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'

42 USC 1395mm

PUBLIC LAW 100-203—DEC. 22, 1987

"(B) The remedies described in this subparagraph are— "(i) civil money penalties of not more than $25,000 for each "' determination under subparagraph (A) or, with respect to a determination under clause (iv) or (v)(I), of not more than $100,000 for each such determination, "(ii) suspension of enrollment of individuals under this section ' after the date the Secretary notifies the organization of a determination under subparagraph (A) and until the Secretary is satisfied that the basis for such determination has been corrected and is not likely to recur, or "(iii) suspension of payment to the organization under this section for individuals enrolled after the date the Secretary notifies the organization of a determination under subparagraph (A) and until the Secretary is satisfied that the basis for such determination has been corrected and is not likely to recur. The provisions of section 1128A (other than subsections (a) and (b)) shall apply to a civil money penalty under clause (i) in the same manner as they apply to a civil money penalty under that section.", SEC. 4015. MEDICARE PAYMENT DEMONSTRATION PROJECTS. (a) MEDICARE INSURED GROUP DEMONSTRATION PROJECTS.—

Contracts.

(1) The Secretary of Health and Human Services (in this subsection referred to as the "Secretary") may provide for capitation demonstration projects (in this subsection referred to as "projects") with an entity which is an eligible organization with a contract with the Secretary under section 1876 of the Social Security Act or which meets the restrictions and requirements of this subsection. The Secretary may not approve a project unless it meets the requirements of this subsection. (2) The Secretary may not conduct more than 3 projects and may not expend, from funds under title XVIII of the Social Security Act, more than $600,000,000 in any fiscal year for all such projects. (3) The per capita rate of payment under a project— (A) may be based on the adjusted average per capita cost (as defined in section 1876(a)(4) of the Social Security Act) determined only with respect to the group of individuals involved (rather than with respect to medicare beneficiaries generally), but \ *' ""'

.,.^f •. .i.»

(B) the r a t e of payment may not exceed the lesser of— (i) 95 percent of the adjusted average per capita cost described in subparagraph (A), or (iiXD in the 4th year or 5th year of a project, 115 percent of the adjusted average per capita cost (as defined in section 1876(a)(4) of such Act) for classes of individuals described in section 1876(a)(l)(B) of that Act, or (II) in any subsequent year of a project, 95 percent of the adjusted average per capita cost (as defined in section 1876(a)(4)) for such cleisses.

(4) If the payment amounts made to a project are greater than the costs of the project (as determined by the Secretary or, if applicable, on the basis of adjusted community rates described in section 1876(e)(3) of the Social Security Act), the project—

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(A) may retain the surplus, but not to exceed 5 percent of the average adjusted per capita cost determined in accordance with paragraph (3)(A), and (B) with respect to any additional surplus not retained by the project, shall apply such surplus to additional benefite for individuals served by the project or return such surplus to the Secretary. (5) Enrollment under the project shall be voluntary. Individuals enrolled with the project may terminate such enrollment as of the beginning of the first calendar month following the date on which the request is made for such termination. Upon such termination, such individuals shall retain the same rights to other health benefits that such individuals would have had if they had never enrolled with the project without any exclusion or waiting period for pre-existing conditions. (6) The requirements of— (A) subsection (c)(3)(C) (relating to dissemination of information), (B) subsection (c)(3)(E) (annual statement of rights), (C) subsection (c)(5) (grievance procedures), (D) subsection (c)(6) (on-going quality), (E) subsection (g)(6) (relating to prompt payment of claims), (F) subsection (i)(3)(A) and (B) (relating to access to information and termination notices), (G) subsection (i)(6) (relating to providing necessary services), and (H) subsection (i)(7) (relating to agreements with peer Contracts. review organizations), of section 1876 of the Social Security Act shall apply to a project in the same manner as they apply to eligible organizations with risk-sharing contracts under such section, (7) The benefits provided under a project must be at least actuarially equivalent to the combination of the benefits available under title XVIII of the Social Security Act and the benefits available through any alternative plans in which the individual can enroll through the the employer. The project shall guarantee the actuarial value of benefits available under the employer plan for the duration of the project. (8) A project shall comply with all applicable State laws. (9) The Secretary may not authorize a project unless the entity offering the project demonstrates to the satisfaction of the Secretary that it has the necessary financial reserves to pay for any liability for benefits under the project (including those liabilities for health benefits under medicare and any supplemental benefits). (10) The Comptroller General shall monitor projects under Reports. this subsection and shall report periodically (not less often than once every year) to the (Dommittee on Finance of the Senate and the Committee on Energy and Commerce and Committee on Ways and Means of the House of Representatives on the status of such projects and the affect on such projects of the requirements of this section and shall submit a final report to each such committee on the results of such projects. (b) PAYMENT METHODOLOGY REFORM DEMONSTRATIONS PROJECTS.—

(1) The Secretary of Health and Human Services (in this subsection referred to as the "Secretary") is specifically au-

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Appropriation authorization.

PUBLIC LAW 100-203—DEC. 22, 1987

thorized to conduct demonstration projects under this subsection for the purpose of testing alternative payment methodologies pertaining to capitation payments under title XVIII of the Social Security Act, including— (A) computing adjustments to the average per capita cost under section 1876 of such Act on the basis of health status or prior utilization of services, and .t\p /^ •r (B) accounting for geographic variations in cost in the adjusted average per capita costs applicable to an eligible organization under such section which differs from payments currently provided on a county-by-county basis. (2) No project may be conducted under this subsection— (A) with an entity which is not an eligible organization (as defined in section 1876(b) of the Social Security Act), and (B) unless the project meets all the requirements of subsections (c) and (i)(3) of section 1876 of such Act. (3) There are authorized to be appropriated to carry out projects Under this subsection $5,000,000 in each of fiscal years 1989 and 1990. (c) APPLICATION OF PROVISIONS.—The provisions of subsection (a)(2) and the first sentence of subsection (b) of section 402 of the Social Security Amendments of 1967 shall apply to the demonstration projects under this section in the same manner as they apply to experiments under subsection (a)(1) of that section.

42 USC 1320a-7a note.

SEC. 4016. DELAY IN EFFECTIVE DATE IN PHYSICIAN INCENTIVE RULES FOR HEALTH MAINTENANCE ORGANIZATIONS.

100 Stat. 2002.

Section 9313(c)(2)(B) of the Omnibus Budget Reconciliation Act of 1986 is amended by striking "April 1, 1989" and inserting "April 1, 1990".

42 USC 1395mm

SEC. 4017. GAO STUDY AND REPORTS ON MEDICARE CAPITATION.

Contracts.

(a) STUDY.—The Comptroller General shall conduct a study on medicare capitation rates that shall include an analysis and assessment of— (1) the current method for computing per capita rates of payment under section 1876 of the Social Security Act (including the method for determining the United States per capita cost); (2) the method for establishing relative costs for geographic areas and the data used to establish age, sex, and other weighting factors; (3) ways to refine the calculation of adjusted average per capita costs under section 1876 of such Act (including making adjustments for health status or prior utilization of services and improvements in the definition of geographic areas); (4) the extent to which individuals enrolled with organizations with a risk-sharing contract with the Secretary under section 1876 of such Act differ in utilization and cost from fee-forservice beneficiaries and ways for modifying enrollment patterns through program changes or for reflecting the differences in rates through group experience rating or other means; (5) approaches for limiting the liability of the contracting organization under section 1876 of such Act in catastrophic cases:

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(6) ways of establishing capitation rates on a basis other than fee-for-service experience in areas with high prepaid market penetration; and (7) methods for providing the rate levels necessary to maintain access to quality prepaid services in rural or medically underserved areas (while maintaining cost savings),

.j«i»«

(b) REPORTS.

V 0

^ g

(1) Not later than January 1 of 1989 and 1990, the Comptroller General shall submit to the Committee on Finance of the Senate and the Committee on Energy and Commerce and Committee on Ways and Means of the House of Representatives interim reports on the progress of the study conducted under subsection (a). (2) Not later than January 1, 1991, the Comptroller General shall submit to each such committee a final report on the results of such study.

SEC. 4018. SPECIAL RULES. (a) ASSIGNMENT OF MEMBERS FOR HIP

HEALTH MAINTENANCE

ORGANIZATION.—Section 1876(f) of such Act (42 U.S.C. 1395mm(f)) is amended by redesignating paragraph (3) as paragraph (4) and by inserting after paragraph (2) the following new paragraph: "(3)(A) An eligible organization described in subparagraph (B) may elect, for purposes of determining the compliance of a subdivi.,,r.. sion, subsidiary, or affiliate described in subparagraph (B)(iii) with .jr. the requirement of paragraph (1) for the period before October 1, .-a% 1992, to have members of the subdivision, subsidiary, or affiliate considered to be members of the parent organization. "(B) An eligible organization described in this subparagraph is an eligible organization which— "(i) is described in section 1903(m)(2)(B)(iii); "(ii) has members who have a collectively bargained contractual right to obtain health benefits from the organization; "(iii) elects to provide benefits under a risk-sharing contract Contracts. to individuals residing in a service area, who have a collectively bargained contractual right to obtain benefits from the organization, through a subdivision, subsidiary, or affiliate which itself is an eligible organization serving the area and which is owned or controlled by the parent eligible organization; and T "(iv) has assumed any risk of insolvency and quality assurance with respect to individuals receiving benefits through such a subdivision, subsidiary, or affiliate.". (b) EXTENSION OF WAIVERS FOR SOCIAL HEALTH MAINTENANCE ORGANIZATIONS.—

(1) The Secretary of Health and Human Services shall extend without interruption, through September 30, 1992, the approval of waivers granted under subsection (a) of section 2355 of the Deficit Reduction Act of 1984 for the demonstration project described in subsection (b) of that section, subject to the terms and conditions (other than duration of the project) established under that section (as amended by paragraph (2) of this subsection). (2) Section 2355(b)(5) of the Deficit Reduction Act of 1984 is 98 Stat. 1103. amended by inserting "and in succeeding years" after "third year".

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 101 STAT. 1330-66 98 Stat. 1103.

PUBLIC LAW 100-203—DEC. 22, 1987

(3) Section 2355(d)(2) of the Deficit Reduction Act of 1984 is amended by striking "final" and inserting "interim". (4) The Secretary of Health and Human Services shall submit •'* a final report to the Congress on the project referred to in paragraph (1) not later than March 31, 1993.

Reports.

