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PUBLIC LAW 100-203—DEC. 22, 1987

"(1) Except as provided in this section, the provisions of chapter 434 of the 1987 Washington Laws, as enacted in May 1987, shall apply to the operation of the Project. "(2) All of the following terms and conditions shall be in effect under the Project: "(A)(i) Except as provided in clause (ii), individuals with respect to whom benefits may be paid under part A of title IV of the Social Security Act, and such other individuals as are included in the Project pursuant to chapter 434 of the 1987 Washington Laws, as enacted in May 1987, shall be eligible to participate in the Project in lieu of receiving benefits under the food stamp program and cash assistance under any other Federal program covered by the Project. "(ii) Individuals who receive only child care or medical benefits under the Project shall not be eligible to receive food assistance under the Project. Such individuals may receive coupons under the food stamp program if eligible. "(B) Individuals who participate in the Project shall receive for each month an amount of cash assistance that is not less than the total value of the assistance such individuals would otherwise receive, in the aggregate, under the food stamp program and any cash-assistance Federal program covered by the Project for such month, including income and resource exclusions and deductions, and benefit levels. "(C)(i) The State may provide a standard benefit for food assistance under the Project, except that individuals who participate in the Project shall receive as food assistance for a month an amount of cash that is not less than the value of the assistance such individuals would otherwise receive under the food stamp program. "(ii) The State may provide a cash benefit for food assistance equal to the value of the thrifty food plan. "(D) Each month participants in the Project shall be notified by the State of the amount of Project assistance that is provided as food assistance for such month. "(E) The State shall have a program to require participants to engage in employment and training activities carried out under chapter 434 of the 1987 Washington Laws, as enacted in May 1987.^ "(F) Food assistance shall be provided under the Project— "(i) to any individual who is accepted for participation in the Project, not later than 30 days after such individued applies to participate in the Project; "(ii) to any participant for the period that begins on the date such participant applies to participate in the Project, except that the amount of such assistance shall be reduced to reflect the pro rata value of any coupons received under the food stamp program for such period for the benefit of such participant; and "(iii) until— "(I) the participant's cash assistance under the Project is terminated; • Copy read "May, 1987.".

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101 STAT. 1330-31

"(II) such participant is informed of such termination and is advised of the eligibility requirements for participation in the food stamp program; "(III) the State determines whether such participant will be eligible to receive coupons as a member of a household under the food stamp program; and "(IV) coupons under the food stamp program are received by such participant if such participant will be eligible to receive coupons as a member of a household under the food stamp program. "(G)(i)' Paragraphs (I)(B), (8), (10), and (19) of section 11(e) shall apply with respect to the participants in the Project in the same manner as such paragraphs apply with respect to participants in the food stamp program. "(ii) Each individual who contacts the State in person during office hours to make what may reasonably be interpreted as an oral or written request to participate in the Project shall receive and shall be permitted to file on the same day that such contact is first made, an application form to participate in the Project. "(iii) The Project shall provide for telephone contact by, mail delivery of forms to and mail return of forms by, and subsequent home or telephone interview with, the elderly persons, physically or mentally handicapped, and persons otherwise unable, solely because of transportation difficulties and similar hardships, to appear in person. "(iv) An individual who applies to participate in the Project may be represented by another person in the review process if the other person has been clearly designated as the representative of such individual for that purpose, by such individual or the spouse of such individual, and, in the case of the review process, the representative is an adult who is sufficiently aware of relevant circumstances, except that the State may— "(I) restrict the number of individuals who may be represented by such person; and "(II) otherwise establish criteria and verification standards for representation under this clause. "(v) The State shall provide a method for reviewing applications to participate in the Project submitted by, and distributing food assistance under the Project to, individuals who do not reside in permanent dwellings or who have no fixed mailing address. In carrying out the preceding sentence, the State shall take such steps as are necessary to ensure that participation in the Project is limited to eligible individuals. "(3) An assurance that the State will allow any individual to apply to participate in the food stamp program without applying to participate in the Project. "(4) An assurance that the cost of food assistance provided under the Project will not be such that the aggregate amount of payments made under this section by the Secretary to the State over the period of the Project will exceed the sum of— ' Copy read " '(H)(i)".

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Termination date.

PUBLIC LAW 100-203—DEC. 22, 1987

"(A) the anticipated aggregate value of the coupons that would have been distributed under the food stamp program if the individuals who participate in the Project had participated instead in the food stamp program; and "(B) the portion of the administrative costs for which the State would have received reimbursement under— "(i) subsections (a) and (g) of section 16 (without regard to the first proviso to such subsection (g)) if the individuals who participated in the Project had participated instead in the food stamp program; and "(ii) section 16(h) if the individuals who participated in the Project had participated in an employment and training program under section 6(d)(4); except that this paragraph shall not be construed to prevent the State from claiming payments for additional households that would qualify for benefits under the food stamp program in the absence of a cash out of such benefits as a result of changes in economic, demographic, and other conditions in the State or a subsequent change in the benefit levels approved by the State legislature. "(5) An assurance that the State will continue to carry out the food stamp program while the State carries out the Project. "(6) If there is a change in existing State law that would eliminate guaranteed benefits or reduce the rights of applicants or participants under this section during, or as a result of participation in, the Project, the Project shall be terminated. "(7) An assurance that the Project shall include procedures and due process guarantees no less beneficial than those which are available under Federal law and under State law to participants in the food stamp program. "(8)(A) An assurance that, except as provided in subparagraph (B), the State will carry out the Project during a 5-year period beginning on the date the first individual is approved for participation in the Project. "(B) The Project may be terminated 180 days after— "(i) the State gives notice to the Secretary that it intends to terminate the Project; or "(ii) the Secretary, after notice and an opportunity for a hearing, determines that the State materially failed to comply with this section. "(c) FUNDING.—If an application submitted under subsection (a) by the State complies with the requirements specified in subsection (b), then the Secretary shall— "(1) approve such application; and "(2) from funds appropriated under this Act, pay the State for— "(A) the actual cost of the food assistance provided under the Project; and "(B) the percentage of the administrative costs incurred by the State to provide food assistance under the Project that is equal to the percentage of the State's aggregate administrative costs incurred in operating the food stamp program in the most recent fiscal year for which data are available, that was paid under subsections (a), (g), and (h) of section 16 of this Act.

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101 STAT. 1330-33

"(d)(1) PROJECT APPLICATION.—Unless and until an application to participate in the Project is approved, and food assistance under the Project is made available to the applicant— "(A) such application shall also be treated as an application to participate in the food stamp program; and "(B) section 11(e)(9) shall apply with respect to such application, "(2) Coupons provided under the food stamp program with respect to an individual who— "(A) is participating in such program; and "(B) applies to participate in the Project; may not be reduced or terminated because such individual applies to participate in the Project. "(3) For purposes of the food stamp program, individuals who participate in the Project shall not be considered to be members of a household during the period of such participation. "(e) WAIVER.—The Secretary shall (with respect to the Project) waive compliance with any requirement contained in this Act (other than this section) that (if applied) would prevent the State from carrying out the Project or effectively achieving its purpose. "(f) CONSTRUCTION.—For purposes of any other Federal, State or local law— "(1) cash assistance provided under the Project that represents food assistance shall be treated in the same manner as coupons provided under the food stamp program are treated; and ® "(2) participants in the program who receive food assistance under the Project shall be treated in the same manner as recipients of coupons under the food stamp program are treated. "(g) PROJECT AUDITS.—The Comptroller General of the United States shall— "(1) conduct periodic audits of the operation of the Project to verify the amounts payable to the State from time to time under subsection (b)(4); and "(2) submit to the Secretary of Agriculture, the Secretary of Health and Human Services, the Committee on Agriculture of the House of Representatives, and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report describing the results of each such audit. "(h) EVALUATION.—With funds appropriated under section 18(a)(l), the Secretary shall conduct, in consultation with the Secretary of Health and Human Services, an evaluation of the Project.".

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TITLE II—NATIONAL ECONOMIC COMMISSION SEC. 2101. ESTABLISHMENT OF COMMISSION.

There is established a commission to be known as the National Economic Commission (in this subtitle referred to as the "Commission"). ' Copy had wrong indention for paragraph " '(2)".

2 USC 901 note.

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President of U.S.

President of U.S.

PUBLIC LAW 100-203—DEC. 22, 1987

SEC. 2102. MEMBERSHIP OF COMMISSION.

(a) APPOINTMENT.—The Commission shall be initially composed of 12 members, appointed not later than March 1, 1988. After the meeting of the Presidential Electors in December 1988, the Commission shall be expanded to 14 members. The members shall be as follows: (1) 2 citizens of the United States, appointed by the President. (2) 1 Senator and 2 citizens of the United States, appointed by the President pro tempore of the Senate upon the recommendations of the Majority Leader of the Senate. (3) 1 Senator and 1 citizen of the United States, appointed by the President pro tempore of the Senate upon the recommendation of the Minority Leader of the Senate. (4) 1 Member of the House of Representatives and 2 citizens of the United States, appointed by the Speaker of the House of Representatives. (5) 1 Member of the House of Representatives and 1 citizen of the United States, appointed by the Minority Leader of the House of Representatives. (6) 2 citizens of the United States, 1 of whom is a Democrat and 1 of whom is a Republican, appointed by the President-elect as established by the allocation of electoral college votes in the Presidential election of November 8, 1988. (b) ADDITIONAL QUALIFICATIONS.—

(1) Individuals appointed under subsection (a)(1) may be officers or employees of the Executive Branch or may be private citizens. (2) Individuals who are not Members of the Congress, and are appointed under paragraphs (2) through (6) of subsection (a) shall be individuals who— (A) are leaders of business or labor, distinguished academics. State or local government officials, or other individuals with distinctive qualifications or experience; and (B) are not officers or employees of the United States. (c) CHAIRPERSON.—The Commission shall elect a Chairperson from among the members of the Commission. (d) QUORUM.—A majority of the members of the Commission shall constitute a quorum for the transaction of business. (e) VOTING.—Each member of the Commission shall be entitled to 1 vote, which shall be equal to the vote of every other member of the Commission. (f) VACANCIES.—Any vacancy on the Commission shall not affect its powers, but shall be filled in the manner in which the original appointment was made. (g) PROHIBITION OF ADDITIONAL PAY.—Members of the Commission shall receive no additional pay, allowances, or benefits by reason of their service on the Commission. Members appointed from among private citizens of the United States may be allowed travel expenses, including per diem, in lieu of subsistence, as authorized by law for persons serving intermittently in the government service to the extent funds are av£dlable for such expenses. 2 USC 901 note.

SEC. 2103. FUNCTIONS OF COMMISSION.

