H.Amdt. 729House110th Congress (2007-2009)
Pursuant to the provisions of H. Res. 594, the text of the amendment reported by the Committee on Ways and Means, modified by the Part A amendment reported by the Committee on Rules shall be considered as adopted and be made in order as original text.
Submitted August 1, 2007
Text
Offered
This amendment's own text couldn't be picked out of its Congressional Record passage, so the passage is shown in full.
CHILDREN'S HEALTH AND MEDICARE PROTECTION ACT OF 2007
Mr. DINGELL. Mr. Speaker, pursuant to House Resolution 594, I call up
the bill (H.R. 3162) to amend titles XVIII, XIX, and XXI of the Social
Security Act to extend and improve the children's health insurance
program, to improve beneficiary protections under the Medicare,
Medicaid, and the CHIP program, and for other purposes, and ask for its
immediate consideration.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 3162
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Children's
Health and Medicare Protection Act of 2007''.
(b) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM
Sec. 100. Purpose.
Subtitle A--Funding
Sec. 101. Establishment of new base CHIP allotments.
Sec. 102. 2-year initial availability of CHIP allotments.
Sec. 103. Redistribution of unused allotments to address State funding
shortfalls.
Sec. 104. Extension of option for qualifying States.
Subtitle B--Improving Enrollment and Retention of Eligible Children
Sec. 111. CHIP performance bonus payment to offset additional
enrollment costs resulting from enrollment and retention
efforts.
Sec. 112. State option to rely on findings from an express lane agency
to conduct simplified eligibility determinations.
Sec. 113. Application of medicaid outreach procedures to all children
and pregnant women.
Sec. 114. Encouraging culturally appropriate enrollment and retention
practices.
Subtitle C--Coverage
Sec. 121. Ensuring child-centered coverage.
Sec. 122. Improving benchmark coverage options.
Sec. 123. Premium grace period.
Subtitle D--Populations
Sec. 131. Optional coverage of older children under Medicaid and CHIP.
Sec. 132. Optional coverage of legal immigrants under the Medicaid
program and CHIP.
Sec. 133. State option to expand or add coverage of certain pregnant
women under CHIP.
Sec. 134. Limitation on waiver authority to cover adults.
Subtitle E--Access
Sec. 141. Children's Access, Payment, and Equality Commission.
Sec. 142. Model of Interstate coordinated enrollment and coverage
process.
Sec. 143. Medicaid citizenship documentation requirements.
Sec. 144. Access to dental care for children.
Sec. 145. Prohibiting initiation of new health opportunity account
demonstration programs.
Subtitle F--Quality and Program Integrity
Sec. 151. Pediatric health quality measurement program.
Sec. 152. Application of certain managed care quality safeguards to
CHIP.
Sec. 153. Updated Federal evaluation of CHIP.
Sec. 154. Access to records for IG and GAO audits and evaluations.
Sec. 155. References to title XXI.
Sec. 156. Reliance on law; exception for State legislation.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improvements in Benefits
Sec. 201. Coverage and waiver of cost-sharing for preventive services.
Sec. 202. Waiver of deductible for colorectal cancer screening tests
regardless of coding, subsequent diagnosis, or ancillary
tissue removal.
Sec. 203. Parity for mental health coinsurance.
Subtitle B--Improving, Clarifying, and Simplifying Financial Assistance
for Low Income Medicare Beneficiaries
Sec. 211. Improving assets tests for Medicare Savings Program and low-
income subsidy program.
Sec. 212. Making QI program permanent and expanding eligibility.
Sec. 213. Eliminating barriers to enrollment.
Sec. 214. Eliminating application of estate recovery.
Sec. 215. Elimination of part D cost-sharing for certain non-
institutionalized full-benefit dual eligible individuals.
Sec. 216. Exemptions from income and resources for determination of
eligibility for low-income subsidy.
Sec. 217. Cost-sharing protections for low-income subsidy-eligible
individuals.
Sec. 218. Intelligent assignment in enrollment.
Subtitle C--Part D Beneficiary Improvements
Sec. 221. Including costs incurred by AIDS drug assistance programs and
Indian Health Service in providing prescription drugs
toward the annual out of pocket threshold under Part D.
Sec. 222. Permitting mid-year changes in enrollment for formulary
changes adversely impact an enrollee.
Sec. 223. Removal of exclusion of benzodiazepines from required
coverage under the Medicare prescription drug program.
Sec. 224. Permitting updating drug compendia under part D using part B
update process.
Sec. 225. Codification of special protections for six protected drug
classifications.
Sec. 226. Elimination of Medicare part D late enrollment penalties paid
by low-income subsidy-eligible individuals.
Sec. 227. Special enrollment period for subsidy eligible individuals.
Subtitle D--Reducing Health Disparities
Sec. 231. Medicare data on race, ethnicity, and primary language.
Sec. 232. Ensuring effective communication in Medicare.
Sec. 233. Demonstration to promote access for Medicare beneficiaries
with limited English proficiency by providing
reimbursement for culturally and linguistically
appropriate services.
Sec. 234. Demonstration to improve care to previously uninsured.
Sec. 235. Office of the Inspector General report on compliance with and
enforcement of national standards on culturally and
linguistically appropriate services (CLAS) in medicare.
Sec. 236. IOM report on impact of language access services.
Sec. 237. Definitions.
TITLE III--PHYSICIANS' SERVICE PAYMENT REFORM
Sec. 301. Establishment of separate target growth rates for service
categories.
Sec. 302. Improving accuracy of relative values under the Medicare
physician fee schedule.
Sec. 303. Physician feedback mechanism on practice patterns.
Sec. 304. Payments for efficient physicians.
Sec. 305. Recommendations on refining the physician fee schedule.
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Sec. 306. Improved and expanded medical home demonstration project.
Sec. 307. Repeal of Physician Assistance and Quality Initiative Fund.
Sec. 308. Adjustment to Medicare payment localities.
Sec. 309. Payment for imaging services.
Sec. 310. Repeal of Physicians Advisory Council.
TITLE IV--MEDICARE ADVANTAGE REFORMS
Subtitle A--Payment Reform
Sec. 401. Equalizing payments between Medicare Advantage plans and fee-
for-service Medicare.
Subtitle B--Beneficiary Protections
Sec. 411. NAIC development of marketing, advertising, and related
protections.
Sec. 412. Limitation on out-of-pocket costs for individual health
services.
Sec. 413. MA plan enrollment modifications.
Sec. 414. Information for beneficiaries on MA plan administrative
costs.
Subtitle C--Quality and Other Provisions
Sec. 421. Requiring all MA plans to meet equal standards.
Sec. 422. Development of new quality reporting measures on racial
disparities.
Sec. 423. Strengthening audit authority.
Sec. 424. Improving risk adjustment for MA payments.
Sec. 425. Eliminating special treatment of private fee-for-service
plans.
Sec. 426. Renaming of Medicare Advantage program.
Subtitle D--Extension of Authorities
Sec. 431. Extension and revision of authority for special needs plans
(SNPs).
Sec. 432. Extension and revision of authority for Medicare reasonable
cost contracts.
TITLE V--PROVISIONS RELATING TO MEDICARE PART A
Sec. 501. Inpatient hospital payment updates.
Sec. 502. Payment for inpatient rehabilitation facility (IRF) services.
Sec. 503. Long-term care hospitals.
Sec. 504. Increasing the DSH adjustment cap.
Sec. 505. PPS-exempt cancer hospitals.
Sec. 506. Skilled nursing facility payment update.
Sec. 507. Revocation of unique deeming authority of the Joint
Commission for the Accreditation of Healthcare
Organizations.
TITLE VI--OTHER PROVISIONS RELATING TO MEDICARE PART B
Subtitle A--Payment and Coverage Improvements
Sec. 601. Payment for therapy services.
Sec. 602. Medicare separate definition of outpatient speech-language
pathology services.
Sec. 603. Increased reimbursement rate for certified nurse-midwives.
Sec. 604. Adjustment in outpatient hospital fee schedule increase
factor.
Sec. 605. Exception to 60-day limit on Medicare substitute billing
arrangements in case of physicians ordered to active duty
in the Armed Forces.
Sec. 606. Excluding clinical social worker services from coverage under
the medicare skilled nursing facility prospective payment
system and consolidated payment.
Sec. 607. Coverage of marriage and family therapist services and mental
health counselor services.
Sec. 608. Rental and purchase of power-driven wheelchairs.
Sec. 609. Rental and purchase of oxygen equipment.
Sec. 610. Adjustment for Medicare mental health services.
Sec. 611. Extension of brachytherapy special rule.
Sec. 612. Payment for part B drugs.
Subtitle B--Extension of Medicare Rural Access Protections
Sec. 621. 2-year extension of floor on medicare work geographic
adjustment.
Sec. 622. 2-year extension of special treatment of certain physician
pathology services under Medicare.
Sec. 623. 2-year extension of medicare reasonable costs payments for
certain clinical diagnostic laboratory tests furnished to
hospital patients in certain rural areas.
Sec. 624. 2-year extension of Medicare incentive payment program for
physician scarcity areas .
Sec. 625. 2-year extension of medicare increase payments for ground
ambulance services in rural areas.
Sec. 626. Extending hold harmless for small rural hospitals under the
HOPD prospective payment system.
Subtitle C--End Stage Renal Disease Program
Sec. 631. Chronic kidney disease demonstration projects.
Sec. 632. Medicare coverage of kidney disease patient education
services.
Sec. 633. Required training for patient care dialysis technicians.
Sec. 634. MedPAC report on treatment modalities for patients with
kidney failure.
Sec. 635. Adjustment for erythropoietin stimulating agents (ESAs).
Sec. 636. Site neutral composite rate.
Sec. 637. Development of ESRD bundling system and quality incentive
payments.
Sec. 638. MedPAC report on ESRD bundling system.
Sec. 639. OIG study and report on erythropoietin.
Subtitle D--Miscellaneous
Sec. 651. Limitation on exception to the prohibition on certain
physician referrals for hospitals.
TITLE VII--PROVISIONS RELATING TO MEDICARE PARTS A AND B
Sec. 701. Home health payment update for 2008.
Sec. 702. 2-year extension of temporary Medicare payment increase for
home health services furnished in a rural area.
Sec. 703. Extension of Medicare secondary payer for beneficiaries with
end stage renal disease for large group plans.
Sec. 704. Plan for Medicare payment adjustments for never events.
Sec. 705. Treatment of Medicare hospital reclassifications.
TITLE VIII--MEDICAID
Subtitle A--Protecting Existing Coverage
Sec. 801. Modernizing transitional Medicaid.
Sec. 802. Family planning services.
Sec. 803. Authority to continue providing adult day health services
approved under a State Medicaid plan.
Sec. 804. State option to protect community spouses of individuals with
disabilities.
Sec. 805. County medicaid health insuring organizations .
Subtitle B--Payments
Sec. 811. Payments for Puerto Rico and territories.
Sec. 812. Medicaid drug rebate.
Sec. 813. Adjustment in computation of Medicaid FMAP to disregard an
extraordinary employer pension contribution.
Sec. 814. Moratorium on certain payment restrictions.
Sec. 815. Tennessee DSH.
Sec. 816. Clarification treatment of regional medical center.
Subtitle C--Miscellaneous
Sec. 821. Demonstration project for employer buy-in.
Sec. 822. Diabetes grants.
Sec. 823. Technical correction.
TITLE IX--MISCELLANEOUS
Sec. 901. Medicare Payment Advisory Commission status.
Sec. 902. Repeal of trigger provision.
Sec. 903. Repeal of comparative cost adjustment (CCA) program.
Sec. 904. Comparative effectiveness research.
Sec. 905. Implementation of Health information technology (IT) under
Medicare.
Sec. 906. Development, reporting, and use of health care measures.
Sec. 907. Improvements to the Medigap program.
TITLE X--REVENUES
Sec. 1001. Increase in rate of excise taxes on tobacco products and
cigarette papers and tubes.
Sec. 1002. Exemption for emergency medical services transportation.
TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM
SEC. 100. PURPOSE.
It is the purpose of this title to provide dependable and
stable funding for children's health insurance under titles
XXI and XIX of the Social Security Act in order to enroll all
six million uninsured children who are eligible, but not
enrolled, for coverage today through such titles.
Subtitle A--Funding
SEC. 101. ESTABLISHMENT OF NEW BASE CHIP ALLOTMENTS.
Section 2104 of the Social Security Act (42 U.S.C. 1397dd)
is amended--
(1) in subsection (a)--
(A) in paragraph (9), by striking ``and'' at the end;
(B) in paragraph (10), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new paragraph:
``(11) for fiscal year 2008 and each succeeding fiscal
year, the sum of the State allotments provided under
subsection (i) for such fiscal year.''; and
(2) in subsections (b)(1) and (c)(1), by striking
``subsection (d)'' and inserting ``subsections (d) and (i)'';
and
(3) by adding at the end the following new subsection:
``(i) Allotments for States and Territories Beginning With
Fiscal Year 2008.--
``(1) General allotment computation.--Subject to the
succeeding provisions of this subsection, the Secretary shall
compute a State allotment for each State for each fiscal year
as follows:
``(A) For fiscal year 2008.--For fiscal year 2008, the
allotment of a State is equal to the greater of--
``(i) the State projection (in its submission on forms CMS-
21B and CMS-37 for May 2007) of Federal payments to the State
under this title for such fiscal year, except that, in the
case of a State that has enacted legislation
[[Page H9304]]
to modify its State child health plan during 2007, the State
may substitute its projection in its submission on forms CMS-
21B and CMS-37 for August 2007, instead of such forms for May
2007; or
``(ii) the allotment of the State under this section for
fiscal year 2007 multiplied by the allotment increase factor
under paragraph (2) for fiscal year 2008.
``(B) Inflation update for fiscal year 2009 and each second
succeeding fiscal year.--For fiscal year 2009 and each second
succeeding fiscal year, the allotment of a State is equal to
the amount of the State allotment under this paragraph for
the previous fiscal year multiplied by the allotment increase
factor under paragraph (2) for the fiscal year involved.
``(C) Rebasing in fiscal year 2010 and each second
succeeding fiscal year.--For fiscal year 2010 and each second
succeeding fiscal year, the allotment of a State is equal to
the Federal payments to the State that are attributable to
(and countable towards) the total amount of allotments
available under this section to the State (including
allotments made available under paragraph (3) as well as
amounts redistributed to the State) in the previous fiscal
year multiplied by the allotment increase factor under
paragraph (2) for the fiscal year involved.
``(D) Special rules for territories.--Notwithstanding the
previous subparagraphs, the allotment for a State that is not
one of the 50 States or the District of Columbia for fiscal
year 2008 and for a succeeding fiscal year is equal to the
Federal payments provided to the State under this title for
the previous fiscal year multiplied by the allotment increase
factor under paragraph (2) for the fiscal year involved (but
determined by applying under paragraph (2)(B) as if the
reference to `in the State' were a reference to `in the
United States').
``(2) Allotment increase factor.--The allotment increase
factor under this paragraph for a fiscal year is equal to the
product of the following:
``(A) Per capita health care growth factor.--1 plus the
percentage increase in the projected per capita amount of
National Health Expenditures from the calendar year in which
the previous fiscal year ends to the calendar year in which
the fiscal year involved ends, as most recently published by
the Secretary before the beginning of the fiscal year.
``(B) Child population growth factor.--1 plus the
percentage increase (if any) in the population of children
under 19 years of age in the State from July 1 in the
previous fiscal year to July 1 in the fiscal year involved,
as determined by the Secretary based on the most recent
published estimates of the Bureau of the Census before the
beginning of the fiscal year involved, plus 1 percentage
point.
``(3) Performance-based shortfall adjustment.--
``(A) In general.--If a State's expenditures under this
title in a fiscal year (beginning with fiscal year 2008)
exceed the total amount of allotments available under this
section to the State in the fiscal year (determined without
regard to any redistribution it receives under subsection (f)
that is available for expenditure during such fiscal year,
but including any carryover from a previous fiscal year) and
if the average monthly unduplicated number of children
enrolled under the State plan under this title (including
children receiving health care coverage through funds under
this title pursuant to a waiver under section 1115) during
such fiscal year exceeds its target average number of such
enrollees (as determined under subparagraph (B)) for that
fiscal year, the allotment under this section for the State
for the subsequent fiscal year (or, pursuant to subparagraph
(F), for the fiscal year involved) shall be increased by the
product of--
``(i) the amount by which such average monthly caseload
exceeds such target number of enrollees; and
``(ii) the projected per capita expenditures under the
State child health plan (as determined under subparagraph (C)
for the original fiscal year involved), multiplied by the
enhanced FMAP (as defined in section 2105(b)) for the State
and fiscal year involved
``(B) Target average number of child enrollees.--In this
subsection, the target average number of child enrollees for
a State--
``(i) for fiscal year 2008 is equal to the monthly average
unduplicated number of children enrolled in the State child
health plan under this title (including such children
receiving health care coverage through funds under this title
pursuant to a waiver under section 1115) during fiscal year
2007 increased by the population growth for children in that
State for the year ending on June 30, 2006 (as estimated by
the Bureau of the Census) plus 1 percentage point; or
``(ii) for a subsequent fiscal year is equal to the target
average number of child enrollees for the State for the
previous fiscal year increased by the population growth for
children in that State for the year ending on June 30 before
the beginning of the fiscal year (as estimated by the Bureau
of the Census) plus 1 percentage point.
``(C) Projected per capita expenditures.--For purposes of
subparagraph (A)(ii), the projected per capita expenditures
under a State child health plan--
``(i) for fiscal year 2008 is equal to the average per
capita expenditures (including both State and Federal
financial participation) under such plan for the targeted
low-income children counted in the average monthly caseload
for purposes of this paragraph during fiscal year 2007,
increased by the annual percentage increase in the per capita
amount of National Health Expenditures (as estimated by the
Secretary) for 2008; or
``(ii) for a subsequent fiscal year is equal to the
projected per capita expenditures under such plan for the
previous fiscal year (as determined under clause (i) or this
clause) increased by the annual percentage increase in the
per capita amount of National Health Expenditures (as
estimated by the Secretary) for the year in which such
subsequent fiscal year ends.
``(D) Availability.--Notwithstanding subsection (e), an
increase in allotment under this paragraph shall only be
available for expenditure during the fiscal year in which it
is provided.
``(E) No redistribution of performance-based shortfall
adjustment.--In no case shall any increase in allotment under
this paragraph for a State be subject to redistribution to
other States.
``(F) Interim allotment adjustment.--The Secretary shall
develop a process to administer the performance-based
shortfall adjustment in a manner so it is applied to (and
before the end of) the fiscal year (rather than the
subsequent fiscal year) involved for a State that the
Secretary estimates will be in shortfall and will exceed its
enrollment target for that fiscal year.
``(G) Periodic auditing.--The Comptroller General of the
United States shall periodically audit the accuracy of data
used in the computation of allotment adjustments under this
paragraph. Based on such audits, the Comptroller General
shall make such recommendations to the Congress and the
Secretary as the Comptroller General deems appropriate.
``(4) Continued reporting.--For purposes of paragraph (3)
and subsection (f), the State shall submit to the Secretary
the State's projected Federal expenditures, even if the
amount of such expenditures exceeds the total amount of
allotments available to the State in such fiscal year.''.
SEC. 102. 2-YEAR INITIAL AVAILABILITY OF CHIP ALLOTMENTS.
Section 2104(e) of the Social Security Act (42 U.S.C.
1397dd(e)) is amended to read as follows:
``(e) Availability of Amounts Allotted.--
``(1) In general.--Except as provided in paragraph (2) and
subsection (i)(3)(D), amounts allotted to a State pursuant to
this section--
``(A) for each of fiscal years 1998 through 2007, shall
remain available for expenditure by the State through the end
of the second succeeding fiscal year; and
``(B) for fiscal year 2008 and each fiscal year thereafter,
shall remain available for expenditure by the State through
the end of the succeeding fiscal year.
``(2) Availability of amounts redistributed.--Amounts
redistributed to a State under subsection (f) shall be
available for expenditure by the State through the end of the
fiscal year in which they are redistributed, except that
funds so redistributed to a State that are not expended by
the end of such fiscal year shall remain available after the
end of such fiscal year and shall be available in the
following fiscal year for subsequent redistribution under
such subsection.''.
SEC. 103. REDISTRIBUTION OF UNUSED ALLOTMENTS TO ADDRESS
STATE FUNDING SHORTFALLS.
Section 2104(f) of the Social Security Act (42 U.S.C.
1397dd(f)) is amended--
(1) by striking ``The Secretary'' and inserting the
following:
``(1) In general.--The Secretary'';
(2) by striking ``States that have fully expended the
amount of their allotments under this section.'' and
inserting ``States that the Secretary determines with respect
to the fiscal year for which unused allotments are available
for redistribution under this subsection, are shortfall
States described in paragraph (2) for such fiscal year, but
not to exceed the amount of the shortfall described in
paragraph (2)(A) for each such State (as may be adjusted
under paragraph (2)(C)). The amount of allotments not
expended or redistributed under the previous sentence shall
remain available for redistribution in the succeeding fiscal
year.''; and
(3) by adding at the end the following new paragraph:
``(2) Shortfall states described.--
``(A) In general.--For purposes of paragraph (1), with
respect to a fiscal year, a shortfall State described in this
subparagraph is a State with a State child health plan
approved under this title for which the Secretary estimates
on the basis of the most recent data available to the
Secretary, that the projected expenditures under such plan
for the State for the fiscal year will exceed the sum of--
``(i) the amount of the State's allotments for any
preceding fiscal years that remains available for expenditure
and that will not be expended by the end of the immediately
preceding fiscal year;
``(ii) the amount (if any) of the performance based
adjustment under subsection (i)(3)(A); and
``(iii) the amount of the State's allotment for the fiscal
year.
``(B) Proration rule.--If the amounts available for
redistribution under paragraph (1) for a fiscal year are less
than the total amounts of the estimated shortfalls determined
for the year under subparagraph (A), the amount to be
redistributed under such
[[Page H9305]]
paragraph for each shortfall State shall be reduced
proportionally.
``(C) Retrospective adjustment.--The Secretary may adjust
the estimates and determinations made under paragraph (1) and
this paragraph with respect to a fiscal year as necessary on
the basis of the amounts reported by States not later than
November 30 of the succeeding fiscal year, as approved by the
Secretary.''.
SEC. 104. EXTENSION OF OPTION FOR QUALIFYING STATES.
Section 2105(g)(1)(A) of the Social Security Act (42 U.S.C.
1397ee(g)(1)(A)) is amended by inserting after ``or 2007''
the following: ``or 30 percent of any allotment under section
2104 for any subsequent fiscal year''.
Subtitle B--Improving Enrollment and Retention of Eligible Children
SEC. 111. CHIP PERFORMANCE BONUS PAYMENT TO OFFSET ADDITIONAL
ENROLLMENT COSTS RESULTING FROM ENROLLMENT AND
RETENTION EFFORTS.
Section 2105(a) of the Social Security Act (42 U.S.C.
1397ee(a)) is amended by adding at the end the following new
paragraphs:
``(3) Performance bonus payment to offset additional
medicaid and chip child enrollment costs resulting from
enrollment and retention efforts.--
``(A) In general.--In addition to the payments made under
paragraph (1), for each fiscal year (beginning with fiscal
year 2008) the Secretary shall pay to each State that meets
the condition under paragraph (4) for the fiscal year, an
amount equal to the amount described in subparagraph (B) for
the State and fiscal year. The payment under this paragraph
shall be made, to a State for a fiscal year, as a single
payment not later than the last day of the first calendar
quarter of the following fiscal year.
``(B) Amount.--The amount described in this subparagraph
for a State for a fiscal year is equal to the sum of the
following amounts:
``(i) For above baseline medicaid child enrollment costs.--
``(I) First tier above baseline medicaid enrollees.--An
amount equal to the number of first tier above baseline child
enrollees (as determined under subparagraph (C)(i)) under
title XIX for the State and fiscal year multiplied by 35
percent of the projected per capita State Medicaid
expenditures (as determined under subparagraph (D)(i)) for
the State and fiscal year under title XIX.
``(II) Second tier above baseline medicaid enrollees.--An
amount equal to the number of second tier above baseline
child enrollees (as determined under subparagraph (C)(ii))
under title XIX for the State and fiscal year multiplied by
90 percent of the projected per capita State Medicaid
expenditures (as determined under subparagraph (D)(i)) for
the State and fiscal year under title XIX.
``(ii) For above baseline chip enrollment costs.--
``(I) First tier above baseline chip enrollees.--An amount
equal to the number of first tier above baseline child
enrollees under this title (as determined under subparagraph
(C)(i)) for the State and fiscal year multiplied by 5 percent
of the projected per capita State CHIP expenditures (as
determined under subparagraph (D)(ii)) for the State and
fiscal year under this title.
``(II) Second tier above baseline chip enrollees.--An
amount equal to the number of second tier above baseline
child enrollees under this title (as determined under
subparagraph (C)(ii)) for the State and fiscal year
multiplied by 75 percent of the projected per capita State
CHIP expenditures (as determined under subparagraph (D)(ii))
for the State and fiscal year under this title.
``(C) Number of first and second tier above baseline child
enrollees; baseline number of child enrollees.--For purposes
of this paragraph:
``(i) First tier above baseline child enrollees.--The
number of first tier above baseline child enrollees for a
State for a fiscal year under this title or title XIX is
equal to the number (if any, as determined by the Secretary)
by which--
``(I) the monthly average unduplicated number of qualifying
children (as defined in subparagraph (E)) enrolled during the
fiscal year under the State child health plan under this
title or under the State plan under title XIX, respectively;
exceeds
``(II) the baseline number of enrollees described in clause
(iii) for the State and fiscal year under this title or title
XIX, respectively;
but not to exceed 3 percent (in the case of title XIX) or 7.5
percent (in the case of this title) of the baseline number of
enrollees described in subclause (II).
``(ii) Second tier above baseline child enrollees.--The
number of second tier above baseline child enrollees for a
State for a fiscal year under this title or title XIX is
equal to the number (if any, as determined by the Secretary)
by which--
``(I) the monthly average unduplicated number of qualifying
children (as defined in subparagraph (E)) enrolled during the
fiscal year under this title or under title XIX,
respectively, as described in clause (i)(I); exceeds
``(II) the sum of the baseline number of child enrollees
described in clause (iii) for the State and fiscal year under
this title or title XIX, respectively, as described in clause
(i)(II), and the maximum number of first tier above baseline
child enrollees for the State and fiscal year under this
title or title XIX, respectively, as determined under clause
(i).
``(iii) Baseline number of child enrollees.--The baseline
number of child enrollees for a State under this title or
title XIX--
``(I) for fiscal year 2008 is equal to the monthly average
unduplicated number of qualifying children enrolled in the
State child health plan under this title or in the State plan
under title XIX, respectively, during fiscal year 2007
increased by the population growth for children in that State
for the year ending on June 30, 2006 (as estimated by the
Bureau of the Census) plus 1 percentage point; or
``(II) for a subsequent fiscal year is equal to the
baseline number of child enrollees for the State for the
previous fiscal year under this title or title XIX,
respectively, increased by the population growth for children
in that State for the year ending on June 30 before the
beginning of the fiscal year (as estimated by the Bureau of
the Census) plus 1 percentage point.
``(D) Projected per capita state expenditures.--For
purposes of subparagraph (B)--
``(i) Projected per capita state medicaid expenditures.--
The projected per capita State Medicaid expenditures for a
State and fiscal year under title XIX is equal to the average
per capita expenditures (including both State and Federal
financial participation) for children under the State plan
under such title, including under waivers but not including
such children eligible for assistance by virtue of the
receipt of benefits under title XVI, for the most recent
fiscal year for which actual data are available (as
determined by the Secretary), increased (for each subsequent
fiscal year up to and including the fiscal year involved) by
the annual percentage increase in per capita amount of
National Health Expenditures (as estimated by the Secretary)
for the calendar year in which the respective subsequent
fiscal year ends and multiplied by a State matching
percentage equal to 100 percent minus the Federal medical
assistance percentage (as defined in section 1905(b)) for the
fiscal year involved.
``(ii) Projected per capita state chip expenditures.--The
projected per capita State CHIP expenditures for a State and
fiscal year under this title is equal to the average per
capita expenditures (including both State and Federal
financial participation) for children under the State child
health plan under this title, including under waivers, for
the most recent fiscal year for which actual data are
available (as determined by the Secretary), increased (for
each subsequent fiscal year up to and including the fiscal
year involved) by the annual percentage increase in per
capita amount of National Health Expenditures (as estimated
by the Secretary) for the calendar year in which the
respective subsequent fiscal year ends and multiplied by a
State matching percentage equal to 100 percent minus the
enhanced FMAP (as defined in section 2105(b)) for the fiscal
year involved.
``(E) Qualifying children defined.--For purposes of this
subsection, the term `qualifying children' means, with
respect to this title or title XIX, children who meet the
eligibility criteria (including income, categorical
eligibility, age, and immigration status criteria) in effect
as of July 1, 2007, for enrollment under this title or title
XIX, respectively, taking into account crtieria applied as of
such date under this title or title XIX, respectively,
pursuant to a waiver under section 1115.
``(4) Enrollment and retention provisions for children.--
For purposes of paragraph (3)(A), a State meets the condition
of this paragraph for a fiscal year if it is implementing at
least 4 of the following enrollment and retention provisions
(treating each subparagraph as a separate enrollment and
retention provision) throughout the entire fiscal year:
``(A) Continuous eligibility.--The State has elected the
option of continuous eligibility for a full 12 months for all
children described in section 1902(e)(12) under title XIX
under 19 years of age, as well as applying such policy under
its State child health plan under this title.
``(B) Liberalization of asset requirements.--The State
meets the requirement specified in either of the following
clauses:
``(i) Elimination of asset test.--The State does not apply
any asset or resource test for eligibility for children under
title XIX or this title.
``(ii) Administrative verification of assets.--The State--
``(I) permits a parent or caretaker relative who is
applying on behalf of a child for medical assistance under
title XIX or child health assistance under this title to
declare and certify by signature under penalty of perjury
information relating to family assets for purposes of
determining and redetermining financial eligibility; and
``(II) takes steps to verify assets through means other
than by requiring documentation from parents and applicants
except in individual cases of discrepancies or where
otherwise justified.
``(C) Elimination of in-person interview requirement.--The
State does not require an application of a child for medical
assistance under title XIX (or for child health assistance
under this title), including an application for renewal of
such assistance, to be made in person nor does the State
require a face-to-face interview, unless there are
discrepancies or individual circumstances justifying an in-
person application or face-to-face interview.
[[Page H9306]]
``(D) Use of joint application for medicaid and chip.--The
application form and supplemental forms (if any) and
information verification process is the same for purposes of
establishing and renewing eligibility for children for
medical assistance under title XIX and child health
assistance under this title.
``(E) Automatic renewal (use of administrative renewal).--
``(i) In general.--The State provides, in the case of
renewal of a child's eligibility for medical assistance under
title XIX or child health assistance under this title, a pre-
printed form completed by the State based on the information
available to the State and notice to the parent or caretaker
relative of the child that eligibility of the child will be
renewed and continued based on such information unless the
State is provided other information. Nothing in this clause
shall be construed as preventing a State from verifying,
through electronic and other means, the information so
provided.
``(ii) Satisfaction through demonstrated use of ex parte
process.--A State shall be treated as satisfying the
requirement of clause (i) if renewal of eligibility of
children under title XIX or this title is determined without
any requirement for an in-person interview, unless sufficient
information is not in the State's possession and cannot be
acquired from other sources (including other State agencies)
without the participation of the applicant or the applicant's
parent or caretaker relative.
``(F) Presumptive eligibility for children.--The State is
implementing section 1920A under title XIX as well as,
pursuant to section 2107(e)(1), under this title .
``(G) Express lane.--The State is implementing the option
described in section 1902(e)(13) under title XIX as well as,
pursuant to section 2107(e)(1), under this title.''.
SEC. 112. STATE OPTION TO RELY ON FINDINGS FROM AN EXPRESS
LANE AGENCY TO CONDUCT SIMPLIFIED ELIGIBILITY
DETERMINATIONS.
(a) Medicaid.--Section 1902(e) of the Social Security Act
(42 U.S.C. 1396a(e)) is amended by adding at the end the
following:
``(13) Express Lane Option.--
``(A) In general.--
``(i) Option to use a finding from an express lane
agency.--At the option of the State, the State plan may
provide that in determining eligibility under this title for
a child (as defined in subparagraph (F)), the State may rely
on a finding made within a reasonable period (as determined
by the State) from an Express Lane agency (as defined in
subparagraph (E)) when it determines whether a child
satisfies one or more components of eligibility for medical
assistance under this title. The State may rely on a finding
from an Express Lane agency notwithstanding sections
1902(a)(46)(B), 1903(x), and 1137(d) and any differences in
budget unit, disregard, deeming or other methodology, if the
following requirements are met:
``(I) Prohibition on determining children ineligible for
coverage.-- If a finding from an Express Lane agency would
result in a determination that a child does not satisfy an
eligibility requirement for medical assistance under this
title and for child health assistance under title XXI, the
State shall determine eligibility for assistance using its
regular procedures.
``(II) Notice requirement.--For any child who is found
eligible for medical assistance under the State plan under
this title or child health assistance under title XXI and who
is subject to premiums based on an Express Lane agency's
finding of such child's income level, the State shall provide
notice that the child may qualify for lower premium payments
if evaluated by the State using its regular policies and of
the procedures for requesting such an evaluation.
``(III) Compliance with screen and enroll requirement.--The
State shall satisfy the requirements under (A) and (B) of
section 2102(b)(3) (relating to screen and enroll) before
enrolling a child in child health assistance under title XXI.
At its option, the State may fulfill such requirements in
accordance with either option provided under subparagraph (C)
of this paragraph.