(c) TREATMENT OF MICHIGAN BLUE CARE HMO NETWORK UNDER ^^ 50 PERCENT RULE.—Blue Care, Inc., a nonprofit corporation which is

indirectly owned and operated by Blue Cross and Blue Shield of Michigan, Inc. and which enrolls individuals for the purpose of providing them with health care services through assignment to health maintenance organizations which are indirectly or wholly owned and operated by Blue Cross and Blue Shield of Michigan, Inc., is deemed to meet the requirement of section 1876(fKl) of the Social Security Act (relating to limitation on enrollment of medicare and medicaid beneficiaries with an eligible organization) if— (1) such requirement would be met if applied to all individuals enrolled with (or otherwise assigned to) each of such health maintenance organizations, and (2) not more than 20 percent of the number of individuals who are members of (or otherwise assigned to) each such organization consists of individuals who are entitled to benefits under title XVIII of the Social Security Act. (d) TEMPORARY WAIVER FOR WATTS HEALTH FOUNDATION.—Section

42 USC 1395mm 9312(c)(3) of the Omnibus Budget Reconciliation Act of 1986 is note. amended by adding at the end the following new subparagraph: Grants.

"(D) TREATMENT OF CERTAIN WAIVERS.—In the CaSC of a n

•e •

V ••

> • >

eligible organization (or successor organization) that is described in clauses (i) and (ii) of subparagraph (C) and that N received a grant or grante totaling at least $3,000,000 in fiscal year 1987 under section 329(d)(l)(A) or 330(d)(l) of the Public Health Service Act— "(i) before January 1, 1990, section 1876(f) of the Social Security Act shall not apply to the organization; "(ii) beginning on January 1, 1990, the Secretary of Health and Human Services shall waive the requirement of such section with respect to the organization if— "(I) before such date, the organization has submitted to the Secretary a schedule for the organization to comply with the requirement of section 1876(fKl) of such Act, and the Secretary has found such schedule to be reasonable and has approved such schedule; and •' ^ "(II) periodically after such date, the Secretary reviews the organization's compliance with such schedule and determines that the organization has complied, or made significant progress towards compliance, with such schedule; and "(iii) after January 1, 1990, if the Secretary has approved a schedule under clause (iiXD and has determined, in a periodic review under clause (iiXII), that . the organization has not complied, or made significant progress towards compliance, with such schedule, the Secretary may provide for a sanction described in sec-

 * ' Copy read "UNDER".

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tion 1876(f)(3) of the Social Security Act effective with respect to individuals enrolling with the organization after the date the Secretary notifies the organization of such noncompliance.".

Subpart B—Home Health Quality SEC. 4021. CONDITIONS AGENCIES.

OF

PARTICIPATION

FOR

HOME

HEALTH

(a) DEFINITION OF HOME HEALTH AGENCY.—Section 1861(o)(6) of the Social Security Act (42 U.S.C. 1395x(o)(6)) is amended by inserting "the conditions of participation specified in section 1891(a) and" after "meets". (b) CONDITIONS OF PARTICIPATION.—Title XVIII of such Act is amended by adding at the end the following new section: "CONDITIONS OF PARTICIPATION FOR HOME HEALTH AGENCIES; HOME HEALTH QUAUTY

"SEC. 1891. (a) The conditions of participation that a home health 42 USC I395bbb. agency is required to meet under this subsection are as follows: "(1) The agency protects and promotes the rights of each individual under its care, including each of the following rights: "(A) The right to be fully informed in advance about the care and treatment to be provided by the sigency, to be fully informed in advance of any changes in the care or treatment to be provided by the agency that may affect the individual's well-being, and (except with respect to an individual adjudged incompetent) to participate in planning care and treatment or changes in care or treatment. "(B) The right to voice grievances with respect to treatment or care that is (or fails to be) furnished without '-•"' discrimination or reprisal for voicing grievances. "(C) The right to confidentiality of the clinical records described in section 1861(o)(3). "(D) The right to have one's property treated with respect. "(E) The right to be fully informed orally and in writing (in advance of coming under the care of the agency) of— "(i) all items and services furnished by (or under arrangements with) the agency for which payment may be made under this title, "(ii) the coverage available for such items and services under this title, title XIX, and any other Federal program of which the agency is reasonably aware, "(iii) any charges for items and services not covered under this title and any charges the individual may have to pay with respect to items and services fur; nished by (or under arrangements with) the agency, and "(iv) any changes in the charges or items and services described in clause (i), (ii), or (iii). "(F) The right to be fully informed in writing (in advance of coming under the care of the agency) of the individual's rights and obligations under this title.

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"(G) The right to be informed of the availability of the State home health agency hot-line established under seclu. tion 1864(a). "(2) The agency notifies the State entity responsible for the licensing or certification of the agency of a change in— "(A) the persons with an ownership or control interest (as defined in section 1124(a)(3)) in the agency, m.iP'-M "(B) the persons who are officers, directors, agents, or managing employees (as defined in section 1126(b)) of the agency, and "(C) the corporation, association, or other company ,J ' responsible for the management of the agency. •'* Such notice shall be given at the time of the change and shall include the identity of each new person or company described in 'SJ the previous sentence. "(3)(A) The agency must not use as a home health aide (on a full-time, temporary, per diem, or other basis), any individual who is not a licensed health care professional (as defined in subparagraph (F)) to provide items or services described in section 1861(m) on or after January 1, 1990, unless the individ.M?(-0;=;/3US^

ual—

"(i) has completed a training and competency evaluation program, or a competency evaluation program, that meets the minimum standards established by the Secretary under subparagraph (D), and "(ii) is competent to provide such items and services. For purposes of clause (i), an individual is not considered to have completed a training and competency evaluation program, or a competency evaluation program if, since the individual's most recent completion of such a program, there has been a continuous period of 24 consecutive months during none of which the individual provided items and services described in section 1861(m) for compensation. "(B)(i) The agency must provide, with respect to individuals used as a home health aide by the agency as of July 1, 1989, for a competency evaluation program (as described in subparagraph (A)(i)) and such preparation as may be necessary for the individual to complete such a program by January 1, 1990. "(ii) The agency must provide such regular performance review and regular in-service education as assures that individuals used to provide items and services described in section 1861(m) are competent to provide those items and services. "(C) The agency must not permit an individual, other than in a training and competency evaluation program that meets the minimum standards established by the Secretary under subparagraph (D), to provide items or services of a type for which the individual has not demonstrated competency. "(D)(i) The Secretary shall establish minimum standards for the programs described in subparagraph (A) by not later than October 1, 1988. "(ii) Such standards shall include the content of the curriculum, minimum hours of training, qualification of instructors, and procedures for determination of competency. "(iii) Such standards may permit approval of programs offered by or in home health agencies, as well as outside agencies (including employee organizations), and of programs in effect on the date of the enactment of this section; except that they may

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not provide for the approval of a program offered by or in a home health agency which has been determined to be out of compliance with the requirements specified in or pursuant to section 1861(o) or subsection (a) within the previous 2 years, "(iv) Such standards shall permit a determination that an individual who has completed (before July 1, 1989) a training and competency evaluation program or a competency evaluation program shall be deemed for purposes of subparagraph (A) to have completed a program that is approved by the Secretary under the standards established under this subparagraph if the Secretary determines that, at the time the program was offered, the program met such standards. "(E) In this paragraph, the term 'home health aide' means any individual who provides the items and services described in section 1861(m), but does not include an individual— "(i) who is a licensed health professional (as defined in subparagraph (F)), or "(ii) who volunteers to provide such services without monetary compensation. "(F) In this paragraph, the term 'licensed health professional' means a physician, physician assistant, nurse practitioner, physical, speech, or occupational therapist, registered professional nurse, licensed practical nurse, or licensed or certified social worker. "(4) With respect to durable medical equipment furnished to rt individuals for whom the agency provides items and services, suppliers of such equipment do not use (on a full-time, temporary, per diem, or other basis) any individual who does not meet minimum training standards (established by the Secretary by October 1, 1988) for the demonstration and use of any such equipment furnished to individuals with respect to whom payments may be made under this title. "(5) The agency includes an individual's plan of care required under section 186l(m) as part of the clinical records described in section 1861(o)(3). "(6) The agency operates and provides services in compliance with all applicable Federal, State, and local laws and regulations (including the requirements of section 1124) and with accepted professional standards and principles which apply to professionals providing items and services in such an agency. "(b) It is the duty and responsibility of the Secretary to assure that the conditions of participation and requirements specified in or pursuant to section 1861(o) and subsection (a) of this section and the enforcement of such conditions and requirements are adequate to protect the health and safety of individuals under the care of a home health agency and to promote the effective and efficient use of public moneys.". (c) EFFECTIVE DATE.—Except as otherwise provided, the amend- 42 USC I395x ments made by subsections (a) and (b) shall apply to home health ^°^agencies as of the first day of the 18th calendar month that begins after the date of the enactment of this Act. SEC. 4022. STANDARD AND EXTENDED SURVEY.

(a) IN GENERAL.—Section 1891 of the Social Security Act (as added by section 4021) is amended by adding at the end the following new subsections:

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y...'