(a) SPECIFIC RECOMMENDATIONS.—The Commission shall make specific recommendations regarding the following:

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101 STAT. 1330-35

(1) Methods to reduce the Federal budget deficit while promoting economic growth and encouraging saving and capital formation. (2) A means of ensuring that the burden of achieving the Federal budget deficit reduction goals of the United States does not undermine economic growth and is equitably distributed and not borne disproportionately by any one economic group, social group, region or State. (b) FINAL REPORT.—

(1) Subject to section 2108(b)(3), the Commission shall submit to the President and to the Congress on March 1, 1989, a final report which shall contain a detailed statement of the findings and conclusions of the Commission, including its recommendations for administrative and legislative action that the Commission considers advisable. (2) Any recommendation may be made by the Commission to the President and to the Congress only if adopted by a majority vote of the members of the Commission who are present and voting. (3) On February 1, 1989, the President may issue an order extending the date for submission of the final report to September 1, 1989. SEC. 2104. POWERS OF COMMISSION.

(a) HEARINGS.—The Commission may, for the purpose of carrying out this, subtitle, hold such hearings and sit and act at such times and places, as the Commission mayfind advisable. (b) RULES AND REGULATIONS.—The Commission may adopt such rules and regulations as may be necessary to establish its procedures and to govern the manner of its operations, organization, and personnel. (c) ASSISTANCE FROM FEDERAL AGENCIES.—

(1) The Commission may request from the head of any Federal agency or instrumentality such information as the Commission may require for the purpose of this subtitle. Each such agency or instrumentality shall, to the extent permitted by law and subject to the exceptions set forth in section 552 of title 5, United States Code (commonly referred to as the Freedom of Information Act), furnish such information to the Commission, upon request made by the Chairperson of the Commission. (2) Upon request of the Chairperson of the Commission, the head of any Federal agency or instrumentality shall, to the extent possible and subject to the discretion of such head— (A) make any of the facilities and services of such agency or instrumentality available to the Commission; and (B) detail any of the personnel of such agency or instrumentality to the Commission, on a non-reimburseable bsisis, to assist the Commission in carrying out its duties under this subtitle, except that any expenses of the Commission incurred under this subparagraph shall be subject to the limitation on total expenses set forth in section 2105(b). (c) MAILS.—The Commission may use the United States mails in the same manner and under the same conditions sis other Federal agencies. (d) CONTRACTING.—The Commission may, to such extent and in such amounts as are provided in appropriation Acts, enter into

2 USC 901 note.

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PUBLIC LAW 100-203—DEC. 22, 1987

contracts with State agencies, private firms, institutions, and individuals for the purpose of conducting research or surveys necessary to enable the Commission to discharge its duties under this subtitle, subject to the limitation on total expenses set forth in section 2105(b). (e) STAFF.—Subject to such rules and regulations as may be adopted by the Commission, the Chairperson of the Commission (subject to the limitation on total expenses set forth in section 2105(b)) shall have the power to appoint, terminate, and fix the compensation (without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, and without regard to the provisions of chapter 51 and subchapter III of chapter 53 of such title, or of any other provision, or of any other provision of law, relating to the number, classification, and General Schedule rates) of an Executive Director, and of such additional staff as the Chairperson deems advisable to assist the Commission, at rates not to exceed a rate equal to the maximum rate for GS-18 of the General Schedule under section 5332 of such title. if) ADVISORY COMMITTEE.—The Commission shall be considered an advisory committee within the meaning of the Federal Advisory Committee Act (5 U.S.C. App.). 2 USC 901 note.

SEC. 2105. EXPENSES OF COMMISSION.

(a) IN GENERAL.—Any expenses of the Commission shall be paid from such funds as may be available to the Secretary of the Treasury. (b) LIMITATION.—The total expenses of the Commission shall not exceed $1,000,000. (c) GAO AUDIT.—Prior to the termination of the Commission, pursuant to section 2106, the Comptroller General of the United States shall conduct an audit of the financial books and records of the Commission to determine that the limitation on expenses has been met, and shall include its determination in an opinion to be included in the report of the Commission. 2 USC 901 note.

SEC. 2106. TERMINATION OF COMMISSION.

The Commission shall cease to exist on the date that is 30 days after the date on which the Commission submits its report.

TITLE III—EDUCATION PROGRAMS Subtitle A—Guaranteed Student Loan Program Savings SEC. 3001. RECOVERY OF EXCESS CASH RESERVES ACCUMULATED UNDER THE GUARANTEED STUDENT LOAN PROGRAM.

(a) IN GENERAL.—Section 422 of the Higher Education Act of 1965 (2 U.S.C. 1072) is amended by adding at the end thereof the following new subsection: "(e) REDUCTION OF EXCESS CASH RESERVES.— "(1) LIMITATION ON MAXIMUM CASH RESERVES.—A guaranty

agency shall not accumulate cash reserves in excess of the greater of— "(A) 40 percent of the total amount paid by that agency on insurance claims during the preceding fiscal year;

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"(B) 0.3 percent of original principal amount of loans that are insured by that agency and that are outstanding at the end of such preceding fiscal year; "(C) an amount which, when combined with all other parts of total agency reserves, equals 0.4 percent of such original principal amount; "(D) $500,000; or "(E) the amount required to comply with the reserve requirements of a State law as in effect on October 17, 1986. "(2)

RECOVERY OF EXCESS CASH RESERVES.—The Secretary

shall, not later than March 31, 1988, determine for each guaranty agency the maximum cash reserve permitted under paragraph (1) for fiscal year 1986. Subject to paragraphs (3) and (4), if the Secretary determines that any guaranty agency had, at the end of fiscal year 1986, a cash reserve that exceeded such maximum, the Secretary shall direct the agency to eliminate such excess by any one or more of the following methods, as selected by the guaranty agency: "(A) by repaying any advances to such agency made by the Secretary under this section that are not required to be repaid under subsection (d); '(B) by withholding and canceling claims for reimbursement otherwise payable under section 428(c)(1); "(C) by reducing the amount of payments for which application will be made by such agency under section 428(f); or "(D) by any other method of reducing payments from or increasing payments to the Federal Government, including payment of additional reinsurance fees in addition to the fees required by section 428(c)(9), as proposed by the agency and agreed to by the Secretary. "(3) APPEALS BASED ON SPECIAL CIRCUMSTANCES.—(A) If

the

Secretary determines, on the basis of an application from a guaranty agency, that— "(i) the agency's financial position has deteriorated significantly since the end of the preceding fiscal year; "(ii) significant changes in the economic circumstances (such as a change in agency current cash reserves) or the loan insurance program render the limitations of paragraph (1) inadequate for the continued functioning of the agency; or "(iii) in recovering funds as required by this subsection, a guaranty agency would be compelled to violate contractual obligations existing on the date of enactment of this subsection that require a specified level of reserve funds to be maintained by such agency; the Secretary may waive, in whole or in part, the imposition of the remedies required by paragraph (2) for such agency. "(B) The Secretary shall respond to request for waivers from guaranty agencies in an expedited manner and, except for unusual circumstances or with the consent of the guaranty agency, shall resolve such request within 6 weeks of submission. "(4) RECOVERY LIMITS.—The Secretary shall not require a total reduction of cash reserves for all guaranty agencies in excess of $250,000,000 during fiscal year 1988. If the total of cash reserves of all guaranty agencies exceeds the maximum amounts permitted under paragraph (1) by more than $250,000,000, the

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 101 STAT. 1330-38

PUBLIC LAW 100-203—DEC. 22, 1987

Secretary shall ratably reduce the amounts that guaranty agencies are directed to eliminate under paragraph (2), so that the total excess cash reserves to be eliminated equals $250,000,000. "(5) DEFINITIONS.—As used in this subsection— "(A) the 'cash reserves' for any guaranty agency for any fiscal year are equal to the agency's cumulative cash receipts less the agency's cumulative cash disbursements at the end of such fiscal year; "(B) the 'total reserves' for any guaranty agency for any fiscal year are equal to the agency's cash reserves plus the agency's cumulative accounts receivable less the agency's accounts payable, as of the end of such fiscal year; "(C) the term 'cumulative cash receipts' includes such receipts as insurance premiums. Federal reinsurance payments, and collections on defaulted loans; "(D) the term 'cumulative cash disbursements' includes such disbursements as payments for default claims, repayment of Federal advances, transfers to other State activities, and payment of collection costs and other operating costs; "(E) the term 'accounts receivable' includes Federal reinsurance payments and administrative cost allowances owed but not yet paid to the guaranty agency, as of the end of a fiscal year; and "(F) the term 'accounts payable' includes collections and reinsurance fees due (hut not paid) to the Department of Education, as of the end of a fiscal year.". Ob) CONFORMING AMENDMENTS.—

(1) The second sentence of section 428(c)(l)(A) of such Act (20 U.S.C. 1078(c)(l)(A)) is amended by striking out "shall be deemed" and inserting "shall, subject to section 422(e), be deemed". (2) Section 428(c)(9)(A) of such Act is amended by striking out "an amount equal to" and inserting "an amount, subject to section 422(e), equal to". (3) The second sentence of section 428(fKlXB) of such Act is amended by striking out "shall be deemed" and inserting "shall, subject to section 422(e), be deemed". SEC. 3002. REPEAL.

(a) IN GENERAL.—Subsection (e) of section 422 of the Higher Education Act of 1965 (20 U.S.C. 1072) is repealed on September 30, 1989. 0)) CONFORMING AMENDMENTS.—

(1) Effective September 30, 1989, the second sentence of section 428(c)(l)(A) of such Act (20 U.S.C. 1078(c)(l)(A)) is amended by striking out "shall, subject to section 422(e), be deemed" and inserting "shall be deemed". (2) Effective September 30, 1989, section 428(c)(9)(A) of such Act is amended by striking out "an amount, subject to section 422(e), equal to" and inserting "an amount equal to". (3) Effective September 30, 1989, the second sentence of section 428(f)(l)(B) of such Act is amended by striking out "shall, subject to section 422(e), be deemed" and inserting "shall be deemed".

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101 STAT. 1330-39

SEC. 3003. INFORMATION ON DEFAULTS REQUIRED.

(a) GENERAL RULE.—The first sentence of section 428(k)(l) of the Higher Education Act of 1965 (20 U.S.C. 1078(kKl)) is amended— (1) by striking out "In" and inserting in lieu thereof "Notwithstanding any other provision of law, in"; and (2) by striking out "may" and inserting in lieu thereof "shall". Qo) CONFORMING AMENDMENT.—The second sentence of section 428(k)(l) of such Act is amended by striking out "may" and inserting in lieu thereof "shall".

Subtitle B—Sale of College Facilities and Housing Loans SEC. 3101. SALE OF COLLEGE FACILITIES AND HOUSING LOANS.