``(ii) Option to apply to renewals and redeterminations.--
The State may apply the provisions of this paragraph when
conducting initial determinations of eligibility,
redeterminations of eligibility, or both, as described in the
State plan.
``(B) Rules of construction.--Nothing in this paragraph
shall be construed--
``(i) to limit or prohibit a State from taking any actions
otherwise permitted under this title or title XXI in
determining eligibility for or enrolling children into
medical assistance under this title or child health
assistance under title XXI; or
``(ii) to modify the limitations in section 1902(a)(5)
concerning the agencies that may make a determination of
eligibility for medical assistance under this title.
``(C) Options for satisfying the screen and enroll
requirement.--
``(i) In general.--With respect to a child whose
eligibility for medical assistance under this title or for
child health assistance under title XXI has been evaluated by
a State agency using an income finding from an Express Lane
agency, a State may carry out its duties under subparagraphs
(A) and (B) of section 2102(b)(3) (relating to screen and
enroll) in accordance with either clause (ii) or clause
(iii).
``(ii) Establishing a screening threshold.--
``(I) In general.--Under this clause, the State establishes
a screening threshold set as a percentage of the Federal
poverty level that exceeds the highest income threshold
applicable under this title to the child by a minimum of 30
percentage points or, at State option, a higher number of
percentage points that reflects the value (as determined by
the State and described in the State plan) of any differences
between income methodologies used by the program administered
by the Express Lane agency and the methodologies used by the
State in determining eligibility for medical assistance under
this title.
``(II) Children with income not above threshold.--If the
income of a child does not exceed the screening threshold,
the child is deemed to satisfy the income eligibility
criteria for medical assistance under this title regardless
of whether such child would otherwise satisfy such criteria.
``(III) Children with income above threshold.--If the
income of a child exceeds the screening threshold, the child
shall be considered to have an income above the Medicaid
applicable income level described in section 2110(b)(4) and
to satisfy the requirement under section 2110(b)(1)(C)
(relating to the requirement that CHIP matching funds be used
only for children not eligible for Medicaid). If such a child
is enrolled in child health assistance under title XXI, the
State shall provide the parent, guardian, or custodial
relative with the following:
``(aa) Notice that the child may be eligible to receive
medical assistance under the State plan under this title if
evaluated for such assistance under the State's regular
procedures and notice of the process through which a parent,
guardian, or custodial relative can request that the State
evaluate the child's eligibility for medical assistance under
this title using such regular procedures.
``(bb) A description of differences between the medical
assistance provided under this title and child health
assistance under title XXI, including differences in cost-
sharing requirements and covered benefits.
``(iii) Temporary enrollment in chip pending screen and
enroll.--
``(I) In general.--Under this clause, a State enrolls a
child in child health assistance under title XXI for a
temporary period if the child appears eligible for such
assistance based on an income finding by an Express Lane
agency.
``(II) Determination of eligibility.--During such temporary
enrollment period, the State shall determine the child's
eligibility for child health assistance under title XXI or
for medical assistance under this title in accordance with
this clause.
``(III) Prompt follow up.--In making such a determination,
the State shall take prompt action to determine whether the
child should be enrolled in medical assistance under this
title or child health assistance under title XXI pursuant to
subparagraphs (A) and (B) of section 2102(b)(3) (relating to
screen and enroll).
``(IV) Requirement for simplified determination.--In making
such a determination, the State shall use procedures that, to
the maximum feasible extent, reduce the burden imposed on the
individual of such determination. Such procedures may not
require the child's parent, guardian, or custodial relative
to provide or verify information that already has been
provided to the State agency by an Express Lane agency or
another source of information unless the State agency has
reason to believe the information is erroneous.
``(V) Availability of chip matching funds during temporary
enrollment period.--Medical assistance for items and services
that are provided to a child enrolled in title XXI during a
temporary enrollment period under this clause shall be
treated as child health assistance under such title.
``(D) Option for automatic enrollment.--
``(i) In general.--At its option, a State may initiate an
evaluation of an individual's eligibility for medical
assistance under this title without an application and
determine the individual's eligibility for such assistance
using findings from one or more Express Lane agencies and
information from sources other than a child, if the
requirements of clauses (ii) and (iii) are met.
``(ii) Individual choice requirement.--The requirement of
this clause is that the child is enrolled in medical
assistance under this title or child health assistance under
title XXI only if the child (or a parent, caretaker relative,
or guardian on the behalf of the child) has affirmatively
assented to such enrollment.
``(iii) Information requirement.--The requirement of this
clause is that the State informs the parent, guardian, or
custodial relative of the child of the services that will be
covered, appropriate methods for using such services, premium
or other cost sharing charges (if any) that apply, medical
support obligations (under section 1912(a)) created by
enrollment (if applicable), and the actions the parent,
guardian, or relative must take to maintain enrollment and
renew coverage.
``(E) Express lane agency defined.--In this paragraph, the
term `express lane agency' means an agency that meets the
following requirements:
``(i) The agency determines eligibility for assistance
under the Food Stamp Act of 1977, the Richard B. Russell
National School Lunch Act, the Child Nutrition Act of 1966,
or the Child Care and Development Block Grant Act of 1990.
[[Page H9307]]
``(ii) The agency notifies the child (or a parent,
caretaker relative, or guardian on the behalf of the child)--
``(I) of the information which shall be disclosed;
``(II) that the information will be used by the State
solely for purposes of determining eligibility for and for
providing medical assistance under this title or child health
assistance under title XXI; and
``(III) that the child, or parent, caretaker relative, or
guardian, may elect to not have the information disclosed for
such purposes.
``(iii) The agency and the State agency are subject to an
interagency agreement limiting the disclosure and use of such
information to such purposes.
``(iv) The agency is determined by the State agency to be
capable of making the determinations described in this
paragraph and is identified in the State plan under this
title or title XXI.
For purposes of this subparagraph, the term `State agency'
refers to the agency determining eligibility for medical
assistance under this title or child health assistance under
title XXI.
``(F) Child defined.--For purposes of this paragraph, the
term `child' means an individual under 19 years of age, or,
at the option of a State, such higher age, not to exceed 21
years of age, as the State may elect.''.
(b) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397gg(e)(1)) is amended by redesignating subparagraph (B)
and succeeding subparagraphs as subparagraph (C) and
succeeding subparagraphs and by inserting after subparagraph
(A) the following new subparagraph:
``(B) Section 1902(e)(13) (relating to the State option to
rely on findings from an Express Lane agency to help evaluate
a child's eligibility for medical assistance).''.
(c) Electronic Transmission of Information.--Section 1902
of such Act (42 U.S.C. 1396a) is amended by adding at the end
the following new subsection:
``(dd) Electronic Transmission of Information.--If the
State agency determining eligibility for medical assistance
under this title or child health assistance under title XXI
verifies an element of eligibility based on information from
an Express Lane Agency (as defined in subsection (e)(13)(F)),
or from another public agency, then the applicant's signature
under penalty of perjury shall not be required as to such
element. Any signature requirement for an application for
medical assistance may be satisfied through an electronic
signature, as defined in section 1710(1) of the Government
Paperwork Elimination Act (44 U.S.C. 3504 note). The
requirements of subparagraphs (A) and (B) of section
1137(d)(2) may be met through evidence in digital or
electronic form.''.
(d) Authorization of Information Disclosure.--
(1) In general.--Title XIX of the Social Security Act is
amended--
(A) by redesignating section 1939 as section 1940; and
(B) by inserting after section 1938 the following new
section:
``SEC. 1939. AUTHORIZATION TO RECEIVE PERTINENT INFORMATION.
``(a) In General.--Notwithstanding any other provision of
law, a Federal or State agency or private entity in
possession of the sources of data potentially pertinent to
eligibility determinations under this title (including
eligibility files maintained by Express Lane agencies
described in section 1902(e)(13)(F), information described in
paragraph (2) or (3) of section 1137(a), vital records
information about births in any State, and information
described in sections 453(i) and 1902(a)(25)(I)) is
authorized to convey such data or information to the State
agency administering the State plan under this title, to the
extent such conveyance meets the requirements of subsection
(b).
``(b) Requirements for Conveyance.--Data or information may
be conveyed pursuant to subsection (a) only if the following
requirements are met:
``(1) The individual whose circumstances are described in
the data or information (or such individual's parent,
guardian, caretaker relative, or authorized representative)
has either provided advance consent to disclosure or has not
objected to disclosure after receiving advance notice of
disclosure and a reasonable opportunity to object.
``(2) Such data or information are used solely for the
purposes of--
``(A) identifying individuals who are eligible or
potentially eligible for medical assistance under this title
and enrolling or attempting to enroll such individuals in the
State plan; and
``(B) verifying the eligibility of individuals for medical
assistance under the State plan.
``(3) An interagency or other agreement, consistent with
standards developed by the Secretary--
``(A) prevents the unauthorized use, disclosure, or
modification of such data and otherwise meets applicable
Federal requirements safeguarding privacy and data security;
and
``(B) requires the State agency administering the State
plan to use the data and information obtained under this
section to seek to enroll individuals in the plan.
``(c) Criminal Penalty.--A private entity described in the
subsection (a) that publishes, discloses, or makes known in
any manner, or to any extent not authorized by Federal law,
any information obtained under this section shall be fined
not more than $1,000 or imprisoned not more than 1 year, or
both, for each such unauthorized publication or disclosure.
``(d) Rule of Construction.--The limitations and
requirements that apply to disclosure pursuant to this
section shall not be construed to prohibit the conveyance or
disclosure of data or information otherwise permitted under
Federal law (without regard to this section).''.
(2) Conforming amendment to title xxi.--Section 2107(e)(1)
of such Act (42 U.S.C. 1397gg(e)(1)), as amended by
subsection (b), is amended by adding at the end the following
new subparagraph:
``(F) Section 1939 (relating to authorization to receive
data potentially pertinent to eligibility determinations).''.
(3) Conforming amendment to provide access to data about
enrollment in insurance for purposes of evaluating
applications and for chip.--Section 1902(a)(25)(I)(i) of such
Act (42 U.S.C. 1396a(a)(25)(I)(i)) is amended--
(A) by inserting ``(and, at State option, individuals who
are potentially eligible or who apply)'' after ``with respect
to individuals who are eligible''; and
(B) by inserting ``under this title (and, at State option,
child health assistance under title XXI)'' after ``the State
plan''.
(e) Effective Date.--The amendments made by this section
are effective on January 1, 2008.
SEC. 113. APPLICATION OF MEDICAID OUTREACH PROCEDURES TO ALL
CHILDREN AND PREGNANT WOMEN.
(a) In General.--Section 1902(a)(55) of the Social Security
Act (42 U.S.C. 1396a(a)(55)) is amended--
(1) in the matter before subparagraph (A), by striking
``individuals for medical assistance under subsection
(a)(10)(A)(i)(IV), (a)(10)(A)(i)(VI), (a)(10)(A)(i)(VII), or
(a)(10)(A)(ii)(IX)'' and inserting ``children and pregnant
women for medical assistance under any provision of this
title''; and
(2) in subparagraph (B), by inserting before the semicolon
at the end the following: ``, which need not be the same
application form for all such individuals''.
(b) Effective Date.--The amendments made by subsection (a)
take effect on January 1, 2008.
SEC. 114. ENCOURAGING CULTURALLY APPROPRIATE ENROLLMENT AND
RETENTION PRACTICES.
(a) Use of Medicaid Funds.--Section 1903(a)(2) of the
Social Security Act (42 U.S.C. 1396b(a)(2)) is amended by
adding at the end the following new subparagraph:
``(E) an amount equal to 75 percent of so much of the sums
expended during such quarter (as found necessary by the
Secretary for the proper and efficient administration of the
State plan) as are attributable to translation or
interpretation services in connection with the enrollment and
retention under this title of children of families for whom
English is not the primary language; plus''.
(b) Use of Community Health Workers for Outreach
Activities.--
(1) In general.--Section 2102(c)(1) of such Act (42 U.S.C.
1397bb(c)(1)) is amended by inserting ``(through community
health workers and others)'' after ``Outreach''.
(2) In federal evaluation.--Section 2108(c)(3)(B) of such
Act (42 U.S.C. 1397hh(c)(3)(B)) is amended by inserting
``(such as through community health workers and others)''
after ``including practices''.
Subtitle C--Coverage
SEC. 121. ENSURING CHILD-CENTERED COVERAGE.
(a) Additional Required Services.--
(1) Child-centered coverage.--Section 2103 of the Social
Security Act (42 U.S.C. 1397cc) is amended----
(A) in subsection (a)--
(i) in the matter before paragraph (1), by striking
``subsection (c)(5)'' and inserting ``paragraphs (5) and (6)
of subsection (c)''; and
(ii) in paragraph (1), by inserting ``at least'' after
``that is''; and
(B) in subsection (c)--
(i) by redesignating paragraph (5) as paragraph (6); and
(ii) by inserting after paragraph (4), the following:
``(5) Dental, fqhc, and rhc services.--The child health
assistance provided to a targeted low-income child (whether
through benchmark coverage or benchmark-equivalent coverage
or otherwise) shall include coverage of the following:
``(A) Dental services necessary to prevent disease and
promote oral health, restore oral structures to health and
function, and treat emergency conditions.
``(B) Federally-qualified health center services (as
defined in section 1905(l)(2)) and rural health clinic
services (as defined in section 1905(l)(1)).
Nothing in this section shall be construed as preventing a
State child health plan from providing such services as part
of benchmark coverage or in addition to the benefits provided
through benchmark coverage.''.
(2) Required payment for fqhc and rhc services.--Section
2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)), as amended
by sections 112(b) and 112(d)(2), is amended by inserting
after subparagraph (B) the following new subparagraph (and
redesignating the succeeding subparagraphs accordingly):
``(C) Section 1902(bb) (relating to payment for services
provided by Federally-qualified health centers and rural
health clinics).''.
(3) Mental health parity.--Section 2103(a)(2)(C) of such
Act (42 U.S.C. 1397aa(a)(2)(C)) is amended by inserting ``(or
100 percent in the case of the category of
[[Page H9308]]
services described in subparagraph (B) of such subsection)''
after ``75 percent''.
(4) Effective date.--The amendments made by this subsection
and subsection (d) shall apply to health benefits coverage
provided on or after October 1, 2008.
(b) Clarification of Requirement To Provide EPSDT Services
for All Children in Benchmark Benefit Packages Under Medicaid
.--
(1) In general.--Section 1937(a)(1) of the Social Security
Act (42 U.S.C. 1396u-7(a)(1)) is amended--
(A) in subparagraph (A)--
(i) in the matter before clause (i), by striking
``Notwithstanding any other provision of this title'' and
inserting ``Subject to subparagraph (E)''; and
(ii) by striking ``enrollment in coverage that provides''
and all that follows and inserting ``benchmark coverage
described in subsection (b)(1) or benchmark equivalent
coverage described in subsection (b)(2).'';
(B) by striking subparagraph (C) and inserting the
following new subparagraph:
``(C) State option to provide additional benefits.--A
State, at its option, may provide such additional benefits to
benchmark coverage described in subsection (b)(1) or
benchmark equivalent coverage described in subsection (b)(2)
as the State may specify.''; and
(C) by adding at the end the following new subparagraph:
``(E) Requiring coverage of epsdt services.--Nothing in
this paragraph shall be construed as affecting a child's
entitlement to care and services described in subsections
(a)(4)(B) and (r) of section 1905 and provided in accordance
with section 1902(a)(43) whether provided through benchmark
coverage, benchmark equivalent coverage, or otherwise.''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect as if included in the amendment made by
section 6044(a) of the Deficit Reduction Act of 2005.
(c) Clarification of Coverage of Services in School-Based
Health Centers Included as Child Health Assistance.--
(1) In general.--Section 2110(a)(5) of such Act (42 U.S.C.
1397jj(a)(5)) is amended by inserting after ``health center
services'' the following: ``and school-based health center
servicesservices for which coverage is otherwise provided
under this title when furnished by a school-based health
center that is authorized to furnish such services under
State law''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to child health assistance furnished on or after
the date of the enactment of this Act.
(d) Assuring Access to Care.--
(1) State child health plan requirement.--Section
2102(a)(7)(B) of such Act (42 U.S.C. 1397bb(c)(2)) is amended
by inserting ``and services described in section 2103(c)(5)''
after ``emergency services''.
(2) Reference to effective date.--For the effective date
for the amendments made by this subsection, see subsection
(a)(5).
SEC. 122. IMPROVING BENCHMARK COVERAGE OPTIONS.
(a) Limitation on Secretary-Approved Coverage.--
(1) Under chip.--Section 2103(a)(4) of the Social Security
Act (42 U.S.C. 1397cc(a)(4)) is amended by inserting before
the period at the end the following: ``if the health benefits
coverage is at least equivalent to the benefits coverage in a
benchmark benefit package described in subsection (b)''.
(2) Under medicaid.--Section 1937(b)(1)(D) of the Social
Security Act (42 U.S.C. 1396u-7(b)(1)(D)) is amended by
inserting before the period at the end the following: ``if
the health benefits coverage is at least equivalent to the
benefits coverage in benchmark coverage described in
subparagraph (A), (B), or (C)''.
(b) Requirement for Most Popular Family Coverage for State
Employee Coverage Benchmark.--
(1) CHIP.--Section 2103(b)(2) of such Act (42 U.S.C.
1397(b)(2)) is amended by inserting ``and that has been
selected most frequently by employees seeking dependent
coverage, among such plans that provide such dependent
coverage, in either of the previous 2 plan years'' before the
period at the end.
(2) Medicaid.--Section 1937(b)(1)(B) of such Act is amended
by inserting ``and that has been selected most frequently, by
employees seeking dependent coverage, among such plans that
provide such dependent coverage, in either of the previous 2
plan years'' before the period at the end.
(c) Effective Date.--The amendments made by this section
shall apply to health benefits coverage provided on or after
October 1, 2008.
SEC. 123. PREMIUM GRACE PERIOD.
(a) In General.--Section 2103(e)(3) of the Social Security
Act (42 U.S.C. 1397cc(e)(3)) is amended by adding at the end
the following new subparagraph:
``(C) Premium grace period.--The State child health plan--
``(i) shall afford individuals enrolled under the plan a
grace period of at least 30 days from the beginning of a new
coverage period to make premium payments before the
individual's coverage under the plan may be terminated; and
``(ii) shall provide to such an individual, not later than
7 days after the first day of such grace period, notice--
``(I) that failure to make a premium payment within the
grace period will result in termination of coverage under the
State child health plan; and
``(II) of the individual's right to challenge the proposed
termination pursuant to the applicable Federal regulations.
For purposes of clause (i), the term `new coverage period'
means the month immediately following the last month for
which the premium has been paid.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to new coverage periods beginning on or after
January 1, 2009.
Subtitle D--Populations
SEC. 131. OPTIONAL COVERAGE OF OLDER CHILDREN UNDER MEDICAID
AND CHIP.
(a) Medicaid.--
(1) In general.--Section 1902(l)(1)(D) of the Social
Security Act (42 U.S.C. 1396a(l)(1)(D)) is amended by
striking ``but have not attained 19 years of age'' and
inserting ``but is under 19 years of age (or, at the option
of a State and subject to section 131(d) of the Children's
Health and Medicare Protection Act of 2007, under such higher
age, not to exceed 25 years of age, as the State may
elect)''.
(2) Conforming amendments.--
(A) Section 1902(e)(3)(A) of such Act (42 U.S.C.
1396a(e)(3)(A)) is amended by striking ``18 years of age or
younger'' and inserting ``under 19 years of age (or under
such higher age as the State has elected under subsection
(l)(1)(D))'' after ``18 years of age''.
(B) Section 1902(e)(12) of such Act (42 U.S.C.
1396a(e)(12)) is amended by inserting ``or such higher age as
the State has elected under subsection (l)(1)(D)'' after ``19
years of age''.
(C) Section 1905(a) of such Act (42 U.S.C. 1396d(a)) is
amended, in clause (i), by inserting ``or under such higher
age as the State has elected under subsection (l)(1)(D)''
after ``as the State may choose''.
(D) Section 1920A(b)(1) of such Act (42 U.S.C. 1396r-
1a(b)(1)) is amended by inserting ``or under such higher age
as the State has elected under section 1902(l)(1)(D)'' after
``19 years of age''.
(E) Section 1928(h)(1) of such Act (42 U.S.C. 1396s(h)(1))
is amended by striking ``18 years of age or younger'' and
inserting ``under 19 years of age or under such higher age as
the State has elected under section 1902(l)(1)(D)''.
(F) Section 1932(a)(2)(A) of such Act (42 U.S.C. 1396u-
2(a)(2)(A)) is amended by inserting ``(or under such higher
age as the State has elected under section 1902(l)(1)(D))''
after ``19 years of age''.
(b) Title XXI.--Section 2110(c)(1) of such Act (42 U.S.C.
1397jj(c)(1)) is amended by inserting ``(or, at the option of
the State and subject to section 131(d) of the Children's
Health and Medicare Protection Act of 2007, under such higher
age as the State has elected under section 1902(l)(1)(D))''.
(c) Effective Date.--Subject to subsection (d), the
amendments made by this section take effect on January 1,
2010.
(d) Transition.--In carrying out the amendments made by
subsections (a) and (b)--
(1) for 2010, a State election under section 1902(l)(1)(D)
shall only apply with respect to title XXI of such Act and
the age elected may not exceed 21 years of age;
(2) for 2011, a State election under section 1902(l)(1)(D)
may apply under titles XIX and XXI of such Act and the age
elected may not exceed 23 years of age;
(3) for 2012, a State election under section 1902(l)(1)(D)
may apply under titles XIX and XXI of such Act and the age
elected may not exceed 24 years of age; and
(4) for 2013 and each subsequent year, a State election
under section 1902(l)(1)(D) may apply under titles XIX and
XXI of such Act and the age elected may not exceed 25 years
of age.
SEC. 132. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE
MEDICAID PROGRAM AND CHIP.
(a) Medicaid Program.--Section 1903(v) of the Social
Security Act (42 U.S.C. 1396b(v)) is amended--
(1) in paragraph (1), by striking ``paragraph (2)'' and
inserting ``paragraphs (2) and (4)''; and
(2) by adding at the end the following new paragraph:
``(4)(A) A State may elect (in a plan amendment under this
title) to provide medical assistance under this title,
notwithstanding sections 401(a), 402(b), 403, and 421 of the
Personal Responsibility and Work Opportunity Reconciliation
Act of 1996, for aliens who are lawfully residing in the
United States (including battered aliens described in section
431(c) of such Act) and who are otherwise eligible for such
assistance, within either or both of the following
eligibility categories:
``(i) Pregnant women.--Women during pregnancy (and during
the 60-day period beginning on the last day of the
pregnancy).
``(ii) Children.--Individuals under age 19 (or such higher
age as the State has elected under section 1902(l)(1)(D)),
including optional targeted low-income children described in
section 1905(u)(2)(B).
``(B) In the case of a State that has elected to provide
medical assistance to a category of aliens under subparagraph
(A), no debt shall accrue under an affidavit of support
against any sponsor of such an alien on the basis of
provision of medical assistance to such category and the cost
of such assistance shall not be considered as an unreimbursed
cost.''.
(b) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397gg(e)(1)), as amended by section 112(b), 112(d)(2),and
121(a)(2), is amended by redesignating subparagraphs (E)
through (G)
[[Page H9309]]
as subparagraphs (G) through (I), respectively, and by
inserting after subparagraph (D) the following new
subparagraphs:
``(E) Section 1903(v)(4)(A) (relating to optional coverage
of certain categories of lawfully residing immigrants),
insofar as it relates to the category of pregnant women
described in clause (i) of such section, but only if the
State has elected to apply such section with respect to such
women under title XIX and the State has elected the option
under section 2111 to provide assistance for pregnant women
under this title.
``(F) Section 1903(v)(4)(A) (relating to optional coverage
of categories of lawfully residing immigrants), insofar as it
relates to the category of children described in clause (ii)
of such section, but only if the State has elected to apply
such section with respect to such children under title
XIX.''.
(c) Effective Date.--The amendments made by this section
take effect on the date of the enactment of this Act.
SEC. 133. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN
PREGNANT WOMEN UNDER CHIP.
(a) CHIP.--
(1) Coverage.--Title XXI (42 U.S.C. 1397aa et seq.) of the
Social Security Act is amended by adding at the end the
following new section:
``SEC. 2111. OPTIONAL COVERAGE OF TARGETED LOW-INCOME
PREGNANT WOMEN.
``(a) Optional Coverage.--Notwithstanding any other
provision of this title, a State may provide for coverage,
through an amendment to its State child health plan under
section 2102, of assistance for pregnant women for targeted
low-income pregnant women in accordance with this section,
but only if--
``(1) the State has established an income eligibility
level--
``(A) for pregnant women, under any of clauses (i)(III),
(i)(IV), or (ii)(IX) of section 1902(a)(10)(A), that is at
least 185 percent (or such higher percent as the State has in
effect for pregnant women under this title) of the poverty
line applicable to a family of the size involved, but in no
case a percent lower than the percent in effect under any
such clause as of July 1, 2007; and
``(B) for children under 19 years of age under this title
(or title XIX) that is at least 200 percent of the poverty
line applicable to a family of the size involved; and
``(2) the State does not impose, with respect to the
enrollment under the State child health plan of targeted low-
income children during the quarter, any enrollment cap or
other numerical limitation on enrollment, any waiting list,
any procedures designed to delay the consideration of
applications for enrollment, or similar limitation with
respect to enrollment.
``(b) Definitions.--For purposes of this title:
``(1) Assistance for pregnant women.--The term `assistance
for pregnant women' has the meaning given the term child
health assistance in section 2110(a) as if any reference to
targeted low-income children were a reference to targeted
low-income pregnant women.
``(2) Targeted low-income pregnant woman.--The term
`targeted low-income pregnant woman' means a woman--
``(A) during pregnancy and through the end of the month in
which the 60-day period (beginning on the last day of her
pregnancy) ends;
``(B) whose family income exceeds 185 percent (or, if
higher, the percent applied under subsection (a)(1)(A)) of
the poverty level applicable to a family of the size
involved, but does not exceed the income eligibility level
established under the State child health plan under this
title for a targeted low-income child; and
``(C) who satisfies the requirements of paragraphs (1)(A),
(1)(C), (2), and (3) of section 2110(b), applied as if any
reference to a child was a reference to a pregnant woman.
``(c) References to Terms and Special Rules.--In the case
of, and with respect to, a State providing for coverage of
assistance for pregnant women to targeted low-income pregnant
women under subsection (a), the following special rules
apply:
``(1) Any reference in this title (other than in subsection
(b)) to a targeted low-income child is deemed to include a
reference to a targeted low-income pregnant woman.
``(2) Any reference in this title to child health
assistance (other than with respect to the provision of early
and periodic screening, diagnostic, and treatment services)
with respect to such women is deemed a reference to
assistance for pregnant women.
``(3) Any such reference (other than in section 2105(d)) to
a child is deemed a reference to a woman during pregnancy and
the period described in subsection (b)(2)(A).
``(4) In applying section 2102(b)(3)(B), any reference to
children found through screening to be eligible for medical
assistance under the State medicaid plan under title XIX is
deemed a reference to pregnant women.
``(5) There shall be no exclusion of benefits for services
described in subsection (b)(1) based on any preexisting
condition and no waiting period (including any waiting period
imposed to carry out section 2102(b)(3)(C)) shall apply.
``(6) In applying section 2103(e)(3)(B) in the case of a
pregnant woman provided coverage under this section, the
limitation on total annual aggregate cost-sharing shall be
applied to such pregnant woman.
``(7) In applying section 2104(i)--
``(A) in the case of a State which did not provide for
coverage for pregnant women under this title (under a waiver
or otherwise) during fiscal year 2007, the allotment amount
otherwise computed for the first fiscal year in which the
State elects to provide coverage under this section shall be
increased by an amount (determined by the Secretary) equal to
the enhanced FMAP of the expenditures under this title for
such coverage, based upon projected enrollment and per capita
costs of such enrollment; and
``(B) in the case of a State which provided for coverage of
pregnant women under this title for the previous fiscal
year--
``(i) in applying paragraph (2)(B) of such section, there
shall also be taken into account (in an appropriate
proportion) the percentage increase in births in the State
for the relevant period; and
``(ii) in applying paragraph (3), pregnant women (and per
capita expenditures for such women) shall be accounted for
separately from children, but shall be included in the total
amount of any allotment adjustment under such paragraph.
``(d) Automatic Enrollment for Children Born to Women
Receiving Assistance for Pregnant Women.--If a child is born
to a targeted low-income pregnant woman who was receiving
assistance for pregnant women under this section on the date
of the child's birth, the child shall be deemed to have
applied for child health assistance under the State child
health plan and to have been found eligible for such
assistance under such plan or to have applied for medical
assistance under title XIX and to have been found eligible
for such assistance under such title on the date of such
birth, based on the mother's reported income as of the time
of her enrollment under this section and applicable income
eligibility levels under this title and title XIX, and to
remain eligible for such assistance until the child attains 1
year of age. During the period in which a child is deemed
under the preceding sentence to be eligible for child health
or medical assistance, the assistance for pregnant women or
medical assistance eligibility identification number of the
mother shall also serve as the identification number of the
child, and all claims shall be submitted and paid under such
number (unless the State issues a separate identification
number for the child before such period expires).''.
(2) Additional amendment.--Section 2107(e)(1)(H) of such
Act (42 U.S.C. 1397gg(e)(1)(H)), as redesignated by section
133(b), is amended to read as follows:
``(H) Sections 1920 and 1920A (relating to presumptive
eligibility for pregnant women and children).''.
(b) Amendments to Medicaid.--
(1) Eligibility of a newborn.--Section 1902(e)(4) of the
Social Security Act (42 U.S.C. 1396a(e)(4)) is amended in the
first sentence by striking ``so long as the child is a member
of the woman's household and the woman remains (or would
remain if pregnant) eligible for such assistance''.
(2) Application of qualified entities to presumptive
eligibility for pregnant women under medicaid.--Section
1920(b) of the Social Security Act (42 U.S.C. 1396r-1(b)) is
amended by adding after paragraph (2) the following flush
sentence:
``The term `qualified provider' also includes a qualified
entity, as defined in section 1920A(b)(3).''.
SEC. 134. LIMITATION ON WAIVER AUTHORITY TO COVER ADULTS.
Section 2102 of the Social Security Act (42 U.S.C. 1397bb)
is amended by adding at the end the following new subsection:
``(d) Limitation on Coverage of Adults.--Notwithstanding
any other provision of this title, the Secretary may not,
through the exercise of any waiver authority on or after
January 1, 2008, provide for Federal financial participation
to a State under this title for health care services for
individuals who are not targeted low-income children or
pregnant women unless the Secretary determines that no
eligible targeted low-income child in the State would be
denied coverage under this title for health care services
because of such eligibility. In making such determination,
the Secretary must receive assurances that--
``(1) there is no waiting list under this title in the
State for targeted low-income children to receive child
health assistance under this title; and
``(2) the State has in place an outreach program to reach
all targeted low-income children in families with incomes
less than 200 percent of the poverty line.''.
Subtitle E--Access
SEC. 141. CHILDREN'S ACCESS, PAYMENT, AND EQUALITY
COMMISSION.
Title XIX of the Social Security Act is amended by
inserting before section 1901 the following new section:
``CHILDREN'S ACCESS, PAYMENT, AND EQUALITY COMMISSION
``Sec. 1900. (a) Establishment.--There is hereby
established as an agency of Congress the Children's Access,
Payment, and Equality Commission (in this section referred to
as the `Commission').
``(b) Duties.--
``(1) Review of payment policies and annual reports.--The
Commission shall--
``(A) review Federal and State payment policies of the
Medicaid program established under this title (in this
section referred to as `Medicaid') and the State Children's
Health Insurance Program established under title XXI (in this
section referred to as `CHIP'), including topics described in
paragraph (2);
[[Page H9310]]
``(B) review access to, and affordability of, coverage and
services for enrollees under Medicaid and CHIP;
``(C) make recommendations to Congress concerning such
policies;
``(D) by not later than March 1 of each year, submit to
Congress a report containing the results of such reviews and
its recommendations concerning such policies; and
``(E) by not later than June 1 of each year, submit to
Congress a report containing an examination of issues
affecting Medicaid and CHIP, including the implications of
changes in health care delivery in the United States and in
the market for health care services on such programs.
``(2) Specific topics to be reviewed.--Specifically, the
Commission shall review the following:
``(A) The factors affecting expenditures for services in
different sectors (such as physician, hospital and other
sectors), payment methodologies, and their relationship to
access and quality of care for Medicaid and CHIP
beneficiaries.
``(B) The impact of Federal and State Medicaid and CHIP
payment policies on access to services (including dental
services) for children (including children with disabilities)
and other Medicaid and CHIP populations.
``(C) The impact of Federal and State Medicaid and CHIP
policies on reducing health disparities, including geographic
disparities and disparities among minority populations.
``(D) The overall financial stability of the health care
safety net, including Federally-qualified health centers,
rural health centers, school-based clinics, disproportionate
share hospitals, public hospitals, providers and grantees
under section 2612(a)(5) of the Public Health Service Act
(popularly known as the Ryan White CARE Act), and other
providers that have a patient base which includes a
disproportionate number of uninsured or low-income
individuals and the impact of CHIP and Medicaid policies on
such stability.
``(E) The relation (if any) between payment rates for
providers and improvement in care for children as measured
under the children's health quality measurement program
established under section 151 of the Children's Health and
Medicare Protection Act of 2007.
``(F) The affordability, cost effectiveness, and
accessibility of services needed by special populations under
Medicaid and CHIP as compared with private-sector coverage.