PUBLIC LAW 100-203—DEC. 22, 1987

"(c)(1) Any agreement entered into or renewed by the Secretary pursuant to section 1864 relating to home health agencies shall provide that the appropriate State or local agency shall conduct, without any prior notice, a standard survey of each home health agency. Any individual who notifies (or causes to be notified) a home health agency of the time or date on which such a survey is scheduled to be conducted is subject to a civil money penalty of not to exceed $2,000. The Secretary shall provide for imposition of civil money penalties under this clause in a manner similar to that for the imposition of civil money penalties under section 1128A. The Secretary shall review each State's or local agency's procedures for scheduling and conduct of standard surveys to assure that the State or agency has taken all reasonable steps to avoid giving notice of such a survey through the scheduling procedures and the conduct of the surveys themselves. "(2)(A) Except as provided in subparagraph (B), each home health agency shall be subject to a standard survey not later than 15 months after the date of the previous standard survey conducted under this paragraph. The statewide-'^ average interval between standard surveys of any home health agency shall not exceed 12 months. "(B) If not otherwise conducted under subparagraph (A), a standard survey (or an abbreviated standard survey) of an agency— "(i) may be conducted within 2 months of any change of a ownership, administration, or management of the agency to determine whether the change has resulted in any decline in the quality of care furnished by the agency, and "(ii) shall be conducted within 2 months of when a significant number of complaints have been reported with respect to the agency to the Secretary, the State, the entity responsible for the maintaining a toll-free hotline and investigative unit (under section 1864(a)), or any other appropriate Federal, State, or local agency. "(C) A standard survey conducted under this paragraph with respect to a home health agency— "(i) shall include (to the extent practicable), for a case-mix stratified sample of individuals furnished items or services by 5; the agency— "(I) visits to the homes of such individuals, but only with the consent of such individuals, for the purpose of evaluat''.ing (in accordance with a standardized reproducible assessment instrument (or instruments) approved by the Secretary under subsection (d)) the extent to which the quality and scope of items and services furnished by the agency '> attained and maintained the highest practicable functional capacity of each such individual as reflected in such individual's written plan of care required under section 1861(m) and clinical records required under section 1861(o)(3); and "(II) a survey of the quality of care and services furnished by the agency as measured by indicators of medical, nursing, and rehabilitative care; "(ii) shall be based upon a protocol that is developed, tested, and validated by the Secretary not later than January 1, 1989; and "(iii) shall be conducted by an individual— "• Copy read "Statewide".
 * . licensing of the agency, the State or local agency responsible for

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"(I) who meets minimum qualifications established by the Secretary not later than July 1, 1989, "(II) who is not serving (or has not served within the previous 2 years) as a member of the staff of, or as a consultant to, the home health agency surveyed respecting compliance with the conditions of participation specified in or pursuant to section 1861(o) or subsection (a) of this section, and "(III) who has no personal or familial financial interest in the home health agency surveyed. "(D) Each home health agency that is found, under a standard survey, to have provided substandard care shall be subject to an extended survey to review and identify the policies and procedures which produced such substandard care and to determine whether the agency has complied with the conditions of participation specified in or pursuant to section 1861(o) or subsection (a) of this section. Any other agency may, at the Secretary's or State's discretion, be subject to such an extended survey (or a partial extended survey). The extended survey shall be conducted immediately after the standard survey (or, if not practical, not later than 2 weeks after the date of completion of the standard survey). "(E) Nothing in this paragraph shall be construed as requiring an extended (or partial extended) survey as a prerequisite to imposing a sanction against an agency under subsection (e) on the basis of the findings of a standard survey. "(d)(1) Not later than January 1, 1989, the Secretary shall designate an assessment instrument (or instruments) for use by an agency in complying with subsection (c)(2)(CXI). "(2)(A) Not later than January 1, 1991, the Secretary shall— "(i) evaluate the assessment process, "(ii) report to Congress on the results of such evaluation, and "(iii) based on such evaluation, make such modifications in the assessment process as the Secretary determines are appropriate. "(B) The Secretary shall periodically update the evaluation conducted under subparagraph (A), report the results of such update to Congress, and, based on such update, make such modifications in the assessment process as the Secretary determines are appropriate. "(3) The Secretary shall provide for the comprehensive training of State and Federal surveyors in matters relating to the performance of standard and extended surveys under this section, including the use of any assessment instrument (or instruments) designated under paragraph (1).". (b) EFFECTIVE DATE.—Except as otherwise specifically provided in section 1891(d) of the Social Security Act (as added by subsection (a)), the amendment made by subsection (a) shall become effective on the first day of the 18th calendar month to begin after the date of the enactment of this Act. SEC. 4023. ENFORCEMENT.

Section 1891 of the Social Security Act (as added by section 4021 and amended by section 4022) is further amended by adding at the end the following new subsections: "(e)(1) If the Secretary determines on the basis of a standard, extended, or partial extended survey or otherwise, that a home health agency that is certified for participation under this title is no longer in compliance with the requirements specified in or pursuant

91-194 O - 90 - 28: QL.3 Part 2

Reports.

Reports.

42 USC 1395bbb note.

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PUBLIC LAW 100-203—DEC. 22, 1987

to section 1861(o) or subsection (a) and determines that the deficiencies involved immediately jeopardize the health and safety of the individuals to whom the agency furnishes items and services, the Secretary shall take immediate action to remove the jeopardy and correct the deficiencies through the remedy specified in subsection (fK2XA)(iii) or terminate the certification of the agency, and may provide, in addition, for 1 or more of the other remedies described in subsection (f)(2)(A). "(2) If the Secretary determines on the basis of a standard, extended, or partial extended survey or otherwise, that a home health agency that is certified for participation under this title is no longer in compliance with the requirements specified in or pursuant to section 1861(o) or subsection (a) and determines that the deficiencies involved do not immediately jeopardize the health and safety of the individuals to whom the agency furnishes items and services, the Secretary may (for a period not to exceed 6 months) impose intermediate sanctions developed pursuant to subsection (f), in lieu of terminating the certification of the agency. If, after such a period of intermediate sanctions, the agency is still no longer in compliance with the requirements specified in or pursuant to section 1861(o) or subsection (a), the Secretary shall terminate the certification of the agency. "(3) If the Secretary determines that a home health agency that is certified for participation under this title is in compliance with the requirements specified in or pursuant to section 1861(o) or subsection (a) but, as of a previous period, did not meet such requirements, the Secretary may provide for a civil money penalty under subsection (f)(2)(A)(i) for the days in which it finds that the agency was not in compliance with such requirements. "(4) The Secretary may continue payments under this title with respect to a home health agency not in compliance with the requirements specified in or pursuant to section 1861(o) or subsection (a) over a period of not longer than 6 months, if— ,. "(A) the State or local survey agency finds that it is more appropriate to take alternative action to assure compliance of the agency with the requirements than to terminate the certification of the agency, "(B) the agency has submitted a plan and timetable for corrective action to the Secretary for approval and the Secretary approves the plan of corrective action, and "(C) the agency agrees to repay to the Federal Government payments received under this subparagraph if the corrective
 * i irf ''tp^'i '?

action is not taken in accordance with the approved plan and .,;.. timetable. The Secretary shall establish guidelines for approval of corrective actions requested by home health agencies under this subparagraph. "(fKD The Secretary shall develop and implement, by not later than April 1, 1989— "(A) a range of intermediate sanctions to apply to home health agencies under the conditions described in subsection (e), and "(B) appropriate procedures for appealing determinations relating to the imposition of such sanctions. "(2)(A) The intermediate sanctions developed under paragraph (1) shall include— "(i) civil money penalties for each day of noncompliance,

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101 STAT. 1330-73

= •

"(ii) suspension of all or part of the payments to which a home health agency would otherwise be entitled under this title with respect to items and services furnished by a home health agency on or after the date on which the Secretary determines that intermediate sanctions should be imposed «i '• pursuant to subsection (e)(2), and h "(iii) the appointment of temporary management to over1 see the operation of the home health agency and to protect and Eissure the health and safety of the individuals under the care of the agency while improvements are made in order to bring the agency into compliance with all the requirements specified in or pursuant to section 1861(o) or subsection (a). ,y- The temporary management under clause (iii) shall not be terminated until the Secretary has determined that the agency , has the management capability to ensure continued compliance ,., -, with all the requirements referred to in that clause. ' "" T "(B) The sanctions specified in subparagraph (A) are in addition to sanctions otherwise available under State or Federal law and shall not be construed as limiting other remedies, including any remedy available to an individual at common law. "(C) A finding to suspend payment under subparagraph (A)(ii) shall terminate when the Secretary finds that the home health agency is in substantial compliance with all the requirements specified in or pursuant to section 1861(o) and subsection (a). "(3) The Secretary shall develop and implement, by not later than April 1, 1989, specific procedures with respect to the conditions under which each of the intermediate sanctions developed under paragraph (1) is to be applied, including the amount of any fines and the severity of each of these sanctions. Such procedures shall be designed so as to minimize the time between identification of deficiencies and imposition of these sanctions and shall provide for the imposition of incrementally more severe fines for repeated or uncorrected deficiencies.". (b) EFFECTIVE DATE.—Except as otherwise specifically provided in 42 USC I395bbb sulasections (e) and (f) of section 1891 of the Social Security Act (as "ot^. added by subsection (a)), the amendment made by subsection (a) shall become effective on the first day of the 18th calendar month to begin after the date of the enactment of this Act. SEC. 4024. REQUIREMENT THAT INDIVIDUAL BE CONFINED TO HOME.

(a) PART A.—Section 1814(a) of the Social Security Act (42 U.S.C. 1395f(a)) is amended by adding at the end the following: "For purposes of paragraph (2)(C), an individual shall be considered to be confined to his home' if the individual has a condition, due to an illness or injury, that restricts the ability of the individual to leave his or her home except with the assistance of another individual or the aid of a supportive device (such as crutches, a cane, a wheelchair, or a walker), or if the individual has a condition such that leaving his or her home is medically contraindicated. While an individual does not have to be bedridden to be considered 'confined to his home', the condition of the individual should be such that there exists a normal inability to leave home, that leaving home requires a considerable and taxing effort by the individual, and that absences of the individual from home are infrequent or of relatively short duration, or are attributable to the need to receive medical treatment.".

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42 USC 1395f note.

PUBLIC LAW 100-203—DEC. 22, 1987

(b) PART B.—Section 1835(a) of such Act (42 U.S.C. 1395n(a)) is amended by adding at the end the following: "For purposes of paragraph (2)(A), an individual shall be considered to be 'confined to his home' if the individual has a condition, due to an illness or injury, that restricts the ability of the individual to leave his or her home except with the assistance of another individual or the aid of a supportive device (such as crutches, a cane, a wheelchair, or a walker), or if the individual has a condition such that leaving his or her home is medically contraindicated. While an individual does not have to be bedridden to be considered 'confined to his home', the condition of the individual should be such that there exists a normal inability to leave home, that leaving home requires a considerable and taxing effort by the individual, and that absences of the individual from home are infrequent or of relatively short duration, or are attributable to the need to receive medical treatment.". (c) EFFECTIVE DATE.—The amendments made by subsections (a) and (b) shall apply to items and services provided on or after January 1, 1988. SEC. 4025. HOME HEALTH TOLL-FREE HOTLINE AND INVESTIGATIVE UNIT.