Section 783 of the Higher Education Act of 1965 (20 U.S.C. 113212) is amended by adding at the end thereof the following: "Notwithstanding any other provision of this title, after September 30, 1988, the Secretary shall not sell any of such obligations. Any agreement providing for delaying payment (with respect to obligations sold) until after September 30, 1988, or for delaying delivery of such obligations or delaying taking other actions in furtherance of such a sale until after such date, shall be considered to be a violation of the preceding sentence.".

TITLE IV—MEDICARE, MEDICAID, AND OTHER HEALTH-RELATED PROGRAMS TABLE OF CONTENTS OF TITLE TITLE IV—MEDICARE, MEDICAID, AND OTHER HEALTH-RELATED PROGRAMS Subtitle A—Medicare

'

" *

PART 1—RELATING ONLY TO PART A

Sec. 4001. Extension of reductions under sequester order. Sec. 4002. Basic hospital prospective payment rates. Sec. 4003. Increase in disproportionate share adjustment and reduction in indirect medical education payments. Sec. 4004. Provisions relating to wage index. Sec. 4005. Rural hospitals. Sec. 4006. Payments for hospital capital. Sec. 4007. Reporting hospital information. Sec. 4008. Other provisions relating to payment for inpatient hospital services. Sec. 4009. Miscellaneous provisions. PART 2—PROVISIONS RELATING TO PARTS A AND B SUBPART A—HEALTH MAINTENANCE ORGANIZATION REFORMS

Sec. Sec. Sec. Sec. Sec. Sec.

,

,,;

4011. Beneficiary protection. 4012. Payments for hospital services. 4013. Two-year extension on period for benefit stabilization. 4014. Civil money penalties and intermediate sanctions against HMOs/CMPs. 4015. Medicare payment demonstration projects. 4016. Delay in effective date in physician incentive rules for health maintenance organizations. Sec. 4017. GAO study and reports on medicare capitation. Sec. 4018. Special rules.

91-194O-90-27:QL.3Part2

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PUBLIC LAW 100-203—DEC. 22, 1987 SUBPART B—HOME HEALTH QUALITY

Sec. Sec. Sec. Sec. Sec. Sec. Sec.

4021. 4022. 4023. 4024. 4025. 4026. 4027.

Conditions of participation for home health agencies. Standard and extended survey. Enforcement. •* Requirement that individual be confined to home. Home health toll-free hotline and investigative unit. Home health agency cost limits. Home health prospective payment demonstration project.

' ^^ • /--r • ' ,

SUBPART C—OTHER PROVISIONS

Sec. 4031. Payment cycle standards. Sec. 4032. Denials and reconsiderations of claims for home health services, extended care services, and post-hospital extended care services. Sec. 4033. Permitting disabled individuals to renew entitlement to medicare after gainful employment without a 2-year waiting period. Sec. 4034. Application of secondary payer provisions to governmental entities. Sec. 4035. Publication and notification of policies. Sec. 4036. End-stage renal disease amendments. Sec. 4037. Medicare hearings and appeals. . ', Sec. 4038. Rural health medical education demonstration project. Sec. 4039. Miscellaneous and technical provisions. •, * -S. ,;

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. Sec. 4042. General update in payments for physicians' services. Sec. 4043. Incentive payments for physicians' services furnished in underserved areas. Sec. 4044. Adjustment in prevailing charge level for primary care services. Sec. 4045. Reduction in prevailing charge level for overpriced procedures. Sec. 4046. Limits on payment for ophthalmic ultrasound. Sec. 4047. Customary charges for primary care services of new physicians...,y.^.. Sec. 4048. Payment for physician anesthesia services. i tk Sec. 4049. Fee schedules for radiologist services. f x Sec. 4050. Fee schedules for physician pathology services. Sec. 4051. Elimination of markup for certain purchased services. Sec. 4052. Collection of past-due amounts owed by physicians who breached contracts under the National Health Service Corps Scholarship Program. ' Sec. 4053. Elimination of 1975 floor for prevailing physician charges. • ° Sec. 4054. Application of maximum allowable actual charge (MAAC). services. • * Sec. 4056. Physician payment studies. SUBPART B—PROVISIONS RELATING TO PAYMENTS FOR OTHER SERVICES
 * ' Sec. 4055. Applying copayment and deductible to certain outpatient physicians'

Sec. 4061. Extension of reduction for other part B items and services payments under sequester order. Sec. 4062. Payments for durable medical equipment, prosthetic devices, orthotics, and prosthetics. Sec. 4063. Payment for intraocular lenses. Sec. 4064. Clinical diagnostic laboratory tests. " *.I'M-- •• S S Sec. 4065. Return on equity payments to outpatient departments. Sec. 4066. Payments to hospital outpatient departments for radiology. Sec. 4067. Updating maximum rate of payment per visit for independent rural health clinics. Sec. 4068. Payment for ambulatory surgery at eye, and eye and ear, specialty hospitals. SUBPART C—ELIGIBILITY AND BENEFITS CHANGES

Sec. 4070. Coverage of mental health services. .p vt; j ': Sec. 4071. Coverage of influenza vaccine and its administration. Sec. 4072. Payment for therapeutic shoes for individuals with severe diabetic foot disease. Sec. 4073. Coverage of certified nurse-midwife services. , ^^ » Copy read "Sec. 4052.". '"Copy read "Sec. 4053.". ' ' Copy read "Sec. 4054.". »» Copy read "Sec. 4055.".

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Sec. 4074. Coverage of social worker services furnished by a health maintenance organization to its members. Sec. 4075. Clarification of coverage of drugs used in immunosuppressive therapy. Sec. 4076. Services of a physician assistant. Sec. 4077. Psychologist services in clinics. Sec. 4078. Provision of offsite comprehensive outpatient rehabilitation services. Sec. 4079. Demonstration projects to provide payment on a prepaid, capitated basis for community nursing and ambulatory care furnished to medicare beneficiaries. Sec. 4080. Part B premium. , v; ^< SUBPART D—OTHER PROVISIONS

Sec. Sec. Sec. Sec. Sec.

4081. 4082. 4083. 4084. 4085.

Submission of claims to supplemental insurance carriers. Revision of part B hearings. Provisions relating to Physician Payment Review Commission. Technical amendments related to certified registered nurse anesthetists. Miscellaneous and technical provisions. PART 4—PEER REVIEW ORGANIZATIONS

V^,

Sec. 4091. Contract provisions. Sec. 4092. Preference in contracting with in-State organizations. Sec. 4093. Requiring reasonable notice and opportunity for discussion prior to denial of claim. Sec. 4094. Peer '^ review norms and education. Sec. 4095. Preexclusion hearings. Sec. 4096. Limitation of beneficiary liability for services disallowed by peer review organizations. Sec. 4097. Separate funding levels. Subtitle B—Medicaid PART 1—ELIGIBILITY AND BENEFITS

Sec. Sec. Sec. Sec.

..•

4101. 4102. 4103. 4104.

Medicaid benefits for poor children and pregnant women. Home and community-based services for the elderly. Physicians' services furnished by dentists. Optional medicaid coverage of individuals in certain States '* receiving only optional State '* supplementary payments. Sec. 4105. Miscellaneous SSI-related amendments. Sec. 4106. Clarification of coverage of clinic services furnished to homeless outside facility. Sec. 4107. Medically needy income levels for certain 2-member couples in California.' * PART 2—OTHER PROVISIONS

Sec. 4111. Increasing the maximum annual medicaid payments that may be made to the commonwealths and territories. Sec. 4112. Adjustment in medicaid payment for inpatient hospital services furnished by disproportionate share hospitals. Sec. 4113. HMO-related provisions. Sec. 4114. Medicaid waiver for hospice care for AIDS patients. Sec. 4115. State demonstration projects. Sec. 4116. Waiver authority under the medicaid program for the Northern Mariana Islands.' * Sec. 4117. Delay quality control sanctions for medicaid. Sec. 4118. Technical and miscellaneous amendments. Subtitle C—Nursing Home Reform PART 1—MEDICARE PROGRAM

Sec. Sec. Sec. Sec. Sec. Sec.

4201. 4202. 4203. 4204. 4205. 4206.

Requirements for skilled nursing facilities. Survey and certification process. Enforcement process. Effective dates. Annual report. Construction.

'Copy read "reer". '* Copy read "states", and "state", respectively. '*Copy read "California.". ' * Copy read "northern mariana islands.".

'^ £j ,H '^

,

'

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Page:United States Statutes at Large Volume 101 Part 2.djvu/836

 101 STAT. 1330-42

PUBLIC LAW 100-203—DEC. 22, 1987 PART 2—MEDICAID PROGRAM

Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec.

4211. Requirements for nursing facilities. 4212. Survey and certification process. 4213. Enforcement process. 4214. Effective dates. ' 4215. Annual report. 4216. Construction. 4217. Final regulations with respect to plans of correction or reduction. 4218. Medicaid certifications and recertifications for certain services. " " '^^ Subtitle D—Vaccine Compensation 4301. Short title, reference. 4302. Effective date. 4303. Compensation. '•'•: 4304. Petitions. 4305. Citizen's actions. 4306. Vaccine'** administrators. 4307. Court jurisdiction.

Subtitle E—Rural Health ... Sec. 4401. Office of Rural Health Policy. Sec. 4402. Impact analyses of medicare rules and regulations on small rural hospitals. S^c. 4403. Set aside for experiments and demonstration projects relating to rural health care issues.

PART l—RELATING ONLY TO PART A 2 USC 902 note.

SEC. 4001. EXTENSION OF REDUCTIONS UNDER SEQUESTER ORDER.

President of U.S.

Notwithstanding 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 section 2520b) 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— (1) March 31, 1988, with respect to payments for inpatient hospital services under such title (including payments under section 1886 of such title attributable or allocated to part A of such title); and (2) December 31, 1987, with respect to payments for other items and services under part A of such title. SEC. 4002. BASIC HOSPITAL PROSPECTIVE PAYMENT RATES. (a) BASIC UPDATE FACTOR FOR P P S HOSPITALS.—Clause

(i) of section 1886(b)(3)(B) of the Social Security Act (42 U.S.C. 1395ww(b)(3)(B)) is amended by striking "and for fiscal year 1988" in subclause (II) and all that follows through the end of such clause and inserting after such subclause the following: "(III) for fiscal year 1988, 3.0 percent for hospitals located in a rural area, 1.5 percent for hospitals located in a large urban area (as defined in subsection (d)(2)(D)), and 1.0 percent for other hospitals, "(IV) for fiscal year 1989, the market basket percentage increase minus 1.5 percent for hospitals located in a rural area, the market basket percentage increase minus 2.0 percent for hospitals located in a large urban area, and the market basket percentage increase minus 2.5 percent for other hospitals, and "(V) for fiscal year 1990 and each subsequent fiscal year, the market basket percentage for hospitals in ail areas.". '*• Copy read "Vacine".