``(G) The extent to which the operation of Medicaid and
CHIP ensures access, comparable to access under employer-
sponsored or other private health insurance coverage (or in
the case of federally-qualified health center services (as
defined in section 1905(l)(2)) and rural health clinic
services (as defined in section 1905(l)(1)), access
comparable to the access to such services under title XIX),
for targeted low-income children.
``(H) The effect of demonstrations under section 1115,
benchmark coverage under section 1937, and other coverage
under section 1938, on access to care, affordability of
coverage, provider ability to achieve children's health
quality performance measures, and access to safety net
services.
``(3) Comments on certain secretarial reports.--If the
Secretary submits to Congress (or a committee of Congress) a
report that is required by law and that relates to payment
policies under Medicaid or CHIP, the Secretary shall transmit
a copy of the report to the Commission. The Commission shall
review the report and, not later than 6 months after the date
of submittal of the Secretary's report to Congress, shall
submit to the appropriate committees of Congress written
comments on such report. Such comments may include such
recommendations as the Commission deems appropriate.
``(4) Agenda and additional reviews.--The Commission shall
consult periodically with the Chairmen and Ranking Minority
Members of the appropriate committees of Congress regarding
the Commission's agenda and progress towards achieving the
agenda. The Commission may conduct additional reviews, and
submit additional reports to the appropriate committees of
Congress, from time to time on such topics relating to the
program under this title or title XXI as may be requested by
such Chairmen and Members and as the Commission deems
appropriate.
``(5) Availability of reports.--The Commission shall
transmit to the Secretary a copy of each report submitted
under this subsection and shall make such reports available
to the public.
``(6) Appropriate committee of congress.--For purposes of
this section, the term `appropriate committees of Congress'
means the Committees on Energy and Commerce of the House of
Representatives and the Committee on Finance of the Senate.
``(7) Voting and reporting requirements.--With respect to
each recommendation contained in a report submitted under
paragraph (1), each member of the Commission shall vote on
the recommendation, and the Commission shall include, by
member, the results of that vote in the report containing the
recommendation.
``(8) Examination of budget consequences.--Before making
any recommendations, the Commission shall examine the budget
consequences of such recommendations, directly or through
consultation with appropriate expert entities.
``(c) Application of Provisions.--The following provisions
of section 1805 shall apply to the Commission in the same
manner as they apply to the Medicare Payment Advisory
Commission:
``(1) Subsection (c) (relating to membership), except that
the membership of the Commission shall also include
representatives of children, pregnant women, individuals with
disabilities, seniors, low-income families, and other groups
of CHIP and Medicaid beneficiaries.
``(2) Subsection (d) (relating to staff and consultants).
``(3) Subsection (e) (relating to powers).
``(d) Authorization of Appropriations.--
``(1) Request for appropriations.--The Commission shall
submit requests for appropriations in the same manner as the
Comptroller General submits requests for appropriations, but
amounts appropriated for the Commission shall be separate
from amounts appropriated for the Comptroller General.
``(2) Authorization.--There are authorized to be
appropriated such sums as may be necessary to carry out the
provisions of this section.''.
SEC. 142. MODEL OF INTERSTATE COORDINATED ENROLLMENT AND
COVERAGE PROCESS.
(a) In General.--In order to assure continuity of coverage
of low-income children under the Medicaid program and the
State Children's Health Insurance Program (CHIP), not later
than 18 months after the date of the enactment of this Act,
the Comptroller General of the United States, in consultation
with State Medicaid and CHIP directors and organizations
representing program beneficiaries, shall develop a model
process for the coordination of the enrollment, retention,
and coverage under such programs of children who, because of
migration of families, emergency evacuations, educational
needs, or otherwise, frequently change their State of
residency or otherwise are temporarily located outside of the
State of their residency.
(b) Report to Congress.--After development of such model
process, the Comptroller General shall submit to Congress a
report describing additional steps or authority needed to
make further improvements to coordinate the enrollment,
retention, and coverage under CHIP and Medicaid of children
described in subsection (a).
SEC. 143. MEDICAID CITIZENSHIP DOCUMENTATION REQUIREMENTS.
(a) State Option To Require Children To Present
Satisfactory Documentary Evidence of Proof of Citizenship or
Nationality for Purposes of Eligibility for Medicaid;
Requirement for Auditing.--
(1) In general.--Section 1902 of the Social Security Act
(42 U.S.C. 1396a) is amended--
(A) in subsection (a)(46)--
(i) by inserting ``(A)'' after ``(46)''; and
(B) by adding at the end the following new sbparagraphs:
``(B) at the option of the State, require that, with
respect to a child under 21 years of age (other than an
individual described in section 1903(x)(2)) who declares to
be a citizen or national of the United States for purposes of
establishing initial eligibility for medical assistance under
this title (or, at State option, for purposes of renewing or
redetermining such eligibility to the extent that such
satisfactory documentary evidence of citizenship or
nationality has not yet been presented), there is presented
satisfactory documentary evidence of citizenship or
nationality of the individual (using criteria determined by
the State, which shall be no more restrictive than the
documentation specified in section 1903(x)(3)); and
``(C) comply with the auditing requirements of section
1903(x)(4);''; and
(C) in subsection (b)(3), by inserting ``or any citizenship
documentation requirement for a child under 21 years of age
that is more restrictive than what a State may provide under
section 1903(x)'' before the period at the end.
(2) Auditing requirement.--Section 1903(x) of such Act (as
amended by section 405(c)(1)(A) of division B of the Tax
Relief and Health Care Act of 2006 (Public Law 109-432)) is
amended by adding at the end the following new paragraph:
``(4)(A) Regardless of whether a State has chosen to take
the option specified in section 1902(a)(46)(B), each State
shall audit a statistically-based sample of cases of children
under 21 years of age in order to demonstrate to the
satisfaction of the Secretary that the percentage of Federal
Medicaid funds being spent for non-emergency benefits for
aliens described in subsection (v)(1) who are under 21 years
of age does not exceed 3 percent of total expenditures for
medical assistance under the plan for items and services for
individuals under 21 years of age for the period for which
the sample is taken. In conducting such audits, a State may
rely on case reviews regularly conducted pursuant to their
Medicaid Quality Control or Payment Error Rate Measurement
(PERM) eligibility reviews under subsection (u).
``(B) In conducting audits under subparagraph (A), payments
for non-emergency benefits shall be treated as erroneous if
the audit could not confirm the citizenship of the individual
based either on documentation in the case file or on
documentation obtained independently during the audit.
``(C) If the erroneous error rate described in subparagraph
(A)--
``(i) exceeds 3 percent, the State shall--
``(I) remit to the Secretary the Federal share of improper
expenditures in excess of the 3 percent level described in
such subparagraph;
``(II) shall develop a corrective action plan; and
``(III) shall conduct another audit the following fiscal
year, after the corrective action plan is implemented; or
[[Page H9311]]
``(ii) does not exceed 3 percent, the State is not required
to conduct another audit under subparagraph (A) until the
third fiscal year succeeding the fiscal year for which the
audit was conducted.'';
(3) Elimination of denial of payments for children.--
Section 1903(i)(22) of such Act (42 U.S.C. 1396b(i)(22)) is
amended by inserting ``(other than a child under the age of
21)'' after ``for an individual''.
(b) Clarification of Rules for Children Born in the United
States to Mothers Eligible for Medicaid.--Section 1903(x)(2)
of such Act (42 U.S.C. 1396b(x)(2)) is amended--
(1) in subparagraph (C), by striking ``or'' at the end;
(2) by redesignating subparagraph (D) as subparagraph (E);
and
(3) by inserting after subparagraph (C) the following new
subparagraph:
``(D) pursuant to the application of section 1902(e)(4)
(and, in the case of an individual who is eligible for
medical assistance on such basis, the individual shall be
deemed to have provided satisfactory documentary evidence of
citizenship or nationality and shall not be required to
provide further documentary evidence on any date that occurs
during or after the period in which the individual is
eligible for medical assistance on such basis; or''.
(c) Documentation for Native Americans .--Section
1903(x)(3)(B) of such Act is amended--
(1) by redesignating clause (v) as clause (vi); and
(2) by inserting after clause (iv) the following new
clause:
``(v) For an individual who is a member of, or enrolled in
or affiliated with, a federally-recognized Indian tribe, a
document issued by such tribe evidencing such membership,
enrollment, or affiliation with the tribe (such as a tribal
enrollment card or certificate of degree of Indian blood),
and, only with respect to those federally-recognized Indian
tribes located within States having an international border
whose membership includes individuals who are not citizens of
the United States, such other forms of documentation
(including tribal documentation, if appropriate) as the
Secretary, after consulting with such tribes, determines to
be satisfactory documentary evidence of citizenship or
nationality for purposes of satisfying the requirement of
this subparagraph.''.
(d) Reasonable Opportunity.--Section 1903(x) of such Act,
as amended by subsection (a)(2), is further amended by adding
at the end the following new paragraph:
``(5) In the case of an individual declaring to be a
citizen or national of the United States with respect to whom
a State requires the presentation of satisfactory documentary
evidence of citizenship or nationality under section
1902(a)(46)(B), the individual shall be provided at least the
reasonable opportunity to present satisfactory documentary
evidence of citizenship or nationality under this subsection
as is provided under clauses (i) and (ii) of section
1137(d)(4)(A) to an individual for the submittal to the State
of evidence indicating a satisfactory immigration status and
shall not be denied medical assistance on the basis of
failure to provide such documentation until the individual
has had such an opportunity.''.
(e) Effective Date.--
(1) Retroactive application.--The amendments made by this
section shall take effect as if included in the enactment of
the Deficit Reduction Act of 2005 (Public Law 109-171; 120
Stat. 4).
(2) Restoration of eligibility.--In the case of an
individual who, during the period that began on July 1, 2006,
and ends on the date of the enactment of this Act, was
determined to be ineligible for medical assistance under a
State Medicaid program solely as a result of the application
of subsections (i)(22) and (x) of section 1903 of the Social
Security Act (as in effect during such period), but who would
have been determined eligible for such assistance if such
subsections, as amended by this section, had applied to the
individual, a State may deem the individual to be eligible
for such assistance as of the date that the individual was
determined to be ineligible for such medical assistance on
such basis.
SEC. 144. ACCESS TO DENTAL CARE FOR CHILDREN.
(a) Dental Education for Parents of Newborns.--The
Secretary of Health and Human Services shall develop and
implement, through entities that fund or provide perinatal
care services to targeted low-income children under a State
child health plan under title XXI of the Social Security Act,
a program to deliver oral health educational materials that
inform new parents about risks for, and prevention of, early
childhood caries and the need for a dental visit within their
newborn's first year of life.
(b) Provision of Dental Services Through FQHCs.--
(1) Medicaid.--Section 1902(a) of the Social Security Act
(42 U.S.C. 1396a(a)) is amended--
(A) by striking ``and'' at the end of paragraph (69);
(B) by striking the period at the end of paragraph (70) and
inserting ``; and''; and
(C) by inserting after paragraph (70) the following new
paragraph:
``(71) provide that the State will not prevent a Federally-
qualified health center from entering into contractual
relationships with private practice dental providers in the
provision of Federally-qualified health center services.''.
(2) CHIP.--Section 2107(e)(1) of such Act is amended--
(A) by redesignating subparagraphs (B) through (D) as
subparagraphs (C) through (E); and
(B) by inserting after subparagraph (A) the following new
subparagraph:
``(B) Section 1902(a)(71) (relating to limiting FQHC
contracting for provision of dental services).''.
(3) Effective date.--The amendments made by this subsection
shall take effect on January 1, 2008.
(c) Reporting Information on Dental Health.----
(1) Medicaid.--Section 1902(a)(43)(D)(iii) of such Act (42
U.S.C. 1396a(a)(43)(D)(iii)) is amended by inserting ``and
other information relating to the provision of dental
services to such children described in section 2108(e)''
after ``receiving dental services,''.
(2) CHIP.--Section 2108 of such Act (42 U.S.C. 1397hh) is
amended by adding at the end the following new subsection:
``(e) Information on Dental Care for Children.--
``(1) In general.--Each annual report under subsection (a)
shall include the following information with respect to care
and services described in section 1905(r)(3) provided to
targeted low-income children enrolled in the State child
health plan under this title at any time during the year
involved:
``(A) The number of enrolled children by age grouping used
for reporting purposes under section 1902(a)(43).
``(B) For children within each such age grouping,
information of the type contained in questions 12(a)-(c) of
CMS Form 416 (that consists of the number of enrolled
targeted low income children who receive any, preventive, or
restorative dental care under the State plan).
``(C) For the age grouping that includes children 8 years
of age, the number of such children who have received a
protective sealant on at least one permanent molar tooth.
``(2) Inclusion of information on enrollees in managed care
plans.--The information under paragraph (1) shall include
information on children who are enrolled in managed care
plans and other private health plans and contracts with such
plans under this title shall provide for the reporting of
such information by such plans to the State.''.
(3) Effective date.--The amendments made by this subsection
shall be effective for annual reports submitted for years
beginning after date of enactment.
(d) GAO Study and Report.--
(1) Study.--The Comptroller General of the United States
shall provide for a study that examines--
(A) access to dental services by children in underserved
areas; and
(B) the feasibility and appropriateness of using qualified
mid-level dental health providers, in coordination with
dentists, to improve access for children to oral health
services and public health overall.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Comptroller General shall submit
to Congress a report on the study conducted under paragraph
(1).
SEC. 145. PROHIBITING INITIATION OF NEW HEALTH OPPORTUNITY
ACCOUNT DEMONSTRATION PROGRAMS.
After the date of the enactment of this Act, the Secretary
of Health and Human Services may not approve any new
demonstration programs under section 1938 of the Social
Security Act (42 U.S.C. 1396u-8).
Subtitle F--Quality and Program Integrity
SEC. 151. PEDIATRIC HEALTH QUALITY MEASUREMENT PROGRAM.
(a) Quality Measurement of Children's Health.--
(1) Establishment of program to develop quality measures
for children's health.--The Secretary of Health and Human
Services (in this section referred to as the ``Secretary'')
shall establish a child health care quality measurement
program (in this subsection referred to as the ``children's
health quality measurement program'') to develop and
implement--
(A) pediatric quality measures on children's health care
that may be used by public and private health care purchasers
(and a system for reporting such measures); and
(B) measures of overall program performance that may be
used by public and private health care purchasers.
The Secretary shall publish, not later than September 30,
2009, the recommended measures under the program for
application under the amendments made by subsection (b) for
years beginning with 2010.
(2) Measures.--
(A) Scope.--The measures developed under the children's
health quality measurement program shall--
(i) provide comprehensive information with respect to the
provision and outcomes of health care for young children,
school age children, and older children.
(ii) be designed to identify disparities by pediatric
characteristics (including, at a minimum, those specified in
subparagraph (C)) in child health and the provision of health
care;
(iii) be designed to ensure that the data required for such
measures is collected and reported in a standard format that
permits comparison at a State, plan, and provider level, and
between insured and uninsured children;
[[Page H9312]]
(iv) take into account existing measures of child health
quality and be periodically updated;
(v) include measures of clinical health care quality which
meet the requirements for pediatric quality measures in
paragraph (1);
(vi) improve and augment existing measures of clinical
health care quality for children's health care and develop
new and emerging measures; and
(vii) increase the portfolio of evidence-based pediatric
quality measures available to public and private purchasers,
providers, and consumers.
(B) Specific measures.--Such measures shall include
measures relating to at least the following aspects of health
care for children:
(i) The proportion of insured (and uninsured) children who
receive age-appropriate preventive health and dental care
(including age appropriate immunizations) at each stage of
child health development.
(ii) The proportion of insured (and uninsured) children who
receive dental care for restoration of teeth, relief of pain
and infection, and maintenance of dental health.
(iii) The effectiveness of early health care interventions
for children whose assessments indicate the presence or risk
of physical or mental conditions that could adversely affect
growth and development.
(iv) The effectiveness of treatment to ameliorate the
effects of diagnosed physical and mental health conditions,
including chronic conditions.
(v) The proportion of children under age 21 who are
continuously insured for a period of 12 months or longer.
(vi) The effectiveness of health care for children with
disabilities.
In carrying out clause (vi), the Secretary shall develop
quality measures and best practices relating to cystic
fibrosis.
(C) Reporting methodology for analysis by pediatric
characteristics.--The children's health quality measurement
program shall describe with specificity such measures and the
process by which such measures will be reported in a manner
that permits analysis based on each of the following
pediatric characteristics:
(i) Age.
(ii) Gender.
(iii) Race.
(iv) Ethnicity.
(v) Primary language of the child's parents (or caretaker
relative).
(vi) Disability or chronic condition (including cystic
fibrosis).
(vii) Geographic location.
(viii) Coverage status under public and private health
insurance programs.
(D) Pediatric quality measure.--In this subsection, the
term ``pediatric quality measure'' means a measurement of
clinical care that assesses one or more aspects of pediatric
health care quality (in various settings) including the
structure of the clinical care system, the process and
outcome of care, or patient experience in such care.
(3) Consultation in developing quality measures for
children's health services.--In developing and implementing
the children's health quality measurement program, the
Secretary shall consult with--
(A) States;
(B) pediatric hospitals, pediatricians, and other primary
and specialized pediatric health care professionals
(including members of the allied health professions) who
specialize in the care and treatment of children,
particularly children with special physical, mental, and
developmental health care needs;
(C) dental professionals;
(D) health care providers that furnish primary health care
to children and families who live in urban and rural
medically underserved communities or who are members of
distinct population sub-groups at heightened risk for poor
health outcomes;
(E) national organizations representing children, including
children with disabilities and children with chronic
conditions;
(F) national organizations and individuals with expertise
in pediatric health quality performance measurement; and
(G) voluntary consensus standards setting organizations and
other organizations involved in the advancement of evidence
based measures of health care.
(4) Use of grants and contracts.--In carrying out the
children's health quality measurement program, the Secretary
may award grants and contracts to develop, test, validate,
update, and disseminate quality measures under the program.
(5) Technical assistance.--The Secretary shall provide
technical assistance to States to establish for the reporting
of quality measures under titles XIX and XXI of the Social
Security Act in accordance with the children's health quality
measurement program.
(b) Dissemination of Information on the Quality of Program
Performance.--Not later than January 1, 2009, and annually
thereafter, the Secretary shall collect, analyze, and make
publicly available on a public website of the Department of
Health and Human Services in an online format--
(1) a complete list of all measures in use by States as of
such date and used to measure the quality of medical and
dental health services furnished to children enrolled under
title XIX of XXI of the Social Security Act by participating
providers, managed care entities, and plan issuers; and
(2) information on health care quality for children
contained in external quality review reports required under
section 1932(c)(2) of such Act (42 U.S.C. 1396u-2) or
produced by States that administer separate plans under title
XXI of such Act.
(c) Reports to Congress on Program Performance.--Not later
than January 1, 2010, and every 2 years thereafter, the
Secretary shall report to Congress on--
(1) the quality of health care for children enrolled under
title XIX and XXI of the Social Security Act under the
children's health quality measurement program; and
(2) patterns of health care utilization with respect to the
measures specified in subsection (a)(2)(B) among children by
the pediatric characteristics listed in subsection (a)(2)(C).
SEC. 152. APPLICATION OF CERTAIN MANAGED CARE QUALITY
SAFEGUARDS TO CHIP.
(a) In General.--Section 2103(f) of Social Security Act (42
U.S.C. 1397bb(f)) is amended by adding at the end the
following new paragraph:
``(3) Compliance with managed care requirements.--The State
child health plan shall provide for the application of
subsections (a)(4), (a)(5), (b), (c), (d), and (e) of section
1932 (relating to requirements for managed care) to coverage,
State agencies, enrollment brokers, managed care entities,
and managed care organizations under this title in the same
manner as such subsections apply to coverage and such
entities and organizations under title XIX.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contract years for health plans beginning on
or after July 1, 2008.
SEC. 153. UPDATED FEDERAL EVALUATION OF CHIP.
Section 2108(c) of the Social Security Act (42 U.S.C.
1397hh(c)) is amended by striking paragraph (5) and inserting
the following:
``(5) Subsequent evaluation using updated information.--
``(A) In general.--The Secretary, directly or through
contracts or interagency agreements, shall conduct an
independent subsequent evaluation of 10 States with approved
child health plans.
``(B) Selection of states and matters included.--Paragraphs
(2) and (3) shall apply to such subsequent evaluation in the
same manner as such provisions apply to the evaluation
conducted under paragraph (1).
``(C) Submission to congress.--Not later than December 31,
2010, the Secretary shall submit to Congress the results of
the evaluation conducted under this paragraph.
``(D) Funding.--Out of any money in the Treasury of the
United States not otherwise appropriated, there are
appropriated $10,000,000 for fiscal year 2009 for the purpose
of conducting the evaluation authorized under this paragraph.
Amounts appropriated under this subparagraph shall remain
available for expenditure through fiscal year 2011.''.
SEC. 154. ACCESS TO RECORDS FOR IG AND GAO AUDITS AND
EVALUATIONS.
Section 2108(d) of the Social Security Act (42 U.S.C.
1397hh(d)) is amended to read as follows:
``(d) Access to Records for IG and GAO Audits and
Evaluations.--For the purpose of evaluating and auditing the
program established under this title, the Secretary, the
Office of Inspector General, and the Comptroller General
shall have access to any books, accounts, records,
correspondence, and other documents that are related to the
expenditure of Federal funds under this title and that are in
the possession, custody, or control of States receiving
Federal funds under this title or political subdivisions
thereof, or any grantee or contractor of such States or
political subdivisions.''.
SEC. 155. REFERENCES TO TITLE XXI.
Section 704 of the Medicare, Medicaid, and SCHIP Balanced
Budget Refinement Act of 1999 (Appendix F, 113 Stat. 1501A-
321), as enacted into law by section 1000(a)(6) of Public Law
106-113) is repealed.
SEC. 156. RELIANCE ON LAW; EXCEPTION FOR STATE LEGISLATION.
(a) Reliance on Law.-- With respect to amendments made by
this title or title VIII that become effective as of a date--
(1) such amendments are effective as of such date whether
or not regulations implementing such amendments have been
issued; and
(2) Federal financial participation for medical assistance
or child health assistance furnished under title XIX or XXI,
respectively, of the Social Security Act on or after such
date by a State in good faith reliance on such amendments
before the date of promulgation of final regulations, if any,
to carry out such amendments (or before the date of guidance,
if any, regarding the implementation of such amendments)
shall not be denied on the basis of the State's failure to
comply with such regulations or guidance.
(b) Exception for State Legislation.--In the case of a
State plan under title XIX or State child health plan under
XXI of the Social Security Act, which the Secretary of Health
and Human Services determines requires State legislation in
order for respective plan to meet one or more additional
requirements imposed by amendments made by this title or
title VIII, the respective State plan shall not be regarded
as failing to comply with the requirements of such title
solely on the basis of its failure to meet such an additional
requirement before the first day of the first calendar
quarter beginning after the close of the first regular
session of the State legislature that begins after the date
of enactment of this Act. For purposes of the previous
sentence, in the case of a
[[Page H9313]]
State that has a 2-year legislative session, each year of the
session shall be considered to be a separate regular session
of the State legislature.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improvements in Benefits
SEC. 201. COVERAGE AND WAIVER OF COST-SHARING FOR PREVENTIVE
SERVICES.
(a) Preventive Services Defined; Coverage of Additional
Preventive Services.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x) is amended--
(1) in subsection (s)(2)--
(A) in subparagraph (Z), by striking ``and'' after the
semicolon at the end;
(B) in subparagraph (AA), by adding ``and'' after the
semicolon at the end; and
(C) by adding at the end the following new subparagraph:
``(BB) additional preventive services (described in
subsection (ccc)(1)(M));''; and
(2) by adding at the end the following new subsection:
``Preventive Services
``(ccc)(1) The term `preventive services' means the
following:
``(A) Prostate cancer screening tests (as defined in
subsection (oo)).
``(B) Colorectal cancer screening tests (as defined in
subsection (pp)).
``(C) Diabetes outpatient self-management training services
(as defined in subsection (qq)).
``(D) Screening for glaucoma for certain individuals (as
described in subsection (s)(2)(U)).
``(E) Medical nutrition therapy services for certain
individuals (as described in subsection (s)(2)(V)).
``(F) An initial preventive physical examination (as
defined in subsection (ww)).
``(G) Cardiovascular screening blood tests (as defined in
subsection (xx)(1)).
``(H) Diabetes screening tests (as defined in subsection
described in subsection (s)(2)(Y)).
``(I) Ultrasound screening for abdominal aortic aneurysm
for certain individuals (as described in described in
subsection (s)(2)(AA)).
``(J) Pneumococcal and influenza vaccine and their
administration (as described in subsection (s)(10)(A)).
``(K) Hepatitis B vaccine and its administration for
certain individuals (as described in subsection (s)(10)(B)).
``(L) Screening mammography (as defined in subsection
(jj)).
``(M) Screening pap smear and screening pelvic exam (as
described in subsection (s)(14)).
``(N) Bone mass measurement (as defined in subsection
(rr)).
``(O) Additional preventive services (as determined under
paragraph (2)).
``(2)(A) The term `additional preventive services' means
items and services, including mental health services, not
described in subparagraphs (A) through (N) of paragraph (1)
that the Secretary determines to be reasonable and necessary
for the prevention or early detection of an illness or
disability.
``(B) In making determinations under subparagraph (1), the
Secretary shall--
``(C) take into account evidence-based recommendations by
the United States Preventive Services Task Force and other
appropriate organizations; and
``(D) use the process for making national coverage
determinations (as defined in section 1869(f)(1)(B)) under
this title.''.
(b) Payment and Elimination of Cost-Sharing.--
(1) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)) is amended--
(A) in clause (T), by striking ``80 percent'' and inserting
``100 percent''; and
(B) by striking ``and'' before ``(V)''; and
(C) by inserting before the semicolon at the end the
following: ``, and (W) with respect to additional preventive
services (as defined in section 1861(ccc)(2)) and other
preventive services for which a payment rate is not otherwise
established under this section, the amount paid shall be 100
percent of the lesser of the actual charge for the services
or the amount determined under a fee schedule established by
the Secretary for purposes of this clause''.
(2) Elimination of coinsurance in outpatient hospital
settings.--
(A) Exclusion from opd fee schedule.--Section
1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395l(t)(1)(B)(iv)) is amended by striking ``screening
mammography (as defined in section 1861(jj)) and diagnostic
mammography'' and inserting ``diagnostic mammography and
preventive services (as defined in section 1861(ccc)(1))''.
(B) Conforming amendments.--Section 1833(a)(2) of the
Social Security Act (42 U.S.C. 1395l(a)(2)) is amended--
(i) in subparagraph (F), by striking ``and'' after the
semicolon at the end;
(ii) in subparagraph (G)(ii), by adding ``and''at the end;
and
(iii) by adding at the end the following new subparagraph:
``(H) with respect to additional preventive services (as
defined in section 1861(ccc)(2)) furnished by an outpatient
department of a hospital, the amount determined under
paragraph (1)(W);''.
(3) Waiver of application of deductible for all preventive
services.--The first sentence of section 1833(b) of the
Social Security Act (42 U.S.C. 1395l(b)) is amended --
(A) in clause (1), by striking ``items and services
described in section 1861(s)(10)(A)'' and inserting
``preventive services (as defined in section 1861(ccc)(1))'';
(B) by inserting ``and'' before ``(4)''; and
(C) by striking clauses (5) through (8).
(c) Inclusion as Part of Initial Preventive Physical
Examination.--Section 1861(ww)(2) of the Social Security Act
(42 U.S.C. 1395x(ww)(2)) is amended by adding at the end the
following new subparagraph:
``(M) Additional preventive services (as defined in
subsection (ccc)(2)).''.
(d) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2008.
SEC. 202. WAIVER OF DEDUCTIBLE FOR COLORECTAL CANCER
SCREENING TESTS REGARDLESS OF CODING,
SUBSEQUENT DIAGNOSIS, OR ANCILLARY TISSUE
REMOVAL.
(a) In General.--Section 1833(b)(8) of the Social Security
Act (42 U.S.C. 1395l(b)(8)) is amended by inserting ``,
regardless of the code applied, of the establishment of a
diagnosis as a result of the test, or of the removal of
tissue or other matter or other procedure that is performed
in connection with and as a result of the screening test''
after ``1861(pp)(1))''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 203. PARITY FOR MENTAL HEALTH COINSURANCE.
Section 1833(c) of the Social Security Act (42 U.S.C.
1395l(c)) is amended--
(1) in the first sentence, by striking ``62-1/2 percent''
and inserting ``the incurred expense percentage (as specified
in the last sentence)''; and
(2) by adding at the end the following: ``For purposes of
this subsection, the `incurred expense percentage' is equal
to 62-1/2 percent increased, for each year beginning with
2008, by 6-1/4 percentage points, but not to exceed 100
percent.''.
Subtitle B--Improving, Clarifying, and Simplifying Financial Assistance
for Low Income Medicare Beneficiaries
SEC. 211. IMPROVING ASSETS TESTS FOR MEDICARE SAVINGS PROGRAM
AND LOW-INCOME SUBSIDY PROGRAM.
(a) Application of Highest Level Permitted Under LIS.--
(1) To full-premium subsidy eligible individuals.--Section
1860D-14(a) of the Social Security Act (42 U.S.C. 1395w-
114(a)) is amended--
(A) in paragraph (1), in the matter before subparagraph
(A), by inserting ``(or, beginning with 2009, paragraph
(3)(E))'' after ``paragraph (3)(D)''; and
(B) in paragraph (3)(A)(iii), by striking ``(D) or''.
(2) Annual increase in lis resource test.--Section 1860D-
14(a)(3)(E)(i) of such Act (42 U.S.C. 1395w-114(a)(3)(E)(i))
is amended--
(A) by striking ``and'' at the end of subclause (I);
(B) in subclause (II), by inserting ``(before 2009)'' after
``subsequent year'';
(C) by striking the period at the end of subclause (II) and
inserting a semicolon; and
(D) by inserting after subclause (II) the following new
subclauses:
``(III) for 2009, $17,000 (or $34,000 in the case of the
combined value of the individual's assets or resources and
the assets or resources of the individual's spouse); and
``(IV) for a subsequent year, the dollar amounts specified
in this subclause (or subclause (III)) for the previous year
increased by $1,000 (or $2,000 in the case of the combined
value referred to in subclause (III)).''.
(3) Application of lis test under medicare savings
program.--Section 1905(p)(1)(C) of such Act (42 U.S.C.
1396d(p)(1)(C)) is amended by inserting before the period at
the end the following: ``or, effective beginning with January
1, 2009, whose resources (as so determined) do not exceed the
maximum resource level applied for the year under section
1860D-14(a)(3)(E) applicable to an individual or to the
individual and the individual's spouse (as the case may
be)''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to eligibility determinations for income-related
subsidies and medicare cost-sharing furnished for periods
beginning on or after January 1, 2009.
SEC. 212. MAKING QI PROGRAM PERMANENT AND EXPANDING
ELIGIBILITY.
(a) Making Program Permanent.--
(1) In general.--Section 1902(a)(10)(E)(iv) of the Social
Security Act (42 U.S.C. 1396b(a)(10)(E)(iv)) is amended--
(A) by striking ``sections 1933 and'' and by inserting
``section''; and
(B) by striking ``(but only with'' and all that follows
through ``September 2007)''.
(2) Elimination of funding limitation.--
(A) In general.--Section 1933 of such Act (42 U.S.C. 1396u-
3) is amended--
(i) in subsection (a), by striking ``who are selected to
receive such assistance under subsection (b)''
(ii) by striking subsections (b), (c), (e), and (g);
(iii) in subsection (d), by striking ``furnished in a
State'' and all that follows and inserting ``the Federal
medical assistance percentage shall be equal to 100
percent.''; and
(iv) by redesignating subsections (d) and (f) as
subsections (b) and (c), respectively.
(B) Conforming amendment.--Section 1905(b) of such Act (42
U.S.C. 1396d(b)) is amended by striking ``1933(d)'' and
inserting ``1933(b)''.
[[Page H9314]]
(C) Effective date.--The amendments made by subparagraph
(A) shall take effect on October 1, 2007.
(b) Increase in Eligibility to 150 Percent of the Federal
Poverty Level.--Section 1902(a)(10)(E)(iv) of such Act is
further amended by inserting ``(or, effective January 1,
2008, 150 percent)'' after ``135 percent''.
SEC. 213. ELIMINATING BARRIERS TO ENROLLMENT.
(a) Administrative Verification of Income and Resources
Under the Low-Income Subsidy Program.--Section 1860D-14(a)(3)
of the Social Security Act (42 U.S.C. 1395w-114(a)(3)) is
amended by adding at the end the following new subparagraph:
``(G) Self-certification of income and resources.--For
purposes of applying this section, an individual shall be
permitted to qualify on the basis of self-certification of
income and resources without the need to provide additional
documentation.''.
(b) Automatic Reenrollment Without Need to Reapply Under
Low-Income Subsidy Program.--Section 1860D-14(a)(3) of such
Act (42 U.S.C. 1395w-114(a)(3)), as amended by subsection
(a), is further amended by adding at the end the following
new subparagraph:
``(H) Automatic reenrollment.--For purposes of applying
this section, in the case of an individual who has been
determined to be a subsidy eligible individual (and within a
particular class of such individuals, such as a full-subsidy
eligible individual or a partial subsidy eligible
individual), the individual shall be deemed to continue to be
so determined without the need for any annual or periodic
application unless and until the individual notifies a
Federal or State official responsible for such determinations
that the individual's eligibility conditions have changed so
that the individual is no longer a subsidy eligible
individual (or is no longer within such class of such
individuals).''.
(c) Encouraging Application of Procedures Under Medicare
Savings Program.--Section 1905(p) of such Act (42 U.S.C.
1396d(p)) is amended by adding at the end the following new
paragraph:
``(7) The Secretary shall take all reasonable steps to
encourage States to provide for administrative verification
of income and automatic reenrollment (as provided under
clauses (iii) and (iv) of section 1860D-14(a)(3)(C) in the
case of the low-income subsidy program).''.