42 USC 1395aa note.

(a) IN GENERAL.—Section 1864(a) of the Social Security Act (42 U.S.C. 1395aa(a)) is amended by adding at the end the following: "Any agreement under this subsection shall provide for the appropriate State or local agency to maintain a toll-free hotline (1) to collect, maintain, and continually update information on home health agencies located in the State or locality that are certified to participate in the program established under this title (which information shall include any significant deficiencies found with respect to patient care in the most recent certification survey conducted with respect to the agency, when that survey was completed, whether corrective actions have been taken or are planned, and the sanctions, if any, imposed under this title with respect to the agency) and (2) to receive complaints (and answer questions) with respect to home health agencies in the State or locality. Any such agreement shall provide for such agency to maintain a unit for investigating such complaints that possesses enforcement authority and has access to survey and certification reports, information gathered by any private accreditation agency pursuant to an agreement with the Secretary under section 1864, and consumer medical records (but only with the consent of the consumer or his or her legal representative).". (b) EFFECTIVE DATE.—The amendment made by subsection (a) shall apply with respect to agreements entered into or renewed on or after the date of enactment of this Act. SEC. 4026. HOME HEALTH AGENCY COST LIMITS. (a) DATA USED TO DETERMINE LIMITS.—

(1) Section 1861(v)(l)(L) of the Social Security Act (42 U.S.C. 1395x(v)(l)(L)) is amended by adding at the end the following new clause: "(iii) In establishing limits under this subparagraph, the Secretary shall— "(I) utilize a wage index that is based on audited wage data obtained from home health sigencies, and s

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.'.

"(ID base such limits on the most recent audited wage data available, which data may be for cost reporting periods beginning no earlier than July 1, 1985.". (2) The amendment made by paragraph (1) shall apply to cost 42 USC 1395x note. reporting periods beginning on or after July 1, 1988. (b) STUDY OF LIMITS.—The Secretary of Health and Human Serv- Reports. ices shall study and report to the Congress, not later than June 1, 1988, on— (1) whether the separate schedules of cost limits currently applied to home health agencies under title XVIII of the Social Security Act located in urban and rural areas accurately reflect differences in the costs of urban and rural home health agenjfc cies, and (2) the appropriateness of modifying such limits to take into account the proportion of agency patients who are from urban and rural areas. SEC. 4027. HOME HEALTH PROSPECTIVE PAYMENT DEMONSTRATION PROJECT.

42 USC 1395n note.

(a) IN GENERAL.—The Secretary of Health and Human Services (in this section referred to as the "Secretary") shall provide for a demonstration project to develop and test alternative methods of paying home health agencies on a prospective basis for services furnished under the medicare and medicaid programs. The project shall be designed in a manner to enable the Secretary to evaluate the effects of various methods of prospective payment (including payments on a per-visit, per-case, and per-episode basis) on program expenditures, access to, and quality of, home health care, and home health agency operations. The Secretary shall assure that services Contracts. are first furnished under the project not later than July 1, 1988, and, for this purpose, the Secretary may reinstate a previously awarded contract, or award a sole source contract, to carry out the project. (b) FUNDING.—The provisions of subsection (a)(2) and the first sentence of subsection (b) of section 402 of the Social Security Amendments of 1967 shall apply to the demonstration project under subsection (a) of this section as they apply to experiments under < subsection (a)(1) of that section. (c) REPORT.—The Secretary shall submit to Congress, not later than one year after the date of the enactment of this Act, an interim report on the demonstration project and, not later than four years after the date of the enactment of this Act, a final report on the results of the project.

Subpart C—Other Provisions SEC. 4031. PAYMENT CYCLE STANDARDS. (a) PAYMENT FLOOR STANDARDS.—

(1) Section 1816(c) of the Social Security Act (42 U.S.C. 1395h(c)) is amended by adding at the end the following new •pars^aph: "(3)(A) Each agreement under this section shall provide that no payment shall be issued, mailed, or otherwise transmitted with respect to any claim submitted under this title within the applicable number of calendar days after the date on which the claim is received. "(B) In this paragraph, the term 'applicable number of calendar days' means—

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"(i) with respect to claims received in the 3-month period •f. beginning July 1, 1988,10 days, and "(ii) with respect to claims received in the 12-month period K !>ii:>ai, ^; » e beginning October 1, 1988,14 days.".27»> < '^-; (2) Section 1842(c) of such Act (42 U.S.C. 1395u(c)) is amended .;,-v;5 by adding at the end the following new paragraph: contracts. "(3)(A) Each contract under this section which provides for the disbursement of funds, as described in subsection (a)(1)(B), shall provide that no payment shall be issued, mailed, or otherwise transmitted with respect to any claim submitted under this title within the applicable number of calendar days after the date on which the claim is received. "(B) In this paragraph, the term 'applicable number of calendar days' means— "(i) with respect to claims received in the 3-month period beginning July 1, 1988,10 days, and ai;f;')/;.;-f. m "(u) with respect to claims received in the 12-month period beginning October 1, 1988, 14 days.''.^"* 42 USC 1395h (3)(A) The amendments made by paragraphs (1) and (2) shall note. apply to claims received on or after July 1, 1988. Contracts. (B) The Secretary of Health and Human Services shall proRegulations. vide for such timely amendments to agreements under section 1816 of the Social Security Act and contracts under section 1842 of such Act, and regulations, to such extent as may be necessary to implement the provisions of this subsection on a timely basis, 42 USC 1395h note.

«{ir'j

42 USC I395h note.

(b) PROHIBITION OF OTHER POUCIES INTENDED TO SLOW DOWN MEDICARE PAYMENTS.—Notwithstanding any other provision of law,

except as specifically provided in this section, the Secretary of Health and Human Services is not authorized to issue, after the date of the enactment of this Act, and before October 1, 1990, any final regulation, instruction, or other policy change which is primarily intended to have the effect of slowing down claims processing, or delaying payment of claims, under title XVIII of the Social Security Act. (c) BUDGET CONSIDERATIONS.—For purposes of section 202 of the Balanced Budget and Emergency Deficit Control Reaffirmation Act of 1987, this section is a necessary (but secondary) result of a significant policy change. SEC. 4032. DENIALS AND RECONSIDERATIONS OF CLAIMS FOR HOME HEALTH SERVICES, EXTENDED CARE SERVICES, AND POSTHOSPITAL EXTENDED CARE SERVICES. (a) NOTIFICATION AND PHYSICIAN REVIEW.—Section 1816 of

the

Social Security Act (42 U.S.C. 1395h) is amended by adding at the end the following new subsection: "(j) An agreement with an agency or organization under this section shall require that, with respect to a claim for home health services, extended care services, or post-hospital extended care services submitted by a provider to such agency or organization that is denied, such agency or organization— "(1) furnish the provider and the individual with respect to whom the claim is made with a written explanation of the denial and of the statutory or regulatory basis for the denial; and jdt"(2) promptly notify such individual and the provider of disposition of such reconsideration.". - • <. j^ * ' Copy read "days.".

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(b) PERFORMANCE STANDARDS FOR FISCAL INTERMEDIARIES AND

CARRIERS.—Section 1816(f) of such Act (42 U.S.C. 1395h(f)) is amended by adding at the end the following: "Such standards and criteria shall include with respect to claims for services furnished under this part by any provider of services other than a hospital whether such agency or organization is able to process 75 percent of reconsiderations within 60 days (except in the case of the fiscal year 1989, 66 percent of reconsiderations) and 90 percent of reconsiderations within 90 days and the extent to which its determinations are reversed on appeal.". 42 USC 1395h note.

(c) EFFECTIVE DATE.—

t

(I)(A) The amendment made by subsection (a) shall apply with respect to claims received on or after January 1, 1988. (B) The amendment made by subsection (b) shall apply with respect to claims filed on or after October 1, 1988. (2) The Secretary of Health and Human Services shall provide Contracts. for such timely amendments to agreements under section 1816 Regulations. and contracts under section 1842 of the Social Security Act, and regulations, to such extent as may be necessary to implement the amendments made by subsections (a) and (b) on a timely basis.

SEC. 4033. PERMITTING DISABLED INDIVIDUALS TO RENEW ENTITLEMENT TO MEDICARE AFTER GAINFUL EMPLOYMENT WITH. •'••3^--OUT A 2.YEAR WAITING PERIOD. (a) IN GENERAL.—

(1) Section 226(0 of the Social Security Act (42 U.S.C. 426(f)) is amended by inserting before the period at the end the following: ", unless the physical or mental impairment which is the basis for disability is the same as (or directly related to) the physical or mental impairment which served as the bsisis for disability in such previous period". (2)(A) The amendment made by subsection (a) shall apply to 42 USC 426 note. months beginning after the end of the 60-day period beginning on the date of enactment of this Act. (B) The amendment made by subsection (a) shall not apply so as to include (for the purposes described in section 226(f) of the Social Security Act) monthly benefits paid for any month in a previous period (described in that section) that terminated before the end of the 60-day period described in paragraph (1). SEC. 4034. APPLICATION OF SECONDARY GOVERNMENTAL ENTITIES.

PAYER

PROVISIONS

TO

(a) IN GENERAL.—Section 1862(b)(4)(B)(i) of the Social Security Act (42 U.S.C. 1395y(b)(4)(B)(i)), as added by the amendment made by ,,... section 9319(a) of the Omnibus Budget Reconciliation Act of 1986, is amended by striking "section 5000(b) of the Internal Revenue (Dode of 1986" and inserting "subsection (b) of section 5000 of the Internal Revenue Code of 1986 without regard to subsection (d) of such section". Oa) EFFECTIVE DATE.—The amendment made by subsection (a) 42 USC I395y shall be effective as if included in the enactment of section 9319(a) of note. the Omnibus Budget Reconciliation Act of 1986. SEC. 4035. PUBLICATION AND NOTIFICATION OF POLICIES. (a) REQUIRING PUBLICATION OF INTERMEDIARY AND CARRIER BUDGET METHODOLOGY.—

Federal Register, publication.

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-^'

Effective date. 42 USC 1395h note.

-

- i-

(1) Section 1816(c)(l) of the Social Security Act (42 U.S.C. 1395h(c)(l)) is amended by adding at the end the following sentence: "The Secretary shall cause to have published in the Federal Register, by not later than September 1 before each fiscal year, data, standards, and methodology to be used to establish budgets for fiscal intermediaries under this section for that fiscal year, and shall cause to be published in the Federal Register for public comment, at least 90 days before such data, standards, and methodology are published, the data, standards, and methodology proposed to be used.". (2) Section 1842(c)(l) of such Act (42 U.S.C. 1395u(c)(l)) is amended by adding at the end the following sentence: "The Secretary shall cause to have published in the Federal Register, •i by not later than September 1 before each fiscal year, data, standards, and methodology to be used to establish budgets for carriers under this section for that fiscal year, and shall cause to be published in the Federal Register for public comment, at least 90 days before such data, standards, and methodology are published, the data, standards, and methodology proposed to be used.". (3) The amendments made by this section shall take effect on the date of the enactment of this Act and shall apply to budgets for fiscal years beginning with fiscalyear 1989. (b) PUBLICATiON AS REGULATIONS OF SIGNIFICANT PouciES.—Section 1871(a) of such Act (42 U.S.C. 1395hh(a)) is amended— (1) by inserting "(1)" after "(a)"; and (2) by adding at the end the following new paragraph: "(2) No rule, requirement, or other statement of policy (other than a national coverage determination) that establishes or changes a substantive legal standard governing the scope of benefits, the payment for services, or the eligibility of individuals, entities, or organizations to furnish or receive services or benefits under this title shall take effect unless it is promulgated by the Secretary by regulation under paragraph (1).". (c) MISCELLANEOUS PUBLICATION AND INFORMATION ACCESS PROVI-

Effective date.