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Page:United States Statutes at Large Volume 101 Part 2.djvu/837

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-43

0>) LARGE URBAN AREA DEFINED.—The second sentence of section

1886(d)(2)(D) of such Act (42 U.S.C. 1395ww(d)(2)(D)) ** is amended by inserting after "under subsection (a) by regulation;" the following: "the term 'large urban area' means, with respect to a fiscal year, such an urban area which the Secretary determines (in the publication described in subsection (e)(5)(B) before the fiscal year) has a population of more than 1,000,000 (as determined by the Secretary based on the most recent available population data published by the Bureau of the Census);". (c) ADJUSTMENT FOR HOSPITALS IN LARGE URBAN AREAS OR IN RURAL AREAS.—

(1) IN GENERAL.—Section 1886(d)(3) of such Act (42 U.S.C. 1395ww(d)(3)) is amended— (A) in the matter before subparagraph (A), by striking "urban or rural areas" and inserting "large urban, other urban, or rural areas"; (B) in first sentence of subparagraph (A)— (i) by striking "The Secretary" and inserting "(i) For discharges occuring in a Hscal year beginning before October 1, 1987, the Secretary", (ii) by striking "each of fiscal years 1985, 1986, 1987, and 1988" and inserting "the fiscal year involved", and (iii) by striking ", and adjusted for subsequent fiscal years in accordance with the final determination of the Secretary under subsection (e)(4), and adjusted to reflect the most recent case-mix data available,"; (C) by adding at the end of subparagraph (A) the following new clauses: "(ii) For discharges occurring in a fiscal year beginning on or after October 1, 1987, the Secretary shall compute an average standardized amount for hospitals located in a large urban area, for hospitals located in a rural area, and for hospitals located in urban areas, within the United States and within each region, equal to the respective average standardized amount computed for the previous fiscal year under this subparagraph increased by the applicable percentage increase under subsection (b)(3)(B)(i) with respect to hospitals located in the respective areas for the fiscal year involved. "(iii) Average standardized amounts computed under this paragraph shall be adjusted to reflect the most recent case-mix data available."; and (D) in subparagraph (D)— (i) by striking "URBAN AND RURAL HOSPITALS" in the heading and inserting "HOSPITALS IN DIFFERENT AREAS",
 * .5

(ii) in clause (i), by inserting "(or, for discharges occurring on or after April 1, 1988, in a large urban area or other urban area)" after "urbsm area" the first place it appears, and (iii) in clause (i), by inserting "such" before "an urban area" the second place it appears. (2) CONFORMING AMENDMENTS.—Section 1886(d)(9)(A) of such Act (42 U.S.C. 1395ww(d)(9)(A)) is amended— (A) in clause (ii)(I), by striking "an urban area, and" and inserting "a large urban area,"; '""Copy read "(42 U.S.C. 1395www(d)(2)(D))".

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Page:United States Statutes at Large Volume 101 Part 2.djvu/838

 101 STAT. 1330-44

PUBLIC LAW 100-203—DEC. 22, 1987

(B) by redesignating subclause (II) of clause (ii) as subclause (III); and (C) by inserting after subclause (I) of clause (ii) the following new subclause: "(II) such rate for hospitals located in other urban areas, and". (d) ESTABLISHMENT OF REGIONAL FLOOR.—Section 1886(d)(l)(A)(iii) of such Act (42 U.S.C. 1395ww(d)(l)(A)(iii)) is amended by inserting before the period at the end the following: ", or, if greater for discharges occurring during the period beginning on April 1, 1988, and ending on September 30, 1990, the sum of (I) 85 percent of the national adjusted DRG prospective payment rate determined under paragraph (3) for such discharges, and (II) 15 percent of the regional adjusted DRG prospective payment rate determined under such paragraph". (e) UPDATE FOR PPS-EXEMPT HOSPITALS.—Section 1886(b)(3)(B) of such Act (42 U.S.C. 1395ww(b)(3)(B)) is amended— (1) in clause (i), by striking "subparagraph (A) for 12-month cost reporting periods beginning during a fiscal year and for purposes of, r (2) in clause (ii), by striking "(ii) For purposes of clause (i)" and inserting "(iii) For purposes of this subparagraph", and (3) by inserting after clause (i) the following new clause: "(ii) For purposes of subparagraph (A), the 'applicable percentage increase' for 12-month cost reporting periods beginning during— "(I) fiscal year 1986, is 0.5 percent, "(II) fiscal year 1987, is 1.15 percent, -Wij "(III) fiscal year 1988, is the market basket percentage increase minus 2.0 percentage points, and "(IV) subsequent fiscal years is the market basket percentage increase.". (f) RELATED CONFORMING AND TECHNICAL AMENDMENTS.—

(1) Section 1886 of such Act (42 U.S.C. 1395ww) is further amended— (A) by adding at the end of subsection (d)(2)(D) the following new sentence: "For purposes of payment under this subsection, a hospital is considered to be located in an ^v,.,;. i^j urban area or large urban area, respectively, if the hospital is paid under this subsection at the rate for hospitals located in such an area."; (B) in subsection (e)(3)(B), by striking "or determine"; (C) in subsection (e)(4)— (i) by striking "for fiscal year 1988" and inserting "for each fiscal year (beginning with fiscal year 1988)', (ii) by striking "and shall determine for each subsequent fiscal year" and all that follows through "fiscal year, and", and (iii) by amending the last sentence to read as follows: "The appropriate change factor may be different for all CB'* S oir^d large urban subsection (d) hospitals, other urban subsection (d) hospitals, urban subsection (d) Puerto is:>ijR lo t- ' Rico hospitals, rural subsection (d) hospitals, and rural subsection (d) Puerto Rico hospitals, and all other hosof s "br» ^ pitals and units not paid under subsection (d), and may vary among such other hospitals and units."; and (D) in paragraph (5), by striking "or determination " each place it appears., • t,••:-::••>.-w<<;:-^.-A^^ /'-^/.^-v, /.^.o-^'
 * 3'^' "

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Page:United States Statutes at Large Volume 101 Part 2.djvu/839

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-45

(2) Subsection (a)(l)(B)(ii) of section 107 of the Balanced Budget and Emergency Deficit Control Reaffirmation Act of 1987 (Public Law 100-119) is amended, effective as of the date of the enactment of such Act, by inserting ", the target percentage and DRG percentage shall be those specified in subsection (d)(l)(C)(iv) of such section, and the applicable percentage increase in a hospital's target amount shall be deemed to be 0 percent" before the period at the end. (g) EFFECTIVE DATES.—

(1) PPS HOSPITALS, DRG PORTION OF PAYMENT.—In the case of a subsection (d) hospital (as defined in paragraph (6))— (A) the amendments made by subsections (a) and (c) shall apply to payments made under section 1886(a)(l)(A)(iii) of the Social Security Act on the basis of discharges occurring on or after April 1, 1988, and (B) for discharges occurring on or after October 1, 1988, the applicable percentage increase (described in section 1886(d)(3)(B) of such Act) *' for discharges occurring during fiscal year 1987 is deemed to have been such percentage increase as amended by subsection (a). (2) PPS SOLE COMMUNITY HOSPITALS, HOSPITAL SPECIFIC PORTION OF PAYMENT.—In the case of a subsection (d) hospital which receives payments made under section 1886(d)(l)(A) of the Social Security Act because it is a sole community hospital— (A) the amendment made by subsections (a) and (c) shall apply to payments under section 1886(d)(l)(A)(ii)(I) of the Social Security Act made on the basis of discharges occurring during a cost reporting period of a hospital, for the hospital's cost reporting period beginning on or after October 1, 1987; ,.. (B) notwithstanding subparagraph (A), for cost reporting period beginning during fiscal year 1988, the applicable percentage increase (as defined in section 1886(d)(3)(B) of such Act) for the— (i) first 51 days of the cost reporting period shall be 0 percent, (ii) next 132 days of such period shall be 2.7 percent, and (iii) remainder of such period of the cost reporting gfst; period shall be the applicable percentage increase (as so defined, as amended by subsection (a)); and (C) for cost reporting periods beginning on or after October 1, 1988, the applicable percentage increase (as so defined) with respect to the previous cost reporting period shall be deemed to have been the applicable percentage increase (as so defined, as amended by subsection (a)). (3) PPS-EXEMPT HOSPITALS.—In the case of a hospital that is not a subsection (d) hospital— (A) the amendments made by subsection (e) shall apply to cost reporting periods beginning on or after October 1, 1987; (B) notwithstanding subparagraph (A), for the hospital's cost reporting period beginning during fiscal year 1988, payment under title XVIII of the Social Security Act shall be made as though the applicable percentage increase de«' Copy read "Act))".

42 USC 1395WW note.

42 USC 1395WW note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/840

 101 STAT. 1330-46

PUBLIC LAW 100-203—DEC. 22, 1987 scribed in section 1886(b)(3)(B) of such Act were equal to the product of 2.7 percent and the ratio of 315 to 366; and (C) for cost reporting periods beginning on or after October 1, 1988, the applicable percentage increase (as so defined) with respect to the cost reporting period beginning during fiscal year 1988 shall be deemed to have been 2.7 percent.

-: « • = ^

Effective date.

(4)

DEFINITION,

REGIONAL

FLOOR,

AND

TECHNICAL

AND

CONFORMING AMENDMENTS.—The amendments m a d e by subsections (b) and (d) and paragraph s (1) and (2) of subsection (0 shall

V >.

take effect on the date of the enactment of this Act. (5) TRANSITION FOR LARGE URBAN AREA RATES.—In computing

the average standardized amount for hospitals located in a large urban area or other urban area under section 1886(d)(3)(A)(ii) of the Social Security Act (as amended by subsection (c)) for fiscal year 1988, the reference to "the respective average standardized amount computed for the previous fiscal year under this subparagraph" is deemed a reference to the average standardized amount computed for hospitals located in an urban area for the 51-day period beginning on October 1, 1987. (6) DEFINITION.—In this subsection, the term "subsection (d) hospital" has the meaning given such term in section 1886(d)(10XB) of the Social Security Act.

,

.