(d) SSA Assistance With Medicare Savings Program and Low-
Income Subsidy Program Applications.--Section 1144 of such
Act (42 U.S.C. 1320b-14) is amended by adding at the end the
following new subsection:
``(c) Assistance With Medicare Savings Program and Low-
Income Subsidy Program Applications.--
``(1) Distribution of applications to applicants for
medicare.--In the case of each individual applying for
hospital insurance benefits under section 226 or 226A, the
Commissioner shall provide the following:
``(A) Information describing the low-income subsidy program
under section 1860D-14 and the medicare savings program under
title XIX.
``(B) An application for enrollment under such low-income
subsidy program as well as an application form (developed
under section 1905(p)(5)) for medical assistance for medicare
cost-sharing under title XIX.
``(C) Information on how the individual may obtain
assistance in completing such applications, including
information on how the individual may contact the State
health insurance assistance program (SHIP) for the State in
which the individual is located.
The Commissioner shall make such application forms available
at local offices of the Social Security Administration.
``(2) Training personnel in assisting in completing
applications.--The Commissioner shall provide training to
those employees of the Social Security Administration who are
involved in receiving applications for benefits described in
paragraph (1) in assisting applicants in completing a
medicare savings program application described in paragraph
(1). Such employees who are so trained shall provide such
assistance upon request.
``(3) Transmittal of completed application.--If such an
employee assists in completing such an application, the
employee, with the consent of the applicant, shall transmit
the completed application to the appropriate State medicaid
agency for processing.
``(4) Coordination with outreach.--The Commissioner shall
coordinate outreach activities under this subsection with
outreach activities conducted by States in connection with
the low-income subsidy program and the medicare savings
program.''.
(e) Medicaid Agency Consideration of Applications.--Section
1935(a) of such Act (42 U.S.C. 1396u-5(a)) is amended by
adding at the end the following new paragraph:
``(4) Consideration of msp applications.--The State shall
accept medicare savings program applications transmitted
under section 1144(c)(3) and act on such applications in the
same manner and deadlines as if they had been submitted
directly by the applicant.''.
(f) Translation of Model Form.--Section 1905(p)(5)(A) of
the Social Security Act (42 U.S.C. 1396d(p)(5)(A)) is amended
by adding at the end the following: ``The Secretary shall
provide for the translation of such application form into at
least the 10 languages (other than English) that are most
often used by individuals applying for hospital insurance
benefits under section 226 or 226A and shall make the
translated forms available to the States and to the
Commissioner of Social Security.''.
(g) Disclosure of Tax Return Information for Purposes of
Providing Low-Income Subsidies Under Medicare.--
(1) In general.--Subsection (l) of section 6103 of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new paragraph:
``(21) Disclosure of return information for purposes of
providing low-income subsidies under medicare.--
``(A) Return information from internal revenue service to
social security administration.--The Secretary, upon written
request from the Commissioner of Social Security, shall
disclose to the officers and employees of the Social Security
Administration with respect to any individual identified by
the Commissioner as potentially eligible (based on
information other than return information) for low-income
subsidies under section 1860D-14 of the Social Security Act--
``(i) whether the adjusted gross income for the applicable
year is less than 135 percent of the poverty line (as
specified by the Commissioner in such request),
``(ii) whether such adjusted gross income is between 135
percent and 150 percent of the poverty line (as so
specified),
``(iii) whether any designated distributions (as defined in
section 3405(e)(1)) were reported with respect to such
individual under section 6047(d) for the applicable year, and
the amount (if any) of the distributions so reported,
``(iv) whether the return was a joint return for the
applicable year, and
``(v) the applicable year.
``(B) Applicable year.--
``(i) In general.--For the purposes of this paragraph, the
term `applicable year' means the most recent taxable year for
which information is available in the Internal Revenue
Service's taxpayer data information systems, or, if there is
no return filed for the individual for such year, the prior
taxable year.
``(ii) No return.--If no return is filed for such
individual for both taxable years referred to in clause (i),
the Secretary shall disclose the fact that there is no return
filed for such individual for the applicable year in lieu of
the information described in subparagraph (A).
``(C) Restriction on use of disclosed information.--Return
information disclosed under this paragraph may be used only
for the purpose of improving the efforts of the Social
Security Administration to contact and assist eligible
individuals for, and administering, low-income subsidies
under section 1860D-14 of the Social Security Act.
``(D) Termination.--No disclosure shall be made under this
paragraph after the 2-year period beginning on the date of
the enactment of this paragraph.''.
(2) Procedures and recordkeeping related to disclosures.--
Paragraph (4) of section 6103(p) of such Code is amended by
striking ``or (17)'' each place it appears and inserting
``(17), or (21)''.
(3) Report.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of the Treasury, after
consultation with the Commissioner of Social Security, shall
submit a written report to Congress regarding the use of
disclosures made under section 6103(l)(21) of the Internal
Revenue Code of 1986, as added by this subsection, in
identifying individuals eligible for the low-income subsidies
under section 1860D-14 of the Social Security Act.
(4) Effective date.--The amendment made by this subsection
shall apply to disclosures made after the date of the
enactment of this Act.
(h) Effective Date.--Except as otherwise provided, the
amendments made by this section shall take effect on January
1, 2009.
SEC. 214. ELIMINATING APPLICATION OF ESTATE RECOVERY.
(a) In General.--Section 1917(b)(1)(B)(ii) of the Social
Security Act (42 U.S.C. 1396p(b)(1)(B)(ii)) is amended by
inserting ``(but not including medical assistance for
medicare cost-sharing or for benefits described in section
1902(a)(10)(E))'' before the period at the end.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect as of January 1, 2008.
SEC. 215. ELIMINATION OF PART D COST-SHARING FOR CERTAIN NON-
INSTITUTIONALIZED FULL-BENEFIT DUAL ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 1860D-14(a)(1)(D)(i) of the Social
Security Act (42 U.S.C. 1395w-114(a)(1)(D)(i)) is amended--
(1) in the heading, by striking ``Institutionalized
individuals.--In'' and inserting ``Elimination of cost-
sharing for certain full-benefit dual eligible individuals.--
``(I) Institutionalized individuals.--In''; and
(2) by adding at the end the following new subclause:
``(II) Certain other individuals.--In the case of an
individual who is a full-benefit dual eligible individual and
with respect to whom there has been a determination that but
for the provision of home and community based care (whether
under section 1915 or under a waiver under section 1115) the
individual would require the level of care provided in a
hospital or a nursing facility or intermediate care facility
for the mentally retarded the cost of which could be
reimbursed under the State plan under title XIX, the
elimination of any beneficiary coinsurance described in
section 1860D-2(b)(2) (for all
[[Page H9315]]
amounts through the total amount of expenditures at which
benefits are available under section 1860D-2(b)(4)).''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to drugs dispensed on or after January 1, 2009.
SEC. 216. EXEMPTIONS FROM INCOME AND RESOURCES FOR
DETERMINATION OF ELIGIBILITY FOR LOW-INCOME
SUBSIDY.
(a) In General.--Section 1860D-14(a)(3) of the Social
Security Act (42 U.S.C. 1395w-114(a)(3)), as amended by
subsections (a) and (b) of section 213, is further amended--
(1) in subparagraph (C)(i), by inserting ``and except that
support and maintenance furnished in kind shall not be
counted as income'' after ``section 1902(r)(2)'';
(2) in subparagraph (D), in the matter before clause (i),
by inserting ``subject to the additional exclusions provided
under subparagraph (G)'' before ``)'';
(3) in subparagraph (E)(i), in the matter before subclause
(I), by inserting ``subject to the additional exclusions
provided under subparagraph (G)'' before ``)''; and
(4) by adding at the end the following new subparagraph:
``(I) Additional exclusions.--In determining the resources
of an individual (and the eligible spouse of the individual,
if any) under section 1613 for purposes of subparagraphs (D)
and (E) the following additional exclusions shall apply:
``(i) Life insurance policy.--No part of the value of any
life insurance policy shall be taken into account.
``(ii) Pension or retirement plan.--No balance in any
pension or retirement plan shall be taken into account.''.
(b) Effective Date.--The amendments made by this section
shall take effect on January 1, 2009, and shall apply to
determinations of eligibility for months beginning with
January 2009.
SEC. 217. COST-SHARING PROTECTIONS FOR LOW-INCOME SUBSIDY-
ELIGIBLE INDIVIDUALS.
(a) In General.--Section 1860D-14(a) of the Social Security
Act (42 U.S.C. 1395w-114(a)) is amended--
(1) in paragraph (1)(D), by adding at the end the following
new clause:
``(iv) Overall limitation on cost-sharing.--In the case of
all such individuals, a limitation on aggregate cost-sharing
under this part for a year not to exceed 2.5 percent of
income.''; and
(2) in paragraph (2), by adding at the end the following
new subparagraph:
``(F) Overall limitation on cost-sharing.--A limitation on
aggregate cost-sharing under this part for a year not to
exceed 2.5 percent of income.''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply as of January 1, 2009.
SEC. 218. INTELLIGENT ASSIGNMENT IN ENROLLMENT.
(a) In General.--Section 1860D-1(b)(1) of the Social
Security Act (42 U.S.C. 1395w-101(b)(1) is amended--
(1) in the second sentence of subparagraph (C), by
inserting ``, subject to subparagraph (D),'' before ``on a
random basis''; and
(2) by adding at the end the following new subparagraph:''.
``(D) Intelligent assignment.--In the case of any auto-
enrollment under subparagraph (C), no part D eligible
individual described in such subparagraph shall be enrolled
in a prescription drug plan which does not meet the following
requirements:
``(i) Formulary.--The plan has a formulary that covers at
least--
``(I) 95 percent of the 100 most commonly prescribed non-
duplicative generic covered part D drugs for the population
of individuals entitled to benefits under part A or enrolled
under part B; and
``(II) 95 percent of the 100 most commonly prescribed non-
duplicative brand name covered part D drugs for such
population.
``(ii) Pharmacy network.--The plan has a network of
pharmacies that substantially exceeds the minimum
requirements for prescription drug plans in the State and
that provides access in areas where lower income individuals
reside.
``(iii) Quality.--
``(I) In general.--Subject to subclause (I), the plan has
an above average score on quality ratings of the Secretary of
prescription drug plans under this part.
``(II) Exception.--Subclause (I) shall not apply to a plan
that is a new plan (as defined by the Secretary), with
respect to the plan year involved.
``(iv) Low cost.--The total cost under this title of
providing prescription drug coverage under the plan
consistent with the previous clauses of this subparagraph is
among the lowest 25th percentile of prescription drug plans
under this part in the State.
In the case that no plan meets the requirements under clauses
(i) through (iv), the Secretary shall implement this
subparagraph to the greatest extent possible with the goal of
protecting beneficiary access to drugs without increasing the
cost relative to the enrollment process under subparagraph
(C) as in existence before the date of the enactment of this
subparagraph.''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect for enrollments effected on or after
November 15, 2009.
Subtitle C--Part D Beneficiary Improvements
SEC. 221. INCLUDING COSTS INCURRED BY AIDS DRUG ASSISTANCE
PROGRAMS AND INDIAN HEALTH SERVICE IN PROVIDING
PRESCRIPTION DRUGS TOWARD THE ANNUAL OUT OF
POCKET THRESHOLD UNDER PART D.
(a) In General.--Section 1860D-2(b)(4)(C) of the Social
Security Act (42 U.S.C. 1395w-102(b)(4)(C)) is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii)--
(A) by striking ``such costs shall be treated as incurred
only if'' and inserting ``subject to clause (iii), such costs
shall be treated as incurred only if'';
(B) by striking ``, under section 1860D-14, or under a
State Pharmaceutical Assistance Program''; and
(C) by striking the period at the end and inserting ``;
and''; and
(3) by inserting after clause (ii) the following new
clause:
``(iii) such costs shall be treated as incurred and shall
not be considered to be reimbursed under clause (ii) if such
costs are borne or paid--
``(I) under section 1860D-14;
``(II) under a State Pharmaceutical Assistance Program;
``(III) by the Indian Health Service, an Indian tribe or
tribal organization, or an urban Indian organization (as
defined in section 4 of the Indian Health Care Improvement
Act); or
``(IV) under an AIDS Drug Assistance Program under part B
of title XXVI of the Public Health Service Act.''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to costs incurred on or after January 1, 2009.
SEC. 222. PERMITTING MID-YEAR CHANGES IN ENROLLMENT FOR
FORMULARY CHANGES ADVERSELY IMPACT AN ENROLLEE.
(a) In General.--Section 1860D-1(b)(3) of the Social
Security Act (42 U.S.C. 1395w-101(b)(3)) is amended by adding
at the end the following new subparagraph:
``(F) Change in formulary resulting in increase in cost-
sharing.--
``(i) In general.--Except as provided in clause (ii), in
the case of an individual enrolled in a prescription drug
plan (or MA-PD plan) who has been prescribed a covered part D
drug while so enrolled, if the formulary of the plan is
materially changed (other than at the end of a contract year)
so to reduce the coverage (or increase the cost-sharing) of
the drug under the plan.
``(ii) Exception.--Clause (i) shall not apply in the case
that a drug is removed from the formulary of a plan because
of a recall or withdrawal of the drug issued by the Food and
Drug Administration.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contract years beginning on or after January
1, 2009.
SEC. 223. REMOVAL OF EXCLUSION OF BENZODIAZEPINES FROM
REQUIRED COVERAGE UNDER THE MEDICARE
PRESCRIPTION DRUG PROGRAM.
(a) In General.--Section 1860D-2(e)(2)(A) of the Social
Security Act (42 U.S.C. 1395w-102(e)(2)(A)) is amended--
(1) by striking ``subparagraph (E)'' and inserting
``subparagraphs (E) and (J)''; and
(2) by inserting ``and benzodiazepines, respectively''
after ``smoking cessation agents''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to prescriptions dispensed on or after January 1,
2009.
SEC. 224. PERMITTING UPDATING DRUG COMPENDIA UNDER PART D
USING PART B UPDATE PROCESS.
Section 1860D-4(b)(3)(C) of the Social Security Act (42
U.S.C. 1395w-104(b)(3)(C)) is amended by adding at the end
the following new clause:
``(iv) Updating drug compendia using part b process.--The
Secretary may apply under this subparagraph the same process
for updating drug compendia that is used for purposes of
section 1861(t)(2)(B)(ii).''.
SEC. 225. CODIFICATION OF SPECIAL PROTECTIONS FOR SIX
PROTECTED DRUG CLASSIFICATIONS.
(a) In General.--Section 1860D-4(b)(3) of the Social
Security Act (42 U.S.C. 1395w-104(b)(3)) is amended--
(1) in subparagraph (C)(i), by inserting ``, except as
provided in subparagraph (G),'' after ``although''; and
(2) by inserting after subparagraph (F) the following new
subparagraph:
``(G) Required inclusion of drugs in certain therapeutic
classes.--
``(i) In general.--The formulary must include all or
substantially all covered part D drugs in each of the
following therapeutic classes of covered part D drugs:
``(I) Anticonvulsants.
``(II) Antineoplastics.
``(III) Antiretrovirals.
``(IV) Antidepressants.
``(V) Antipsychotics.
``(VI) Immunosuppresessants.
``(ii) Use of utilization management tools.--A PDP sponsor
of a prescription drug plan may use prior authorization or
step therapy for the initiation of medications within one of
the classifications specified in clause (i) but only when
approved by the Secretary, except that such prior
authorization or step therapy may not be used in the case of
antiretrovirals and in the case of individuals who already
are stabilized on a drug treatment regimen.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply for plan years beginning on or after January 1,
2009.
[[Page H9316]]
SEC. 226. ELIMINATION OF MEDICARE PART D LATE ENROLLMENT
PENALTIES PAID BY LOW-INCOME SUBSIDY-ELIGIBLE
INDIVIDUALS.
(a) Individuals With Income Below 135 Percent of Poverty
Line.--Paragraph (1)(A)(ii) of section 1860D-14(a) of the
Social Security Act (42 U.S.C. 1395w-114(a)) is amended to
read as follows:
``(ii) 100 percent of any late enrollment penalties imposed
under section 1860D-13(b) for such individual.''.
(b) Individuals With Income Between 135 and 150 Percent of
Poverty Line.--Paragraph (2)(A) of such section is amended--
(1) by inserting ``equal to (i) an amount'' after ``premium
subsidy'';
(2) by striking ``paragraph (1)(A)'' and inserting ``clause
(i) of paragraph (1)(A)''; and
(3) by adding at the end before the period the following:
``, plus (ii) 100 percent of the amount described in clause
(ii) of such paragraph for such individual''.
(c) Effective Date.--The amendments made by this section
shall apply to subsidies for months beginning with January
2008.
SEC. 227. SPECIAL ENROLLMENT PERIOD FOR SUBSIDY ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 1860D-1(b)(3) of the Social
Security Act (42 U.S.C. 1395w-101(b)(3)), as amended by
section 222(a), is further amended by adding at the end the
following new subparagraph:
``(G) Eligibility for low-income subsidy.--
``(i) In general.--In the case of an applicable subsidy
eligible individual (as defined in clause (ii)), the special
enrollment period described in clause (iii).
``(ii) Applicable subsidy eligible individual defined.--For
purposes of this subparagraph, the term `applicable subsidy
eligible individual' means a part D eligible individual who
is determined under subparagraph (B) of section 1860D-
14(a)(3) to be a subsidy eligible individual (as defined in
subparagraph (A) of such section), and includes such an
individual who was enrolled in a prescription drug plan or an
MA-PD plan on the date of such determination.
``(iii) Special enrollment period described.--The special
enrollment period described in this clause, with respect to
an applicable subsidy eligible individual, is the 90-day
period beginning on the date the individual receives
notification that such individual has been determined under
section 1860D-14(a)(3)(B) to be a subsidy eligible individual
(as so defined).''.
(b) Automatic Enrollment Process for Certain Subsidy
Eligible Individuals.--Section 1860D-1(b)(1) of the Social
Security Act (42 U.S.C. 1395w-101(b)(1)), as amended by
section 218(a)(2), is further amended by adding at the end
the following new subparagraph:
``(E) Special rule for subsidy eligible individuals.--The
process established under subparagraph (A) shall include, in
the case of an applicable subsidy eligible individual (as
defined in clause (ii) of paragraph (3)(F)) who fails to
enroll in a prescription drug plan or an MA-PD plan during
the special enrollment period described in clause (iii) of
such paragraph applicable to such individual, a process for
the facilitated enrollment of the individual in the
prescription drug plan or MA-PD plan that is most appropriate
for such individual (as determined by the Secretary). Nothing
in the previous sentence shall prevent an individual
described in such sentence from declining enrollment in a
plan determined appropriate by the Secretary (or in the
program under this part) or from changing such enrollment.''.
(c) Effective Date.--The amendments made by this section
shall apply to subsidy determinations made for months
beginning with January 2008.
Subtitle D--Reducing Health Disparities
SEC. 231. MEDICARE DATA ON RACE, ETHNICITY, AND PRIMARY
LANGUAGE.
(a) Requirements.--
(1) In general.--The Secretary of Health and Human Services
(in this subtitle referred to as the ``Secretary'') shall--
(A) collect data on the race, ethnicity, and primary
language of each applicant for and recipient of benefits
under title XVIII of the Social Security Act--
(i) using, at a minimum, the categories for race and
ethnicity described in the 1997 Office of Management and
Budget Standards for Maintaining, Collecting, and Presenting
Federal Data on Race and Ethnicity;
(ii) using the standards developed under subsection (e) for
the collection of language data;
(iii) where practicable, collecting data for additional
population groups if such groups can be aggregated into the
minimum race and ethnicity categories; and
(iv) where practicable, through self-reporting;
(B) with respect to the collection of the data described in
subparagraph (A) for applicants and recipients who are minors
or otherwise legally incapacitated, require that--
(i) such data be collected from the parent or legal
guardian of such an applicant or recipient; and
(ii) the preferred language of the parent or legal guardian
of such an applicant or recipient be collected;
(C) systematically analyze at least annually such data
using the smallest appropriate units of analysis feasible to
detect racial and ethnic disparities in health and health
care and when appropriate, for men and women separately;
(D) report the results of analysis annually to the Director
of the Office for Civil Rights, the Committee on Health,
Education, Labor, and Pensions and the Committee on Finance
of the Senate, and the Committee on Energy and Commerce and
the Committee on Ways and Means of the House of
Representatives; and
(E) ensure that the provision of assistance to an applicant
or recipient of assistance is not denied or otherwise
adversely affected because of the failure of the applicant or
recipient to provide race, ethnicity, and primary language
data.
(2) Rules of construction.--Nothing in this subsection
shall be construed--
(A) to permit the use of information collected under this
subsection in a manner that would adversely affect any
individual providing any such information; and
(B) to require health care providers to collect data.
(b) Protection of Data.--The Secretary shall ensure
(through the promulgation of regulations or otherwise) that
all data collected pursuant to subsection (a) is protected--
(1) under the same privacy protections as the Secretary
applies to other health data under the regulations
promulgated under section 264(c) of the Health Insurance
Portability and Accountability Act of 1996 (Public Law 104-
191; 110 Stat. 2033) relating to the privacy of individually
identifiable health information and other protections; and
(2) from all inappropriate internal use by any entity that
collects, stores, or receives the data, including use of such
data in determinations of eligibility (or continued
eligibility) in health plans, and from other inappropriate
uses, as defined by the Secretary.
(c) Collection Plan.--In carrying out the duties specified
in subsection (a), the Secretary shall develop and implement
a plan to improve the collection, analysis, and reporting of
racial, ethnic, and primary language data within the programs
administered under title XVIII of the Social Security Act,
and, in consultation with the National Committee on Vital
Health Statistics, the Office of Minority Health, and other
appropriate public and private entities, shall make
recommendations on how to--
(1) implement subsection (a) while minimizing the cost and
administrative burdens of data collection and reporting;
(2) expand awareness that data collection, analysis, and
reporting by race, ethnicity, and primary language is legal
and necessary to assure equity and non-discrimination in the
quality of health care services;
(3) ensure that future patient record systems have data
code sets for racial, ethnic, and primary language
identifiers and that such identifiers can be retrieved from
clinical records, including records transmitted
electronically;
(4) improve health and health care data collection and
analysis for more population groups if such groups can be
aggregated into the minimum race and ethnicity categories;
(5) provide researchers with greater access to racial,
ethnic, and primary language data, subject to privacy and
confidentiality regulations; and
(6) safeguard and prevent the misuse of data collected
under subsection (a).
(d) Compliance With Standards.--Data collected under
subsection (a) shall be obtained, maintained, and presented
(including for reporting purposes and at a minimum) in
accordance with the 1997 Office of Management and Budget
Standards for Maintaining, Collecting, and Presenting Federal
Data on Race and Ethnicity.
(e) Language Collection Standards.--Not later than 1 year
after the date of enactment of this Act, the Director of the
Office of Minority Health, in consultation with the Office
for Civil Rights of the Department of Health and Human
Services, shall develop and disseminate Standards for the
Classification of Federal Data on Preferred Written and
Spoken Language.
(f) Technical Assistance for the Collection and Reporting
of Data.--
(1) In general.--The Secretary may, either directly or
through grant or contract, provide technical assistance to
enable a health care provider or plan operating under the
Medicare program to comply with the requirements of this
section.
(2) Types of assistance.--Assistance provided under this
subsection may include assistance to--
(A) enhance or upgrade computer technology that will
facilitate racial, ethnic, and primary language data
collection and analysis;
(B) improve methods for health data collection and analysis
including additional population groups beyond the Office of
Management and Budget categories if such groups can be
aggregated into the minimum race and ethnicity categories;
(C) develop mechanisms for submitting collected data
subject to existing privacy and confidentiality regulations;
and
(D) develop educational programs to raise awareness that
data collection and reporting by race, ethnicity, and
preferred language are legal and essential for eliminating
health and health care disparities.
(g) Analysis of Racial and Ethnic Data.--The Secretary,
acting through the Director of the Agency for Health Care
Research and Quality and in coordination with the
Administrator of the Centers for Medicare & Medicaid
Services, shall--
(1) identify appropriate quality assurance mechanisms to
monitor for health disparities under the Medicare program;
(2) specify the clinical, diagnostic, or therapeutic
measures which should be monitored;
[[Page H9317]]
(3) develop new quality measures relating to racial and
ethnic disparities in health and health care;
(4) identify the level at which data analysis should be
conducted; and
(5) share data with external organizations for research and
quality improvement purposes, in compliance with applicable
Federal privacy laws.
(h) Report.--Not later than 2 years after the date of
enactment of this Act, and biennially thereafter, the
Secretary shall submit to the appropriate committees of
Congress a report on the effectiveness of data collection,
analysis, and reporting on race, ethnicity, and primary
language under the programs administered through title XVIII
of the Social Security Act. The report shall evaluate the
progress made with respect to the plan under subsection (c)
or subsequent revisions thereto.
(i) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section, such sums as
may be necessary for each of fiscal years 2008 through 2012.
SEC. 232. ENSURING EFFECTIVE COMMUNICATION IN MEDICARE.
(a) Ensuring Effective Communication by the Centers for
Medicare & Medicaid Services.--
(1) Study on medicare payments for language services.--The
Secretary of Health and Human Services shall conduct a study
that examines ways that Medicare should develop payment
systems for language services using the results of the
demonstration program conducted under section 233.
(2) Analyses.-- The study shall include an analysis of each
of the following:
(A) How to develop and structure appropriate payment
systems for language services for all Medicare service
providers.
(B) The feasibility of adopting a payment methodology for
on-site interpreters, including interpreters who work as
independent contractors and interpreters who work for
agencies that provide on-site interpretation, pursuant to
which such interpreters could directly bill Medicare for
services provided in support of physician office services for
an LEP Medicare patient.
(C) The feasibility of Medicare contracting directly with
agencies that provide off-site interpretation including
telephonic and video interpretation pursuant to which such
contractors could directly bill Medicare for the services
provided in support of physician office services for an LEP
Medicare patient.
(D) The feasibility of modifying the existing Medicare
resource-based relative value scale (RBRVS) by using
adjustments (such as multipliers or add-ons) when a patient
is LEP.
(E) How each of options described in a previous paragraph
would be funded and how such funding would affect physician
payments, a physician's practice, and beneficiary cost-
sharing.
(3) Variation in payment system described.--The payment
systems described in subsection (b) may allow variations
based upon types of service providers, available delivery
methods, and costs for providing language services including
such factors as--
(A) the type of language services provided (such as
provision of health care or health care related services
directly in a non-English language by a bilingual provider or
use of an interpreter);
(B) type of interpretation services provided (such as in-
person, telephonic, video interpretation);
(C) the methods and costs of providing language services
(including the costs of providing language services with
internal staff or through contract with external independent
contractors and/or agencies);
(D) providing services for languages not frequently
encountered in the United States; and
(E) providing services in rural areas.
(4) Report.--The Secretary shall submit a report on the
study conducted under subsection (a) to appropriate
committees of Congress not later than 1 year after the
expiration of the demonstration program conducted under
section 3.
(b) Health Plans.--Section 1857(g)(1) of the Social
Security Act (42 U.S.C. 1395w-27(g)(1)) is amended--
(1) by striking ``or'' at the end of subparagraph (F);
(2) by adding ``and'' at the end of subparagraph (G); and
(3) by inserting after subparagraph (G) the following new
subparagraph:
``(H) fails substantially to provide language services to
limited English proficient beneficiaries enrolled in the plan
that are required under law;''.
SEC. 233. DEMONSTRATION TO PROMOTE ACCESS FOR MEDICARE
BENEFICIARIES WITH LIMITED ENGLISH PROFICIENCY
BY PROVIDING REIMBURSEMENT FOR CULTURALLY AND
LINGUISTICALLY APPROPRIATE SERVICES.
(a) In General.--Within one year after the date of the
enactment of this Act the Secretary, acting through the
Centers for Medicare & Medicaid Services, shall award 24 3-
year demonstration grants to eligible Medicare service
providers to improve effective communication between such
providers and Medicare beneficiaries who are limited English
proficient. The Secretary shall not authorize a grant larger
than $500,000 over three years for any grantee.
(b) Eligibility; Priority.--
(1) Eligibility.--To be eligible to receive a grant under
subsection (1) an entity shall--
(A) be--
(i) a provider of services under part A of title XVIII of
the Social Security Act;
(ii) a service provider under part B of such title;
(iii) a part C organization offering a Medicare part C plan
under part C of such title; or
(iv) a PDP sponsor of a prescription drug plan under part D
of such title; and
(B) prepare and submit to the Secretary an application, at
such time, in such manner, and accompanied by such additional
information as the Secretary may require.
(2) Priority.--
(A) Distribution.--To the extent feasible, in awarding
grants under this section, the Secretary shall award--
(i) 6 grants to providers of services described in
paragraph (1)(A)(i);
(ii) 6 grants to service providers described in paragraph
(1)(A)(ii);
(iii) 6 grants to organizations described in paragraph
(1)(A)(iii); and
(iv) 6 grants to sponsors described in paragraph
(1)(A)(iv).
(B) For community organizations.--The Secretary shall give
priority to applicants that have developed partnerships with
community organizations or with agencies with experience in
language access.
(C) Variation in grantees.--The Secretary shall also ensure
that the grantees under this section represent, among other
factors, variations in--
(i) different types of service providers and organizations
under parts A through D of title XVIII of the Social Security
Act;
(ii) languages needed and their frequency of use;
(iii) urban and rural settings;
(iv) at least two geographic regions; and
(v) at least two large metropolitan statistical areas with
diverse populations.
(c) Use of Funds.--
(1) In general.--A grantee shall use grant funds received
under this section to pay for the provision of competent
language services to Medicare beneficiaries who are limited
English proficient. Competent interpreter services may be
provided through on-site interpretation, telephonic
interpretation, or video interpretation or direct provision
of health care or health care related services by a bilingual
health care provider. A grantee may use bilingual providers,
staff, or contract interpreters. A grantee may use grant
funds to pay for competent translation services. A grantee
may use up to 10 percent of the grant funds to pay for
administrative costs associated with the provision of
competent language services and for reporting required under
subsection (E).
(2) Organizations.--Grantees that are part C organizations
or PDP sponsors must ensure that their network providers
receive at least 50 percent of the grant funds to pay for the
provision of competent language services to Medicare
beneficiaries who are limited English proficient, including
physicians and pharmacies.
(3) Determination of payments for language services.--
Payments to grantees shall be calculated based on the
estimated numbers of LEP Medicare beneficiaries in a
grantee's service area utilizing--
(A) data on the numbers of limited English proficient
individuals who speak English less than ``very well'' from
the most recently available data from the Bureau of the
Census or other State-based study the Secretary determines
likely to yield accurate data regarding the number of LEP
individuals served by the grantee; or
(B) the grantee's own data if the grantee routinely
collects data on Medicare beneficiaries' primary language in
a manner determined by the Secretary to yield accurate data
and such data shows greater numbers of LEP individuals than
the data listed in subparagraph (A).
(4) Limitations.--
(A) Reporting.--Payments shall only be provided under this
section to grantees that report their costs of providing
language services as required under subsection (e). If a
grantee fails to provide the reports under such section for
the first year of a grant, the Secretary may terminate the
grant and solicit applications from new grantees to
participate in the subsequent two years of the demonstration
program.
(B) Type of services.--
(i) In general.--Subject to clause (ii), payments shall be
provided under this section only to grantees that utilize
competent bilingual staff or competent interpreter or
translation services which--
(I) if the grantee operates in a State that has statewide
health care interpreter standards, meet the State standards
currently in effect; or
(II) if the grantee operates in a State that does not have
statewide health care interpreter standards, utilizes
competent interpreters who follow the National Council on
Interpreting in Health Care's Code of Ethics and Standards of
Practice.
(ii) Exemptions.--The requirements of clause (i) shall not
apply--
(I) in the case of a Medicare beneficiary who is limited
English proficient (who has been informed in the
beneficiary's primary language of the availability of free
interpreter and translation services) and who requests the
use of family, friends, or other persons untrained in
interpretation or translation and the grantee documents the
request in the beneficiary's record; and
[[Page H9318]]
(II) in the case of a medical emergency where the delay
directly associated with obtaining a competent interpreter or
translation services would jeopardize the health of the
patient.
Nothing in clause (ii)(II) shall be construed to exempt an
emergency rooms or similar entities that regularly provide
health care services in medical emergencies from having in
place systems to provide competent interpreter and
translation services without undue delay.
(d) Assurances.--Grantees under this section shall--
(1) ensure that appropriate clinical and support staff
receive ongoing education and training in linguistically
appropriate service delivery; ensure the linguistic
competence of bilingual providers;
(2) offer and provide appropriate language services at no
additional charge to each patient with limited English
proficiency at all points of contact, in a timely manner
during all hours of operation;
(3) notify Medicare beneficiaries of their right to receive
language services in their primary language;
(4) post signage in the languages of the commonly
encountered group or groups present in the service area of
the organization; and
(5) ensure that--
(A) primary language data are collected for recipients of
language services; and
(B) consistent with the privacy protections provided under
the regulations promulgated pursuant to section 264(c) of the
Health Insurance Portability and Accountability Act of 1996
(42 U.S.C. 1320d-2 note), if the recipient of language
services is a minor or is incapacitated, the primary language
of the parent or legal guardian is collected and utilized.
(e) Reporting Requirements.--Grantees under this section
shall provide the Secretary with reports at the conclusion of
the each year of a grant under this section. each report
shall include at least the following information:
(1) The number of Medicare beneficiaries to whom language
services are provided.
(2) The languages of those Medicare beneficiaries.
(3) The types of language services provided (such as
provision of services directly in non-English language by a
bilingual health care provider or use of an interpreter).