^•

SIONS.—Section 1871 of such Act (42 U.S.C. 1395hh) is amended by adding at the end the following new subsection: "(c)(1) The Secretary shall publish in the Federal Register, not less frequently than every 3 months, a list of all manual instructions, interpretative rules, statements of policy, and guidelines of general applicability which— "(A) are promulgated to carry out this title, but "(B) are not published pursuant to subsection (a)(1) and have not been previously published in a list under this subsection. "(2) Effective June 1, 1988, each fiscal intermediary and carrier administering claims for extended care, post-hospital extended care, home health care, and durable medical equipment benefits under this title shall make available to the public all interpretative materials, guidelines, and clarifications of policies which relate to payments for such benefits. "(3) The Secretary shall to the extent feasible make such changes in automated data collection and retrieval by the Secretary and fiscal intermediaries with agreements under section 1816 as are necessary to make easily accessible for the Secretary and other appropriate parties a data base which fairly and accurately reflects the provision of extended care, post-hospital extended care and home health care benefits pursuant to this title, including such

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101 STAT. 1330-79

categories as benefit denials, results of appeals, and other relevant factors, and selectable by such categories and by fiscal intermediary, service provider, and region.". SEC. 4036. END-STAGE RENAL DISEASE AMENDMENTS. (a) IMPLEMENTATION OF PRIMARY PAYER REQUIREMENTS FOR ENDSTAGE RENAL DISEASE PROGRAM.—

J,

(1) Section 1862(b)(2)(A) of the Social Security Act (42 U.S.C. 1395y(b)(2)(A)) is amended by striking "(ii)" and all that follows through "under this title" and inserting "(ii) can reasonably be expected to be made under such a plan". (2) The amendment made by paragraph (1) shall apply with Effective date. respect to items and services furnished on or after 30 days after 42 USC 1395y note. the date of the enactment of this Act.

(b) LIMITATION OF MINIMUM UTIUZATION RATE REQUIREMENT FOR END-STAGE RENAL DISEASE TRANSPLANTATIONS.—The last sentence

of section 1881(b)(l) of such Act (42 U.S.C. 1395rr(b)(l)) is amended by striking "covered procedures and for self-dialysis training programs" and inserting "transplantations". (c) EXTENSION OF DEADLINE FOR ESTABLISHING PROTOCOLS ON REUSE OF DIALYSIS FILTERS AND OTHER DIALYSIS SUPPLIES AS IT RELATES TO THE REUSE OF BLOODUNES.—

(I)(A) Section 9335(k)(2) of the Omnibus Budget Reconciliation Act of 1986 is amended by inserting "(or July 1, 1988, with respect to protocols that relate to the reuse of bloodlines)" after "October 1, 1987". (B) The amendment made by subparagraph (A) shall be effective as if included in the enactment of section 9335(k)(2) of the Omnibus Budget Reconciliation Act of 1986. (2) Section 1881(fK7XB) of the Social Security Act (42 U.S.C. 1395rr(f)(7)(B)) is amended by inserting "(or July 1, 1988, with respect to protocols that relate to the reuse of bloodlines)" after "January 1, 1988". (d) STUDIES OF END-STAGE RENAL DISEASE PROGRAM.—

42 USC 1395rr note. 42 USC 1395rr note.

42 USC 1395rr note.

(1) The Secretary of Health and Human Services (in this sult)section referred to as the "Secretary") shall arrange for a study of the end-stage renal disease program within the medicare program. (2) Among other items, the study shall address— (A) access to treatment by both individuals eligible for medicare benefits and those not eligible for such benefits; (B) the quality of care provided to end-stage renal disease beneficiaries, as measured by clinical indicators, functional status of patients, and patient satisfaction; (C) the effect of reimbursement on quality of treatment; (D) major epidemiological and demographic changes in the end-stage renal disease population that may affect access to treatment, the quality of care, or the resource requirements of the program; and (E) the adequacy of existing data systems to monitor these matters on a continuing basis. (3) The Secretary shall submit to Congress, not later than 3 Reports. years after the date of the enactment of this Act, a report on the study. (4) The Secretary shall request the National Academy of Sciences, acting through the Institute of Medicine, to submit an application to conduct the study described in this section. If the

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'-'.;j

42 USC 1395ff note.

/' 'iv -?r'

PUBLIC LAW 100-203—DEC. 22, 1987

Academy submits an acceptable application, the Secretary shall enter into an appropriate arrangement with the Academy for the conduct of the study. If the Academy does not submit an acceptable application to conduct the study, the Secretary may request one or more appropriate nonprofit private entities to submit an application to conduct the study and may enter into an appropriate arrangement for the conduct of the study by the entity which submits the best acceptable application. (5) Section 1881 of the Social Security Act (42 U.S.C. 1395rr) is amended— (A) in subsection (c)(2)(F), by striking "and subsection (g)", • (B) by striking the last sentence of subsection (c)(6), (C) by striking subsection (g), and (D) by redesignating subsection (h), as added by section 20 of the Medicare and Medicaid Patient and Program Protection Act of 1987 (Public Law 100-93), as subsection (g).

SEC. 4037. MEDICARE HEARINGS AND APPEALS. (a) MAINTAINING CURRENT SYSTEM FOR HEARINGS AND APPEALS.—

Any hearing conducted under section 1869(b)(1) of the Social Security Act prior to the earliest of the date on which the Secretary of Health and Human Services submits the report required to be submitted by the Secretary under subsection (l))(l) or September 1 • ' •;) 5 shall be conducted by Administrative Law Judges of the Office of Hearings and Appeals of the Social Security Administration in the same manner as are hearings conducted under section 205(b)(1) of ' ' ' ' ' such Act. '^**'^ (b) STUDY AND REPORT ON USE OF TELEPHONE HEARINGS.— (1) The Secretary of Health and Human Services and the Comptroller General of the United States shall each conduct a • study on holding hearings under section 1869(b)(1) of the Social '9 Security Act by telephone and shall each report the results of the study not later than 6 months after the date of enactment of this Act. " *'• (2) The studies under paragraph (1) shall focus on whether telephone hearings allow for a full and fair evidentiary hearing, in general, or with respect to any particular category of claims and shall examine the possible improvements to the hearing process (such as cost-effectiveness, convenience to the claimant, and reduction in time under the process) resulting from the use of such hearings as compared to the adoption of other changes to the process (such as expansions in staff and resources). 42 USC 1395WW note.
 * {•%.. >::;r!,;

SEC. 4038. RURAL HEALTH PROJECT.

MEDICAL

EDUCATION DEMONSTRATION

(a) IN GENERAL.—The Secretary of Health and Human Services (in this section referred to as the ' Secretary") shall enter into agreements with four sponsoring hospitals submitting applications under this subsection to conduct demonstration projects to assist resident physicians in developing field clinical experience in rural areas. (b) NATURE OF PROJECT.—Under a demonstration project con-

.iff:i^sSi ducted under subsection (a), a sponsoring hospital entering into an agreement with the Secretary under such subsection shall enter into arrangements with a small rural hospital to provide to such rural hospital, for a period of one to three months of training, physicians (in such number as the agreement under subsection (a) may provide) who have completed one year of residency training. - .,,.

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101 STAT. 1330-81

(c) SELECTION.—In selecting from among applications submitted under subsection (a), the Secretary shall ensure that four small rural hospitals located in different counties participate in the demonstration project and that— (1) two of such hospitals are located in rural counties of more than 2,700 square miles (one of which is east of the Mississippi River and one of which is west of such river); and (2) two of such hospitals are located in rural counties with (as o determined by the Secretary) a severe shortage of physicians - (one of which is east of the Mississippi River and one of which is west of such river). (d) CLARIFICATION OF PAYMENT.—For purposes of section 1886 of

the Social Security Act— (1) with respect to subsection (d)(5)(B) of such section, any resident physician participating in the project under subsection A (a) for any part of a year shall be treated as if he or she were it working at the appropriate sponsoring hospital with an agreement under subsection (a) on September 1 of such year (and shall not be treated as if working at the small rural hospital); and (2) with respect to subsection (h) of such section, the payment amount permitted under such subsection for a sponsoring hospital with an agreement under subsection (a) shall be increased (for the duration of the project only) by an amount equal to the amount of any direct graduate medical education costs (as defined in paragraph (5) of such subsection (h)) incurred by such hospital in supervising the education and training activities '"••- under a project under subsection (a). (e) DURATION OF PROJECT.—Each demonstration project under subsection (a) shall be commenced not later than six months after the date of enactment of this Act and shall be conducted for a period of three years. (1) DEFINITION.—In this section, the term "sponsoring hospital" means a hospital that receives payments under sections 1886(d)(5)(B) and 1886(h) of the Social Security Act.

. „^ '"

',;;_

SEC. 4039. MISCELLANEOUS AND TECHNICAL PROVISIONS. (a) CLARIFICATION OF CRIMINAL PENALTIES FOR WILLFUL MISREPRE-

SENTATIONS.—Subsection (c) of section 1128B of the Social Security Act (42 U.S.C. 1320a-7(b)), ^s as redesignated by section 4(d) of the Medicare and Medicaid Patient and Program Protection Act of 1987 (Public Law 100-93), is amended— (1) by striking "institution or facility" each place it appears and inserting "institution, facility, or entity", and (2) by inserting "(including an eligible organization under section 1876(b))" after "other entity". -, (b) PODIATRISTS.—

(1) Section 1861(r)(3) of the Social Security Act (42 U.S.C. 1395x(r)(3)) is amended— (A) by striking "subsection (s) of this section" and inserting "subsections (k), (m), (p)(D, and (s) of this section and t sections 1814(a), 1832(a)(2)(F)(ii), and 1835", and (B) by striking "; and for the purposes" and all that follows through "which he is legally authorized to perform". " Copy read "1320a-7b)),".
 * ,^ _

42 USC 1320a-7b. ,

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PUBLIC LAW 100-203—DEC. 22, 1987

(2) Section 1861(b)(6) of such Act (42 U.S.C. 1395x(b)(6)) is amended by striking "Council on Podiatry Education of the American Podiatry Association" and inserting "Council on Podiatric Medical Education of the American Podiatric Medical Association". (c) RECOVERY OF PAYMENTS FOR CERTAIN PACEMAKER DEVICES.—

Effective date. 42 USC 1395y note. 42 USC 1395WW note.