SEC. 4003. INCREASE IN DISPROPORTIONATE SHARE ADJUSTMENT AND REDUCTION IN INDIRECT MEDICAL EDUCATION PAYMENTS. (a) REDUCTION I N INDIRECT M E D I C A L EDUCATION P A Y M E N T S. —

(1) Section 1886(d)(5)(B)(ii) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)(ii)) is amended—

(A) in subclause (I), by striking "2" and inserting in lieu thereof "1.89"; and (B) in subclause (II), by striking "1.5" and inserting in lieu thereof "1.43". (2) Section 1886(d)(3)(C)(ii) of such Act (42 U.S.C. after "1985" each place it appears in subclauses (I) and (II). (b) INCREASE I N DISPROPORTIONATE S H A R E ADJUSTMENT. — S e c t i o n
 * , 1395ww(d)(3)(C)(ii)) is amended by inserting "and by section
 * "'' 4003(a)(l) of the Omnibus Budget Reconciliation Act of 1987"

1886(d)(5)(F) of such Act (42 U.S.C. 1395ww(d)(5)(B))—

(1) in clause (iii), by striking "15 percent" and inserting "25 percent", and (2) in clause (ivXD, by striking " the lesser of 15 percent, or". (c)

EXTENSION

OF DISPROPORTIONATE SHARE ADJUSTMENT.—Sec-

tions 1886(d)(2)(C)(iv) (42 U.S.C. 1395ww(d)(2)(C)(iv)), 1886(d)(3)(C)(iiXI) (42 U.S.C. 1395ww(d)(3)(C)(iiXI)), 1886(d)(3)(C)(iiXII) (42 U.S.C. 1395ww(d)(3)(C)(iiXII)), 1886(d)(5)(B)(iiXI) (42 U.S.C. 1395ww(d)(5)(B)(iiXI)), 1886(d)(5)(B)(iiXII) (42 U.S.C. 1395ww(d)(5)(B)(iiXII)), and 1886(d)(5)(F)(i) (42 U.S.C. 1395ww(d)(5)(F)(i)) of the Social Security Act are each amended by striking "1989" and inserting in lieu thereof "1990". (d) SPECIAL RULE.—In the case of a hospital which— (1) consists of 2 inpatient hospital facilities which are more than 4 miles apart and each of which is in a separate political jurisdiction within the same State and one of which meets the criteria under section 1886(d)(5)(F) of the Social Security Act for serving a significantly disproportionate number of low-income patients as if that facility were a separate hospital; and

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Page:United States Statutes at Large Volume 101 Part 2.djvu/841

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-47

(2) receives payments for inpatient hospital services under title XVIII of the Social Security Act which are less than the hospital's reasonable costs, the Secretary of Health and Human Services, upon application by the hospital, may treat each of the facilities of hospital as separate hospitals for purposes of applying section 1886(d)(5)(F) of the Social Security Act, for discharges occurring on or after October 1, 1988. (e) EFFECTIVE DATE.—The amendments made by this section shall 42 USC 1395WW apply to payments for discharges occurring on or after October 1, note. 1988. SEC. 4004. PROVISIONS RELATING TO WAGE INDEX.

(a) SURVEY.—Section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended by adding at the end the following: "Not later than October 1, 1990 (and at least every 36 months thereafter), the Secretary shall update the factor under the preceding sentence on the basis of a survey conducted by the Secretary (and updated as appropriate) of the wages and wage-related costs of subsection (d) hospitals in the United States. To the extent determined feasible by the Secretary, such survey shall measure the earnings and paid hours of employment by occupational category and shall exclude data with respect to the wages and wage-related costs incurred in furnishing skilled nursing facility services.". (b) CLINIC HOSPITAL WAGE INDICES.—In calculating the wage index 42 USC 1395WW under section 1886(d) of the Social Security Act for purposes of note. making payment adjustments after September 30, 1988, as required under paragraphs (2)(H) and (3)(E) of such section, in the case of any institution which received the waiver specified in section 602(k) of the Social Security Amendments of 1983, the Secretary of Health and Human Services shall include wage costs paid to related organization employees directly involved in the delivery and administration of care provided by the related organization to hospital inpatients. For purposes of the preceding sentence, the term "wage costs" does not include costs of overhead or home office administrative salaries or any costs that are not incurred in the hospital's Metropolitan Statistical Area. SEC. 4005. RURAL HOSPITALS. (a) REVISION OF STANDARDS FOR INCLUDING A RURAL COUNTY IN AN URBAN AREA.— (1) TREATING CERTAIN RURAL HOSPITALS ADJACENT TO URBAN

AREAS AS URBAN HOSPITALS.—Section 1886(d)(8) of the Social Security Act (42 U.S.C. 1395ww(d)(8))— (A) by redesignating clauses (i) and (ii) of subparagraphs (A) and (B) as subclauses (I) and (II), respectively, (B) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively, (C) by inserting "(A)" after "(8)", and (D) by adding at the end the following new subparagraph: "(B) The Secretary shall treat a hospital located in a rural county adjacent to one or more urban areas as being located in the urban metropolitan statistical area to which the greatest number of workers in the county commute, if— "(i) the rural county would otherwise be considered part of an urban area but for the fact that the rural county does not meet the standard relating to the rate of commutation between the

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Page:United States Statutes at Large Volume 101 Part 2.djvu/842

 101 STAT. 1330-48

PUBLIC LAW 100-203—DEC. 22, 1987

-r; pf

rural county and the central county or counties of any adjacent urban area; and "(ii) either (I) the number of residents of the rural county who /f commute for employment to the central county or counties of any adjacent urban area is equal to at least 15 percent of the number of residents of the rural county who are employed, or (II) the sum of the number of residents of the rural county who commute for employment to the central county or counties of ,1 any adjacent urban area and the number of residents of any adjacent urban area who commute for employment to the rural county is at least equal to 20 percent of the number of residents of the rural county who are employed. "(C) The Secretary shall make a proportional adjustment in the standardized amount determined under paragraph (3) for hospitals located in an urban area to assure that the provisions of subparagraph (B) do not result in aggregate payments under this section that are greater or less than those that would otherwise be made. The Secretary shall make such adjustment in payments under this section to hospitals located in rural areas as are necessary to assure that the aggregate of payments to rural hospitals not affected by subparagraph (B) are not changed as a result of the application of subparagraph (B).". (2) LOCATION OF HOSPITAL.—For purposes of section 1886 of the Social Security Act, Watertown Memorial Hospital in Watertown, Wisconsin is deemed to be located in Jefferson County, Wisconsin. 42 USC 1395WW (3) EFFECTIVE DATE.—This section, and the amendments made note. by paragraph (1), shall apply to discharges occurring on or after October 1, 1988. (b) EXPANSION OF SWING-BED PROGRAM.— (1) EXPANSION TO HOSPITALS WITH FEWER THAN lOO BEDS.—

Section 1883(b)(1) of the Social Security Act (42 U.S.C. 1395tt(b)(l)) is amended by striking "50 beds" and inserting "100 beds". (2) REQUIREMENTS FOR HOSPITALS WITH MORE THAN 49 BEDS.—

42 USC 1395tt.

Regulations.

Section 1883(d) of such Act (42 U.S.C. 1395dd(d)) is amended— (A) by inserting "(1)" after "(d)", and (B) by adding at the end the following new paragraphs: "(2)(A) Any agreement under this section with a hospital with more than 49 beds shall provide that no payment may be made for extended care services which are furnished to an extended care patient after the end of the 5-day period (excluding weekends and holidays) beginning on an availability date for a skilled nursing facility, unless the patient's physician certifies, within such 5-day period, that the transfer of that patient to that facility is not medically appropriate on the availability date. The Secretary shall prescribe regulations to provide for notice by skilled nursing facilities of availability dates to hospitals which have agreements under this section and which are located within the same geographic region (as defined by the Secretary). "(B) In this paragraph: "(i) The term 'availability date' means, with respect to an extended care patient at a hospital, any date on which a bed is available for the patient in a skilled nursing facility located ,.!; within the geographic region in which the hospital is located.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/843

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-49

"(ii) The term 'extended care patient' means an individual being furnished extended care services at a hospital pursuant to an agreement with the Secretary under this section. "(3) In the case of an agreement for a cost reporting period under this section with a hospital that has more than 49 beds, payment may not be made in the period for patient-days of extended care services that exceed 15 percent of the product of the number of days in the period and the average number of licensed beds in the hospital in the period.". (3) REPORT.—The Secretary of Health and Human Services shall report to Congress, not later than February 1, 1989, concerning— (A) the proportion of admissions to hospitals for extended care services under section 1883 of the Social Security Act which are denied or approved by a peer review organization under section 1154(a)(l) of such Act, and (B) on recommendations for methods of encouraging hospitals that— (i) have a low occupancy rate, ,;_ (ii) are eligible to enter (but have not entered) into an agreement under section 1883 of such Act, and (iii) are located in areas with a need for additional providers of extended care services, to enter into such agreements. (4) EFFECTIVE DATE.—The amendments made by paragraphs (1) and (2) shall apply to agreements under section 1883 of the Social Security Act entered into after March 31, 1988.

42 USC 1395tt note.

42 USC 1395tt note.

(c) PAYMENTS TO SOLE COMMUNITY HOSPITALS.—

(1) Section 1886(d)(5)(C)(ii) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(C)(ii)) is amended— (A) by striking "1988" in the second sentence and insert-^* ' ing "1990", and (B) by inserting after the second sentence the following: >>• "A subsection (d) hospital that meets the criteria for classification as a sole community hospital and otherwise te -^ qualifies for the adjustment authorized by the preceding sentence may qualify for such an adjustment without regard to the formula by which payments are determined for the hospital under paragraph (I)(A).". (2)(A) The amendments made by paragraph (1) shall apply to 42 USC 1395WW cost reporting periods beginning on or after October 1, 1987 note. (B) The Secretary of Health and Human Services shall take appropriate steps to ensure that the total amount paid in a fiscal year under title XVIII of the Social Security Act by reason of the amendment made by paragraph (I)(B) does not exceed $5,000,000 in the case of fiscal year 1988 and $10,000,000 for fiscal year 1989. (d) MEDICARE CLASSIFICATION OF RURAL REFERRAL CENTERS.— (1) EXTENSION OF CLASSIFICATION.—

-mil.

(A) IN GENERAL.—The first sentence of section 1886(d)(5)(C)(i)(I) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(C)(i)(I)) is amended by striking "500" and inserting "275". (B) EFFECTIVE DATE.—The amendment made by subpara- 42 USC 1395WW graph (A) shall apply to discharges occurring on or after note. April 1, 1988. (2) STUDY.—

42 USC 1395WW note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/844

 101 STAT. 1330-50

PUBLIC LAW 100-203—DEC. 22, 1987

'. /..

-

.

"^ . ''

42 USC 1395WW

note.

(A) IN GENERAL.—The Secretary of Health and Human Services shall provide for a study of the criteria used for the classification of hospitals as rural referral centers under section 1886(d)(5)(C)(i) of the Social Security Act. The study shall include an examination of— (i) the extent that hospitals classified as rural referral centers receive more or less than their actual costs of providing inpatient hospital services, and (ii) the appropriateness of providing for payment for such centers at a rate other than the rate for a hospital located in an other urban area. (B) REPORT.—The Secretary shall report to Congress, by not later than March 1, 1989, on the study conducted under subparagraph (A) and on recommendations for the criteria that should be applied under section 1886(d)(5)(C)(i) of the Social Security Act for the classification of hospitals as rural referral centers for cost reporting periods beginning on or after October 1, 1989.