(4) Type of interpretation (such as in-person, telephonic,
or video interpretation).
(5) The methods of providing language services (such as
staff or contract with external independent contractors or
agencies).
(6) The length of time for each interpretation encounter.
(7) The costs of providing language services (which may be
actual or estimated, as determined by the Secretary).
(f) No Cost Sharing.--LEP Beneficiaries shall not have to
pay cost-sharing or co-pays for language services provided
through this demonstration program.
(g) Evaluation and Report.--The Secretary shall conduct an
evaluation of the demonstration program under this section
and shall submit to the appropriate committees of Congress a
report not later than 1 year after the completion of the
program. The report shall include the following:
(1) An analysis of the patient outcomes and costs of
furnishing care to the LEP Medicare beneficiaries
participating in the project as compared to such outcomes and
costs for limited English proficient Medicare beneficiaries
not participating.
(2) The effect of delivering culturally and linguistically
appropriate services on beneficiary access to care,
utilization of services, efficiency and cost-effectiveness of
health care delivery, patient satisfaction, and select health
outcomes.
(3) Recommendations regarding the extension of such project
to the entire Medicare program.
(h) General Provisions.--Nothing in this section shall be
construed to limit otherwise existing obligations of
recipients of Federal financial assistance under title VI of
the Civil Rights Act of 1964 (42 U.S.C. 2000(d) et seq.) or
any other statute.
(i) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section $10,000,000 for
each fiscal year of the demonstration.
SEC. 234. DEMONSTRATION TO IMPROVE CARE TO PREVIOUSLY
UNINSURED.
(a) Establishment.--Within one year after the date of
enactment of this Act, the Secretary shall establish a
demonstration project to determine the greatest needs and
most effective methods of outreach to medicare beneficiaries
who were previously uninsured.
(b) Scope.--The demonstration shall be in no fewer than 10
sites, and shall include state health insurance assistance
programs, community health centers, community-based
organizations, community health workers, and other service
providers under parts A, B, and C of title XVIII of the
Social Security Act. Grantees that are plans operating under
part C shall document that enrollees who were previously
uninsured receive the ``Welcome to Medicare'' physical exam.
(c) Duration.--The Secretary shall conduct the
demonstration project for a period of 2 years.
(d) Report and Evaluation.--The Secretary shall conduct an
evaluation of the demonstration and not later than 1 year
after the completion of the project shall submit to Congress
a report including the following:
(1) An analysis of the effectiveness of outreach activities
targeting beneficiaries who were previously uninsured, such
as revising outreach and enrollment materials (including the
potential for use of video information), providing one-on-one
counseling, working with community health workers, and
amending the Medicare and You handbook.
(2) The effect of such outreach on beneficiary access to
care, utilization of services, efficiency and cost-
effectiveness of health care delivery, patient satisfaction,
and select health outcomes.
SEC. 235. OFFICE OF THE INSPECTOR GENERAL REPORT ON
COMPLIANCE WITH AND ENFORCEMENT OF NATIONAL
STANDARDS ON CULTURALLY AND LINGUISTICALLY
APPROPRIATE SERVICES (CLAS) IN MEDICARE.
(a) Report.--Not later than two years after the date of the
enactment of this Act, the Inspector General of the
Department of Health and Human Services shall prepare and
publish a report on--
(1) the extent to which Medicare providers and plans are
complying with the Office for Civil Rights' Guidance to
Federal Financial Assistance Recipients Regarding Title VI
Prohibition Against National Origin Discrimination Affecting
Limited English Proficient Persons and the Office of Minority
Health's Culturally and Linguistically Appropriate Services
Standards in health care; and
(2) a description of the costs associated with or savings
related to the provision of language services.
Such report shall include recommendations on improving
compliance with CLAS Standards and recommendations on
improving enforcement of CLAS Standards.
(b) Implementation.--Not later than one year after the date
of publication of the report under subsection (a), the
Department of Health and Human Services shall implement
changes responsive to any deficiencies identified in the
report.
SEC. 236. IOM REPORT ON IMPACT OF LANGUAGE ACCESS SERVICES.
(a) In General.--The Secretary of Health and Human Services
shall seek to enter into an arrangement with the Institute of
under which the Institute will prepare and publish, not later
than 3 years after the date of the enactment of this Act, a
report on the impact of language access services on the
health and health care of limited English proficient
populations.
(b) Contents.--Such report shall include--
(1) recommendations on the development and implementation
of policies and practices by health care organizations and
providers for limited English proficient patient populations;
(2) a description of the effect of providing language
access services on quality of health care and access to care
and reduced medical error; and
(3) a description of the costs associated with or savings
related to provision of language access services.
SEC. 237. DEFINITIONS.
In this subtitle:
(1) Bilingual.--The term ``bilingual'' with respect to an
individual means a person who has sufficient degree of
proficiency in two languages and can ensure effective
communication can occur in both languages.
(2) Competent interpreter services.--The term ``competent
interpreter services'' means a trans-language rendition of a
spoken message in which the interpreter comprehends the
source language and can speak comprehensively in the target
language to convey the meaning intended in the source
language. The interpreter knows health and health-related
terminology and provides accurate interpretations by choosing
equivalent expressions that convey the best matching and
meaning to the source language and captures, to the greatest
possible extent, all nuances intended in the source message.
(3) Competent translation services.--The term ``competent
translation services'' means a trans-language rendition of a
written document in which the translator comprehends the
source language and can write comprehensively in the target
language to convey the meaning intended in the source
language. The translator knows health and health-related
terminology and provides accurate translations by choosing
equivalent expressions that convey the best matching and
meaning to the source language and captures, to the greatest
possible extent, all nuances intended in the source document.
(4) Effective communication.--The term ``effective
communication'' means an exchange of information between the
provider of health care or health care-related services and
the limited English proficient recipient of such services
that enables limited English proficient individuals to
access, understand, and benefit from health care or health
care-related services.
(5) Interpreting/interpretation.--The terms
``interpreting'' and ``interpretation'' mean the transmission
of a spoken message from one language into another,
faithfully, accurately, and objectively.
(6) Health care services.--The term ``health care
services'' means services that address physical as well as
mental health conditions in all care settings.
(7) Health care-related services.--The term ``health care-
related services'' means human or social services programs or
activities that provide access, referrals or links to health
care.
[[Page H9319]]
(8) Language access.--The term ``language access'' means
the provision of language services to an LEP individual
designed to enhance that individual's access to,
understanding of or benefit from health care or health care-
related services.
(9) Language services.--The term ``language services''
means provision of health care services directly in a non-
English language, interpretation, translation, and non-
English signage.
(10) Limited english proficient.--The term ``limited
English proficient'' or ``LEP'' with respect to an individual
means an individual who speaks a primary language other than
English and who cannot speak, read, write or understand the
English language at a level that permits the individual to
effectively communicate with clinical or nonclinical staff at
an entity providing health care or health care related
services.
(11) Medicare program.--The term ``Medicare program'' means
the programs under parts A through D of title XVIII of the
Social Security Act.
(12) Service provider.--The term ``service provider''
includes all suppliers, providers of services, or entities
under contract to provide coverage, items or services under
any part of title XVIII of the Social Security Act.
TITLE III--PHYSICIANS' SERVICE PAYMENT REFORM
SEC. 301. ESTABLISHMENT OF SEPARATE TARGET GROWTH RATES FOR
SERVICE CATEGORIES.
(a) Establishment of Service Categories.--Subsection (j) of
section 1848 of the Social Security Act (42 U.S.C. 1395w-4)
is amended by adding at the end the following new paragraph:
``(5) Service categories.--For services furnished on or
after January 1, 2008, each of the following categories of
physicians' services shall be treated as a separate `service
category':
``(A) Evaluation and management services for primary care
(including new and established patient office visits
delivered by physicians who the Secretary determines provide
accessible, continuous, coordinated, and comprehensive care
for Medicare beneficiaries, emergency department visits, and
home visits), and for preventive services (including
screening mammography, colorectal cancer screening, and other
services as defined by the Secretary, limited to the
recommendations of the United States Preventive Services Task
Force).
``(B) Evaluation and management services not described in
subparagraph (A).
``(C) Imaging services (as defined in subsection (b)(4)(B))
and diagnostic tests (other than clinical diagnostic
laboratory tests) not described in subparagraph (A).
``(D) Procedures that are subject (under regulations
promulgated to carry out this section) to a 10-day or 90-day
global period (in this paragraph referred to as `major
procedures'), except that the Secretary may reclassify as
minor procedures under subparagraph (F) any procedures that
would otherwise be included in this category if the Secretary
determines that such procedures are not major procedures.
``(E) Anesthesia services that are paid on the basis of the
separate conversion factor for anesthesia services determined
under subsection (d)(1)(D).
``(F) Minor procedures and any other physicians' services
that are not described in a preceding subparagraph.''.
(b) Establishment of Separate Conversion Factors for Each
Service Category.--Subsection (d)(1) of section 1848 of the
Social Security Act (42 U.S.C. 1395w-4) is amended--
(1) in subparagraph (A)--
(A) by designating the sentence beginning ``The conversion
factor'' as clause (i) with the heading ``Application of
single conversion factor'' and with appropriate indentation;
(B) by striking ``The conversion factor'' and inserting
``Subject to clause (ii), the conversion factor''; and
(C) by adding at the end the following new clause:
``(ii) Application of multiple conversion factors beginning
with 2008.--
``(I) In general.--In applying clause (i) for years
beginning with 2008, separate conversion factors shall be
established for each service category of physicians' services
(as defined in subsection (j)(5)) and any reference in this
section to a conversion factor for such years shall be deemed
to be a reference to the conversion factor for each of such
categories.
``(II) Initial conversion factors; special rule for
anesthesia services.-- Such factors for 2008 shall be based
upon the single conversion factor for 2007 multiplied by the
update established under paragraph (8) for such category for
2008. In the case of the service category described in
subsection (j)(5)(F) (relating to anesthesia services), the
conversion factor for 2008 shall be based on the separate
conversion factor specified in subparagraph (D) for 2007
multiplied by the update established under paragraph (8) for
such category for 2008.
``(III) Updating of conversion factors.-- Such factor for a
service category for a subsequent year shall be based upon
the conversion factor for such category for the previous year
and adjusted by the update established for such category
under paragraph (8) for the year involved.''; and
(2) in subparagraph (D), by inserting ``(before 2008)''
after ``for a year''.
(c) Establishing Updates for Conversion Factors for Service
Categories.--Section 1848(d) of the Social Security Act (42
U.S.C. 1395w-4(d)) is amended--
(1) in paragraph (4)(B), by striking ``and (6)'' and
inserting ``, (6), and (8)'';
(2) in paragraph (4)(C)(iii), by striking ``The allowed''
and inserting ``Subject to paragraph (8)(B), the allowed'';
(3) in paragraph (4)(D), by striking ``The update'' and
inserting ``Subject to paragraph (8)(E), the update''; and
(4) by adding at the end the following new paragraphs:
``(8) Updates for service categories beginning with 2008.--
``(A) In general.--In applying paragraph (4) for a year
beginning with 2008, the following rules apply:
``(i) Application of separate update adjustments for each
service category.--Pursuant to paragraph (1)(A)(ii)(I), the
update shall be made to the conversion factor for each
service category (as defined in subsection (j)(5)) based upon
an update adjustment factor for the respective category and
year and the update adjustment factor shall be computed, for
a year, separately for each service category.
``(ii) Computation of allowed and actual expenditures based
on service categories.--In computing the prior year
adjustment component and the cumulative adjustment component
under clauses (i) and (ii) of paragraph (4)(B), the following
rules apply:
``(I) Application based on service categories.--The allowed
expenditures and actual expenditures shall be the allowed and
actual expenditures for the service category, as determined
under subparagraph (B).
``(II) Limitation to physician fee-schedule services.--
Actual expenditures shall only take into account expenditures
for services furnished under the physician fee schedule.
``(III) Application of category specific target growth
rate.--The growth rate applied under clause (ii)(II) of such
paragraph shall be the target growth rate for the service
category involved under subsection (f)(5).
``(IV) Allocation of cumulative overhang.--There shall be
substituted for the difference described in subparagraph
(B)(ii)(I) of such paragraph the amount described in
subparagraph (C)(i) for the service category involved.
``(B) Determination of allowed expenditures.--In applying
paragraph (4) for a year beginning with 2008, notwithstanding
subparagraph (C)(iii) of such paragraph, the allowed
expenditures for a service category for a year is an amount
computed by the Secretary as follows:
``(i) For 2008.--For 2008:
``(I) Total 2007 allowed expenditures.--Compute the total
allowed expenditures for services furnished under the
physician fee schedule under such paragraph for 2007.
``(II) Increase by growth rate.--Increase the total under
subclause (I) by the target growth rate for such category
under subsection (f) for 2008.
``(III) Allocation to service category.--Multiply the
increased total under subclause (II) by the overhang
allocation factor for the service category (as defined in
subparagraph (C)(iii)).
``(ii) For subsequent years.--For a subsequent year, take
the amount of allowed expenditures for such category for the
preceding year (under clause (i) or this clause) and increase
it by the target growth rate determined under subsection (f)
for such category and year.
``(C) Computation and application of cumulative overhang
among categories.--
``(i) In general.--For purposes of applying paragraph
(4)(B)(ii)(II) under clause (ii)(IV), the amount described in
this clause for a year (beginning with 2008) is the sum of
the following:
``(I) Pre-2008 cumulative overhang.--The amount of the pre-
2008 cumulative excess spending (as defined in clause (ii))
multiplied by the overhang allocation factor for the service
category (under clause (iii)).
``(II) Post-2007 cumulative amounts.--For a year beginning
with 2009, the difference (which may be positive or negative)
between the amount of the allowed expenditures for
physicians' services (as determined under paragraph (4)(C))
in the service category from January 1, 2008, through the end
of the prior year and the amount of the actual expenditures
for such services in such category during that period.
``(ii) Pre-2008 cumulative excess spending defined.--For
purposes of clause (i)(I), the term `pre-2008 cumulative
excess spending' means the difference described in paragraph
(4)(B)(ii)(I) as determined for the year 2008, taking into
account expenditures through December 31, 2007. Such
difference takes into account expenditures included in
subsection (f)(4)(A).
``(iii) Overhang allocation factor.--For purposes of this
paragraph, the term `overhang allocation factor' means, for a
service category, the proportion, as determined by the
Secretary of total actual expenditures under this part for
items and services in such category during 2007 to the total
of such actual expenditures for all the service categories.
In calculating such proportion, the Secretary shall only take
into account services furnished under the physician fee
schedule.
``(D) Floor for updates for 2008 and 2009.--The update to
the conversion factors for each service category for each of
2008 and 2009 shall be not less than 0.5 percent.
[[Page H9320]]
``(E) Change in restriction on update adjustment factor for
2010 and 2011.--The update adjustment factor determined under
subparagraph (4)(B), as modified by this paragraph, for a
service category for a year (beginning with 2010 and ending
with 2011) may be less than -0.07, but may not be less than -
0.14.''.
(d) Application of Separate Target Growth Rates for Each
Category.--
(1) In general.--Section 1848(f) of the Social Security Act
(42 U.S.C. 1395w-4(f)) is amended by adding at the end the
following new paragraph:
``(5) Application of separate target growth rates for each
service category beginning with 2008.--The target growth rate
for a year beginning with 2008 shall be computed and applied
separately under this subsection for each service category
(as defined in subsection (j)(5)) and shall be computed using
the same method for computing the sustainable growth rate
except for the following:
``(A) The reference in paragraphs (2)(A) and (2)(D) to `all
physicians' services' is deemed a reference to the
physicians' services included in such category but shall not
take into account items and services included in physicians'
services through the operation of paragraph (4)(A).
``(B) The factor described in paragraph (2)(C) for the
service category described in subsection (j)(5)(A) shall be
increased by 0.03.
``(C) A national coverage determination (as defined in
section 1869(f)(1)(B)) shall be treated as a change in
regulation described in paragraph (2)(D).''.
(2) Use of target growth rates.--Section 1848 of such Act
is further amended--
(A) in subsection (d)--
(i) in paragraph (1)(E)(ii), by inserting ``or target''
after ``sustainable''; and
(ii) in paragraph (4)(B)(ii)(II), by inserting ``or
target'' after ``sustainable''; and
(B) in subsection (f)--
(i) in the heading by inserting ``; Target Growth Rate''
after ``Sustainable Growth Rate''
(ii) in paragraph (1)--
(I) by striking ``and'' at the end of subparagraph (A);
(II) in subparagraph (B), by inserting ``before 2008''
after ``each succeeding year'' and by striking the period at
the end and inserting ``; and''; and
(III) by adding at the end the following new subparagraph:
``(C) November 1 of each succeeding year the target growth
rate for such succeeding year and each of the 2 preceding
years.''; and
(iii) in paragraph (2), in the matter before subparagraph
(A), by inserting after ``beginning with 2000'' the
following: ``and ending with 2007'' .
(e) Reports on Expenditures for Part B Drugs and Clinical
Diagnostic Laboratory Tests.--
(1) Reporting requirement.--The Secretary of Health and
Human Services shall include information in the annual
physician fee schedule proposed rule on the change in the
annual rate of growth of actual expenditures for clinical
diagnostic laboratory tests or drugs, biologicals, and
radiopharmaceuticals for which payment is made under part B
of title XVIII of the Social Security Act.
(2) Recommendations.--The report submitted under paragraph
(1) shall include an analysis of the reasons for such excess
expenditures and recommendations for addressing them in the
future.
SEC. 302. IMPROVING ACCURACY OF RELATIVE VALUES UNDER THE
MEDICARE PHYSICIAN FEE SCHEDULE.
(a) Use of Expert Panel To Identify Misvalued Physicians'
Services.--Section 1848(c) of the Social Security Act (42
U.S.C. 1395w(c)) is amended by adding at the end the
following new paragraph:
``(7) Use of expert panel to identify misvalued physicians'
services.--
``(A) In general.--The Secretary shall establish an expert
panel (in this paragraph referred to as the `expert panel')--
``(i) to identify, through data analysis, physicians'
services for which the relative value under this subsection
is potentially misvalued, particularly those services for
which such relative value may be overvalued;
``(ii) to assess whether those misvalued services warrant
review using existing processes (referred to in paragraph
(2)(J)(ii)) for the consideration of coding changes; and
``(iii) to advise the Secretary concerning the exercise of
authority under clauses (ii)(III) and (vi) of paragraph
(2)(B).
``(B) Composition of panel.--The expert panel shall be
appointed by the Secretary and composed of--
``(i) members with expertise in medical economics and
technology diffusion;
``(ii) members with clinical expertise;
``(iii) physicians, particularly physicians (such as a
physician employed by the Veterans Administration or a
physician who has a full time faculty appointment at a
medical school) who are not directly affected by changes in
the physician fee schedule under this section;
``(iv) carrier medical directors; and
``(v) representatives of private payor health plans.
``(C) Appointment considerations.--In appointing members to
the expert panel, the Secretary shall assure racial and
ethnic diversity on the panel and may consider appointing a
liaison from organizations with experience in the
consideration of coding changes to the panel.''.
(b) Examination of Services With Substantial Changes.--Such
section is further amended by adding at the end the following
new paragraph:
``(8) Examination of services with substantial changes.--
The Secretary, in consultation with the expert panel under
paragraph (7), shall--
``(A) conduct a five-year review of physicians' services in
conjunction with the RUC 5-year review, particularly for
services that have experienced substantial changes in length
of stay, site of service, volume, practice expense, or other
factors that may indicate changes in physician work;
``(B) identify new services to determine if they are likely
to experience a reduction in relative value over time and
forward a list of the services so identified for such five-
year review; and
``(C) for physicians' services that are otherwise
unreviewed under the process the Secretary has established,
periodically review a sample of relative value units within
different types of services to assess the accuracy of the
relative values contained in the Medicare physician fee
schedule.''.
(c) Authority To Reduce Work Component for Services With
Accelerated Volume Growth.--
(1) In general.--Paragraph (2)(B) of such section is
amended--
(A) in clause (v), by adding at the end the following new
subclause:
``(III) Reductions in work value units for services with
accelerated volume growth.--Effective January 1, 2009,
reduced expenditures attributable to clause (vi).''; and
(B) by adding at the end the following new clauses:
``(vi) Authorizing reduction in work value units for
services with accelerated volume growth.--The Secretary may
provide (without using existing processes the Secretary has
established for review of relative value) for a reduction in
the work value units for a particular physician's service if
the annual rate of growth in the expenditures for such
service for which payment is made under this part for
individuals for 2006 or a subsequent year exceeds the average
annual rate of growth in expenditures of all physicians'
services for which payment is made under this part by more
than 10 percentage points for such year.
``(vii) Consultation with expert panel and based on
clinical evidence.--The Secretary shall exercise authority
under clauses (ii)(III) and (vi) in consultation with the
expert panel established under paragraph (7) and shall take
into account clinical evidence supporting or refuting the
merits of such accelerated growth''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply with respect to payment for services furnished on
or after January 1, 2009.
(d) Adjustment Authority for Efficiency Gains for New
Procedures.--Paragraph (2)(B)(ii) of such section is amended
by adding at the end the following new subclause:
``(III) Adjustment authority for efficiency gains for new
procedures.--In carrying out subclauses (I) and (II), the
Secretary may apply a methodology, based on supporting
evidence, under which there is imposed a reduction over a
period of years in specified relative value units in the case
of a new (or newer) procedure to take into account inherent
efficiencies that are typically or likely to be gained during
the period of initial increased application of the
procedure.''.
SEC. 303. PHYSICIAN FEEDBACK MECHANISM ON PRACTICE PATTERNS.
By not later than July 1, 2008, the Secretary of Health and
Human Services shall develop and implement a mechanism to
measure resource use on a per capita and an episode basis in
order to provide confidential feedback to physicians in the
Medicare program on how their practice patterns compare to
physicians generally, both in the same locality as well as
nationally. Such feedback shall not be subject to disclosure
under section 552 of title 5, United States Code).
SEC. 304. PAYMENTS FOR EFFICIENT PHYSICIANS.
Section 1833 of the Social Security Act (42 U.S.C. 1395l)
is amended by adding at the end the following new subsection:
``(v) Incentive Payments for Efficient Physicians.--
``(1) In general.--In the case of physicians' services
furnished on or after January 1, 2009, and before January 1,
2011, by a participating physician in an efficient area (as
identified under paragraph (2)), in addition to the amount of
payment that would otherwise be made for such services under
this part, there also shall be paid an amount equal to 5
percent of the payment amount for the services under this
part.
``(2) Identification of efficient areas.--
``(A) In general.--Based upon available data, the Secretary
shall identify those counties or equivalent areas in the
United States in the lowest fifth percentile of utilization
based on per capita spending for services provided in 2007
under this part and part A.
``(B) Identification of counties where service is
furnished..--For purposes of paying the additional amount
specified in paragraph (1), if the Secretary uses the 5-digit
postal ZIP Code where the service is furnished, the dominant
county of the postal ZIP Code (as determined by the United
States Postal Service, or otherwise) shall be used to
determine whether the postal ZIP
[[Page H9321]]
Code is in a county described in subparagraph (A).
``(C) Judicial review.-- There shall be no administrative
or judicial review under section 1869, 1878, or otherwise,
respecting--
``(i) the identification of a county or other area under
subparagraph (A); or
``(ii) the assignment of a postal ZIP Code to a county or
other area under subparagraph (B).
``(D) Publication of list of counties; posting on
website.--With respect to a year for which a county or area
is identified under this paragraph, the Secretary shall
identify such counties or areas as part of the proposed and
final rule to implement the physician fee schedule under
section 1848 for the applicable year. The Secretary shall
post the list of counties identified under this paragraph on
the Internet website of the Centers for Medicare & Medicaid
Services.''.
SEC. 305. RECOMMENDATIONS ON REFINING THE PHYSICIAN FEE
SCHEDULE.
(a) Recommendations on Consolidated Coding for Services
Commonly Performed Together.--Not later than December 31,
2008, the Comptroller General of the United States shall--
(1) complete an analysis of codes paid under the Medicare
physician fee schedule to determine whether the codes for
procedures that are commonly furnished together should be
combined; and
(2) submit to Congress a report on such analysis and
include in the report recommendations on whether an
adjustment should be made to the relative value units for
such combined code.
(b) Recommendations on Increased Use of Bundled Payments.--
Not later than December 31, 2008, the Comptroller General of
the United States shall--
(1) complete an analysis of those procedures under the
Medicare physician fee schedule for which no global payment
methodology is applied but for which a ``bundled'' payment
methodology would be appropriate; and
(2) submit to Congress a report on such analysis and
include in the report recommendations on increasing the use
of ``bundled'' payment methodology under such schedule.
(c) Medicare Physician Fee Schedule.--In this section, the
term ``Medicare physician fee schedule'' means the fee
schedule established under section 1848 of the Social
Security Act (42 U.S.C. 1395w-4).
SEC. 306. IMPROVED AND EXPANDED MEDICAL HOME DEMONSTRATION
PROJECT.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') shall
establish under title XVIII of the Social Security Act an
expanded medical home demonstration project (in this section
referred to as the ``expanded project'') under this section.
The expanded project supersedes the project that was
initiated under section 204 of the Medicare Improvement and
Extension Act of 2006 (division B of Public Law 109-432). The
purpose of the expanded project is--
(1) to guide the redesign of the health care delivery
system to provide accessible, continuous, comprehensive, and
coordinated, care to Medicare beneficiaries; and
(2) to provide care management fees to personal physicians
delivering continuous and comprehensive care in qualified
medical homes.
(b) Nature and Scope of Project.--
(1) Duration; scope.--The expanded project shall operate
during a period of three years, beginning not later than
October 1, 2009, and shall include a nationally
representative sample of physicians serving urban, rural, and
underserved areas throughout the United States.
(2) Encouraging participation of small physician
practices.--
(A) In general.--The expanded project shall be designed to
include the participation of physicians in practices with
fewer than four full-time equivalent physicians, as well as
physicians in larger practices particularly in rural and
underserved areas.
(B) Technical assistance.-- In order to facilitate the
participation under the expanded project of physicians in
such practices, the Secretary shall make available additional
technical assistance to such practices during the first year
of the expanded project.
(3) Selection of homes to participate.--The Secretary shall
select up to 500 medical homes to participate in the expanded
project and shall give priority to--
(A) the selection of up to 100 HIT-enhanced medical homes;
and
(B) the selection of other medical homes that serve
communities whose populations are at higher risk for health
disparities,
(4) Beneficiary participation.--The Secretary shall
establish a process for any Medicare beneficiary who is
served by a medical home participating in the expanded
project to elect to participate in the project. Each
beneficiary who elects to so participate shall be eligible--
(A) for enhanced medical home services under the project
with no cost sharing for the additional services; and
(B) for a reduction of up to 50 percent in the coinsurance
for services furnished under the physician fee schedule under
section 1848 of the Social Security Act by the medical home.
The Secretary shall develop standard recruitment materials
and election processes for Medicare beneficiaries who are
electing to participate in the expanded project.
(c) Standards for Medical Homes, HIT-Enhanced Medical
Homes.--
(1) Standard setting and certification process.--The
Secretary shall establish a process for selection of a
qualified standard setting and certification organization--
(A) to establish standards, consistent with this section,
for medical practices to qualify as medical homes or as HIT-
enhanced medical homes; and
(B) to provide for the review and certification of medical
practices as meeting such standards.
(2) Basic standards for medical homes.--For purposes of
this subsection, the term ``medical home'' means a physician-
directed practice that has been certified, under paragraph
(1), as meeting the following standards:
(A) Access and communication with patients.--The practice
applies standards for access to care and communication with
participating beneficiaries.
(B) Managing patient information and using information in
management to support patient care.--The practice has readily
accessible, clinically useful information on participating
beneficiaries that enables the practice to treat such
beneficiaries comprehensively and systematically.
(C) Managing and coordinating care according to individual
needs.--The practice maintains continuous relationships with
participating beneficiaries by implementing evidence-based
guidelines and applying them to the identified needs of
individual beneficiaries over time and with the intensity
needed by such beneficiaries.
(D) Providing ongoing assistance and encouragement in
patient self-management.--The practice--
(i) collaborates with participating beneficiaries to pursue
their goals for optimal achievable health; and
(ii) assesses patient-specific barriers to communication
and conducts activities to support patient self-management.
(E) Resources to manage care.--The practice has in place
the resources and processes necessary to achieve improvements
in the management and coordination of care for participating
beneficiaries.
(F) Monitoring performance.--The practice monitors its
clinical process and performance (including outcome measures)
in meeting the applicable standards under this subsection and
provides information in a form and manner specified by the
Secretary with respect to such process and performance.
(3) Additional standards for hit-enhanced medical home.--
For purposes of this subsection, the term ``HIT-enhanced
medical home'' means a medical home that has been certified,
under paragraph (1), as using a health information technology
system that includes at least the following elements:
(A) Electronic health record (ehr).--The system uses, for
participating beneficiaries, an electronic health record that
meets the following standards:
(i) In general.--The record--
(I) has the capability of interoperability with secure data
acquisition from health information technology systems of
other health care providers in the area served by the home;
or
(II) the capability to securely acquire clinical data
delivered by such other health care providers to a secure
common data source.
(ii) The record protects the privacy and security of health
information.
(iii) The record has the capability to acquire, manage, and
display all the types of clinical information commonly
relevant to services furnished by the home, such as complete
medical records, radiographic image retrieval, and clinical
laboratory information.
(iv) The record is integrated with decision support
capacities that facilitate the use of evidence-based medicine
and clinical decision support tools to guide decision-making
at the point-of-care based on patient-specific factors.
(B) E-prescribing.--The system supports e-prescribing and
computerized physician order entry.
(C) Outcome measurement.--The system supports the secure,
confidential provision of clinical process and outcome
measures approved by the National Quality Forum to the
Secretary for use in confidential manner for provider
feedback and peer review and for outcomes and clinical
effectiveness research.
(D) Patient education capability.--The system actively
facilitates participating beneficiaries engaging in the
management of their own health through education and support
systems and tools for shared decision-making.
(E) Support of basic standards.-- The elements of such
system, such as the electronic health record, email
communications, patient registries, and clinical-decision
support tools, are integrated in a manner to better achieve
the basic standards specified in paragraph (2) for a medical
home.
(4) Use of data.--The Secretary shall use the data
submitted under paragraph (1)(F) in a confidential manner for
feedback and peer review for medical homes and for outcomes
and clinical effectiveness research. After the first two
years of the expanded project, these data may be used for
adjustment in the monthly medical home care management fee
under subsection (d)(2)(E).
(d) Monthly Medical Home Care Management Fee.--
[[Page H9322]]
(1) In general.--Under the expanded project, the Secretary
shall provide for payment to the personal physician of each
participating beneficiary of a monthly medical home care
management fee.
(2) Amount of payment.-- In determining the amount of such
fee, the Secretary shall consider the following:
(A) Operating expenses.--The additional practice expenses
for the delivery of services through a medical home, taking
into account the additional expenses for an HIT-enhanced
medical home. Such expenses include costs associated with--
(i) structural expenses, such as equipment, maintenance,
and training costs;
(ii) enhanced access and communication functions;
(iii) population management and registry functions;
(iv) patient medical data and referral tracking functions;
(v) provision of evidence-based care;
(vi) implementation and maintenance of health information
technology;
(vii) reporting on performance and improvement conditions;
and
(viii) patient education and patient decision support,
including print and electronic patient education materials.
(B) Added value services.--The value of additional
physician work, such as augmented care plan oversight,
expanded e-mail and telephonic consultations, extended
patient medical data review (including data stored and
transmitted electronically), and physician supervision of
enhanced self management education, and expanded follow-up
accomplished by non-physician personnel, in a medical home
that is not adequately taken into account in the
establishment of the physician fee schedule under section
1848 of the Social Security Act.
(C) Risk adjustment.--The development of an appropriate
risk adjustment mechanism to account for the varying costs of
medical homes based upon characteristics of participating
beneficiaries.
(D) HIT adjustment.--Variation of the fee based on the
extensiveness of use of the health information technology in
the medical home.
(E) Performance-based.--After the first two years of the
expanded project, an adjustment of the fee based on
performance of the home in achieving quality or outcomes
standards.
(3) Personal physician defined.--For purposes of this
subsection, the term ``personal physician'' means, with
respect to a participating Medicare beneficiary, a physician
(as defined in section 1861(r)(1) of the Social Security Act
(42 U.S.C. 1395x(r)(1)) who provides accessible, continuous,
coordinated, and comprehensive care for the beneficiary as
part of a medical practice that is a qualified medical home.
Such a physician may be a specialist for a beneficiary
requiring ongoing care for a chronic condition or multiple
chronic conditions (such as severe asthma, complex diabetes,
cardiovascular disease, rheumatologic disorder) or for a
beneficiary with a prolonged illness.
(e) Funding.--
(1) Use of current project funding.--Funds otherwise
applied to the demonstration under section 204 of the
Medicare Improvement and Extension Act of 2006 (division B of
Public Law 109-432) shall be available to carry out the
expanded project
(2) Additional funding from smi trust fund.--
(A) In general.--In addition to the funds provided under
paragraph (1), there shall be available, from the Federal
Supplementary Medical Insurance Trust Fund (under section
1841 of the Social Security Act), the amount of $500,000,000
to carry out the expanded project, including payments to of
monthly medical home care management fees under subsection
(d), reductions in coinsurance for participating
beneficiaries under subsection (b)(4)(B), and funds for the
design, implementation, and evaluation of the expanded
project.
(B) Monitoring expenditures; early termination.--The
Secretary shall monitor the expenditures under the expanded
project and may terminate the project early in order that
expenditures not exceed the amount of funding provided for
the project under subparagraph (A).
(f) Evaluations and Reports.--.
