Instructions: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
Input: SECTION 1. SHORT TITLE.

This Act may be cited as the ''Medicare Psychiatric Hospital
Prospective Payment System Act of 1999''.

SEC. 2. MEDICARE PROSPECTIVE PAYMENT SYSTEM FOR PSYCHIATRIC FACILITIES.

(a) Establishment of Prospective Payment System.--Section 1886 of
the Social Security Act (42 U.S.C. 1395ww) is amended by adding at the
end the following:
''(l) Prospective Payment System for Inpatient Psychiatric
Services.--
''(1) Amount of payment.--
''(A) During transition period.--Notwithstanding
section 1814(b), but subject to the provisions of
section 1813, the amount of payment with respect to the
operating and capital-related costs of inpatient
hospital services of a psychiatric facility (as defined
in paragraph (7)(C)) for each day of services furnished
in a cost reporting period beginning on or after
October 1, 2000, and before October 1, 2003, is equal
to the sum of--
''(i) the TEFRA percentage (as defined in
paragraph (7)(D)) of the facility-specific per
diem rate (determined under paragraph (2)); and
''(ii) the PPS percentage (as defined in
paragraph (7)(B)) of the applicable Federal per
diem rate (determined under paragraph (3)).
''(B) Under fully implemented system.--
Notwithstanding section 1814(b), but subject to the
provisions of section 1813, the amount of payment with
respect to the operating and capital-related costs of
inpatient hospital services of a psychiatric facility
for each day of services furnished in a cost reporting
period beginning on or after October 1, 2003, is equal
to the applicable Federal per diem rate determined
under paragraph (3) for the facility for the fiscal
year in which the day of services occurs.
''(C) New facilities.--In the case of a psychiatric
facility that does not have a base fiscal year (as
defined in paragraph (7)(A)), payment for the operating
and capital-related costs of inpatient hospital
services shall be made under this subsection using the
applicable Federal per diem rate.
''(2) Determination of facility-specific per diem rates.--
''(A) Base year.--The Secretary shall determine, on
a per diem basis, the allowable operating and capital-
related costs of inpatient hospital services for each
psychiatric facility for its cost reporting period (if
any) beginning in the base fiscal year (as defined in
paragraph (7)(A)), such costs determined as if
subsection (b)(8) did not apply.
''(B) Updating.--The Secretary shall update the
amount determined under subparagraph (A) for each cost
reporting period after the cost reporting period
beginning in the base fiscal year and before October 1,
2003, by a factor equal to the market basket percentage
increase (as defined in subsection (b)(3)(B)(iii)).
''(3) Determination of federal per diem rate.--
''(A) Base year.--The Secretary shall determine, on
a per diem basis, the allowable operating and capital-
related costs of inpatient hospital services for each
psychiatric facility for its cost reporting period (if
any) beginning in the base fiscal year (as defined in
paragraph (7)(A)), such costs determined as if
subsection (b)(8) did not apply.
''(B) Updating to first fiscal year.--The Secretary
shall update the amount determined under subparagraph
(A) for each cost reporting period up to the first cost
reporting period to which this subsection applies by a
factor equal to the market basket percentage increase
(as defined in subsection (b)(3)(B)(iii)).
''(C) Computation of standardized per diem rate.--
The Secretary shall standardize the amount determined
under subparagraph (B) for each facility by--
''(i) adjusting for variations among
facilities by area in the average facility wage
level per diem; and
''(ii) adjusting for variations in case mix
per diem among facilities (based on the patient
classification system established by the
Secretary under paragraph (4)).
''(D) Computation of weighted average per diem
rates.--
''(i) Separate rates for urban and rural
areas.--Based on the standardized amounts
determined under subparagraph (C) for each
facility, the Secretary shall compute a
separate weighted average per diem rate--
''(I) for all psychiatric
facilities located in an urban area (as
defined in subsection (d)(2)(D)); and
''(II) for all psychiatric
facilities located in a rural area (as
defined in subsection (d)(2)(D)).
''(ii) For hospitals and units.--In the
areas referred to in clause (i), the Secretary
may compute a separate weighted average per
diem rate for--
''(I) psychiatric hospitals; and
''(II) psychiatric units described
in the matter following clause (v) of
subsection (d)(1)(B).
If the Secretary establishes separate average
weighted per diem rates under this clause, the
Secretary shall also establish separate average
per diem rates for psychiatric facilities in
such categories that are owned and operated by
an agency or instrumentality of Federal, State,
or local government and for psychiatric
facilities other than such facilities.
''(iii) Weighted average.--In computing the
weighted averages under clauses (i) and (ii),
the standardized per diem amount for each
facility shall be weighted for each facility by
the number of days of inpatient hospital
services furnished during its cost reporting
period beginning in the base fiscal year.
''(E) Updating.--The weighted average per diem
rates determined under subparagraph (D) shall be
updated for each fiscal year after the first fiscal
year to which this subsection applies by a factor equal
to the market basket percentage increase (as defined in
subsection (b)(3)(B)(iii)).
''(F) Determination of Federal per diem rate.--
''(i) In general.--The Secretary shall
compute for each psychiatric facility for each