42 USC 1395x note.

(1) Section 1862(h) of such Act (42 U.S.C. 1395y(h)) is ^ amended— (A) in paragraph dXB), by striking "law," and inserting "law (and any amount paid to a provider under any such warranty),"; d ^k:ii (B) in paragraph (1)(D), by striking "(3)," and inserting "(3), in determining the amount subject to repayment under paragraph (2)(C),"; (C) in paragraph (2)— (i) by striking "and" at the end of subparagraph (A), > (ii) by striking the period at the end of subparagraph > (B) and inserting ", and", and (iii) by adding at the end the following new subparagraph: •'v--- "(C) to make repayment to the Secretary of amounts paid under this title to the provider with respect to any cardiac pacemaker device or lead which has been replaced by the manufacturer, or for which the manufacturer has made payment to the provider, under an express or implied warranty.'; and (D) in paragraph (4)(B)— (i) by striking "or has" and inserting ", has", and » ' --: (ii) by striking "(2)(B)," and inserting "(2)(B), or has failed to make repayment to the Secretary as required under paragraph (2)(C),". (2) The amendments made by paragraph (1) shall become effective on January 1, 1988. (d) EXTEND AND CLARIFY PROHIBITION ON COST SAVINGS POUCIES BEFORE BEGINNING OF FISCAL YEAR.—Notwithstanding any other

provision of law, except as required to implement specific provisions required under statute, the Secretary of Health and Human Services is not authorized to issue in final form, after the date of the enactment of this Act and before October 15, 1988, any regulation, instruction, or other policy which is estimated by the Secretary to result in a net reduction in expenditures under title XVIII of the Social Security Act in fiscal year 1989 of more than $50,000,000. (e) MORATORIUM ON PRIOR AUTHORIZATION FOR HOME HEALTH AND POST-HOSPITAL EXTENDED CARE SERVICES.—The Secretary of Health

and Human Services shall not implement any voluntary or mandatory program of prior authorization for home health services, extended care services, or post-hospital extended care services under part A or B of title XVIII of the Social Security Act at any time prior to six months after the date on which the Congress receives the report required under section 9305(k)(4) of the Omnibus Budget Reconciliation Act of 1986. Federal Register, publication. 42 USC 1395x note.

(f) DELAY IN PUBUSHING REGULATIONS WITH RESPECT TO DEEMING THE STATUS OF ENTITIES.—The Secretary of Health and Human

Services (in this subsection referred to as the "Secretary") shall not deem any entity to be a provider of services (as defined in section 1861(u) of the Social Security Act) for purposes of title XVIII of such Act—

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 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-83

(1) on any date prior to 6 months after the date on which the Secretary has published a proposed rule with respect to the deeming of the entity, and (2) until the Secretary publishes a final rule with respect to the deeming of the entity. (g) USE OF INTERIM FINAL REGULATIONS.—The Secretary of Health and Human Services shall issue such regulations (on an interim or other beisis) as may be necessary to implement this subtitle and the amendments made by this subtitle.

42 USC 1395hh note.

PART 3—RELATING TO PART B $ Subpart A—Provisions Relating to Payments for Physicians' Services SEC. 4041. FREEZE IN PAYMENTS FOR PHYSICIANS' SERVICES; EXTENSION OF SEQUESTER ORDER. (a) THREE-MONTH FREEZE ON INCREASES IN PHYSICIAN PAYMENTS.—

(1) IN GENERAL.—Section 1842 of the Social Security Act (42 U.S.C. 1395u) is amended— (A) in subsection (b)(4)— (i) in subparagraph (A), by redesignating clause (v) as clause (vi) and by inserting after clause (iv) the following new clause: "(v) In determining the prevailing charge levels under the third and fourth sentences of paragraph (3) for physicians' services furnished during the 3-month period beginning January 1, 1988, the Secretary shall not set any level higher than the same level as was set for the 12-month period beginning January 1, 1987.", and (ii) in subparagraph (B), by adding at the end the following new clause: "(iii) In determining the reasonable charge under paragraph (3) for physicians' services furnished during the 3-month period beginning January 1, 1988, the customary charges shall be the same customary charges as were recognized under this section for the 12month period beginning January 1, 1987."; and (B) in subsection (j)(lKC), by adding at the end thereof the following new clause: "(vii) Notwithstanding any other provision of this subparagraph, the maximum allowable actual charge for a particular physician's service furnished by a nonparticipating physician to individuals enrolled under this part during the 3-month period beginning on January 1, 1988, shall be the amount determined under this subparagraph for 1987. The maximum allowable actual charge for any such service otherwise determined under this subparagraph for 1988 shall take effect on April 1, 1988.". (2) EXTENSION OF PHYSICIAN PARTICIPATION AGREEMENTS AND RELATED PROVISIONS.—Notwithstanding any other provision of

law— (A) subject to the last sentence of this paragraph, each agreement with a participating physician in effect on December 31, 1987, under section 1842(h)(l) of the Social Security Act shall remain in effect for the 3-month period beginning on January 1, 1988;

Effective date. 42 USC 1395u note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/878

 101 STAT. 1330-84

42 USC notes. iote 42 USC note. y.-:

PUBLIC LAW 100-203—DEC. 22, 1987

(B) the effective period for agreements under such section '>. K entered into for 1988 shall be the nine-month period beginning on April 1, 1988, and the Secretary shall provide an iij 'ji,' opportunity for physicians to enroll as participating physicians prior to April 1, 1988; 'i'") _i. ii (C) instead of publishing, under section 1842(h)(4) of the "'• Social Security Act at the beginning of 1988, directories of participating physicians for 1988, the Secretary shall provide for such publication, at the beginning of the 9-month period beginning on April 1, 1988, of such directories of participating physicians for such period; and (D) instead of providing to nonparticipating physicians, under section 1842(b)(3)(G) of the Social Security Act at the beginning of 1988, a list of maximum allowable actual charges for 1988, the Secretary shall provide, at the beginning of the 9-month period beginning on April 1, 1988, to -»it such physicians such a list for such 9-month period. An agreement with a participating physician in effect on ,Y^ December 31, 1987, under section 1842(h)(1) of the Social Security Act shall not remain in effect for the period described in ,i|, subparagraph (A) if the participating physician requests on or before December 31, 1987, that the agreement be terminated. (3)(A) Section 1842 of the Social Security Act (42 U.S.C. 1395u) is amended— ,^„ (i) in subsection (b)(2), by adding at the end the following: ' "In establishing such standards and criteria, the Secretary shall provide a system to measure a carrier's performance of responsibilities described in paragraph (3)(H) and subsection (h)."; and (ii) in subsection (c)(1), by inserting "(A)" after "(c)(1)" and by adding at the end the following new subparagraph: "(B) Of the amounts appropriated for administrative activities to carry out this part, the Secretary shall provide payments, totaling 1 percent of the total payments to carriers for claims processing in any fiscal year, to carriers under this section, to reward carriers for their success in increasing the proportion of physicians in the carrier's service area who are participating physicians or in increasing the proportion of total payments for physicians' services which are payments for such services rendered by participating physicians.". (B) Section 9332(a) of the Omnibus Budget Reconciliation Act of 1986 is amended— I395u (i) by striking paragraphs (2) and (3), (ii) in paragraph (4)(B), by striking "under paragraph (2)'^'^ ^^^^" ^^^ inserting "under the last sentence of section 1842(b)(2) of the Social Security Act", and 1395U (iii) in paragraph (4)(C)— (I) by striking "under paragraph (3)" and inserting "under section 1842(c)(l)(B) of the Social Security Act", jviA r^ - .;^. (II) by striking "April" and inserting "July", and ^ (III) by striking "at the end of 1987" and inserting "before April 1, 1988".

President of U.S.

(b) EXTENSION OF REDUCTION U N D E R S E Q U E S T E R O R D E R. — Not w i t h -

2 USC 902 note,

standing any other provision of law (including any other provision of this Act), the reductions in the amount of payments required under title XVIII of the Social Security Act made by the final sequester order issued by the President on November 20, 1987, pursuant to

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Page:United States Statutes at Large Volume 101 Part 2.djvu/879

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-85

section 252Cb) of the Balanced Budget Emergency Deficit Control Act of 1985 shall continue to be effective (as provided by sections 252(a)(4)(B) and 256(d)(2) of such Act) through March 31, 1988, with respect to payments for physicians' services under part B of such title. SEC. 4042. GENERAL UPDATE IN PAYMENTS FOR PHYSICIANS* SERVICES.

(a) INCREASE IN M E I FOR 1988 AND 1989.—Section 1842(b)(4) of the Social Security Act (42 U.S.C. 1395u(b)(4)) is amended by adding at the end the following new subparagraph: "(F)(i) For purposes of this part for physicians' services furnished in 1987, the percentage increase in the MEI is 3.2 percent. "(ii) For purposes of this part for physicians' services furnished in 1988, on or after April 1, the percentage increase in the MEI is— "(I) 3.6 percent for primary care services (as defined in subparagraph (E)(iii)), and "(II) 1 percent for other physicians' services, "(iii) For purposes of this part for physicians' services furnished in 1989, the percentage increase in the MEI is— "(I) 3.0 percent for primary care services; and "(II) 1 percent for other physician'services.". (b) PRIMARY CARE SERVICES DEFINED.—Section 1842(b)(4)(E) of such Act (42 U.S.C. 1395u(b)(4)(E)) is amended by adding at the end thereof the following new clause: "(iii) The term 'primary care services' means physicians' services which constitute office medical services, emergency . department services, home medical services, skilled nursing, intermediate care, and long-term care medical services, or nursing home, boarding home, domiciliary, or custodial care medical services.". (c)

PARTICIPATING

PHYSICIAN

DIFFERENTIAL.—Section

1842(b)(4)(A)(iv) of such Act (42 U.S.C. 1395u(b)(4)(A)(iv)) is amended— (1) by striking "96 percent" and inserting "applicable percent", and (2) by adding at the end the following: "In the previous sentence, the term 'applicable percent' means for services furnished (I) on or after January 1, 1987, and before April 1, 1988, 96 percent, (II) on or after April 1, 1988, and before January 1, 1988, 95.5 percent, and (III) on or after January 1, 1989, 95 percent.". SEC. 4043. INCENTIVE PAYMENTS FOR PHYSICIANS' SERVICES FURNISHED IN UNDERSERVED AREAS.