(e) G R A N T PROGRAM FOR RURAL HEALTH C A R E TRANSITION.—

(1) The Administrator of the Health Care Financing Adminisf tration, in consultation with the Assistant Secretary for Health (or a designee), shall establish a program of grants to assist eligible small rural hospitals and their communities in the planning and implementation of projects to modify the type and extent of services such hospitals provide in order to adjust for one or more of the following factors: (A) Changes in clinical practice patterns. (B) Changes in service populations. (C) Declining demand for acute-care inpatient hospital ,,^.., capacity. (D) Declining ability to provide appropriate staffing for inpatient hospitals. (E) Increasing demand for ambulatory and emergency services. (F) Increasing demand for appropriate integration of community health services. (G) The need for adequate access (including appropriate transportation) to emergency care and inpatient care in areas in which a significant number of underutilized hospital beds are being eliminated. (H) The Administrator shall submit a final report on the program to the Congress not later than 180 days after all projects receiving a grant under the program are completed. ,^ Each demonstration project under this subsection shall demonstrate methods of strengthening the financial and managerial capability of the hospital involved to provide necessary services. Such methods may include programs of cooperation with other health care providers, of diversification in services furnished (including the provision of home health services), of physician recruitment, and of improved management systems. (2) For purposes of this subsection, the term "eligible small J, rural hospital" * means any non-Federal, short-term general ® acute care hospital that— • • Copy read " 'eligible small rural hospital' ".
 * . n ^

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Page:United States Statutes at Large Volume 101 Part 2.djvu/845

 PUBLIC LAW 100-208—DEC. 22, 1987

101 STAT. 1330-51

(A) is located in a rural area (as determined in accordance with subsection (d)), (B) has less than 100 beds, and (C) is not for profit. (3)(A) Any eligible small rural hospital that desires to modify the type or extent of health care services that it provides in order to adjust for one or more of the factors specified in paragraph (1) may submit an application to the Governor of the State in which it is located. The application shall specify the nature of the project proposed by the hospital, the data and information on which the project is based, and a timetable (of not more than 24 months) for completion of the project. The application shall be submitted on or before a date specified by the Administrator and shall be in such form as the Administrator may require. (B) The Governor shall transmit any application submitted pursuant to subparagraph (A) to the Secretary not later than 30 days after it is received by the Governor, accompanied by any comments with respect to the application that the Governor deems appropriate. (C) The Governor of a State may designate an appropriate State agency to receive and comment on applications submitted under subparagraph (A). (4) A hospital shall be considered to be located in a rural area for purposes of this subsection if it is treated as being located in a rural area for purposes of section 1886(d)(3)(D) of the Social Security Act. (5) In determining which hospitals making application under paragraph (3) will receive grants under this subsection, the Administrator shall take into account— (A) any comments received under paragraph (3)(B) with respect to a proposed project; (B) the effect that the project will have on— (i) reducing expenditures from the Federal Hospital Insurance Trust Fund, (ii) improving the access of medicare beneficiaries to health care of a reasonable quality; (C) the extent to which the proposal of the hospital, using appropriate data, demonstrates an understanding of— (i) the primary market or service area of the hospital, and (ii) the health care needs of the elderly and disabled ' that are not currently being met by providers in such market or area, and (D) the degree of coordination that may be expected between the proposed project and— (i) other local or regional health care providers, and (ii) community and government leaders, as evidenced by the availability of support for the project (in cash or in kind) and other relevant factors. (6) A grant to a hospital under this subsection may not exceed $50,000 a year and may not exceed a term of 2 years. (7)(A) Except as provided in subparagraphs (D) and (C), a hospital receiving a grant under this subsection may use the grant for any of expenses incurred in planning and implementing the project with respect to which the grant is made.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/846

 101 STAT. 1330-52

PUBLIC LAW 100-203—DEC. 22, 1987

Reports.

Reports.

(B) A hospital receiving a grant under this subsection for a project may not use the grant to retire debt incurred with respect to any capital expenditure made prior to the date on which the project is initiated. (C) Not more than one-third of any grant made under this subsection may be expended for capital-related costs (as defined by the Secretary for purposes of section 1886(a)(4) of the Social Security Act) of the project. . •. (8)(A) A hospital receiving a grant under this section shall K furnish the Administrator with such information as the Administrator may require to evaluate the project with respect to which the grant is made and to ensure that the grant is expended for the purposes for which it was made. (B) The Administrator shall report to the Congress at least once every 6 months on the program of grants established under this subsection. The report shall assess the functioning and status of the program, shall evaluate the progress made toward achieving the purposes of the program, and shall include any recommendations the Secretary may deem appropriate with respect to the program. In preparing the report, the Secretary shall solicit and include the comments and recommendations of utJ J private and public entities with an interest in rural health care. (C) The Administrator shall submit a final report on the program to the Congress not later than 180 days after all projects receiving a grant under the program are completed. (9) For purposes of carrying out the program of grants under this subsection, there are authorized to be appropriated from the Federal Hospital Insurance Trust Fund $15,000,000 for each of the fiscal years 1989 and 1990. ,, . SEC. 4006. PAYMENTS FOR HOSPITAL CAPITAL.

(a) REDUCTIONS IN PAYMENTS FOR CAPITAL.—Section 1886(g)(3)(A) of the Social Security Act (42 U.S.C. 1395ww(g)(3)(A)) is amended— (A) in clause (ii), by striking ", and" and inserting "on or after October 1, 1987, and before January 1, 1988,", c' (B) by striking clause (iii) and inserting the following: "(iii) 12 percent for payments attributable to portions of cost reporting periods or discharges (as the case may be) in fiscal year 1988, occurring on or after January 1, 1988, and "(iv) 15 percent to portions of cost reporting periods or discharges (as the case may) be occurring during fiscal year 1989.". (b) PROSPECTIVE PAYMENT FOR CAPITAL-RELATED COSTS.—

(1) IN GENERAL.—Paragraph (1) of section 1886(g) of such Act (42 U.S.C. 1395ww(g)) is amended to read as follows: "(g)(l)(A) Notwithstanding section 1861(v), instead of any amounts that are otherwise payable under this title with respect to the reasonable costs of subsection (d) hospitals and subsection (d) Puerto Rico hospitals for capital-related costs of inpatient hospital services, the Secretary shall, for hospital cost reporting periods beginning on or after October 1, 1991, provide for payments for such costs in accordance with a prospective payment system established by the Secretary. •.-..-s-vv • ••.'•:• v, •• u-. ^j-• "(B) Such system— "(i) shall provide for (I) a payment on a per discharge basis, and (II) an appropriate weighting of such payment amount as relates to the classification of the discharge;

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Page:United States Statutes at Large Volume 101 Part 2.djvu/847

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-53

"(ii) may provide for an adjustment to take into account variations in the relative costs of capital and construction for the different types of facilities or areas in which they are located; "(iii) may provide for such exceptions (including appropriate exceptions to reflect capital obligations) as the Secretary deteri mines to be appropriate, and r "(iv) may provide for suitable adjustment to reflect hospital occupancy rate. "(C) In this paragraph, the term 'capital-related costs' has the meaning given such term by the Secretary under subsection (a)(4) as of September 30, 1987, and does not include a return on equity capital.". (2) CONFORMING AMENDMENT.—Section 1886 of such Act is 42 USC 1395WW. amended— (A) in subsection (a)(4), by striking "with respect to costs ^ incurred in cost reporting periods beginning prior to October 1 of 1987 (or of such later year as the Secretary may, in .J i& his discretion, select), other capital-related costs, as defined by the Secretary" and inserting "other capital-related costs

(as defined by the Secretary for periods before October 1, 1987)", and (B) by striking subparagraph (C) of subsection (g)(3). to ^•^ (3) EFFECTIVE DATES.—The amendment made by paragraph (1) 42 USC 1395WW shall take effect on October 1, 1987. The amendments made by note. paragraph (2) shall apply to cost reporting periods beginning on or after October 1, 1987. (c) P R O P A C REPORT ON ADJUSTMENT FOR HOSPITAL OCCUPANCY.—

The Prospective Payment Assessment Commission shall study and report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate, by not later than May 1, 1988, on the suitability and feasibility of linking ayment for capital-related costs under part A of title XVIII of the ocial Security Act to hospital occupancy rates.

g

SEC. 4007. REPORTING HOSPITAL INFORMATION.

' '

(a) DEVELOPMENT OF DATA BASE.—The Secretary of Health and

Human Services (in ^^ this section referred to as the "Secretary") shall develop and place into effect not later than June 1, 1989, a data base of the operating costs of inpatient hospital services with respect to all hospitals under title XVIII of the Social Security Act, which data base shall be updated at least once every quarter (and maintained for the 12-month period preceding any such update). The data base under this subsection may include data from preliminary cost reports (but the Secretary shall make available an updata analysis of the differences between preliminary and settled cost reports). (b) REPORTING OF INFORMATION ELECTRONICALLY.—

2° (1) Subject to paragraph (2), with respect to hospital cost reporting periods beginning on or after October 1, 1989, the Secretary shall place into effect a standardized electronic cost reporting format for hospitals under the medicare program. (2) The Secretary may delay or waive the implementation of such format in particular instances where such implementation '* Copy read "Services, (in".
 * ° Copy read "ELECTRONICALLY.—Subject"

42 USC 1395WW note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/848

 101 STAT. 1330-54

PUBLIC LAW 100-203—DEC. 22, 1987

would result in financial hardship (in particular with respect to a small percentage of medicare volume), (c) DEMONSTRATION PROJECT.—

Contracts.

^

f ., •., „. a.