(1) Annual interim evaluations and reports.--For each year
of the expanded project, the Secretary shall provide for an
evaluation of the project and shall submit to Congress, by a
date specified by the Secretary, a report on the project and
on the evaluation of the project for each such year.
(2) Final evaluation and report.--The Secretary shall
provide for an evaluation of the expanded project and shall
submit to Congress, not later than 18 months after the date
of completion of the project, a report on the project and on
the evaluation of the project.
SEC. 307. REPEAL OF PHYSICIAN ASSISTANCE AND QUALITY
INITIATIVE FUND.
Subsection (l) of section 1848 of the Social Security Act
(42 U.S.C. 1395w-4) is repealed.
SEC. 308. ADJUSTMENT TO MEDICARE PAYMENT LOCALITIES.
Section 1848(e) of the Social Security Act (42 U.S.C.1395w-
4(e)) is amended by adding at the end the following new
paragraph:
``(6) Fee schedule geographic areas.--
``(A) In general.--
``(i) Revision.--Subject to clause (ii), for services
furnished on or after January 1, 2009, the Secretary shall
revise the fee schedule areas used for payment under this
section applicable to the State of California using the
county-based geographic adjustment factor as specified in
option 3 (table 9) in the proposed rule for the 2008
physician fee schedule published at 72 Fed. Reg. 38,122 (July
12, 2007).
``(ii) Transition.--For services furnished during the
period beginning January 1, 2009, and ending December 31,
2010, after calculating the work, practice expense, and
malpractice geographic indices described in clauses (i),
(ii), and (iii) of paragraph (1)(A) that would otherwise
apply, the Secretary shall increase any such geographic index
for any county in California that is lower than the
geographic index used for payment for services under this
section as of December 31, 2008, in such county to such
geographic index level.
``(iii) Non-application of periodic revision.--If a
periodic review of geographic indices, as required under
paragraph (1)(B), results in a reduction in a work, practice
expense and malpractice geographic index for any county in
California that is below the geographic index level
established pursuant to clause (ii) during a portion of the
period described in such clause, the work, practice expense,
or malpractice index established in such clause shall be
applied to payment for services furnished in such county
during such portion of such period.
``(B) Subsequent revisions.--
``(i) Timing.--Not later than January 1, 2014, the
Secretary shall review and make revisions to fee schedule
areas in all States for which more than one fee schedule area
is used for payment of services under this section. The
Secretary may revise fee schedule areas in States in which a
single fee schedule area is used for payment for services
under this section using the same methodology applied in the
previous sentence.
``(ii) Link with geographic index data revision.--The
revision described in clause (i) shall be made effective
concurrently with the application of the periodic review of
geographic adjustment factors required under paragraph (1)(C)
for 2014.''.
SEC. 309. PAYMENT FOR IMAGING SERVICES.
(a) Payment Under Part B of the Medicare Program for
Diagnostic Imaging Services Furnished in Facilities
Conditioned on Accreditation of Facilities.--
(1) Special payment rule.--
(A) In general.--Section 1848(b)(4) of the Social Security
Act (42 U.S.C. 1395w-4(b)(4)) is amended--
(i) in the heading, by striking ``rule'' and inserting
``rules'';
(ii) in subparagraph (A), by striking ``In general'' and
inserting ``Limitation''; and
(iii) by adding at the end the following new subparagraph:
``(C) Payment only for services provided in accredited
facilities.--
``(i) In general.--In the case of imaging services that are
diagnostic imaging services described in clause (ii), the
payment amount for the technical component and the
professional component of the services established for a year
under the fee schedule described in paragraph (1) shall each
be zero, unless the services are furnished at a diagnostic
imaging services facility that meets the certificate
requirement described in section 354(b)(1) of the Public
Health Service Act, as applied under subsection (m). The
previous sentence shall not apply with respect to the
professional component of a diagnostic imaging service that
is furnished by a physician or that is an ultrasound
furnished by nurse practitioner or or nurse-midwife.
``(ii) Diagnostic imaging services.--For purposes of clause
(i) and subsection (m), the term `diagnostic imaging
services' means all imaging modalities, including diagnostic
magnetic resonance imaging (`MRI'), computed tomography
(`CT'), positron emission tomography (`PET'), nuclear
medicine procedures, x-rays, sonograms, ultrasounds,
echocardiograms, and such emerging diagnostic imaging
technologies as specified by the Secretary. Such term does
not include image guided procedures.''.
(B) Effective date.--
(i) In general.--Subject to clause (ii), the amendments
made by subparagraph (A) shall apply to diagnostic imaging
services furnished on or after January 1, 2010.
(ii) Extension for ultrasound services.--The amendments
made by subparagraph (A) shall apply to diagnostic imaging
services that are ultrasound services on or after January 1,
2012.
(2) Certification of facilities that furnish diagnostic
imaging services.--Section 1848 of the Social Security Act
(42 U.S.C. 1395w-4) is amended by adding at the end the
following new subsection:
``(m) Certification of Facilities That Furnish Diagnostic
Imaging Services.--
``(1) In general.--For purposes of subsection (b)(4)(C)(i),
except as provided under paragraphs (2) through (8), the
provisions of section 354 of the Public Health Service Act
(as in effect as of June 1, 2007), relating to the
certification of mammography facilities, shall apply, with
respect to the provision of diagnostic imaging services (as
defined in subsection (b)(4)(C)(ii)) and to a diagnostic
imaging services facility defined in paragraph (8) (and to
the process of accrediting such facilities) in the same
manner that such provisions apply, with respect to the
provision of mammograms and to a facility defined in
paragraph (8) (and to the process of accrediting such
facilities) in the same manner that such provisions apply,
with respect
[[Page H9323]]
to the provision of mammograms and to a facility defined
in subsection (a)(3) of such section (and to the process
of accrediting such mammography facilities).
``(2) Terminology and references.--For purposes of applying
section 354 of the Public Health Service Act under paragraph
(1)--
``(A) any reference to `mammography', or `breast imaging'
is deemed a reference to `diagnostic imaging services (as
defined in section 1848(b)(4)(C)(ii) of the Social Security
Act)';
``(B) any reference to a mammogram or film is deemed a
reference to an image, as defined in paragraph (8);
``(C) any reference to `mammography facility' or to a
`facility' under such section 354 is deemed a reference to a
diagnostic imaging services facility, as defined in paragraph
(8);
``(D) any reference to radiological equipment used to image
the breast is deemed a reference to medical imaging equipment
used to provide diagnostic imaging services;
``(E) any reference to radiological procedures or
radiological is deemed a reference to medical imaging
services, as defined in paragraph (8) or medical imaging,
respectively;
``(F) any reference to an inspection (as defined in
subsection (a)(4) of such section) or inspector is deemed a
reference to an audit (as defined in paragraph (8)) or
auditor, respectively;
``(G) any reference to a medical physicist (as described in
subsection (f)(1)(E) of such section) is deemed to include a
reference to a magnetic resonance scientist or the
appropriate qualified expert as determined by the accrediting
body;
``(H) in applying subsection (d)(1)(A)(i) of such section,
the reference to `type of each x-ray machine, image receptor,
and processor' is deemed a reference to `type of imaging
equipment';
``(I) in applying subsection (d)(1)(B) of such section, the
reference that `the person or agent submits to the Secretary'
is deemed a reference that `the person or agent submits to
the Secretary, through the appropriate accreditation body';
``(J) in applying subsection (d)(1)(B)(i) of such section,
the reference to standards established by the Secretary is
deemed a reference to standards established by an
accreditation body and approved by the Secretary;
``(K) in applying subsection (e) of such section, relating
to an accreditation body--
``(i) in paragraph (1)(A), the reference to `may' is deemed
a reference to `shall';
``(ii) in paragraph (1)(B)(i)(II), the reference to `a
random sample of clinical images from such facilities' is
deemed a reference to `a statistically significant random
sample of clinical images from a statistically significant
random sample of facilities';
``(iii) in paragraph (3)(A) of such section--
``(I) the reference to `paragraph (1)(B)' in such
subsection is deemed to be a reference to `paragraph (1)(B)
and subsection (f)'; and
``(II) the reference to the `Secretary' is deemed a
reference to `an accreditation body, with the approval of the
Secretary'; and
``(iv) in paragraph (6)(B), the reference to the Committee
on Labor and Human Resources of the Senate is deemed to be
the Committee on Finance of the Senate and the reference to
the Committee on Energy and Commerce of the House of
Representatives is deemed to include a reference to the
Committee on Ways and Means of the House of Representatives;
``(L) in applying subsection (f), relating to quality
standards--
``(i) each reference to standards established by the
Secretary is deemed a reference to standards established by
an accreditation body involved and approved by the Secretary
under subsection (d)(1)(B)(i) of such section
``(ii) in paragraph (1)(A), the reference to `radiation
dose' is deemed a reference to `radiation dose, as
appropriate';
``(iii) in paragraph (1)(B), the reference to `radiological
standards' is deemed a reference to `medical imaging
standards, as appropriate';
``(iv) in paragraphs (1)(D)(ii) and (1)(E)(iii), the
reference to `the Secretary' is deemed a reference to `an
accreditation body with the approval of the Secretary';
``(v) in each of subclauses (III) and (IV) of paragraph
(1)(G)(ii), each reference to `patient' is deemed a reference
to `patient, if requested by the patient'; and
``(M) in applying subsection (g), relating to inspections--
``(i) each reference to the `Secretary or State or local
agency acting on behalf of the Secretary' is deemed to
include a reference to an accreditation body involved;
``(ii) in the first sentence of paragraph (1)(F), the
reference to `annual inspections required under this
paragraph' is deemed a reference to `the audits carried out
in facilities at least every three years from the date of
initial accreditation under this paragraph'; and
``(iii) in the second sentence of paragraph (1)(F), the
reference to `inspections carried out under this paragraph'
is deemed a reference to `audits conducted under this
paragraph during the previous year'.
``(3) Dates and periods.--For purposes of paragraph (1), in
applying section 354 of the Public Health Service Act, the
following applies:
``(A) In general.--Except as provided in subparagraph (B)--
``(i) any reference to `October 1, 1994' shall be deemed a
reference to `January 1, 2010';
``(ii) the reference to `the date of the enactment of this
section' in each of subsections (e)(1)(D) and (f)(1)(E)(iii)
is deemed to be a reference to `the date of the enactment of
the Children's Health and Medicare Protection Act of 2007';
``(iii) the reference to `annually' in subsection (g)(1)(E)
is deemed a reference to `every three years';
``(iv) the reference to `October 1, 1996' in subsection (l)
is deemed to be a reference to `January 1, 2011';
``(v) the reference to `October 1, 1999' in subsection
(n)(3)(H) is deemed to be a reference to `January 1, 2012';
and
``(vi) the reference to `October 1, 1993' in the matter
following paragraph (3)(J) of subsection (n) is deemed to be
a reference `January 1, 2010'.
``(B) Ultrasound services.--With respect to diagnostic
imaging services that are ultrasounds--
``(i) any reference to `October 1, 1994' shall be deemed a
reference to `January 1, 2012';
``(ii) the reference to `the date of the enactment of this
section' in subsection (f)(1)(E)(iii) is deemed to be a
reference to `7 years after the date of the enactment of the
Children's Health and Medicare Protection Act of 2007';
``(iii) the reference to `October 1, 1996' in subsection
(l) is deemed to be a reference to `January 1, 2013';
``(4) Provisions not applicable.--For purposes of paragraph
(1), in applying section 354 of the Public Health Service
Act, the following provision shall not apply:
``(A) Subsections (e) and (f) of such section, in so far as
the respective subsection imposes any requirement for a
physician to be certified, accredited, or otherwise meet
requirements, with respect to the provision of any diagnostic
imaging services, as a condition of payment under subsection
(b)(4)(C)(i), with respect to the professional or technical
component, for such service.
``(B) Subsection (e)(1)(B)(iv) of such section, insofar as
it applies to a facility with respect to the provision of
ultrasounds.
``(C) Subsection (e)(1)(B)(v).
``(D) Subsection (f)(1)(H) of such section, relating to
standards for special techniques for mammograms of patients
with breast implants.
``(E) Subsection (g)(6) of such section, relating to an
inspection demonstration program.
``(F) Subsection (n)(3)(G) of such section, relating to the
national advisory committee.
``(G) Subsection (p) of such section, relating to breast
cancer screening surveillance research grants.
``(H) Paragraphs (1)(B) and (2) of subsection (r) of such
section, related to funding.
``(5) Accreditation bodies.--For purposes of paragraph (1),
in applying section 354(e)(1) of the Public Health Service,
the following shall apply:
``(A) Approval of two accreditation bodies for each
treatment modality.--In the case that there is more than one
accreditation body for a treatment modality that qualifies
for approval under this subsection, the Secretary shall
approve at least two accreditation bodies for such treatment
modality.
``(B) Additional accreditation body standards.--In addition
to the standards described in subparagraph (B) of such
section for accreditation bodies, the Secretary shall
establish standards that require--
``(i) the timely integration of new technology by
accreditation bodies for purposes of accrediting facilities
under this subsection; and
``(ii) the accreditation body involved to evaluate the
annual medical physicist survey (or annual medical survey of
another appropriate qualified expert chosen by the
accreditation body) of a facility upon onsite review of such
facility.
``(6) Additional quality standards.--For purposes of
paragraph (1), in applying subsection (f)(1) of section 354
of the Public Health Service--
``(A) the quality standards under such subsection shall,
with respect to a facility include--
``(i) standards for qualifications of medical personnel who
are not physicians and who perform diagnostic imaging
services at the facility that require such personnel to
ensure that individuals, prior to performing medical imaging,
demonstrate compliance with the standards established under
subsection (a) through successful completion of certification
by a nationally recognized professional organization,
licensure, completion of an examination, pertinent coursework
or degree program, verified pertinent experience, or through
other ways determined appropriate by an accreditation body
(with the approval of the Secretary, or through some
combination thereof);
``(ii) standards requiring the facility to maintain records
of the credentials of physicians and other medical personnel
described in clause (i);
``(iii) standards for qualifications and responsibilities
of medical directors and other personnel with supervising
roles at the facility;
``(iv) standards that require the facility has procedures
to ensure the safety of patients of the facility; and
``(v) standards for the establishment of a quality control
program at the facility to be implemented as described in
subparagraph (E) of such subsection;
``(B) the quality standards described in subparagraph (B)
of such subsection shall be deemed to include standards that
require the
[[Page H9324]]
establishment and maintenance of a quality assurance and
quality control program at each facility that is adequate and
appropriate to ensure the reliability, clarity, and accuracy
of the technical quality of diagnostic images produced at
such facilities; and
``(C) the quality standard described in subparagraph (C) of
such subsection, relating to a requirement for personnel who
perform specified services, shall include in such requirement
that such personnel must meet continuing medical education
standards as specified by an accreditation body (with the
approval of the Secretary) and update such standards at least
once every three years.
``(7) Additional requirements.--Notwithstanding any
provision of section 354 of the Public Health Service Act,
the following shall apply to the accreditation process under
this subsection for purposes of subsection (b)(4)(C)(i):
``(A) Any diagnostic imaging services facility accredited
before January 1, 2010 (or January 1, 2012 in the case of
ultrasounds), by an accrediting body approved by the
Secretary shall be deemed a facility accredited by an
approved accreditation body for purposes of such subsection
as of such date if the facility submits to the Secretary
proof of such accreditation by transmittal of the certificate
of accreditation, including by electronic means.
``(B) The Secretary may require the accreditation under
this subsection of an emerging technology used in the
provision of a diagnostic imaging service as a condition of
payment under subsection (b)(4)(C)(i) for such service at
such time as the Secretary determines there is sufficient
empirical and scientific information to properly carry out
the accreditation process for such technology.
``(8) Definitions.--For purposes of this subsection:
``(A) Audit.--The term `audit' means an onsite evaluation,
with respect to a diagnostic imaging services facility, by
the Secretary, State or local agency on behalf of the
Secretary, or accreditation body approved under this
subsection that includes the following:
``(i) Equipment verification.
``(ii) Evaluation of policies and procedures for compliance
with accreditation requirements.
``(iii) Evaluation of personnel qualifications and
credentialing.
``(iv) Evaluation of the technical quality of images.
``(v) Evaluation of patient reports.
``(vi) Evaluation of peer-review mechanisms and other
quality assurance activities.
``(vii) Evaluation of quality control procedures, results,
and follow-up actions.
``(viii) Evaluation of medical physicists (or other
appropriate professionals chosen by the accreditation body)
and magnetic resonance scientist surveys.
``(ix) Evaluation of consumer complaint mechanisms.
``(x) Provision of recommendations for improvement based on
findings with respect to clauses (i) through (ix).
``(B) Diagnostic imaging services facility.--The term
`diagnostic imaging services facility' has the meaning given
the term `facility' in section 354(a)(3) of the Public Health
Service Act (42 U.S.C. 263b(a)(3)) subject to the reference
changes specified in paragraph (2), but does not include any
facility that does not furnish diagnostic imaging services
for which payment may be made under this section.
``(C) Image.--The term `image' means the portrayal of
internal structures of the human body for the purpose of
detecting and determining the presence or extent of disease
or injury and may be produced through various techniques or
modalities, including radiant energy or ionizing radiation
and ultrasound and magnetic resonance. Such term does not
include image guided procedures.
``(D) Medical imaging service.--The term `medical imaging
service' means a service that involves the science of an
image. Such term does not include image guided procedures.''.
(b) Adjustment in Practice Expense To Reflect Higher
Presumed Utilization.--Section 1848 of the Social Security
Act (42 U.S.C. 1395w(b)(4)) is amended--
(1) in subsection (b)(4)--
(A) in the heading, by striking ``rule'' and inserting
``rules'';
(B) in subparagraph (B), by striking ``subparagraph (A)''
and inserting ``this paragraph''; and
(C) by adding at the end the following new subparagraph:
``(C) Adjustment in practice expense to reflect higher
presumed utilization.--In computing the number of practice
expense relative value units under subsection (c)(2)(C)(ii)
with respect to imaging services described in subparagraph
(B), the Secretary shall adjust such number of units so it
reflects a 75 percent (rather than 50 percent) presumed rate
of utilization of imaging equipment.''; and
(2) in subsection (c)(2)(B)(v)(II), by inserting ``and
other provisions'' after ``OPD payment cap''
(c) Adjustment in Technical Component ``discount'' on
Single-Session Imaging to Consecutive Body Parts.--Section
1848(b)(4) of such Act is further amended by adding at the
end the following new subparagraph:
``(D) Adjustment in technical component discount on single-
session imaging involving consecutive body parts.--The
Secretary shall increase the reduction in expenditures
attributable to the multiple procedure payment reduction
applicable to the technical component for imaging under the
final rule published by the Secretary in the Federal Register
on November 21, 2005 (42 C.F.R. 405, et al.) from 25 percent
to 50 percent.''.
(d) Adjustment in Assumed Interest Rate for Capital
Purchases.--Section 1848(b)(4) of such Act is further amended
by adding at the end the following new subparagraph:
``(E) Adjustment in assumed interest rate for capital
purchases.--In computing the practice expense component for
imaging services under this section, the Secretary shall
change the interest rate assumption for capital purchases of
imaging devices to reflect the prevailing rate in the market,
but in no case higher than 11 percent.''.
(e) Disallowance of Global Billing.--Effective for claims
filed for imaging services (as defined in subsection
(b)(4)(B) of section 1848 of the Social Security Act)
furnished on or after the first day of the first month that
begins more than 1 year after the date of the enactment of
this Act, the Secretary of Health and Human Services shall
not accept (or pay) a claim under such section unless the
claim is made separately for each component of such services.
(f) Effective Date.--Except as otherwise provided, this
section, and the amendments made by this section, shall apply
to services furnished on or after January 1, 2008.
SEC. 310. REPEAL OF PHYSICIANS ADVISORY COUNCIL.
Section 1868(a) of the Social Security Act (42 U.S.C.
1395ee(a)), relating to the Practicing Physicians Advisory
Council, is repealed.
TITLE IV--MEDICARE ADVANTAGE REFORMS
Subtitle A--Payment Reform
SEC. 401. EQUALIZING PAYMENTS BETWEEN MEDICARE ADVANTAGE
PLANS AND FEE-FOR-SERVICE MEDICARE.
(a) Phase in of Payment Based on Fee-for-Service Costs.--
Section 1853 of the Social Security Act (42 U.S.C. 1395w-23)
is amended--
(1) in subsection (j)(1)(A)--
(A) by striking ``beginning with 2007'' and inserting ``for
2007 and 2008''; and
(B) by inserting after ``(k)(1)'' the following: ``, or,
beginning with 2009, \1/12\ of the blended benchmark amount
determined under subsection (l)(1)''; and
(2) by adding at the end the following new subsection:
``(l) Determination of Blended Benchmark Amount.--
``(1) In general.--For purposes of subsection (j), subject
to paragraphs (2) and (3), the term `blended benchmark
amount' means for an area--
``(A) for 2009 the sum of--
``(i) \2/3\ of the applicable amount (as defined in
subsection (k)(1)) for the area and year; and
``(ii) \1/3\ of the amount specified in subsection
(c)(1)(D)(i) for the area and year;
``(B) for 2010 the sum of--
``(i) \1/3\ of the applicable amount for the area and year;
and
``(ii) \2/3\ of the amount specified in subsection
(c)(1)(D)(i) for the area and year; and
``(C) for a subsequent year the amount specified in
subsection (c)(1)(D)(i) for the area and year.
``(2) Fee-for-service payment floor.--In no case shall the
blended benchmark amount for an area and year be less than
the amount specified in subsection (c)(1)(D)(i) for the area
and year.
``(3) Exception for pace plans.--This subsection shall not
apply to payments to a PACE program under section 1894.''.
(b) Phase in of Payment Based on IME Costs.--
(1) In general.--Section 1853(c)(1)(D)(i) of such Act (42
U.S.C. 1395w-23(c)(1)(D)(i)) is amended by inserting ``and
costs attributable to payments under section 1886(d)(5)(B)''
after ``1886(h)''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to the capitation rate for years beginning with
2009.
(c) Limitation on Plan Enrollment in Cases of Excess Bids
for 2009 and 2010.--
(1) In general.--In the case of a Medicare Part C
organization that offers a Medicare Part C plan in the 50
States or the District of Columbia for which--
(A) bid amount described in paragraph (2) for a Medicare
Part C plan for 2009 or 2010, exceeds
(B) the percent specified in paragraph (4) of the fee-for-
service amount described in paragraph (3),
the Medicare Part C plan may not enroll any new enrollees in
the plan during the annual, coordinated election period
(under section 1851(e)(3)(B) of such Act (42 U.S.C. 1395w-
21(e)(3)(B)) for the year or during the year (if the
enrollment becomes effective during the year).
(2) Bid amount for part a and b services.--
(A) In general.--Except as provided in subparagraph (B),
the bid amount described in this paragraph is the unadjusted
Medicare Part C statutory non-drug monthly bid amount (as
defined in section 1854(b)(2)(E) of the Social Security Act
(42 U.S.C. 1395w-24(b)(2)(E)).
(B) Treatment of msa plans.--In the case of an MSA plan (as
defined in section
[[Page H9325]]
1859(b)(3) of the Social Security Act, 42 U.S.C. 1935w-
28(b)(3)), the bid amount described in this paragraph is the
amount described in section 1854(a)(3)(A) of such Act (42
U.S.C. 1395w-24(a)(3)(A)).
(3) Fee-for-service amount described.--
(A) In general.--Subject to subparagraph (B), the fee-for-
service amount described in this paragraph for an Medicare
Part C local area is the amount described in section
1853(c)(1)(D)(i) of the Social Security Act (42 U.S.C. 1395w-
23) for such area.
(B) Treatment of multi-county plans.--In the case of an MA
plan the service area for which covers more than one Medicare
Part C local area, the fee-for-service amount described in
this paragraph is the amount described in section
1853(c)(1)(D)(i) of the Social Security Act for each such
area served, weighted for each such area by the proportion of
the enrollment of the plan that resides in the county (as
determined based on amounts posted by the Administrator of
the Centers for Medicare & Medicaid Services in the April bid
notice for the year involved).
(4) Percentage phase down.--For purposes of paragraph (1),
the percentage specified in this paragraph--
(A) for 2009 is 106 percent; and
(B) for 2010 is 103 percent.
(5) Exemption of age-ins.--For purposes of paragraph (1),
the term ``new enrollee'' with respect to a Medicare Part C
plan offered by a Medicare Part C organization, does not
include an individual who was enrolled in a plan offered by
the organization in the month immediately before the month in
which the individual was eligible to enroll in such a
Medicare Part C plan offered by the organization.
(d) Annual Rebasing of Fee-for-Service Rates.--Section
1853(c)(1)(D)(ii) of the Social Security Act (42 U.S.C.
1395w-23(c)(1)(D)(ii)) is amended--
(1) by inserting ``(before 2009)'' after ``for subsequent
years''; and
(2) by inserting before the period at the end the
following: ``and for each year beginning with 2009''.
(e) Repeal of PPO Stabilization Fund.--Section 1858 of the
Social Security Act (42 U.S.C. 1395) is amended--
(1) by striking subsection (e); and
(2) in subsection (f)(1), by striking ``subject to
subsection (e),''.
Subtitle B--Beneficiary Protections
SEC. 411. NAIC DEVELOPMENT OF MARKETING, ADVERTISING, AND
RELATED PROTECTIONS.
(a) In General.--Section 1852 of the Social Security Act
(42 U.S.C. 1395w-22) is amended by adding at the end the
following new subsection:
``(m) Application of Model Marketing and Enrollment
Standards.--
``(1) In general.--The National Association of Insurance
Commissioners (in this subsection referred to as the `NAIC')
is requested to develop, and to submit to the Secretary of
Health and Human Services not later than 12 months after the
date of the enactment of this Act, model regulations (in this
section referred to as `model regulations') regarding
Medicare plan marketing, enrollment, broker and agent
training and certification, agent and broker commissions, and
market conduct by plans, agents and brokers for
implementation (under paragraph (7)) under this part and part
D, including for enforcement by States under section
1856(b)(3).
``(2) Marketing guidelines.--
``(A) In general.--The model regulations shall address the
sales and advertising techniques used by Medicare private
plans, agents and brokers in selling plans, including
defining and prohibiting cold calls, unsolicited door-to-door
sales, cross-selling, and co-branding.
``(B) Special considerations.--The model regulations shall
specifically address the marketing--
``(i) of plans to full benefit dual-eligible individuals
and qualified medicare beneficiaries;
``(ii) of plans to populations with limited English
proficiency;
``(iii) of plans to beneficiaries in senior living
facilities; and
``(iv) of plans at educational events.
``(3) Enrollment guidelines.--
``(A) In general.--The model regulations shall address the
disclosures Medicare private plans, agents, and brokers must
make when enrolling beneficiaries, and a process--
``(i) for affirmative beneficiary sign off before
enrollment in a plan; and
``(ii) in the case of Medicare Part C plans, for plans to
conduct a beneficiary call-back to confirm beneficiary sign
off and enrollment.
``(B) Specific considerations.--The model regulations shall
specially address beneficiary understanding of the Medicare
plan through required disclosure (or beneficiary
verification) of each of the following:
``(i) The type of Medicare private plan involved.
``(ii) Attributes of the plan, including premiums, cost
sharing, formularies (if applicable), benefits, and provider
access limitations in the plan.
``(iii) Comparative quality of the plan.
``(iv) The fact that plan attributes may change annually.
``(4) Appointment, certification and training of agents and
brokers.--The model regulations shall establish procedures
and requirements for appointment, certification (and periodic
recertification), and training of agents and brokers that
market or sell Medicare private plans consistent with
existing State appointment and certification procedures and
with this paragraph.
``(5) Agent and broker commissions.--
``(A) In general.--The model regulations shall establish
standards for fair and appropriate commissions for agents and
brokers consistent with this paragraph.
``(B) Limitation on types of commission.--The model
regulations shall specifically prohibit the following:
``(i) Differential commissions--
``(I) for Medicare Part C plans based on the type of
Medicare private plan; or
``(II) prescription drug plans under part D based on the
type of prescription drug plan.
``(ii) Commissions in the first year that are more than 200
percent of subsequent year commissions.
``(iii) The payment of extra bonuses or incentives (such as
trips, gifts, and other non-commission cash payments).
``(C) Agent disclosure.--In developing the model
regulations, the NAIC shall consider requiring agents and
brokers to disclose commissions to a beneficiary upon request
of the beneficiary before enrollment.
``(D) Prevention of fraud.--The model regulations shall
consider the opportunity for fraud and abuse and beneficiary
steering in setting standards under this paragraph and shall
provide for the ability of State commissioners to investigate
commission structures.
``(6) Market conduct.--
``(A) In general.--The model regulations shall establish
standards for the market conduct of organizations offering
Medicare private plans, and of agents and brokers selling
such plans, and for State review of plan market conduct.
``(B) Matters to be included.--Such standards shall include
standards for--
``(i) timely payment of claims;
``(ii) beneficiary complaint reporting and disclosure; and
``(iii) State reporting of market conduct violations and
sanctions.
``(7) Implementation.--
``(A) Publication of naic model regulations.--If the model
regulations are submitted on a timely basis under paragraph
(1)--
``(i) the Secretary shall publish them in the Federal
Register upon receipt and request public comment on the issue
of whether such regulations are consistent with the
requirements established in this subsection for such
regulations;
``(ii) not later than 6 months after the date of such
publication, the Secretary shall determine whether such
regulations are so consistent with such requirements and
shall publish notice of such determination in the Federal
Register; and
``(iii) if the Secretary makes the determination under
clause (ii) that such regulations are consistent with such
requirements, in the notice published under clause (ii) the
Secretary shall publish notice of adoption of such model
regulations as constituting the marketing and enrollment
standards adopted under this subsection to be applied under
this title; and
``(iv) if the Secretary makes the determination under such
clause that such regulations are not consistent with such
requirements, the procedures of clauses (ii) and (iii) of
subparagraph (B) shall apply (in relation to the notice
published under clause (ii)), in the same manner as such
clauses would apply in the case of publication of a notice
under subparagraph (B)(i).
``(B) No model regulations.--If the model regulations are
not submitted on a timely basis under paragraph (1)--
``(i) the Secretary shall publish notice of such fact in
the Federal Register;
``(ii) not later than 6 months after the date of
publication of such notice, the Secretary shall propose
regulations that provide for marketing and enrollment
standards that incorporate the requirements of this
subsection for the model regulations and request public
comments on such proposed regulations; and
``(iii) not later than 6 months after the date of
publication of such proposed regulations, the Secretary shall
publish final regulations that shall constitute the marketing
and enrollment standards adopted under this subsection to be
applied under this title.
``(C) References to marketing and enrollment standards.--In
this title, a reference to marketing and enrollment standards
adopted under this subsection is deemed a reference to the
regulations constituting such standards adopted under
subparagraph (A) or (B), as the case may be.
``(D) Effective date of standards.--In order to provide for
the orderly and timely implementation of marketing and
enrollment standards adopted under this subsection, the
Secretary, in consultation with the NAIC, shall specify (by
program instruction or otherwise) effective dates with
respect to all components of such standards consistent with
the following:
``(i) In the case of components that relate predominantly
to operations in relation to Medicare private plans, the
effective date shall be for plan years beginning on or after
such date (not later than 1 year after the date of
promulgation of the standards) as the Secretary specifies.
``(ii) In the case of other components, the effective date
shall be such date, not later than 1 year after the date of
promulgation of the standards, as the Secretary specifies.
``(E) Consultation.-- In promulgating marketing and
enrollment standards under this paragraph, the NAIC or
Secretary shall
[[Page H9326]]
consult with a working group composed of representatives of
issuers of Medicare private plans, consumer groups, medicare
beneficiaries, State Health Insurance Assistance Programs,
and other qualified individuals. Such representatives shall
be selected in a manner so as to assure balanced
representation among the interested groups.
``(8) Enforcement.--
``(A) In general.--Any Medicare private plan that violates
marketing and enrollment standards is subject to sanctions
under section 1857(g).
``(B) State responsibilities.--Nothing in this subsection
or section 1857(g) shall prohibit States from imposing
sanctions against Medicare private plans, agents, or brokers
for violations of the marketing and enrollment standards
adopted under section 1852(m). States shall have the sole
authority to regulate agents and brokers.
``(9) Medicare private plan defined.--In this subsection,
the term `Medicare private plan' means a Medicare Part C plan
and a prescription drug plan under part D.''.
(b) Expansion of Exception to Preemption of State Role.--
(1) In general.--Section 1856(b)(3) of the Social Security
Act (42 U.S.C. 1395w-26(b)(3)) is amended by striking
``(other than State licensing laws or State laws relating to
plan solvency)'' and inserting ``(other than State laws
relating to licensing or plan solvency and State laws or
regulations adopting the marketing and enrollment standards
adopted under section 1852(m)).''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to plans offered on or after July 1, 2008.
(c) Application to Prescription Drug Plans.--
(1) In general.--Section 1860D-1 of such Act is amended by
adding at the end the following new subsection:
``(d) Application of Marketing and Enrollment Standards.--
The marketing and enrollment standards adopted under section
1852(m) shall apply to prescription drug plans (and sponsors
of such plans) in the same manner as they apply to Medicare
Part C plans and organizations offering such plans.''.
(2) Reference to current law provisions.--The amendment
made by subsection (a) and (b) apply, pursuant to section
1860D-1(b)(1)(B)(ii) of the Social Security Act (42 U.S.C.
1395w-101(b)(1)(B)(ii)), to prescription drug plans under
part D of title XVIII of such Act.
(d) Contract Requirement To Meet Marketing and Advertising
Standards.--
(1) In general.--Section 1857(d) of the Social Security Act
(42 U.S.C. 1395w-27(d)), as amended by subsection (b)(1), is
further amended by adding at the end the following new
paragraph:
``(7) Marketing and advertising standards.--The contract
shall require the organization to meet all standards adopted
under section 1852(m) (including those enforced by the State
involved pursuant to section 1856(b)(3)) relating to
marketing and advertising conduct''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contracts for plan years beginning on or after
January 1, 2011.