(a) IN GENERAL.—Section 1833 of the Social Security Act (42 U.S.C. 13951) is amended by adding at the end the following new subsection: "(m) In the case of physicians' services furnished to an individual, who is covered under the insurance program established by this part and who incurs expenses for such services, in an area that is designated (under section 332(a)(l)(A) of the Public Health Service Act) as a class 1 or class 2 health manpower shortage area, in addition to the amount otherwise paid under this part, there also shall be paid to the physician (or to an employer or facility in the cases described in clause (A) of section 1842(b)(6)) (on a monthly or quarterly basis) from the Federal Supplementary Medical Insurance 'Trust Fund an amount equal to 5 percent of the payment amount for the service under this part.".

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/880

 101 STAT. 1330-86 Reports.

42 USC 1395/ note.

42 USC 1395/ note.

PUBLIC LAW 100-203—DEC. 22, 1987

(b) STUDY.—The Secretary of Health and Human Services shall study and report to Congress, by not later than January 1, 1990, on the feasibility of making additional payments described in section 1833(m) of the Social Security Act with respect to physician services which are performed in health manpower shortage areas located in urban areas. (c) EFFECTIVE DATE.—The amendments made by this subsection (a) shall apply with respect to services furnished in a rural area (as defined in section 1886(d)(2)(D) of the Social Security Act) ^ 9 on or after January 1, 1989, and to other services furnished on or after January 1, 1991. SEC. 4044. ADJUSTMENT IN PREVAILING CHARGE LEVEL FOR PRIMARY CARE SERVICES. (a) INCREASE IN PREVAIUNG CHARGES FOR PRIMARY CARE SERV-

42 USC 1395u note.

ICES.—Section 1842(b)(4)(A) of the Social Security Act (42 U.S.C. 1395u(b)(4)(A)), as amended by section 4041(a)(l) of this subtitle, is further amended by redesignating clause (vi) as clause (vii) and by inserting after clause (v) the following new clause: "(vi) Before each year (beginning with 1989), the Secretary shall establish a prevailing charge floor for primary care services (as defined in subparagraph (E)(iii)) equal to 50 percent of the average of the prevailing charge levels (determined, for participating physicians under the third and fourth sentences of paragraph (3) and under paragraph (4), without regard to this clause and without regard to physician specialty) for such service for all localities in the United States (weighted by the relative frequency of the service in each locality) for the year.. (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall apply to payment for physicians' services furnished on or after January 1, 1989. SEC. 4045. REDUCTION IN PREVAILING CHARGE LEVEL FOR OVERPRICED PROCEDURES.

(a) IN GENERAL.—Paragraph (10) of section 1842(b) of the Social Security Act (42 U.S.C. 1395u(b)) is amended to read as follows: "(lOXAXi) In determining the reasonable charge under paragraph (3) for procedures described in subparagraph (C) and performed during the 9-month period beginning on April 1, 1988, the prevailing charge for such procedure for participating and nonparticipating physicians shall be the prevailing charge otherwise recognized for such procedure for 1987— "(I) subject to clause (iii), reduced by 2.0 percent, and "(II) further reduced by the applicable percentage specified in clause (ii). "(ii) For purposes of clause (i), the applicable percentage specified in this clause is— "(I) 15 percent, in the case of a prevailing charge otherwise recognized (without regard to this paragraph and determined without regard to physician specialty) that is at least 150 percent of the weighted national average (as determined by the Secretary) of such prevailing charges for such procedure for all localities in the United States for 1987; "(II) 0 percent, in the case of a prevailing charge that does not exceed 85 percent of such weighted national average; and
 * " Copy read "Act))".

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Page:United States Statutes at Large Volume 101 Part 2.djvu/881

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-87

"(III) in the case of any other prevailing charge, a percent determined on the basis of a straight-line sliding scale, equal to % 3 of a percentage point for each percent by which the prevailing charge exceeds 85 percent of such weighted national average. "(iii) In no case shall the reduction under clause (i) for a procedure result in a prevailing charge in a locality for 1988 which is less than 85 percent of the Secretary's estimate of the weighted national average of such prevailing charges for such procedure for all localities in the United States for 1987 0)ased upon the best available data and determined without regard to physician specialty) after making the reduction described in clause (i)(II). "(B) The procedures described in this subparagraph are as follows: bronchoscopy,^^ carpal tunnel repair, cataract surgery, coronary artery bypass surgery, diagnostic and/or therapeutic dilation and curettage, knee arthroscopy, knee arthroplasty, pacemaker implantation surgery, total hip replacement, suprapubic prostatectomy, transurethral resection of the prostate, and upper gastrointestinal endoscopy. "(C) In the case of a reduction in the reasonable charge ifor a physicians' service under subparagraph (A), if a nonparticipating physician furnishes the service to an individual entitled to benefits under this part, after the effective date of such reduction, the physician's actual charge is subject to a limit under subsection OXIXD). "(D) There shall be no administrative or judicial review section 1869 or otherwise of any determination under subparagraph (A) or under "»> paragraph (llXBXii).". (h) MODIFICATION OF GEOGRAPHIC INDEX.—Section 1845(e)(4)(A)(i)

of such Act (42 U.S.C. 1395w-l(e)(4)(A)(i)) is amended by inserting "and costs of living" after "costs of practice". (C) CONSOUDATED CHARGE LIMITATION PROVISIONS.— (1) PENALTIES FOR EXCESS CHARGES.—Section 1842

of such Act

is further amended— (A) in subsection (b)(llXC)— ,; (i) in clause (i), by striking "(subject to clause (iv))" and all that follows through the end and inserting the following: ", the physician's actual charge is subject to a limit under subsection (j)(l)(D)."; (ii) in clause (i), by striking "(i)" after "(C)"; and (iii) by striking clauses (ii) through (iv); and (B) in subsection (j)(D, by adding at the end the following new subparagraph: "(D)(i) If an action described in clause (ii) results in a reduction in a reasonable charge for a physicians' service or item and a nonparticipating physician furnishes the service or item to an individual entitled to benefits under this part after the effective date of such action, the physician may not charge the individual more than 125 percent of the reduced payment allowance (as defined in clause (iii)) plus (for services or items furnished during the 12-month period (or 9-month period in the case of an action described in clause (iiXID) beginning on the effective date of the action) Vz of the amount by which the physician's maximum allowable actual charge for the service or item for the previous 12-month period exceeds such 125 percent level. "(ii) The first sentence of clause (i) shall apply to— ' Copy read "bronschoscopy,". ' Copy read "under under'.

•'• . t ^

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Page:United States Statutes at Large Volume 101 Part 2.djvu/882

 101 STAT. 1330-88

42 USC 1395u note. 42 USC 1395u note.

PUBLIC LAW 100-203—DEC. 22, 1987

"(I) an adjustment under subsection (b)(8)(B) (relating to inherent reasonableness), "(II) a reduction under subsection (b)(10)(A) (relating to certain overpriced procedures), "(III) a reduction under subsection (b)(ll)(B) (relating to certain cataract procedures), and "(IV) an adjustment under section 1833(1)(3)(B) (relating to physician supervision of certified registered nurse anesthetists), "(iii) In clause (i), the term 'reduced payment allowance' means, with respect to an action— "(I) under subsection (b)(8)(B), the inherently reasonable charge established under subsection (b)(8); or "(II) under subsection (b)(10)(A) or (b)(ll)(B) or under section 1833(1)(3)(B), the prevailing charge for the service after the action, "(iv) If a physician knowingly and willfully imposes a charge in violation of clause (i) (whether or not such charge violates subparagraph (B)), the Secretary may apply sanctions against such physician in accordance with paragraph (2). "(v) Clause (i) shall not apply to items and services furnished after the earlier of (I) December 31, 1990, or (II) one-year after the date the Secretary reports to Congress, under section 1845(e)(3), on the development of the relative value scale under section 1845.". (2) CONFORMING AMENDMENTS.—(A) Section 1833(1)(6) of such Act (42 U.S.C. 13951(1)(6)) is amended— (i) in subparagraph (A), by striking "(subject to subparaV V graph (D))" and all that follows through the end and insert' I ing the following: "after the effective date of the reduction, the physician's actual charge is subject to a limit under, -section 1842(j)(l)(D)."; (ii) in subparagraph (A), by striking "(A)" after "(6)"; and (iii) by striking subparagraphs (B) through (D). (B) Section 1842(b)(ll)(B)(i) of such Act (42 U.S.C. 1395u(b)(ll)(B)(i)) is amended by striking "and shall be further reduced" and all that follows through "1988". (C) Section 9334(b)(2) of the Omnibus Budget Reconciliation Act of 1986 is amended by striking "1842(b)(10)" and inserting "18420X1)(D)". (d) EFFECTIVE DATE.—The amendments made by this section shall apply to items and services furnished on or after April 1, 1988, except the amendment made by subsection (c)(2)(B) shall apply to services furnished on or after January 1, 1988. SEC. 4046. LIMITS ON PAYMENT FOR OPHTHALMIC ULTRASOUND.

(a) IN GENERAL.—Section 1842 of the Social Security Act (42 U.S.C. 1395u), as previously amended by this subpart is amended— (1) in subsection (b)(ll)— (A) in subparagraph (C), as redesignated under section 4045(c)(l)(A)(ii) of this title, by inserting "or (C)" after "subparagraph (B)"; (B) by redesignating subparagraph (C) as subparagraph (D); and (C) by inserting after subparagraph (B) the following new subparagraph: "(C) The prevailing charge level determined with respect to Amode ophthalmic ultrsisound procedures may not exceed 5 percent

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text: The Lion and the Mouse (Aesop)

title: The Lion and the Mouse (Aesop)


text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/883

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-89

of the prevailing charge level established with respect to extracapsular cataract removal with lens implantation."; and (2) in subparagraph (D) of subsection (j)(D, as added by section 4045(c)(l)(B) of this subtitle— (A) in clause (ii), by striking "and" at the end of subclause (III), by redesignating subclause (IV) as subclause (V) and by inserting before such subclause the following new ,r'subclause: "(IV) a prevailing charge limit is established under subsection (b)(llXC)(i), and"; and (B) in clause (iii)(II), by striking "or (b)(llXB)" and inserting ", (b)(llXB), or (b)(ll)(C)(i)". (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall apply to services furnished on or after April 1, 1988.