(1) The Secretary of Health and Human Services shall provide for a 3-year demonstration project to develop, and determine the costs and benefits of establishing a uniform system for the reporting by medicare participating hospitals of balance sheet and information described in paragraph (2), In contracting the project, the Secretary shall require hospitals in at least 2 States, one of which maintains a uniform hospital reporting system, to report such information based on standard information established by the Secretary. (2) The information described in this paragraph is as follows: (A) Hospital discharges (classified by category of service and by class of primary payer). (B) Patient days (classified by category of service and by class of primary payer). (C) Licensed beds, staffed beds, and occupancy (by category of service). (D) Outpatient visits (classified by class of primary payer). (E) Inpatient charges and revenues (classified by clsiss of primary payer). (F) Outpatient charges and revenues (classified by class of primary payer). (G) Inpatient and outpatient hospital expenses (by costcenter classifled for operating and capital). (H) Reasonable costs. (I) Other income. (J) Uncompensated care (classified by bad debt and charity care). (K) Capital acquisitions. (L) Capital assets. (3) The Secretary shall develop the system under subsection (c) in a manner so as— (A) to facilitate the submittal of the information in the report in an electronic form, and (B) to be compatible with the needs of the medicare prospective payment system. (4) The Secretary shall prepare and submit, to the Prospective Payment Assessment Commission, the Comptroller General, the Committee on Ways and Means of the House of Representatives, and the Committee on Finance of the Senate, by not later than 45 days after the end of each calendar quarter, data collected under the system. (5) In paragraph (3): (A) The terms "bad debt" and "charity care" have such meanings as the Secretary establishes. (B) The term "class" means, with respect to payers, the programs under this title VIII of the Social Security Act, a State plan approved under title XIX of such Act, other third party-payers, and self-paying individuals. (6) 21 The Secretary shall set aside at least $1,000,000 for each of fiscal years 1988, 1989, and 1990 from existing research funds

»'Copy read "(7)"

•*;•

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Page:United States Statutes at Large Volume 101 Part 2.djvu/849

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-55

to develop the format, according to paragraph (1), and at least $2,000,000 from program operations funds for data collection and analysis, but total funds shall not exceed $15,000,000 over 3 years. (7) 2 2 Tj^g Comptroller General shall analyze the adequacy of the existing system for reporting of hospital information and the costs and benefits of data reporting under the demonstration system and will recommend improvements in hospital data collection and in analysis and display of data in support of policy making. ^^ (d) CONSULTATION.—The Secretary shall consult representatives of the hospital industry in carrying out the provisions of this section. SEC. 4008. OTHER PROVISIONS RELATING TO PAYMENT FOR INPATIENT HOSPITAL SERVICES. (a) MASSACHUSETTS MEDICARE REPAYMENT.—The Secretary of

Health and Human Services shall not, on or after the date of the enactment of this Act, and before January 1, 1989, recoup from, or otherwise reduce payments to, hospitals in the State of Massachusetts because of alleged overpayments to such hospitals under part A of title XVIII of the Social Security Act which occurred during the period of the statewide hospital reimbursement demonstration project conducted in that State, between October 1, 1982, and June 30, 1986, under section 402 of the Social Security Amendments of 1967 and section 222 of the Social Security Amendments of 1972. Oo) CLARIFICATION OF SECTION 18140)) STATE WAIVER AUTHORITY.— (1) APPLICATION OF AGGREGATE TEST.—Section 181403)(3)(B) of

the Social Security Act (42 U.S.C. 1395f(b)(3)(B)) is amended by striking "rate of increase for the previous three-year period' and inserting "aggregate rate of increeise from October 1, 1983, to the most recent date for which annual data are available". (2) EFFECTIVE DATE.—The amendment made by paragraph (1) 42 USC 1395f shall take effect on the date of the enactment of this Act. note. (c) CONTINUATION OF BAD DEBT RECOGNITION FOR HOSPITAL SERV-

ICES.—In making payments to hospitals under title XVIII of the Social Security Act, the Secretary of Health and Human Services shall not make any change in the policy in effect on August 1, 1987, with respect to payment under title XVIII of the Social Security Act to providers of service for reasonable costs relating to unrecovered costs associated with unpaid deductible and coinsurance amounts incurred under such title (including criteria for what constitutes a reasonable collection effort). (d) HOSPITAL OUTUER PAYMENTS AND POLICY.— (1) INCREASE IN OUTUER PAYMENTS FOR BURN CENTER DRGS.—

(A) IN GENERAL.—For discharges classified in diagnosisrelated groups relating to burn cases and occurring on or after April 1, 1988, and before October 1, 1989, the marginal cost of care permitted by the Secretary of Health and Human Services under section 1886(d)(5)(A)(iii) of the Social Security Act shall be 90 percent of the appropriate per diem cost of care or 90 percent of the cost for cost outliers. (B) BUDGET NEUTRAUTY.—Subparagraph (A) shall be implemented in a manner that ensures that total payments under section 1886 of the Social Security Act are not in2" Copy read "(8)". 23 "(J)' Paragraph had wrong indention.

42 USC 1395f note.

42 USC 1395WW note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/850

 101 STAT. 1330-56

PUBLIC LAW 100-203—DEC. 22, 1987 creased or decreased by reason of the adjustments required by such subparagraph.

' '

(2) LIMITATION ON CHANGES IN OUTLIER REGULATIONS.—

(A) IN GENERAL.—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 September 1, 1988, any final regulation which changes the method of ayment for outlier cases under section 1886(d)(5)(A) of the ocial Security Act. ^ ^ (B) PROPAC 24 REPORT.—The chairman of the Prospective i^ J Payment Assessment Commission shall report to the Congress and the Secretary of Health and Human Services, by not later than June 1, 1988, on the method of payment for ^'',^ outlier cases under such section and providing more ade^' quate and appropriate payments with respect to burn outlier cases. (3) REPORT ON OUTLIER PAYMENTS.—The Secretary of Health and Human Services shall include in the annual report submitted to the Congress pursuant to section 1875(b) of the Social Security Act a comparison with respect to hospitals located in an urban area and hospitals located in a rural area in the amount of reductions under section 1886(d)(3)(B) of the Social Security Act and additional payments under section 1886(d)(5)(A) of such Act.

g

(e) MISCELLANEOUS ACCOUNTING PROVISION.—Effective as if

42 USC I395ww ^°^-

cluded in the enactment of the Omnibus Budget Reconciliation Act of 1986, subsection (d) of section 9307 of such Act is amended to read as follows: "(d)

,,, *'

,,,,

,

in-

MISCELLANEOUS ACCOUNTING PROVISION.—Notwithstanding

any other provision of law, for purposes of section 1886(d)(1)(A) of the Social Security Act, in the case of a hospital that— "(1) had a cost reporting period beginning on September 28, 29, or 30 of 1985, "(2) is located in a State in which inpatient hospital services were paid in fiscal year 1985 pursuant to a Statewide demonstration project under section 402 of the Social Security Amendments of 1967 and section 222 of the Social Security Amendments of 1972, and "(3) elects, by notice to the Secretary of Health and Human Services by not later than April 1, 1988, to have this subsection apply, during the first 7 months of such cost reporting period the target percentage' shall be 75 percent and the 'DRG percentage' shall be 25 percent, and during the remaining 5 months of such period the 'target percentage' and the 'DRG percentage' shall each be 50 percent.'. SEC. 4009. MISCELLANEOUS PROVISIONS.

"-

(a) RESPONSIBILITIES OF MEDICARE HOSPITALS IN EMERGENCY CASES.— (1) INCREASE IN CIVIL MONETARY PENALTY.—Section 1867(d)(2)

of the Social Security Act (42 U.S.C. 1395dd(d)(2)) is amended by striking "$25,000" and inserting "$50,000". 24 "Copy read " P R O P A C ".

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 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-57

(2) EXCLUSION FROM MEDICARE PROGRAM FOR VIOLATIONS —

Section 1867(dKl) of such Act is amended by adding at the end the following new sentence: "If a civil money penalty is imposed on a responsible physician under paragraph (2), the Secretary may impose the sanction described in section 1842(j)(2)(A) (relating to barring from participation in the medicare program) in the same manner as it is imposed under section 1842(j).". (3) EFFECTIVE DATE.—The amendments made by this subsec- 42 USC 1395dd tion shall apply to actions occurring on or after the date of the note. enactment of this Act. (b) DESIGNATION OF PEDIATRIC HOSPITALS AS MEETING CERTIFICATION AS HEART TRANSPLANT FACILITY.—For purposes of determin-

42 USC 1395y note.

ing whether a pediatric hospital that performs pediatric heart transplants meets the criteria established by the Secretary of Health and Human Services for facilities in which the heart transplants performed will be considered to meet the requirement of section 1862(a)(l)(A) of the Social Security Act, the Secretary shall treat such a hospital as meeting such criteria if— (1) the hospital's pediatric heart transplant program is operated jointly by the hospital and another facility that meets such criteria, ,, (2) the unified program shares the same transplant surgeons and quality assurance program (including oversight committee, patient protocol, and patient selection criteria), and (3) the hospital demonstrates to the satisfaction of the Secretary that it is able to provide the sp)ecialized facilities, services, and personnel that are required by pediatric heart transplant patients. (c) WAIVER OF INPATIENT LIMITATIONS FOR THE CONNECTICUT HOS-

PICE. ^^—Subsection (a) of section 9307 of the Omnibus Budget Reconciliation Act of 1986 is amended—

100 Stat. 1995.

(1) by striking "TEMPORARY" in the heading, and

r

(2) by striking "for hospice care provided before October 1, 1988,".

" (d) REVISION OF APPOINTMENT PROCESS FOR PROSPECTIVE PAYMENT ASSESSMENT COMMISSION.—

(1) IN GENERAL.—Section 1886(e)(6)(B) of the Social Security Act (42 U.S.C. 1395ww(e)(6)(B)) is amended— (A) in the first sentence, by striking "provide expertise and experience in the provision and financing of health care" and inserting "include individuals with national recognition for their expertise in health economics, hospital reimbursement, hospital financial management, and other related fields, who provide a mix of different professionals, broad geographic representation, and a balance between urban and rural representatives,"; and (B) by striking the last sentence. (2) EFFECTIVE DATE.—The amendments made by paragraph (1)

.

shall apply to appointments made after the date of the enactment of this Act.

(e) PSYCHOLOGISTS' INPATIENTS.—

SERVICES

FURNISHED

 * Copy read "LIMITATIONS FOR THE CONNECTICUT HOSPICE.".

TO

HOSPITAL

42 USC 1395WW note.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/852

 101 STAT. 1330-58

42 USC 1395x note.

PUBLIC LAW 100-203—DEC. 22, 1987

(1) IN GENERAL.—Section 1861(b)(3) of such Act (42 U.S.C. 1395x(b)(3)) is amended by inserting "(including clinical psychologist (as defined by the Secretary))" after "others" the first place it appears. (2) EFFECTIVE DATE.—The amendment made by paragraph (1) shall apply with respect to services furnished on or after April 1, 1988. (f) HOSPITAL CONDITION OF PARTICIPATION RELATED TO INDIVIDUAL RESPONSIBLE FOR CARE OF PATIENT.—Section 1861(e)(4) of such Act

42 USC 1320bnote.

Effective date. 42 USC 1320b-8 note. 42 USC 1395WW note.

