for participation in the demonstration project.
            ``(2) Listing of participating eye doctors.--Each practice 
        so identified shall be provided with a list of eye doctors who 
        are located in the area of such practice and who have agreed to 
        participate in the demonstration project.
            ``(3) Requirements for participating eye doctors.--As part 
        of the participation agreement of an eye doctor under the 
        demonstration project, the eye doctor agrees--
                    ``(A) to offer to furnish to each diabetic Medicare 
                beneficiary referred to the doctor by a primary care 
                practice so identified a comprehensive dilated eye 
                examination and needed diabetes-related eye care 
                covered under this title; and
                    ``(B) to report back to such practice on the 
                results of such an examination or care within 72 hours 
                after the time of conducting such examination or 
                furnishing such care.
    ``(d) Incentive Payment Methodology.--
            ``(1) In general.--Under the demonstration project, subject 
        to paragraph (2), the Secretary shall pay an incentive on an 
        annual basis to each primary care practice participating in the 
        demonstration project for each beneficiary the practice refers 
        in the year for an eye examination under the demonstration 
        project. Such amount shall be set at a level so as to encourage 
        primary care practices to participate in the demonstration 
        project.
            ``(2) Budget neutrality.--The Secretary shall ensure that 
        the aggregate payments made under this title, including 
        incentive payments made under this section, with respect to 
        individuals participating in the demonstration project do not 
        exceed the aggregate amounts that the Secretary estimates would 
        have been paid under title with respect to such individuals if 
        the demonstration project had not been implemented. In order to 
        carry out the previous sentence, the Secretary is authorized to 
        reduce payment rates under part B for eye care services for 
        diabetic Medicare beneficiaries (other than those described in 
        subsection (a)) to take into account the costs of comprehensive 
        dilated eye examinations furnished to individuals otherwise 
        eligible to participate in the demonstration project.
            ``(3) Funding.--The costs, including incentive payments, of 
        carrying out the demonstration project shall be paid from the 
        Federal Supplementary Medical Insurance Trust Fund established 
        under section 1841.
    ``(e) Waiver.--The Secretary may waive such provisions of this 
title and title XI as the Secretary determines necessary in order to 
implement the demonstration project.
    ``(f) Evaluation and Reports.--
            ``(1) Evaluation.--The Secretary shall conduct an 
        independent evaluation of the demonstration project to assess 
        whether the project has the results described in subsection 
        (b).
            ``(2) Reports.--
                    ``(A) Preliminary report.--Not later than 60 days 
                after the completion of the first year of the 
                demonstration project, the Secretary shall submit to 
                Congress a preliminary report on the results of the 
                project.
                    ``(B) Final report.--No later than 6 months after 
                the date of the completion of the demonstration 
                project, the Secretary shall submit to Congress a final 
                report on the results of the project and shall include 
                in such report the findings of the evaluation conducted 
                under paragraph (1).
    ``(g) Definitions.--In this section:
            ``(1) Diabetic medicare beneficiary.--The term `diabetic 
        Medicare beneficiary' means, with respect to a primary care 
        practice, an individual who--
                    ``(A) is entitled to benefits under part A and 
                enrolled for benefits under part B;
                    ``(B) is not enrolled in a Medicare Advantage plan 
                under part C or a PACE program under section 1894;
                    ``(C) has been determined to have diabetes 
                mellitus; and
                    ``(D) is receiving primary care services through 
                one or more physicians or nurse practitioners in such 
                practice.
            ``(2) Eye doctor.--The term `eye doctor' means a 
        participating physician who is a State-licensed optometrist or 
        ophthalmologist.
            ``(3) Primary care practice.--The term `primary care 
        practice'--
                    ``(A) means a physician (as described in section 
                1861(r)(1)) who has a primary specialty designation of 
                family medicine, internal medicine, or geriatric 
                medicine; and
                    ``(B) includes a group practice the physicians 
                within which are primarily physicians with such a 
                specialty designation and may also include physician 
                assistants and nurse practitioners.''.
Output: Diabetic Eye Disease Prevention Act of 2016 This bill amends title XVIII of the Social Security Act (Medicare) to establish a demonstration project through which primary care practices may receive incentives for referring diabetic Medicare beneficiaries to local eye doctors for comprehensive dilated eye exams. The project must test the extent to which these incentives: (1) improve early detection and treatment of diabetes-related vision problems, (2) reduce the cost of Medicare services, and (3) achieve beneficiary satisfaction. The project&nbsp;shall identify for participation at least 100 primary care practices in at least 10 states that have high per capita costs of diabetes care for Medicare beneficiaries. Project costs shall be paid from the Federal Supplementary Medical Insurance Trust Fund.