42 USC 1395u note.

SEC. 4047. CUSTOMARY CHARGES FOR PRIMARY CARE SERVICES OF NEW PHYSICIANS.

(a) IN GENERAL.—Section 1842(b)(4) of the Social Security Act, as amended by section 4042(a), is further amended by adding at the end thereof the following new subparagraph: "(G) In determining the customary charges for physicians' services (other primary care services and other than services furnished in a rural area (as defined in section 1886(d)(2)(D)) that is designated, under section 332(a)(1)(A) of the Public Health Service Act, as a health manpower shortage area) for which adequate actual charge data are not available because a physician has not yet been in practice for a sufficient period of time, the Secretary shall set a customary charge at a level no higher than 80 percent of the prevailing charge (as determined under the third and fourth sentences of paragraph (3) and under paragraph (4)) for a service.". 0)) EFFECTIVE DATE.—The amendment made by subsection (a) shall apply to physicians who first furnish services to medicare beneficiaries after April 1, 1988.

42 USC 1395U note.

SEC. 4048. PAYMENT FOR PHYSICIAN ANESTHESIA SERVICES.

(a) IN GENERAL.—Section 1842(b) of the Social Security Act (42 U.S.C. 1395u(b)) is further amended by adding at the end the following new paragraph: "(14)(A) In determining the reasonable charge under paragraph (3) of a physician for medical direction of two or more nurse anesthetists performing, on or after April 1, 1988, and before January 1, 1991, anesthesia services in whole or in part concurrently, the number of base units which may be recognized with respect to such medical direction for each concurrent procedure (other than cataract surgery or an iridectomy) shall be reduced by— "(i) 10 percent, in the case of medical direction of 2 nurse anesthetists concurrently, "(ii) 25 percent, in the case of medical direction of 3 nurse anesthetists concurrently, and "(iii) 40 percent, in the case of medical direction of 4 nurse anesthetists concurrently. "(B) In determining the reasonable charge under paragraph (3) of a physician for medical direction of two or more nurse anesthetists performing, on or after January 1, 1989, and before January 1, 1991, anesthesia services in whole or in part concurrently, the number of base units which may be recognized with respect to such medical

nvQun.

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text:
Page:United States Statutes at Large Volume 101 Part 2.djvu/884

 101 STAT. 1330-90

Regulations. 42 USC 1395u note.

Reports. 42 USC 1395u note.

42 USC 1395u note.

Reports.

Reports.

PUBLIC LAW 100-203—DEC. 22, 1987

direction for each concurrent cataract surgery or iridectomy procedure shall be reduced by 10 percent. "(C) The Secretary shall require claims for physicians' services for medical direction of nurse anesthetists during the periods in which the provisions of subparagraph (A) or (B) apply to indicate the number of such anesthetists being medically directed concurrently at any time during the procedure, the name of each nurse anesthetist being directed, and the type of procedure for which the services are provided.". (b) DEVELOPMENT OF UNIFORM RELATIVE VALUE GUIDE.—The Secretary of Health and Human Services, in consultation with groups representing physicians who furnish anesthesia services, shall establish by regulation a relative value guide for use in all carrier localities in making payment for physician anesthesia services furnished under part B of title XVIII of the Social Security Act on and after January 1, 1989. Such guide shall be designed so as to result in expenditures under such title for such services in an amount that would not exceed the amount of such expenditures which would otherwise occur. (c) STUDY OF PREVAIUNG CHARGES FOR ANESTHESIA SERVICES.—

The Secretary of Health and Human Services shall conduct a study of the variations in conversion factors used by carriers under section 184203) of the Social Security Act to determine the prevailing charge for anesthesia services and shall report the results of the study and make recommendations for appropriate adjustments in such factors not later than January 1, 1989. (d) GAG STUDIES.—(1) The Comptroller General shall conduct a study— (A) to determine the average anesthesia times reported for medicare reimbursement purposes, (B) to verify those times from patient medical records, (C) to compare anesthesia times to average surgical times, and (D) to determine whether the current payments for physician supervision of nurse anesthetists are excessive. The Comptroller General shall report to Congress, by not later than January 1, 1989, on such study and in the report include recommendations regarding the appropriateness of the anesthesia times recognized by medicare for reimbursement purposes and recommendations regarding adjustments of payments for physician supervision of nurse anesthetists. (2) The Comptroller General shall conduct a study on the impact of the amendment made by subsection (a), and shall report to Congress on the results of such study by April 1, 1990. SEC. 4049. FEE SCHEDULES FOR RADIOLOGIST SERVICES.

(a) IN GENERAL.—Part B of title XVIII of the Social Security Act is (1) in section 1833(a)(l) (42 U.S.C. 13951(a)(l)), as amended by section 4062(c)(3) of this subtitle by striking "and" before "(I)", and by adding at the end the following new clause: "and (J) with respect to expenses incurred for radiologist services (as defined in section 18340)X5)), the amounts paid shall be 80 percent of the lesser of the actual charge for the services or the amount provided under the fee schedule established under section 1834(b),"; and

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 PUBLIC LAW 100-203—DEC. 22, 1987

iCl STAT. 1330-91

(2) by adding at the end of section 1834, as subsequently inserted by section 4062(a) of this subtitle, the following new subsection: "(b) F E E SCHEDULES FOR RADIOLOGIST SERVICES.—

"(1) DEVELOPMENT.—The Secretary shall develop— "(A) a relative value scale to serve as the basis for the payment for radiologist services under this part, and "(B) using such scale and appropriate conversion factors, fee schedules (on a regional, statewide, or carrier service area basis) for payment for radiologist services under this part, to be implemented for such services furnished during 1989. "(2) CONSULTATION.—In carrying out paragraph (1), the Secretary shall regularly consult closely with the Physician Payment Review Commission, the American College of Radiology, and other organizations representing physicians or suppliers who furnish radiologist services and shall share with them the data and data analysis being used to make the determinations under paragraph (1), including data on variations in current medicare payments by geographic area, and by service and physician specialty. "(3) CONSIDERATIONS.—In developing the relative value scale and fee schedules under paragraph (1), the Secretary— "(A) shall take into consideration variations in the cost of furnishing such services among geographic areas and among different sites where services are furnished, and "(B) may also take into consideration such other factors respecting the manner in which physicians in different specialties furnish such services as may be appropriate to assure that payment amounts are equitable and designed to promote effective and efficient provision of radiologist services by physicians in the different specialties. "(4) SAVINGS.— "(A) BUDGET NEUTRAL FEE SCHEDULES.—The Secretary

shall develop preliminary fee schedules for 1989, which are designed to result in the same amount of aggregate payments (net of any insurance and deductibles under section 1835(a)(l)(I) and 1833(b)) for radiologist services furnished in 1989 as would have been made if this subsection had not been enacted. "(B) INITIAL SAVINGS.—The fee schedules established for payment purposes under this subsection for services furnished in 1989 shall be 97 percent of the amounts permitted under these ^° preliminary fee schedules developed under subparagraph (A). "(C) SUBSEQUENT UPDATING.—Radiologist services furnished in subsequent years, the fee schedules shall be the schedules for the previous year updated by the percentage increase in the MET (as defined in section 1842(b)(4)(E)(ii)) for the year. "(D) ^* NONPARTICIPATING PHYSICIANS.—Each fee sched-

ule so established shall provide that the payment rate '° Copy read "this". =" Copy read " '(C)".

42 USC I395m.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/886

 101 STAT. 1330-92 ' '' ^,,,, -,,,, m.<......^ ,

PUBLIC LAW 100-203—DEC. 22, 1987 recognized for nonparticipating physicians and suppliers is equal to the appropriate percent (as defined in section 1842(b)(4)(A)(iv)) of the payment rate recognized for participating physicians and suppliers. "(5)

LIMITING CHARGES OF NONPARTICIPATING PHYSICIANS.—

"(A) IN GENERAL.—In the case of radiologist services furnished after January 1, 1989, for which payment is made under a fee schedule under this subsection, if a nonparticipating physician or supplier furnishes the service to an individual entitled to benefits under this part, the physician or supplier may not charge the individual more ,_. than the limiting charge (as defined in subparagraph (B)). .-, wg^ LIMITING CHARGE DEFINED.—In subparagraph (A), the term 'limiting charge' means, with respect to a service furnished— "(i) in 1989, 125 percent of the amount specified for the service in the appropriate fee schedule established under paragraph (1), ^ "(ii) in 1990, 120 percent of the amount specified for *' the service in the appropriate fee schedule established J under paragraph (1), and ^ •" " "(iii) after 1990, 115 percent of the amount specified for the service in the appropriate fee schedule estabI ' ""'•'' lished under paragraph (1). "-"'' "(C) ENFORCEMENT.—If a physician or supplier knowingly and willfully imposes a charge in violation of subparagraph (A), the Secretary may apply sanctions against such physician or supplier in accordance with section 1842(j)(2). "(6) ^2 RADIOLOGIST SERVICES DEFINED.—For the

purposes of

this subsection, section 1833(a)(l)(I), and section 1842(h)(l)(B), the term 'radiologist services' only includes radiologic services performed by, or under the direction or supervision of, a physician— "(A) who is certified, or eligible to be certified, by the American Board of Radiology, or "(B) for whom radiologic services account for at least 50 percent of billings made under this part.". Reports.

note^^ ^^^^^

42 USC 1395/

(b) DEADLINES AND EFFECTIVE D A T E. —

^^^ '^^® Secretary of Health and Human Services shall establish the relative value scale and fee schedules for radiologist services (under section 1834(b) of the Social Security Act) by not later than August 1, 1988, and shall report to Congress on the development of such fee schedules not later than August 1, 1988. (2) The amendments made by this section shall apply to services performed on or after January 1, 1989, and until such time as the Secretary of Health and Human Services implements physician fee schedules based on the relative value scale developed under section 1845(e) of the Social Security Act. SEC. 4050. FEE SCHEDULES FOR PHYSICIAN PATHOLOGY SERVICES.

(a) IN GENERAL.—The Secretary of Health and Human Services shall develop— '* Copy read " ' (5) ".

i " " •. <

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