(e) Application of Sanctions.--
(1) Application to violation of marketing and enrollment
standards.--Section 1857(g) of such Act (42 U.S.C. 1395w-
27(g)) is amended--
(A) by striking ``or'' at the end of subparagraph (F);
(B) by adding ``or'' at the end of subparagraph (G); and
(C) by inserting after subparagraph (G) the following new
subparagraph:
``(H) violates marketing and enrollment standards adopted
under section 1852(m);''.
(2) Enhanced civil money sanctions.--Such section is
further amended--
(A) in paragraph (2)(A), by striking ``$25,000'',
``$100,000'', and ``$15,000'' and inserting ``$50,000'',
``$200,000'', and ``$30,000'', respectively; and
(B) in subparagraphs (A), (B), and (D) of paragraph (3), by
striking ``$25,000'', ``$10,000'', and ``$100,000'',
respectively, and inserting ``$50,000'', ``$20,000'', and
``$200,000'', respectively.
(3) Effective date.--The amendments made by paragraph (2)
shall apply to violations occurring on or after the date of
the enactment of this Act.
(f) Disclosure of Market and Advertising Contract
Violations and Imposed Sanctions.--Section 1857 of such Act
is amended by adding at the end the following new subsection
``(j) Disclosure of Market and Advertising Contract
Violations and Imposed Sanctions.--For years beginning with
2009, the Secretary shall post on its public website for the
Medicare program an annual report that--
``(1) lists each MA organization for which the Secretary
made during the year a determination under subsection (c)(2)
the basis of which is described in paragraph (1)(E); and
``(2) that describes any applicable sanctions under
subsection (g) applied to such organization pursuant to such
determination.''.
(g) Standard Definitions of Benefits and Formats for Use in
Marketing Materials.--Section 1851(h) of such Act (42 U.S.C.
1395w-21(h)) is amended by adding at the end the following
new paragraph:
``(6) Standard definitions of benefits and formats for use
in marketing materials.--
``(A) In general.--Not later than January 1, 2010, the
Secretary, in consultation with the National Association of
Insurance Commissioners and a working group of the type
described in section 1852(m)(7)(E), shall develop standard
descriptions and definitions for benefits under this title
for use in marketing material distributed by Medicare Part C
organizations and formats for including such descriptions in
such marketing material.
``(B) Required use of standard definitions.-- For plan
years beginning on or after January 1, 2011, the Secretary
shall disapprove the distribution of marketing material under
paragraph (1)(B) if such marketing material does not use,
without modification, the applicable descriptions and formats
specified under subparagraph (A).''.
(h) Support for State Health Insurance Assistance Programs
(SHIPs).--Section 1857(e)(2) of the Social Security Act (42
U.S.C. 1395w-27(e)(2)) is amended--
(1) in subparagraph (B), by adding at the end the
following: ``Of the amounts so collected, no less than
$55,000,000 for fiscal year 2009, $65,000,000 for fiscal year
2010, $75,000,000 for fiscal year 2011, and $85,000,000 for
fiscal year 2012 shall be used to support Medicare Part C and
Part D counseling and assistance provided by State Health
Insurance Assistance Programs.'';
(2) in subparagraph (C)--
(A) by striking ``and'' after ``$100,000,000''; and
(B) by striking ``an amount equal to $200,000,000'' and
inserting ``and ending with fiscal year 2008 an amount equal
to $200,000,000, for fiscal year 2009 an amount equal to
$255,000,000, for fiscal year 2010 an amount equal to
$265,000,000, for fiscal year 2011 an amount equal to
$275,000,000, and for fiscal year 2012 an amount equal to
$285,000,000''; and
(3) in subparagraph (D)(ii)--
(A) by striking ``and'' at the end of subclause (IV);
(B) in subclause (V), by striking the period at the end and
inserting ``before fiscal year 2009; and''; and
(C) by adding at the end the following new subclauses:
``(VI) for fiscal year 2009 and each succeeding fiscal year
the applicable portion (as so defined) of the amount
specified in subparagraph (C) for that fiscal year.''.
SEC. 412. LIMITATION ON OUT-OF-POCKET COSTS FOR INDIVIDUAL
HEALTH SERVICES.
(a) In General.--Section 1852(a)(1) of the Social Security
Act (42 U.S.C. 1395w-22(a)(1)) is amended--
(1) in subparagraph (A), by inserting before the period at
the end the following: ``with cost-sharing that is no greater
(and may be less) than the cost-sharing that would otherwise
be imposed under such program option'';
(2) in subparagraph (B)(i), by striking `` or an
actuarially equivalent level of cost-sharing as determined in
this part''; and
(3) by amending clause (ii) of subparagraph (B) to read as
follows:
``(ii) Permitting use of flat copayment or per diem rate.--
Nothing in clause (i) shall be construed as prohibiting a
Medicare part C plan from using a flat copayment or per diem
rate, in lieu of the cost-sharing that would be imposed under
part A or B, so long as the amount of the cost-sharing
imposed does not exceed the amount of the cost-sharing that
would be imposed under the respective part if the individual
were not enrolled in a plan under this part.''.
(b) Limitation for Dual Eligibles and Qualified Medicare
Beneficiaries.--Section 1852(a) of such Act is amended by
adding at the end the following new paragraph:
``(7) Limitation on cost-sharing for dual eligibles and
qualified medicare beneficiaries.--In the case of a
individual who is a full-benefit dual eligible individual (as
defined in section 1935(c)(6)) or a qualified medicare
beneficiary (as defined in section 1905(p)(1)) who is
enrolled in a Medicare Part C plan, the plan may not impose
cost-sharing that exceeds the amount of cost-sharing that
would be permitted with respect to the individual under this
title and title XIX if the individual were not enrolled with
such plan.''.
(c) Effective Dates.--
(1) The amendments made by subsection (a) shall apply to
plan years beginning on or after January 1, 2009.
(2) The amendments made by subsection (b) shall apply to
plan years beginning on or after January 1, 2008.
SEC. 413. MA PLAN ENROLLMENT MODIFICATIONS.
(a) Improved Plan Enrollment, Disenrollment, and Change of
Enrollment.--
(1) Continuous open enrollment for full-benefit dual
eligible individuals and qualified medicare beneficiaries
(qmb).--Section 1851(e)(2)(D) of the Social Security Act (42
U.S.C. 1395w-21(e)(2)(D)) is amended--
(A) in the heading, by inserting ;``, full-benefit dual
eligible individuals, and qualified medicare beneficiaries''
after ``institutionalized individuals''; and
(B) in the matter before clause (i), by inserting ``, a
full-benefit dual eligible individual (as defined in section
1935(c)(6)), or a qualified medicare beneficiary (as defined
in section 1905(p)(1))'' after ``institutionalized (as
defined by the Secretary)''; and
(C) in clause (i), by inserting ``or disenroll'' after
``enroll''.
(2) Special election periods for additional categories of
individuals.--Section
[[Page H9327]]
1851(e)(4) of such Act (42 U.S.C. 1395w(e)(4)) is amended--
(A) in subparagraph (C), by striking at the end ``or'';
(B) in subparagraph (D), by inserting ``, taking into
account the health or well-being of the individual'' before
the period and redesignating such subparagraph as
subparagraph (G); and
(C) by inserting after subparagraph (C) the following new
subparagraphs:
``(D) the individual is described in section
1902(a)(10)(E)(iii) (relating to specified low-income
medicare beneficiaries); or
``(E) the individual is enrolled in an MA plan and
enrollment in the plan is suspended under paragraph (2)(B) or
(3)(C) of section 1857(g) because of a failure of the plan to
meet applicable requirements.''.
(3) Elimination of continuous open enrollment of original
fee-for-service enrollees in medicare advantage non-
prescription drug plans.--Subparagraph (E) of section
1851(e)(2) of the Social Security Act, as added by section
206 of division B of the Tax Relief and Health Care Act of
2006 (Public Law 109-432), is repealed.
(4) Effective date.--The amendments made by this subsection
shall take effect on the date of the enactment of this Act.
(b) Access to Medigap Coverage for Individuals Who Leave MA
Plans.--
(1) In general.--Section 1882(s)(3) of the Social Security
Act (42 U.S.C. 1395ss(s)(3)) is amended--
(A) in each of clauses (v)(III) and (vi) subparagraph (B),
by striking ``12 months'' and inserting ``24 months''; and
(B) in each of subclauses (I) and (II) of subparagraph
(F)(i), by striking ``12 months'' and inserting ``24
months''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to terminations of enrollments in MA plans
occurring on or after the date of the enactment of this Act.
(c) Improved Enrollment Policies.--
(1) No auto-enrollment of medicaid beneficiaries.--
(A) In general.--Section 1851(e) of such Act (42 U.S.C.
1395w-21(e)) is amended by adding at the end the following
new paragraph:
``(7) No auto-enrollment of medicaid beneficiaries.--In no
case may the Secretary provide for the enrollment in a MA
plan of a Medicare Advantage eligible individual who is
eligible to receive medical assistance under title XIX as a
full-benefit dual eligible individual or a qualified medicare
beneficiary, without the affirmative application of such
individual (or authorized representative of the individual)
to be enrolled in such plan.''.
(B) No application to prescription drug plans.--Section
1860D-1(b)(1)(B)(iii) of such Act (42 U.S.C. 1395w-
101(b)(1)(B)(iii)) is amended--
(i) by striking ``paragraph (2) and'' and by inserting
``paragraph (2),''; and
(ii) by inserting ``, and paragraph (7),'' after
``paragraph (4)''.
(C) Effective date.--The amendments made by this paragraph
shall apply to enrollments that are effective on or after the
date of the enactment of this Act.
SEC. 414. INFORMATION FOR BENEFICIARIES ON MA PLAN
ADMINISTRATIVE COSTS.
(a) Disclosure of Medical Loss Ratios and Other Expense
Data.--Section 1851 of the Social Security Act (42 U.S.C.
1395w-21) is amended by adding at the end the following new
subsection:
``(j) Publication of Medical Loss Ratios and Other Cost-
Related Information.--
``(1) In general.--The Secretary shall publish, not later
than October 1 of each year (beginning with 2009), for each
Medicare Part C plan contract, the following:
``(A) The medical loss ratio of the plan in the previous
year.
``(B) The per enrollee payment under this part to the plan,
as adjusted to reflect a risk score (based on factors
described in section 1853(a)(1)(C)(i)) of 1.0.
``(C) The average risk score (as so based).
``(2) Submission of data.--
``(A) In general.--Each Medicare Part C organization shall
submit to the Secretary, in a form and manner specified by
the Secretary, data necessary for the Secretary to publish
the information described in paragraph (1) on a timely basis,
including the information described in paragraph (3).
``(B) Data for 2008 and 2009.--The data submitted under
subparagraph (A) for 2008 and for 2009 shall be consistent in
content with the data reported as part of the Medicare Part C
plan bid in June 2007 for 2008.
``(C) Medical loss ratio data.--The data to be submitted
under subparagraph (A) relating to medical loss ratio for a
year--
``(i) shall be submitted not later than June 1 of the
following year; and
``(ii) beginning with 2010, shall be submitted based on the
standardized elements and definitions developed under
paragraph (4).
``(D) Audited data.--Data submitted under this paragraph
shall be data that has been audited by an independent third
party auditor.
``(3) MLR information.--The information described in this
paragraph with respect to a Medicare Part C plan for a year
is as follows:
``(A) The costs for the plan in the previous year for each
of the following:
``(i) Total medical expenses, separately indicated for
benefits for the original medicare fee-for-service program
option and for supplemental benefits.
``(ii) Non-medical expenses, shown separately for each of
the following categories of expenses:
``(I) Marketing and sales.
``(II) Direct administration.
``(III) Indirect administration.
``(IV) Net cost of private reinsurance.
``(B) Gain or loss margin.
``(C) Total revenue requirement, computed as the total of
medical and nonmedical expenses and gain or loss margin,
multiplied by the gain or loss margin.
``(D) Percent of revenue ratio, computed as the total
revenue requirement expressed as a percentage of revenue.
``(4) Development of data reporting standards.--
``(A) In general.--The Secretary shall develop and
implement standardized data elements and definitions for
reporting under this subsection, for contract years beginning
with 2010, of data necessary for the calculation of the
medical loss ratio for Medicare Part C plans. Not later than
December 31, 2008, the Secretary shall publish a report
describing the elements and definitions so developed.
``(B) Consultation.--The Secretary shall consult with
representatives of Medicare Part C organizations, experts on
health plan accounting systems, and representatives of the
National Association of Insurance Commissioners, in the
development of such data elements and definitions
``(5) Medical loss ratio defined.--For purposes of this
part, the term `medical loss ratio' means, with respect to an
MA plan for a year, the ratio of--
``(A) the aggregate benefits (excluding nonmedical expenses
described in paragraph (3)(A)(ii)) paid under the plan for
the year, to
``(B) the aggregate amount of premiums (including basic and
supplemental beneficiary premiums) and payments made under
sections 1853 and 1860D-15) collected for the plan and year.
Such ratio shall be computed without regard to whether the
benefits or premiums are for required or supplemental
benefits under the plan.''.
(b) Audit of Administrative Costs and Compliance With the
Federal Acquisition Regulation.--
(1) In general.--Section 1857(d)(2)(B) of such Act (42
U.S.C. 1395w-27(d)(2)(B)) is amended--
(A) by striking ``or (ii)'' and inserting ``(ii)''; and
(B) by inserting before the period at the end the
following: ``, or (iii) to compliance with the requirements
of subsection (e)(4) and the extent to which administrative
costs comply with the applicable requirements for such costs
under the Federal Acquisition Regulation''.
(2) Effective date.--The amendments made by this subsection
shall apply for contract years beginning after the date of
the enactment of this Act.
(c) Minimum Medical Loss Ratio.--Section 1857(e) of the
Social Security Act (42 U.S.C. 1395w-27(e)) is amended by
adding at the end the following new paragraph:
``(4) Requirement for minimum medical loss ratio.--If the
Secretary determines for a contract year (beginning with
2010) that an MA plan has failed to have a medical loss ratio
(as defined in section 1851(j)(4)) of at least .85--
``(A) for that contract year, the Secretary shall reduce
the blended benchmark amount under subsection (l) for the
second succeeding contract year by the numer of percentage
points by which such loss ratio was less than 85 percent;
``(B) for 3 consecutive contract years, the Secretary shall
not permit the enrollment of new enrollees under the plan for
coverage during the second succeeding contract year; and
``(C) the Secretary shall terminate the plan contract if
the plan fails to have such a medical loss ratio for 5
consecutive contract years.''.
(d) Information on Medicare Part C Plan Enrollment and
Services.--Section 1851 of such Act, as amended by subsection
(a), is further amended by adding at the end the following
new subsection:
``(k) Publication of Enrollment and Other Information.--
``(1) Monthly publication of plan-specific enrollment
data.--The Secretary shall publish (on the public website of
the Centers for Medicare & Medicaid Services or otherwise)
not later than 30 days after the end of each month (beginning
with January 2008) on the actual enrollment in each Medicare
Part C plan by contract and by county.
``(2) Availability of other information.--The Secretary
shall make publicly available data and other information in a
format that may be readily used for analysis of the Medicare
Part C program under this part and will contribute to
the understanding of the organization and operation of
such program.''.
(e) MedPAC Report on Varying Minimum Medical Loss Ratios.--
(1) Study.--The Medicare Payment Advisory Commission shall
conduct a study of the need and feasibility ofproviding for
different minimum medical loss ratios for different types of
Medicare Part C plans, including coordinated care plans,
group model plans, coordinated care independent practice
association plans, preferred provider organization plans, and
private fee-for-services plans.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, submit to Congress a report on the
study conducted under paragraph (1).
[[Page H9328]]
Subtitle C--Quality and Other Provisions
SEC. 421. REQUIRING ALL MA PLANS TO MEET EQUAL STANDARDS.
(a) Collection and Reporting of Information.--
(1) In general.--Section 1852(e)(1) of the Social Security
Act (42 U.S.C. 1395w-112(e)(1)) is amended by striking
``(other than an MA private fee-for-service plan or an MSA
plan)''.
(2) Reporting for private fee-for-services and msa plans.--
Section 1852(e)(3) of such Act is amended by adding at the
end the following new subparagraph:
``(C) Data collection requirements by private fee-for-
service plans and msa plans.--
``(i) Using measures for ppos for contract year 2009.--For
contract year 2009, the Medicare Part C organization offering
a private fee-for-service plan or an MSA plan shall submit to
the Secretary for such plan the same information on the same
performance measures for which such information is required
to be submitted for Medicare Part C plans that are preferred
provider organization plans for that year.
``(ii) Application of same measures as coordinated care
plans beginning in contract year 2010.--For a contract year
beginning with 2010, a Medicare Part C organization offering
a private fee-for-service plan or an MSA plan shall submit to
the Secretary for such plan the same information on the same
performance measures for which such information is required
to be submitted for such contract year Medicare Part C plans
described in section 1851(a)(2)(A)(i) for contract year such
contract year.''.
(3) Effective date.--The amendment made by paragraph (1)
shall apply to contract years beginning on or after January
1, 2009.
(b) Employer Plans.--
(1) In general.--The first sentence of paragraph (2) of
section 1857(i) of such Act (42 U.S.C. 1395w-27(i)) is
amended by inserting before the period at the end the
following: ``, but only if 90 percent of the Medicare part C
eligible individuals enrolled under such plan reside in a
county in which the Medicare Part C organization offers a
Medicare Part C local plan''.
(2) Limitation on application of waiver authority.--
Paragraphs (1) and (2) of such section are each amended by
inserting ``that were in effect before the date of the
enactment of the Children's Health and Medicare Protection
Act of 2007'' after ``waive or modify requirements''.
(3) Effective dates.--The amendment made by paragraph (1)
shall apply for plan years beginning on or after January 1,
2009, and the amendments made by paragraph (2) shall take
effect on the date of the enactment of this Act.
SEC. 422. DEVELOPMENT OF NEW QUALITY REPORTING MEASURES ON
RACIAL DISPARITIES.
(a) New Quality Reporting Measures.--
(1) In general.--Section 1852(e)(3) of the Social Security
Act (42 U.S.C. 1395w-22(e)(3)), as amended by section
421(a)(2), is amended--
(A) in subparagraph (B)--
(i) in clause (i), by striking ``The Secretary'' and
inserting ``Subject to subparagraph (D), the Secretary''; and
(ii) in clause (ii), by inserting ``and subparagraph (C)''
after ``clause (iii)''; and
(B) by adding at the end the following new subparagraph:
``(D) Additional quality reporting measures.--
``(i) In general.--The Secretary shall develop by October
1, 2009, quality measures for Medicare Part C plans that
measure disparities in the amount and quality of health
services provided to racial and ethnic minorities.
``(ii) Data to measure racial and ethnic disparities in the
amount and quality of care provided to enrollees.--The
Secretary shall provide for Medicare Part C organizations to
submit data under this paragraph, including data similar to
those submitted for other quality measures, that permits
analysis of disparities among racial and ethnic minorities in
health services, quality of care, and health status among
Medicare Part C plan enrollees for use in submitting the
reports under paragraph (5).''.
(2) Effective date.--The amendments made by this subsection
shall apply to reporting of quality measures for plan years
beginning on or after January 1, 2010.
(b) Biennial Report on Racial and Ethnic Minorities.--
Section 1852(e) of such Act (42 U.S.C. 1395w-22(e)) is
amended by adding at the end the following new paragraph:
``(5) Report to congress.--
``(A) In general.--Not later than 2 years after the date of
the enactment of this paragraph, and biennially thereafter,
the Secretary shall submit to Congress a report regarding how
quality assurance programs conducted under this subsection
measure and report on disparities in the amount and quality
of health care services furnished to racial and ethnic
minorities.
``(B) Contents of report.--Each such report shall include
the following:
``(i) A description of the means by which such programs
focus on such racial and ethnic minorities.
``(ii) An evaluation of the impact of such programs on
eliminating health disparities and on improving health
outcomes, continuity and coordination of care, management of
chronic conditions, and consumer satisfaction.
``(iii) Recommendations on ways to reduce clinical outcome
disparities among racial and ethnic minorities.
``(iv) Data for each MA plan from HEDIS and other source
reporting the disparities in the amount and quality of health
services furnished to racial and ethnic minorities.''.
SEC. 423. STRENGTHENING AUDIT AUTHORITY.
(a) For Part C Payments Risk Adjustment.--Section
1857(d)(1) of the Social Security Act (42 U.S.C. 1395w-
27(d)(1)) is amended by inserting after ``section 1858(c))''
the following: ``, and data submitted with respect to risk
adjustment under section 1853(a)(3).''.
(b) Enforcement of Audits and Deficiencies.--
(1) In general.--Section 1857(e) of such Act is amended by
adding at the end the following new paragraph:
``(4) Enforcement of audits and deficiencies.--
``(A) Information in contract.--The Secretary shall require
that each contract with a Medicare Part C organization under
this section shall include terms that inform the organization
of the provisions in subsection (d).
``(B) Enforcement authority.--The Secretary is authorized,
in connection with conducting audits and other activities
under subsection (d), to take such actions, including pursuit
of financial recoveries, necessary to address deficiencies
identified in such audits or other activities.''.
(2) Application under part d.--For provision applying the
amendment made by paragraph (1) to prescription drug plans
under part D, see section 1860D-12(b)(3)(D) of the Social
Security Act.
(c) Effective Date.--The amendments made by this section
shall take effect the date of the enactment of this Act and
shall apply to audits and activities conducted for contract
years beginning on or after January 1, 2009.
SEC. 424. IMPROVING RISK ADJUSTMENT FOR MA PAYMENTS.
(a) In General.--Not later than 1 year after the date of
the enactment of this Act, the Secretary of Health and Human
Services shall submit to Congress a report that evaluates the
adequacy of the Medicare Advantage risk adjustment system
under section 1853(a)(1)(C) of the Social Security Act (42
U.S.C. 1395-23(a)(1)(C)).
(b) Particulars.--The report under subsection (a) shall
include an evaluation of at least the following:
(1) The need and feasibility of improving the adequacy of
the risk adjustment system in predicting costs for
beneficiaries with co-morbid conditions and associated
cognitive impairments.
(2) The need and feasibility of including further
gradations of diseases and conditions (such as the degree of
severity of congestive heart failure).
(3) The feasibility of measuring difference in coding over
time between Medicare part C plans and the medicare
traditional fee-for-service program and, to the extent this
difference exists, the options for addressing it.
(4) The feasibility and value of including part D and other
drug utilization data in the risk adjustment model.
SEC. 425. ELIMINATING SPECIAL TREATMENT OF PRIVATE FEE-FOR-
SERVICE PLANS.
(a) Elimination of Extra Billing Provision.--Section
1852(k)(2) of the Social Security Act (42 U.S.C. 1395w-
22(k)(2)) is amended--
(1) in subparagraph (A)(i), by striking ``115 percent'' and
inserting ``100 percent''; and
(2) in subparagraph (C)(i), by striking `` (including any
liability for balance billing consistent with this
subsection)''.
(b) Review of Bid Information.--Section 1854(a)(6)(B) of
such Act (42 U.S.C. 1395w-24(a)(6)(B)) is amended--
(1) in clause (i), by striking ``clauses (iii) and (iv)''
and inserting ``clause (iii)''; and
(2) by striking clause (iv).
(c) Effective Date.--The amendments made by this section
shall apply to contract years beginning with 2009.
SEC. 426. RENAMING OF MEDICARE ADVANTAGE PROGRAM.
(a) In General.--The program under part C of title XVIII of
the Social Security Act is henceforth to be known as the
``Medicare Part C program''.
(b) Change in References.--
(1) Amending social security act.--The Social Security Act
is amended by striking ``Medicare Advantage'', ``MA'', and
``Medicare+Choice'' and inserting ``Medicare Part C'' each
place it appears, with the appropriate, respective
typographic formatting, including typeface and
capitalization.
(2) Additional references.--Notwithstanding section 201(b)
of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (Public Law 108-173), any reference
to the program under part C of title XVIII of the Social
Security Act shall be deemed a reference to the ``Medicare
Part C'' program and, with respect to such part, any
reference to ``Medicare+Choice''. ``Medicare Advantage'', or
``MA'' is deemed a reference to the program under such part.
Subtitle D--Extension of Authorities
SEC. 431. EXTENSION AND REVISION OF AUTHORITY FOR SPECIAL
NEEDS PLANS (SNPS).
(a) Extending Restriction on Enrollment Authority for SNPs
for 3 Years.--Subsection (f) of section 1859 of the Social
Security Act (42 U.S.C. 1395w-28) is amended by striking
``2009'' and inserting ``2012''.
(b) Structure of Authority for SNPs.--
(1) In general.--Such section is further amended--
[[Page H9329]]
(A) in subsection (b)(6)(A), by striking all that follows
``means'' and inserting the following: ``an MA plan--
``(i) that serves special needs individuals (as defined in
subparagraph (B));
``(ii) as of January 1, 2009, either--
``(I) at least 90 percent of the enrollees in which are
described in subparagraph (B)(i), as determined under
regulations in effect as of July 1, 2007; or
``(II) at least 90 percent of the enrollees in which are
described in subparagraph (B)(ii) and are full-benefit dual
eligible individuals (as defined in section 1935(c)(6)) or
qualified medicare beneficiaries (as defined in section
1905(p)(1)); and
``(iii) as of January 1, 2009, meets the applicable
requirements of paragraph (2) or (3) of subsection (f), as
the case may be.'';
(B) in subsection (b)(6)(B)(iii), by inserting ``only for
contract years beginning before January 1, 2009,'' after
``(iii)'';
(C) in subsection (f)--
(i) by amending the heading to read as follows:
``Requirements for Enrollment in Part C Plans for Special
Needs Beneficiaries'';
(ii) by designating the sentence beginning ``In the case
of'' as paragraph (1) with the heading ``Requirements for
enrollment'' and with appropriate indentation; and
(iii) by adding at the end the following new paragraphs:
``(2) Additional requirements for institutional snps.--In
the case of a specialized MA plan for special needs
individuals described in subsection (b)(6)(A)(ii)(I), the
applicable requirements of this subsection are as follows:
``(A) The plan has an agreement with the State that
includes provisions regarding cooperation on the coordination
of care for such individuals. Such agreement shall include a
description of the manner that the State Medicaid program
under title XIX will pay for the costs of services for
individuals eligible under such title for medical assistance
for acute care and long-term care services.
``(B) The plan has a contract with long-term care
facilities and other providers in the area sufficient to
provide care for enrollees described in subsection
(b)(6)(B)(i).
``(C) The plan reports to the Secretary information on
additional quality measures specified by the Secretary under
section 1852(e)(3)(D)(iv)(I) for such plans.
``(3) Additional requirements for dual snps.--In the case
of a specialized MA plan for special needs individuals
described in subsection (b)(6)(A)(ii)(II), the applicable
requirements of this subsection are as follows:
``(A) The plan has an agreement with the State Medicaid
agency that--
``(i) includes provisions regarding cooperation on the
coordination of the financing of care for such individuals;
``(ii) includes a description of the manner that the State
Medicaid program under title XIX will pay for the costs of
cost-sharing and supplemental services for individuals
enrolled in the plan eligible under such title for medical
assistance for acute and long-term care services; and
``(iii) effective January 1, 2011, provides for capitation
payments to cover costs of supplemental benefits for
individuals described in subsection (b)(6)(A)(ii)(II).
``(B) The out-of-pocket costs for services under parts A
and B that are charged to enrollees may not exceed the out-
of-pocket costs for same services permitted for such
individuals under title XIX.
``(C) The plan reports to the Secretary information on
additional quality measures specified by the Secretary under
section 1852(e)(3)(D)(iv)(II) for such plans.''.
(2) Quality standards and quality reporting.--Section
1852(e)(3) of such Act (42 U.S.C. 1395w-22(e)(3) is amended--
(A) in subparagraph (A)(i), by adding at the end the
following: ``In the case of a specialized Medicare Part C
plan for special needs individuals described in paragraph (2)
or (3) of section 1859(f), the organization shall provide for
the reporting on quality measures developed for the plan
under subparagraph (D)(iii).''; and
(B) in subparagraph (D), as added by section 422(a)(1), by
adding at the end the following new clause:
``(iii) Specification of additional quality measurements
for specialized part c plans.--For implementation for plan
years beginning not later than January 1, 2010, the Secretary
shall develop new quality measures appropriate to meeting the
needs of--
``(I) beneficiaries enrolled in specialized Medicare Part C
plans for special needs individuals (described in section
1859(b)(6)(A)(ii)(I)) that serve predominantly individuals
who are dual-eligible individuals eligible for medical
assistance under title XIX by measuring the special needs for
care of individuals who are both Medicare and Medicaid
beneficiaries; and
``(II) beneficiaries enrolled in specialized Medicare Part
C plans for special needs individuals (described in section
1859(b)(6)(A)(ii)(II)) that serve predominantly
institutionalized individuals by measuring the special needs
for care of individuals who are a resident in long-term care
institution.''.
(3) Effective date; grandfather.--The amendments made by
paragraph (1) shall take effect for enrollments occurring on
or after January 1, 2009, and shall not apply--
(A) to plans with a contract with a State Medicaid agency
to operate an integrated Medicaid-Medicare program, that had
been approved by Centers for Medicare & Medicaid Services on
January 1, 2004; and
(B) to plans that are operational as of the date of the
enactment of this Act as approved Medicare demonstration
projects and that provide services predominantly to
individuals with end-stage renal disease.
(4) Transition for non-qualifying snps.--
(A) Restrictions in 2008 for chronic care snps.--In the
case of a specialized MA plan for special needs individuals
(as defined in section 1859(b)(6)(A) of the Social Security
Act (42 U.S.C. 1395w-28(b)(6)(A)) that, as of December 31,
2007, is not described in either subclause (I) or subclause
(II) of clause (ii) of such section, as amended by paragraph
(1), then as of January 1, 2008--
(i) the plan may not be offered unless it was offered
before such date;
(ii) no new members may be enrolled with the plan; and
(iii) there may be no expansion of the service area of such
plan.
(B) Transition of enrollees.--The Secretary of Health and
Human Services shall provide for an orderly transition of
those specialized MA plans for special needs individuals (as
defined in section 1859(b)(6)(A) of the Social Security Act
(42 U.S.C. 1395w-28(b)(6)(A)), as of the date of the
enactment of this Act), and their enrollees, that no longer
qualify as such plans under such section, as amended by this
subsection.
SEC. 432. EXTENSION AND REVISION OF AUTHORITY FOR MEDICARE
REASONABLE COST CONTRACTS.
(a) Extension for 3 Years of Period Reasonable Cost Plans
Can Remain in the Market.--Section 1876(h)(5)(C)(ii) of the
Social Security Act (42 U.S.C. 1395mm(h)(5)(C)(ii)) is
amended, in the matter preceding subclause (I), by striking
``January 1, 2008'' and inserting ``January 1, 2011''.
(b) Application of Certain Medicare Advantage Requirements
to Cost Contracts Extended or Renewed After Enactment.--
Section 1876(h) of such Act (42 U.S.C. 1395mm(h)), as amended
by subsection (a), is amended--
(1) by redesignating paragraph (5) as paragraph (6); and
(2) by inserting after paragraph (4) the following new
paragraph:
``(5)(A) Any reasonable cost reimbursement contract with an
eligible organization under this subsection that is extended
or renewed on or after the date of enactment of the
Children's Health and Medicare Protection Act of 2007 shall
provide that the provisions of the Medicare Part C program
described in subparagraph (B) shall apply to such
organization and such contract in a substantially similar
manner as such provisions apply to Medicare Part C
organizations and Medicare Part C plans under part C.
``(B) The provisions described in this subparagraph are as
follows:
``(i) Section 1851(h) (relating to the approval of
marketing material and application forms).
``(ii) Section 1852(e) (relating to the requirement of
having an ongoing quality improvement program and treatment
of accreditation in the same manner as such provisions apply
to Medicare Part C local plans that are preferred provider
organization plans).
``(iii) Section 1852(f) (relating to grievance mechanisms).
``(iv) Section 1852(g) (relating to coverage
determinations, reconsiderations, and appeals).
``(v) Section 1852(j)(4) (relating to limitations on
physician incentive plans).
``(vi) Section 1854(c) (relating to the requirement of
uniform premiums among individuals enrolled in the plan).
``(vii) Section 1854(g) (relating to restrictions on
imposition of premium taxes with respect to payments to
organizations).
``(viii) Section 1856(b)(3) (relating to relation to State
laws).
``(ix) The provisions of part C relating to timelines for
contract renewal and beneficiary notification.''.
TITLE V--PROVISIONS RELATING TO MEDICARE PART A
SEC. 501. INPATIENT HOSPITAL PAYMENT UPDATES.
(a) For Acute Hospitals.--Clause (i) of section
1886(b)(3)(B) of the Social Security Act (42 U.S.C.
1395ww(b)(3)(B)) is amended--
(1) in subclause (XIX), by striking ``and'';
(2) by redesignating subclause (XX) as subclause (XXII);
and
(3) by inserting after subclause (XIX) the following new
subclauses:
``(XX) for fiscal year 2007, subject to clause (viii), the
market basket percentage increase for hospitals in all areas,
``(XXI) for fiscal year 2008, subject to clause (viii), the
market basket percentage increase minus 0.25 percentage point
for hospitals in all areas, and''.
(b) For Other Hospitals.--Clause (ii) of such section is
amended--
(1) in subclause (VII) by striking ``and'';
(2) by redesignating subclause (VIII) as subclause (X); and
(3) by inserting after subclause (VII) the following new
subclauses:
``(VIII) fiscal years 2003 through 2007, is the market
basket percentage increase,
``(IX) fiscal year 2008, is the market basket percentage
increase minus 0.25 percentage point, and''.