(42 U.S.C. 1395x(e)(4)) is amended by inserting "with respect to whom payment may be made under this title" after "patient", (g) DELAY IN REQUIREMENTS RELATING TO HOSPITAL STANDARDS F R ORGAN TRANSPLANTS AND STANDARDS FOR ORGAN PROCUREMENT O AGENCIES.—

(1) Section 9318(b)(2) of the Omnibus Budget Reconciliation Act of 1986, as amended by section 107(c) of the Balanced Budget and Emergency Deficit (Dontrol Reaffirmation Act of 1987, is amended by striking "November 21, 1987" and inserting "March 31, 1988". (2) The amendment made by paragraph (1) shall be effective as if included in the enactment of the Omnibus Budget Reconciliation Act of 1986. (h) PROPAC STUDIES AND REPORTS.— (1) PROPAC REPORTS ON STUDY OF DRG RATES FOR HOSPITALS IN

RURAL AND URBAN AREAS.—The Prospective Payment Assessment Commission shall evaluate the study conducted by the Secretary of Health and Human Services pursuant to section 603(a)(2)(C)(i) of the Social Security Amendments of 1983 (relating to the feasibility, impact, and desirability of eliminating or phasing out separate urban and rural DRG prospective payment rates) and report its conclusions and recommendations to the Congress not later than March 1, 1988. (2) PROPAC REPORT ON SEPARATE URBAN PAYMENT RATES.—The

Prospective Payment Assessment Commission shall evaluate ' the desirability of maintaining separate DRG prospective payment rates for hospitals located in large urban areas (as defined Y? in section 1886(d)(2)(D)) of the Social Security Act) and in other urban areas, and shall report to Congress on such evaluation ' • not later than January 1, 1989. (3)

42 USC 1395WW note.

REPORT ON ADJUSTMENT FOR NON-LABOR COSTS.—The

Prospective Payment Assessment Commission shall perform an analysis to determine the feasibility and appropriateness of acljusting the non-wage-related portion of the adjusted average standardized amounts under section 1886(d)(3) of the Social Security Act based on area differences in hospitals' costs (other than wage-related costs) and input prices. The Commission shall report to the Congress on such analysis by not later than October 1, 1989. (i) SPECIAL RULE.—In the case of New England county metropolitan areas, the Secretary of Health and Human Services shall apply the second sentence of section 1886(d)(2)(D) of the Social Security Act, as amended by section 4001(b) of this subtitle, as though 970,000 were substituted for 1,000,000. (j) TECHNICAL CORRECTIONS.—

(1) Section 1886(a)(4) of the Social Security Act (42 U.S.C. 1395ww(a)(4)) is amended by inserting a comma after "educational activities".

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 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-59

(2) Section 1886(d)(5)(C)(i)(II) of such Act (42 U.S.C. 1395ww(d)(5)(C)(i)(II)) is amended by inserting "index" after "case mix" both places it appears. (3) Section 1886(d)(5)(F) of such Act (42 U.S.C. 1395ww(d)(5)(F)) is amended— (A) in clause (i)(H), by striking "such revenues" the second place it appears and inserting "such net inpatient care revenues", and (B) in clause (ivXI), by striking "subclause (III)" and inserting "clause (v)". (4) Section 1886(d)(9) of such Act (42 U.S.C. 1395ww(d)(9)) is amended by moving the matter in subparagraph (B) before clause (i) 2 ems to the left so the left margin of such matter is aligned with the left margin of the matter in subparagraph (A) (5) Section 1886(h)(4)(C) of such Act (42 U.S.C. 1395ww(h)(4)(C)) is amended by striking "subparagraph (E)" and inserting "subparagraph (D)". (6) Effective as if included in the enactment of the Omnibus Budget Reconciliation Act of 1986— (A) subparagraph (B) of section 9307(c)(l) of such Act is amended to read as follows: "(B) in paragraph (2)— "(i) by striking subparagraphs (A) and (B), "(ii) in subparagraph (C), by striking 'such subsection' and inserting 'of section 1886(d) of the Social Security Act (42 U.S.C. 1395ww(d)' and by redesignating such subparagraph as subparagraph (A), and "(iii) by amending subparagraph (D) to read as follows: " '(B) The amendments made by subparagraph (A) apply to discharges occurring on or after May 1, 1986.' "; (B) section 9302(a)(2)(C) of such Act is amended by striking "1866(e)(5)" and inserting "1886(e)(5)"; (C) section 9320(h)(l) of such Act is amended by striking "before the period" and inserting "before the semicolon"; (D) section 9321(c)(4) of such Act is amended by striking "second sentence" and all that follows through "operating costs" and inserting "second sentence of section 1886(a)(4) of the Social Security Act, from the term 'operating costs"; (E) the second sentence of section 9335(d)(2) of such Act is amended by striking "establish" and inserting "designate"; and (F) section 9321(c)(3) of such Act is amended by inserting "section 1861(v)(l)(O) and 1886(g)(2) of the Social Security Act and" after "implementing". (7) Section 218(v) of the Social Security Act (42 U.S.C. 418(v)) is amended by striking paragraph (3). (8) Effective as if included in the Tax Reform Act of 1986, section 1895(d)(6)(C) of such Act is amended by striking "603" and inserting "2203".

42 USC 1395WW.

42 USC 1395WW note. 42 USC 1395WW. 42 USC 1395y. 42 USC 1395WW note.

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

42 USC 300bb-6.

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Page:United States Statutes at Large Volume 101 Part 2.djvu/854

 101 STAT. 1330-60

PUBLIC LAW 100-203—DEC. 22, 1987

P A R T 2 — PROVISIONS R E L A T I N G TO P A R T S A ANDB •^'l!

Subpart A—Health Maintenance Organization Reforms

SEC. 4011. BENEFICIARY PROTECTION. (a) POST-CONTRACT PROTECTION FOR ENROLLEES WITH ELIGIBLE ORGANIZATIONS UNDER ^e THE MEDICARE PROGRAM.—

42 USC 1395mm note.

(1) Section 1876(c)(3) of such Act (42 U.S.C. 1395mm(b)(2)) is amended by adding at the end the following new subparagraph: "(F) Each eligible organization that provides items and services pursuant to a contract under this section shall provide assurances to the Secretary that in the event the organization ceases to provide such items and services, the organization shall provide or arrange for supplemental coverage of benefits under this title related to a pre-existing Bi'f'i condition with respect to any exclusion period, to all individuals enrolled with the entity who receive benefits under this title, for the lesser of six months or the duration of such period.". (2) The amendment made by paragraph (1) shall apply with respect to contracts entered into or renewed on or after the date of enactment of this Act. (b) NOTIFICATION OF TERMINATION OF RISK-SHARING CONTRACT.—

•'•Pufi'^H:

42 USC 1395mm note.

(1) Section 1876(c)(3) of such Act, as amended by subsection (a)(1), is further amended by adding at the end the following new subparagraph: "(G)(i) Each eligible organization having a risk-sharing contract under this section shall notify individuals eligible to enroll with the organization under this section and individuals enrolled with the organization under this section that— "(I) the organization is authorized by law to terminate or refuse to renew the contract, and "(II) termination or nonrenewal of the contract may result in termination of the enrollments of individuals enrolled with the organization under this section. "(ii) The notice required by clause (i) shall be included in— "(I) any marketing materials described in subparagraph (C) that are distributed by an eligible organization to individuals eligible to enroll under this section with the organization, and "(II) any explanation provided to enrollees by the organization pursuant to subparagraph (E).". (2) The amendment made by paragraph (1) shall apply to contracts entered into or renewed on or after the date of the enactment of this Act. SEC. 4012. PAYMENTS FOR HOSPITAL SERVICES.

.ji-ddtHm naiJ

contracts.

(a) IN GENERAL.—Section 1866(a)(l) of such Act (42 U.S.C. 1395cc(a)(l)) is amended by inserting immediately after subparagraph (N) the following new subparagraph: "(O) in the cgise of hospitals and skilled nursing facilities, to accept as payment in full for inpatient hospital and extended
 * Copy read "UNDER".

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Page:United States Statutes at Large Volume 101 Part 2.djvu/855

 PUBLIC LAW 100-203—DEC. 22, 1987

101 STAT. 1330-61

care services that are covered under this title and are furnished • to any individual enrolled with an eligible organization with a risk-sharing contract under section 1876 the amounts (in the case of hospitals) or limits (in the case of skilled nursing facilities) that would be made as a payment in full under this title if the individuals were not so enrolled.". (b) REPEAL.—Section 1876(g)(4) of the Social Security Act (42 U.S.C. 1395mm(g)(4)) is repealed. (c) IMPLEMENTATION.—The Secretary of Health and Human Services shall provide (in machine readable form) to eligible organizations under section 1876 of the Social Security Act medicare DRG rates for payments required by the amendment made by paragraph (2) and data on cost pass-through items for all inpatient services provided to medicare beneficiaries enrolled with such organizations. (d) EFFECTIVE DATE.—The amendments made by subsections (a) and (b) shall apply to admissions occurring on or after April 1, 1988, or, if later, the earliest date the Secretary can provide the information required under subsection (c) in machine readable form.

42 USC 1395mm note.

42 USC 1395mm note.

SEC. 40L3. TWO-YEAR EXTENSION ON PERIOD FOR BENEFIT STABILIZATION.

(a) IN GENERAL.—Section 1876(g)(5) of the Social Security Act (42 U.S.C. 1395mm(g)(5)), as added by the amendment made by section 2350(a)(2) of the Deficit Reduction Act of 1984, is amended by striking "four" and inserting "six". (b) EFFECTIVE DATE.—The amendment made by subsection (a) 42 USC 1395mm shall be effective as if included in the enactment of the amendment note. made by section 2350(a)(2) of the Deficit Reduction Act of 1984. SEC. 4014. CIVIL MONEY PENALTIES AND INTERMEDIATE SANCTIONS AGAINST HMOS/CMPS.

Section 1876(i)(6) of the Social Security Act (42 U.S.C. 1395mm) is amended to read as follows: "(6)(A) If the Secretary determines that an eligible organization Contracts. with a contract under this section— "(i) fails substantially to provide medically necessary items and services that are required (under law or under the contract) to be provided to an individual covered under the contract, if the failure has adversely affected (or has substantial likelihood of adversely affecting) the individual; "(ii) imposes premiums on individuals enrolled under this section in excess of the premiums permitted; "(iii) acts to expel or to refuse to re-enroll an individual in violation of the provisions of this section; Ii "(iv) engages in any practice that would reasonably be expected to have the effect of denying or discouraging enrollment (except as permitted by this section) by eligible individuals with ., the organization whose medical condition or history indicates a need for substantial future medical services; "(v) misrepresents or falsifies information that is furnished— "(I) to the Secretary under this section, or "(II) to an individual or to any other entity under this section; or "(vi) fails to comply with the requirements of subsection (g)(e)(A); the Secretary may provide for any of the remedies described in subparagraph (B).

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