fiscal year (beginning with fiscal year 2001) a
Federal per diem rate equal to the applicable
weighted average per diem rate determined under
subparagraph (E), adjusted for--
''(I) variations among facilities
by area in the average facility wage
level per diem;
''(II) variations in case mix per
diem among facilities (based on the
patient classification system
established by the Secretary under
paragraph (4)); and
''(III) variations among facilities
in the proportion of low-income
patients served by the facility.
''(ii) Other adjustments.--In computing
Federal per diem rates under this subparagraph,
the Secretary may adjust for outlier cases, the
indirect costs of medical education, and such
other factors as the Secretary determines to be
appropriate.
''(iii) Budget neutrality.--The adjustments
specified in clauses (i)(I), (i)(III), and (ii)
shall be implemented in a manner that does not
result in aggregate payments under this
subsection that are greater or less than those
aggregate payments that otherwise would have
been made if such adjustments did not apply.
''(4) Establishment of patient classification system.--
''(A) In general.--The Secretary shall establish--
''(i) classes of patients of psychiatric
facilities (in this paragraph referred to as
'case mix groups'), based on such factors as
the Secretary determines to be appropriate; and
''(ii) a method of classifying specific
patients in psychiatric facilities within these
groups.
''(B) Weighting factors.--For each case mix group,
the Secretary shall assign an appropriate weighting
factor that reflects the relative facility resources
used with respect to patients classified within that
group compared to patients classified within other such
groups.
''(5) Data collection; utilization monitoring.--
''(A) Data collection.--The Secretary may require
psychiatric facilities to submit such data as is
necessary to implement the system established under
this subsection.
''(B) Utilization monitoring.--The Secretary shall
monitor changes in the utilization of inpatient
hospital services furnished by psychiatric facilities
under the system established under this subsection and
report to the appropriate committees of Congress on
such changes, together with recommendations
for legislation (if any) that is needed to address unwarranted changes
in such utilization.
''(6) Special adjustments.--Notwithstanding the preceding
provisions of this subsection, the Secretary shall reduce
aggregate payment amounts that would otherwise be payable under
this subsection for inpatient hospital services furnished by a
psychiatric facility during cost reporting periods beginning in
fiscal years 2001 and 2002 by such uniform percentage as is
necessary to assure that payments under this subsection for
such cost reporting periods are reduced by an amount that is
equal to the sum of--
''(A) the aggregate increase in payments under this
title during fiscal years 1999 and 2000, that is
attributable to the operation of subsection (b)(8); and
''(B) the aggregate increase in payments under this
title during fiscal years 2001 and 2002 that is
attributable to the application of the market basket
percentage increase under paragraphs (2)(B) and (3)(E)
of this subsection in lieu of the provisions of
subclauses (VI) and (VII) of subsection (b)(3)(B)(ii).
Reductions under this paragraph shall not affect
computation of the amounts payable under this
subsection for cost reporting periods beginning in
fiscal years after fiscal year 2002.
''(7) Definitions.--For purposes of this subsection:
''(A) The term 'base fiscal year' means, with
respect to a hospital, the most recent fiscal year
ending before the date of enactment of this subsection
for which audited cost report data are available.
''(B) The term 'PPS percentage' means--
''(i) with respect to cost reporting
periods beginning on or after October 1, 2000,
and before October 1, 2001, 25 percent;
''(ii) with respect to cost reporting
periods beginning on or after October 1, 2001,
and before October 1, 2002, 50 percent; and
''(iii) with respect to cost reporting
periods beginning on or after October 1, 2002,
and before October 1, 2003, 75 percent.
''(C) The term 'psychiatric facility' means--
''(i) a psychiatric hospital; and
''(ii) a psychiatric unit described in the
matter following clause (v) of subsection
(d)(1)(B).
''(D) The term 'TEFRA percentage' means--
''(i) with respect to cost reporting
periods beginning on or after October 1, 2000,
and before October 1, 2001, 75 percent;
''(ii) with respect to cost reporting
periods beginning on or after October 1, 2001,
and before October 1, 2002, 50 percent; and
''(iii) with respect to cost reporting
periods beginning on or after October 1, 2002,
and before October 1, 2003, 25 percent.''.
(b) Limit on Reductions Under Balanced Budget Act.--Section 1886(b)
of the Social Security Act (42 U.S.C. 1395ww(b)) is amended by adding
at the end the following:
''(8) Notwithstanding the amendments made by sections 4411,
4414, 4415, and 4416 of the Balanced Budget Act of 1997, in the
case of a psychiatric facility (as described in subsection
(l)(7(C)(ii)), the amount of payment for the operating costs of
inpatient hospital services for cost reporting periods
beginning on or after October 1, 1998, and before October 1,
2000, shall not be less than 95 percent of the amount that
would have been paid for such costs if such amendments did not
apply.
(c) Effective Date.--The amendments made by subsections (a) and (b)
shall apply as if included in the enactment of the Balanced Budget Act
of 1997.
Output:
Provides that the amendments made by this Act shall apply as if included in the enactment of BBA '97.