(c) Delayed Effective Date.--
(1) Acute care hospitals.--The amendments made by
subsection (a) shall not apply to discharges occurring before
January 1, 2008.
[[Page H9330]]
(2) Other hospitals.--The amendments made by subsection (b)
shall be applied, only with respect to cost reporting periods
beginning during fiscal year 2008 and not with respect to the
computation for any succeeding cost reporting period, by
substituting ``0.1875 percentage point'' for ``0.25
percentage point''.
SEC. 502. PAYMENT FOR INPATIENT REHABILITATION FACILITY (IRF)
SERVICES.
(a) Payment Update.--
(1) In general.--Section 1886(j)(3)(C) of the Social
Security Act (42 U.S.C. 1395ww(j)(3)(C)) is amended by adding
at the end the following: ``The increase factor to be applied
under this subparagraph for fiscal year 2008 shall be 1
percent.''
(2) Delayed effective date.--The amendment made by
paragraph (1) shall not apply to payment units occurring
before January 1, 2008.
(b) Inpatient Rehabilitation Facility Classification
Criteria.--
(1) In general.--Section 5005 of the Deficit Reduction Act
of 2005 (Public Law 109-171) is amended--
(A) in subsection (a), by striking ``apply the applicable
percent specified in subsection (b)'' and inserting ``require
a compliance rate that is no greater than the 60 percent
compliance rate that became effective for cost reporting
periods beginning on or after July 1, 2006,''; and
(B) by amending subsection (b) to read as follows:
``(b) Continued Use of Comorbidities.--For portions of cost
reporting periods occurring on or after the date of the
enactment of the Children's Health and Medicare Protection
Act of 2007, the Secretary shall include patients with
comorbidities as described in section 412.23(b)(2)(i) of
title 42, Code of Federal Regulations (as in effect as of
January 1, 2007), in the inpatient population that counts
towards the percent specified in subsection (a).''.
(2) Effective date.--The amendment made by paragraph (1)(A)
shall apply to portions of cost reporting periods beginning
on or after the date of the enactment of this Act.
(c) Payment for Certain Medical Conditions Treated in
Inpatient Rehabilitation Facilities.--
(1) In general.--Section 1886(j) of the Social Security Act
(42 U.S.C. 1395ww(j)) is amended--
(A) by redesignating paragraph (7) as paragraph (8);
(B) by inserting after paragraph (6) the following new
paragraph:
``(7) Special payment rule for certain medical
conditions.--
``(A) In general.--Subject to subparagraph (H), in the case
of discharges occurring on or after October 1, 2008, in lieu
of the standardized payment amount (as determined pursuant to
the preceding provisions of this subsection) that would
otherwise be applicable under this subsection, the Secretary
shall substitute, for payment units with respect to an
applicable medical condition (as defined in subparagraph
(G)(i)) that is treated in an inpatient rehabilitation
facility, the modified standardized payment amount determined
under subparagraph (B).
``(B) Modified standardized payment amount.--The modified
standardized payment amount for an applicable medical
condition shall be based on the amount determined under
subparagraph (C) for such condition, as adjusted under
subparagraphs (D), (E), and (F).
``(C) Amount determined.--
``(i) In general.--The amount determined under this
subparagraph for an applicable medical condition shall be
based on the sum of the following:
``(I) An amount equal to the average per stay skilled
nursing facility payment rate for the applicable medical
condition (as determined under clause (ii)).
``(II) An amount equal to 25 percent of the difference
between the overhead costs (as defined in subparagraph
(G)(ii)) component of the average inpatient rehabilitation
facility per stay payment amount for the applicable medical
condition (as determined under the preceding paragraphs of
this subsection) and the overhead costs component of the
average per stay skilled nursing facility payment rate for
such condition (as determined under clause (ii)).
``(III) An amount equal to 33 percent of the difference
between the patient care costs (as defined in subparagraph
(G)(iii)) component of the average inpatient rehabilitation
facility per stay payment amount for the applicable medical
condition (as determined under the preceding paragraphs of
this subsection) and the patient care costs component of the
average per stay skilled nursing facility payment rate for
such condition (as determined under clause (ii)).
``(ii) Determination of average per stay skilled nursing
facility payment rate.--For purposes of clause (i), the
Secretary shall convert skilled nursing facility payment
rates for applicable medical conditions, as determined under
section 1888(e), to average per stay skilled nursing facility
payment rates for each such condition.
``(D) Adjustments.--The Secretary shall adjust the amount
determined under subparagraph (C) for an applicable medical
condition using the adjustments to the prospective payment
rates for inpatient rehabilitation facilities described in
paragraphs (2), (3), (4), and (6).
``(E) Update for inflation.--Except in the case of a fiscal
year for which the Secretary rebases the amounts determined
under subparagraph (C) for applicable medical conditions
pursuant to subparagraph (F), the Secretary shall annually
update the amounts determined under subparagraph (C) for each
applicable medical condition by the increase factor for
inpatient rehabilitation facilities (as described in
paragraph (3)(C)).
``(F) Rebasing.--The Secretary shall periodically (but in
no case less than once every 5 years) rebase the amounts
determined under subparagraph (C) for applicable medical
conditions using the methodology described in such
subparagraph and the most recent and complete cost report and
claims data available.
``(G) Definitions.--In this paragraph:
``(i) Applicable medical condition.--The term `applicable
medical condition' means--
``(I) unilateral knee replacement;
``(II) unilateral hip replacement; and
``(III) unilateral hip fracture.
``(ii) Overhead costs.--The term `overhead costs' means
those Medicare-allowable costs that are contained in the
General Service cost centers of the Medicare cost reports for
inpatient rehabilitation facilities and for skilled nursing
facilities, respectively, as determined by the Secretary.
``(iii) Patient care costs.--The term `patient care costs'
means total Medicare-allowable costs minus overhead costs.
``(H) Sunset.--The provisions of this paragraph shall cease
to apply as of the date the Secretary implements an
integrated, site-neutral payment methodology under this title
for post-acute care.''; and
(C) in paragraph (8), as redesignated by paragraph (1)--
(i) in subparagraph (C), by striking ``and'' at the end;
(ii) in subparagraph (D), by striking the period at the end
and inserting ``, and''; and
(iii) by adding at the end the following new subparagraph:
``(E) modified standardized payment amounts under paragraph
(7).''.
(2) Special rule for discharges occurring in the second
half of fiscal year 2008.--
(A) In general.--In the case of discharges from an
inpatient rehabilitation facility occurring during the period
beginning on April 1, 2008, and ending on September 30, 2008,
for applicable medical conditions (as defined in paragraph
(7)(G)(i) of section 1886(j) of the Social Security Act (42
U.S.C. 1395ww(j)), as inserted by paragraph (1)(B), in lieu
of the standardized payment amount determined pursuant to
such section, the standardized payment amount shall be $9,507
for unilateral knee replacement, $10,398 for unilateral hip
replacement, and $10,958 for unilateral hip fracture. Such
amounts are the amounts that are estimated would be
determined under paragraph (7)(C) of such section 1886(j) for
such conditions if such paragraph applied for such period.
Such standardized payment amounts shall be multiplied by the
relative weights for each case-mix group and tier, as
published in the final rule of the Secretary of Health and
Human Services for inpatient rehabilitation facility services
prospective payment for fiscal year 2008, to obtain the
applicable payment amounts for each such condition for each
case-mix group and tier.
(B) Implementation.--Notwithstanding any other provision of
law, the Secretary of Health and Human Services may implement
this subsection by program instruction or otherwise.
Paragraph (8)(E) of such section 1886(j) of the Social
Security Act, as added by paragraph (1)(C), shall apply for
purposes of this subsection in the same manner as such
paragraph applies for purposes of paragraph (7) of such
section 1886(j).
(d) Recommendations for Classifying Inpatient
Rehabilitation Hospitals and Units.--
(1) Report to congress.--Not later than 12 months after the
date of the enactment of this Act, the Secretary of Health
and Human Services, in consultation with physicians
(including geriatricians and physiatrists), administrators of
inpatient rehabilitation, acute care hospitals, skilled
nursing facilities, and other settings providing
rehabilitation services, Medicare beneficiaries, trade
organizations representing inpatient rehabilitation hospitals
and units and skilled nursing facilities, and the Medicare
Payment Advisory Commission, shall submit to the Committee on
Ways and Means of the House of Representatives and the
Committee on Finance of the Senate a report that includes--
(A) an examination of Medicare beneficiaries' access to
medically necessary rehabilitation services;
(B) alternatives or refinements to the 75 percent rule
policy for determining exclusion criteria for inpatient
rehabilitation hospital and unit designation under the
Medicare program, including determining clinical
appropriateness of inpatient rehabilitation hospital and unit
admissions and alternative criteria which would consider a
patient's functional status, diagnosis, co-morbidities, and
other relevant factors; and
(C) an examination that identifies any condition for which
individuals are commonly admitted to inpatient rehabilitation
hospitals that is not included as a condition described in
section 412.23(b)(2)(iii) of title 42, Code of Federal
Regulations, to determine the appropriate setting of care,
and any variation in patient outcomes and costs, across
settings of care, for treatment of such conditions.
For the purposes of this subsection, the term ``75 percent
rule'' means the requirement of section 412.23(b)(2) of title
42, Code of Federal Regulations, that 75 percent of the
patients
[[Page H9331]]
of a rehabilitation hospital or converted rehabilitation unit
are in 1 or more of 13 listed treatment categories.
(2) Considerations.--In developing the report described in
paragraph (1), the Secretary shall include the following:
(A) The potential effect of the 75 percent rule on access
to rehabilitation care by Medicare beneficiaries for the
treatment of a condition, whether or not such condition is
described in section 412.23(b)(2)(iii) of title 42, Code of
Federal Regulations.
(B) An analysis of the effectiveness of rehabilitation care
for the treatment of conditions, whether or not such
conditions are described in section 412.23(b)(2)(iii) of
title 42, Code of Federal Regulations, available to Medicare
beneficiaries in various health care settings, taking into
account variation in patient outcomes and costs across
different settings of care, and which may include whether the
Medicare program and Medicare beneficiaries may incur higher
costs of care for the entire episode of illness due to
readmissions, extended lengths of stay, and other factors.
SEC. 503. LONG-TERM CARE HOSPITALS.
(a) Long-Term Care Hospital Payment Update.--
(1) In general.--Section 1886 of the Social Security Act
(42 U.S.C. 1395ww) is amended by adding at the end the
following new subsection:
``(m) Prospective Payment for Long-Term Care Hospitals.--
``(1) Reference to establishment and implementation of
system.--For provisions related to the establishment and
implementation of a prospective payment system for payments
under this title for inpatient hospital services furnished by
a long-term care hospital described in subsection
(d)(1)(B)(iv), see section 123 of the Medicare, Medicaid, and
SCHIP Balanced Budget Refinement Act of 1999 and section
307(b) of Medicare, Medicaid, and SCHIP Benefits Improvement
and Protection Act of 2000.
``(2) Update for rate year 2008.--In implementing the
system described in paragraph (1) for discharges occurring
during the rate year ending in 2008 for a hospital, the base
rate for such discharges for the hospital shall be the same
as the base rate for discharges for the hospital occurring
during the previous rate year.''.
(2) Delayed effective date.--Subsection (m)(2) of section
1886 of the Social Security Act, as added by paragraph (1),
shall not apply to discharges occurring on or after July 1,
2007, and before January 1, 2008.
(b) Payment for Long-Term Care Hospital Services; Patient
and Facility Criteria.--
(1) Definition of long-term care hospital.--
(A) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x) is amended by adding at the end the
following new subsection:
``Long-Term Care Hospital
``(ccc) The term `long-term care hospital' means an
institution which--
``(1) is primarily engaged in providing inpatient services,
by or under the supervision of a physician, to Medicare
beneficiaries whose medically complex conditions require a
long hospital stay and programs of care provided by a long-
term care hospital;
``(2) has an average inpatient length of stay (as
determined by the Secretary) for Medicare beneficiaries of
greater than 25 days, or as otherwise defined in section
1886(d)(1)(B)(iv);
``(3) satisfies the requirements of subsection (e);
``(4) meets the following facility criteria:
``(A) the institution has a patient review process,
documented in the patient medical record, that screens
patients prior to admission for appropriateness of admission
to a long-term care hospital, validates within 48 hours of
admission that patients meet admission criteria for long-term
care hospitals, regularly evaluates patients throughout their
stay for continuation of care in a long-term care hospital,
and assesses the available discharge options when patients no
longer meet such continued stay criteria;
``(B) the institution has active physician involvement with
patients during their treatment through an organized medical
staff, physician-directed treatment with physician on-site
availability on a daily basis to review patient progress, and
consulting physicians on call and capable of being at the
patient's side within a moderate period of time, as
determined by the Secretary;
``(C) the institution has interdisciplinary team treatment
for patients, requiring interdisciplinary teams of health
care professionals, including physicians, to prepare and
carry out an individualized treatment plan for each patient;
and
``(5) meets patient criteria relating to patient mix and
severity appropriate to the medically complex cases that
long-term care hospitals are designed to treat, as measured
under section 1886(m).''.
(B) New patient criteria for long-term care hospital
prospective payment.--Section 1886 of such Act (42 U.S.C.
1395ww), as amended by subsection (a), is further amended by
adding at the end the following new subsection:
``(n) Patient Criteria for Prospective Payment to Long-Term
Care Hospitals.--
``(1) In general.--To be eligible for prospective payment
under this section as a long-term care hospital, a long-term
care hospital must admit not less than a majority of patients
who have a high level of severity, as defined by the
Secretary, and who are assigned to one or more of the
following major diagnostic categories:
``(A) Circulatory diagnoses.
``(B) Digestive, endocrine, and metabolic diagnoses.
``(C) Infection disease diagnoses.
``(D) Neurological diagnoses.
``(E) Renal diagnoses.
``(F) Respiratory diagnoses.
``(G) Skin diagnoses.
``(H) Other major diagnostic categories as selected by the
Secretary.
``(2) Major diagnostic category defined.--In paragraph (1),
the term `major diagnostic category' means the medical
categories formed by dividing all possible principle
diagnosis into mutually exclusive diagnosis areas which are
referred to in 67 Federal Register 49985 (August 1, 2002).''.
(C) Establishment of rehabilitation units within certain
long-term care hospitals.--If the Secretary of Health and
Human Services does not include rehabilitation services
within a major diagnostic category under section 1886(n)(2)
of the Social Security Act, as added by subparagraph (B), the
Secretary shall approve for purposes of title XVIII of such
Act distinct part inpatient rehabilitation hospital units in
long-term care hospitals consistent with the following:
(i) A hospital that, on or before October 1, 2004, was
classified by the Secretary as a long-term care hospital, as
described in section 1886(d)(1)(B)(iv)(I) of such Act (42
U.S.C. 1395ww(d)(1)(V)(iv)(I)), and was accredited by the
Commission on Accreditation of Rehabilitation Facilities, may
establish a hospital rehabilitation unit that is a distinct
part of the long-term care hospital, if the distinct part
meets the requirements (including conditions of
participation) that would otherwise apply to a distinct-part
rehabilitation unit if the distinct part were established by
a subsection (d) hospital in accordance with the matter
following clause (v) of section 1886(d)(1)(B) of such Act,
including any regulations adopted by the Secretary in
accordance with this section, except that the one-year
waiting period described in section 412.30(c) of title 42,
Code of Federal Regulations, applicable to the conversion of
hospital beds into a distinct-part rehabilitation unit shall
not apply to such units.
(ii) Services provided in inpatient rehabilitation units
established under clause (i) shall not be reimbursed as long-
term care hospital services under section 1886 of such Act
and shall be subject to payment policies established by the
Secretary to reimburse services provided by inpatient
hospital rehabilitation units.
(D) Effective date.--The amendments made by subparagraphs
(A) and (B), and the provisions of subparagraph (C), shall
apply to discharges occurring on or after January 1, 2008.
(2) Implementation of facility and patient criteria.--
(A) Report.--No later than 1 year after the date of the
enactment of this Act, the Secretary of Health and Human
Services (in this section referred to as the ``Secretary'')
shall submit to the appropriate committees of Congress a
report containing recommendations regarding the promulgation
of the national long-term care hospital facility and patient
criteria for application under paragraphs (4) and (5) of
section 1861(ccc) and section 1886(n) of the Social Security
Act, as added by subparagraphs (A) and (B), respectively, of
paragraph (1). In the report, the Secretary shall consider
recommendations contained in a report to Congress by the
Medicare Payment Advisory Commission in June 2004 for long-
term care hospital-specific facility and patient criteria to
ensure that patients admitted to long-term care hospitals are
medically complex and appropriate to receive long-term care
hospital services.
(B) Implementation.--No later than 1 year after the date of
submittal of the report under subparagraph (A), the Secretary
shall, after rulemaking, implement the national long-term
care hospital facility and patient criteria referred to in
such subparagraph. Such long-term care hospital facility and
patient criteria shall be used to screen patients in
determining the medical necessity and appropriateness of a
Medicare beneficiary's admission to, continued stay at, and
discharge from, long-term care hospitals under the Medicare
program and shall take into account the medical judgment of
the patient's physician, as provided for under sections
1814(a)(3) and 1835(a)(2)(B) of the Social Security Act (42
U.S.C. 1395f(a)(3), 1395n(a)(2)(B)).
(3) Expanded review of medical necessity.--
(A) In general.--The Secretary of Health and Human Services
shall provide, under contracts with one or more appropriate
fiscal intermediaries or medicare administrative contractors
under section 1874A(a)(4)(G) of the Social Security Act (42
U.S.C. 1395kk(a)(4)(G)), for reviews of the medical necessity
of admissions to long-term care hospitals (described in
section 1886(d)(1)(B)(iv) of such Act) and continued stay at
such hospitals, of individuals entitled to, or enrolled for,
benefits under part A of title XVIII of such Act on a
hospital-specific basis consistent with this paragraph. Such
reviews shall be made for discharges occurring on or after
October 1, 2007.
(B) Review methodology.--The medical necessity reviews
under paragraph (A) shall be conducted for each such long-
term care hospital on an annual basis in accordance with
rules (including a sample methodology)
[[Page H9332]]
specified by the Secretary. Such sample methodology shall--
(i) provide for a statistically valid and representative
sample of admissions of such individuals sufficient to
provide results at a 95 percent confidence interval; and
(ii) guarantee that at least 75 percent of overpayments
received by long-term care hospitals for medically
unnecessary admissions and continued stays of individuals in
long-term care hospitals will be identified and recovered and
that related days of care will not be counted toward the
length of stay requirement contained in section
1886(d)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395ww(d)(1)(B)(iv)).
(C) Continuation of reviews.--Under contracts under this
paragraph, the Secretary shall establish a denial rate with
respect to such reviews that, if exceeded, could require
further review of the medical necessity of admissions and
continued stay in the hospital involved.
(D) Termination of required reviews.--
(i) In general.--Subject to clause (iii), the previous
provisions of this subsection shall cease to apply as of the
date specified in clause (ii).
(ii) Date specified.--The date specified in this clause is
the later of January 1, 2013, or the date of implementation
of national long-term care hospital facility and patient
criteria under section paragraph (2)(B).
(iii) Continuation.--As of the date specified in clause
(ii), the Secretary shall determine whether to continue to
guarantee, through continued medical review and sampling
under this paragraph, recovery of at least 75 percent of
overpayments received by long-term care hospitals due to
medically unnecessary admissions and continued stays.
(4) Limited, qualified moratorium of long-term care
hospitals.--
(A) In general.--Subject to subparagraph (B), the Secretary
shall impose a temporary moratorium on the certification of
new long-term care hospitals (and satellite facilities), and
new long-term care hospital and satellite facility beds, for
purposes of the Medicare program under title XVIII of the
Social Security Act. The moratorium shall terminate at the
end of the 4-year period beginning on the date of the
enactment of this Act.
(B) Exceptions.--
(i) In general.--The moratorium under subparagraph (A)
shall not apply as follows:
(I) To a long-term care hospital, satellite facility, or
additional beds under development as of the date of the
enactment of this Act.
(II) To a new long-term care hospital in an area in which
there is not a long-term care hospital, if the Secretary
determines it to be in the best interest to provide access to
long-term care hospital services to Medicare beneficiaries
residing in such area. There shall be a presumption in favor
of the moratorium, which may be rebutted by evidence the
Secretary deems sufficient to show the need for long-term
care hospital services in that area.
(III) To an existing long-term care hospital that requests
to increase its number of long-term care hospital beds, if
the Secretary determines there is a need at the long-term
care hospital for additional beds to accommodate--
(aa) infectious disease issues for isolation of patients;
(bb) bedside dialysis services;
(cc) single-sex accommodation issues;
(dd) behavioral issues;
(ee) any requirements of State or local law; or
(ff) other clinical issues the Secretary determines warrant
additional beds, in the best interest of Medicare
beneficiaries.
(IV) To an existing long-term care hospital that requests
an increase in beds because of the closure of a long-term
care hospital or significant decrease in the number of long-
term care hospital beds, in a State where there is only one
other long-term care hospital.
There shall be no administrative or judicial review from a
decision of the Secretary under this subparagraph.
(ii) ``Under development'' defined.--For purposes of clause
(i)(I), a long-term care hospital or satellite facility is
considered to be ``under development'' as of a date if any of
the following have occurred on or before such date:
(I) The hospital or a related party has a binding written
agreement with an outside, unrelated party for the
construction, reconstruction, lease, rental, or financing of
the long-term care hospital.
(II) Actual construction, renovation or demolition for the
long-term care hospital has begun.
(III) A certificate of need has been approved in a State
where one is required or other necessary approvals from
appropriate State agencies have been received for the
operation of the hospital.
(IV) The hospital documents that it is within a 6-month
long-term care hospital demonstration period required by
section 412.23(e)(1)-(3) of title 42, Code of Federal
Regulations, to demonstrate that it has a greater than 25 day
average length of stay.
(V) There is other evidence presented that the Secretary
determines would indicate that the hospital or satellite is
under development.
(5) No application of 25 percent patient threshold payment
adjustment to freestanding and grandfathered ltchs.--The
Secretary shall not apply, during the 5-year period beginning
on the date of the enactment of this Act, section 412.536 of
title 42, Code of Federal Regulations, or any similar
provision, to freestanding long-term care hospitals and the
Secretary shall not apply such section or section 412.534 of
title 42, Code of Federal Regulations, or any similar
provisions, to a long-term care hospital identified by
section 4417(a) of the Balanced Budget Act of 1997 (Public
Law 105-33). A long-term care hospital identified by such
section 4417(a) shall be deemed to be a freestanding long-
term care hospital for the purpose of this section. Section
412.536 of title 42, Code of Federal Regulations, shall be
void and of no effect.
(6) Payment for hospitals-within-hospitals.--
(A) In general.--Payments to an applicable long-term care
hospital or satellite facility which is located in a rural
area or which is co-located with an urban single or MSA
dominant hospital under paragraphs (d)(1), (e)(1), and (e)(4)
of section 412.534 of title 42, Code of Federal Regulations,
shall not be subject to any payment adjustment under such
section if no more than 75 percent of the hospital's Medicare
discharges (other than discharges described in paragraphs
(d)(2) or (e)(3) of such section) are admitted from a co-
located hospital.
(B) Co-located long-term care hospitals and satellite
facilities.--
(i) In general.--Payment to an applicable long-term care
hospital or satellite facility which is co-located with
another hospital shall not be subject to any payment
adjustment under section 412.534 of title 42, Code of Federal
Regulations, if no more than 50 percent of the hospital's
Medicare discharges (other than discharges described in
section 412.534(c)(3) of such title) are admitted from a co-
located hospital.
(ii) Applicable long-term care hospital or satellite
facility defined.--In this paragraph, the term ``applicable
long-term care hospital or satellite facility'' means a
hospital or satellite facility that is subject to the
transition rules under section 412.534(g) of title 42, Code
of Federal Regulations.
(C) Effective date.--Subparagraphs (A) and (B) shall apply
to discharges occurring on or after October 1, 2007, and
before October 1, 2012.
(7) No application of very short-stay outlier policy.--The
Secretary shall not apply, during the 5-year period beginning
on the date of the enactment of this Act, the amendments
finalized on May 11, 2007 (72 Federal Register 26904) made to
the short-stay outlier payment provision for long-term care
hospitals contained in section 412.529(c)(3)(i) of title
42, Code of Federal Regulations, or any similar provision.
(8) No application of one time adjustment to standard
amount.--The Secretary shall not, during the 5-year period
beginning on the date of the enactment of this Act, make the
one-time prospective adjustment to long-term care hospital
prospective payment rates provided for in section
412.523(d)(3) of title 42, Code of Federal Regulations, or
any similar provision.
(c) Separate Classification for Certain Long-Stay Cancer
Hospitals.--
(1) In general.--Subsection (d)(1)(B) of section 1886 of
the Social Security Act (42 U.S.C. 1395ww) is amended--
(A) in clause (iv)--
(i) in subclause (I), by striking ``(iv)(I)'' and inserting
``(iv)'' and by striking ``or'' at the end; and
(ii) in subclause (II)--
(I) by striking ``, or'' at the end and inserting a
semicolon; and
(II) by redesignating such subclause as clause (vi) and by
moving it to immediately follow clause (v); and
(B) in clause (v), by striking the semicolon at the end and
inserting ``, or''.
(2) Conforming payment references.--Subsection (b) of such
section is amended--
(A) in paragraph (2)(E)(ii), by adding at the end the
following new subclause:
``(III) Hospitals described in clause (vi) of such
subsection.'';
(B) in paragraph (3)(F)(iii), by adding at the end the
following new subclause:
``(VI) Hospitals described in clause (vi) of such
subsection.'';
(C) in paragraphs (3)(G)(ii), (3)(H)(i), and (3)(H)(ii)(I),
by inserting ``or (vi)'' after ``clause (iv)'' each place it
appears;
(D) in paragraph (3)(H)(iv), by adding at the end the
following new subclause:
``(IV) Hospitals described in clause (vi) of such
subsection.'';
(E) in paragraph (3)(J), by striking ``subsection
(d)(1)(B)(iv)'' and inserting ``clause (iv) or (vi) of
subsection (d)(1)(B)''; and
(F) in paragraph (7)(B), by adding at the end the following
new clause:
``(iv) Hospitals described in clause (vi) of such
subsection.''.
(3) Additional conforming amendments.--The second sentence
of subsection (d)(1)(B) of such section is amended--
(A) by inserting ``(as in effect as of such date)'' after
``clause (iv)''; and
(B) by inserting ``(or, in the case of a hospital
classified under clause (iv)(II), as so in effect, shall be
classified under clause (vi) on and after the effective date
of such clause)'' after ``so classified''.
(4) Transition rule.--In the case of a hospital that is
classified under clause (iv)(II) of section 1886(d)(1)(B) of
the Social Security Act immediately before the date of the
enactment of this Act and which is classified under clause
(vi) of such section after such date of enactment, payments
under section
[[Page H9333]]
1886 of such Act for cost reporting periods beginning after
the date of the enactment of this Act shall be based upon
payment rates in effect for the cost reporting period for
such hospital beginning during fiscal year 2001, increased
for each succeeding cost reporting period (beginning before
the date of the enactment of this Act) by the applicable
percentage increase under section 1886(b)(3)(B)(ii) of such
Act.
(5) Clarification of treatment of satellite facilities and
remote locations.--A long-stay cancer hospital described in
section 1886(d)(1)(B)(vi) of the Social Security Act, as
designated under paragraph (1), shall include satellites or
remote site locations for such hospital established before or
after the date of the enactment of this Act if the provider-
based requirements under section 413.65 of title 42, Code of
Federal Regulations, applicable certification requirements
under title XVIII of the Social Security, and such other
applicable State licensure and certificate of need
requirements are met with respect to such satellites or
remote site locations.
SEC. 504. INCREASING THE DSH ADJUSTMENT CAP.
Section 1886(d)(5)(F)(xiv) of the Social Security Act (42
U.S.C. 1395ww(d)(5)(F)(xiv)) is amended--
(1) subclause (II), by striking ``12 percent'' and
inserting ``the percent specified in subclause (III)''; and
(2) by adding at the end the following new subclause:
``(III) The percent specified in this subclause is, in the
case of discharges occurring--
``(a) before October 1, 2007, 12 percent;
``(b) during fiscal year 2008, 16 percent;
``(c) during fiscal year 2009, 18 percent; and
``(d) on or after October 1, 2009, 12 percent.''.
SEC. 505. PPS-EXEMPT CANCER HOSPITALS.
(a) Authorizing Rebasing for PPS-Exempt Cancer Hospitals.--
Section 1886(b)(3)(F) of the Social Security Act (42 U.S.C.
1395ww(b)(3)(F)) is amended by adding at the end the
following new clause:
``(iv) In the case of a hospital (or unit described in the
matter following clause (v) of subsection (d)(1)(B)) that
received payment under this subsection for inpatient hospital
services furnished during cost reporting periods beginning
before October 1, 1999, that is within a class of hospital
described in clause (iii) (other than subclause (IV),
relating to long-term care hospitals, and that requests the
Secretary (in a form and manner specified by the Secretary)
to effect a rebasing under this clause for the hospital, the
Secretary may compute the target amount for the hospital's
12-month cost reporting period beginning during fiscal year
2008 as an amount equal to the average described in clause
(ii) but determined as if any reference in such clause to
`the date of the enactment of this subparagraph' were a
reference to `the date of the enactment of this clause'.''.
(b) MedPAC Report on PPS-Exempt Cancer Hospitals.--Not
later than March 1, 2009, the Medicare Payment Advisory
Commission (established under section 1805 of the Social
Security Act (42 U.S.C. 1395b-6)) shall submit to the
Secretary and Congress a report evaluating the following:
(1) Measures of payment adequacy and Medicare margins for
PPS-exempt cancer hospitals, as established under section
1886(d)(1)(B)(v) of the Social Security Act (42 U.S.C.
1395ww(d)(1)(B)(v)).
(2) To the extent a PPS-exempt cancer hospital was
previously affiliated with another hospital, the margins of
the PPS-exempt hospital and the other hospital as separate
entities and the margins of such hospitals that existed when
the hospitals were previously affiliated.
(3) Payment adequacy for cancer discharges under the
Medicare inpatient hospital prospective payment system.
SEC. 506. SKILLED NURSING FACILITY PAYMENT UPDATE.
(a) In General.--Section 1888(e)(4)(E)(ii) of the Social
Security Act (42 U.S.C. 1395yy(e)(4)(E)(ii)) is amended--
(1) in subclause (III), by striking ``and'';
(2) by redesignating subsection (IV) as subclause (VI); and
(3) by inserting after subclause (III) the following new
subclauses:
``(IV) for each of fiscal years 2004, 2005, 2006, and 2007,
the rate computed for the previous fiscal year increased by
the skilled nursing facility market basket percentage change
for the fiscal year involved;
``(V) for fiscal year 2008, the rate computed for the
previous fiscal year; and''.
(b) Delayed Effective Date.--Section 1888(e)(4)(E)(ii)(V)
of the Social Security Act, as inserted by subsection (a)(3),
shall not apply to payment for days before January 1, 2008.
SEC. 507. REVOCATION OF UNIQUE DEEMING AUTHORITY OF THE JOINT
COMMISSION FOR THE ACCREDITATION OF HEALTHCARE
ORGANIZATIONS.
(a) Revocation.--Section 1865 of the Social Security Act
(42 U.S.C. 1395bb) is amended--
(1) by striking subsection (a); and
(2) by redesignating subsections (b), (c), (d), and (e) as
subsections (a), (b), (c), and (d), respectively.
(b) Conforming Amendments.--(1) Such section is further
amended--
(A) in subsection (a)(1), as so redesignated, by striking
``In addition, if'' and inserting ``If'';
(B) in subsection (b), as so redesignated--
(i) by striking ``released to him by the Joint Commission
on Accreditation of Hospitals,'' and inserting ``released to
the Secretary by''; and
(ii) by striking the comma after ``Association'';
(C) in subsection (c), as so redesignated, by striking
``pursuant to subsection (a) or (b)(1)'' and inserting
``pursuant to subsection (a)(1)''; and
(D) in subsection (d), as so redesignated, by striking
``pursuant to subsection (a) or (b)(1)'' and inserting
``pursuant to subsection (a)(1)''.
(2) Section 1861(e) of such Act (42 U.S.C. 1395x(e)) is
amended in the fourth sentence by striking ``and (ii) is
accredited by the Joint Commission on Accreditation of
Hospitals, or is accredited by or approved by a program of
the country in which such institution is located if the
Secretary finds the accreditation or comparable approval
standards of such program to be essentially equivalent to
those of the Joint Commission on Accreditation of Hospitals''
and inserting ``and (ii) is accredited by a national
accreditation body recognized by the Secretary under section
1865(a), or is accredited by or approved by a program of the
country in which such institution is located if the Secretary
finds the accreditation or comparable approval standards of
such program to be essentially equivalent to those of such a
national accreditation body.''.
(3) Section 1864(c) of such Act (42 U.S.C. 1395aa(c)) is
amended by striking ``pursuant to subsection (a) or (b)(1) of
section 1865'' and inserting ``pursuant to section
1865(a)(1)''.
(4) Section 1875(b) of such Act (42 U.S.C. 1395ll(b)) is
amended by striking ``the Joint Commission on Accreditation
of Hospitals,'' and inserting ``national accreditation bodies
under section 1865(a)''.
(5) Section 1834(a)(20)(B) of such Act (42 U.S.C.
1395m(a)(20)(B)) is amended by striking ``section 1865(b)''
and inserting ``section 1865(a)''.
(6) Section 1852(e)(4)(C) of such Act (42 U.S.C. 1395w-
22(e)(4)(C)) is amended by striking ``section 1865(b)(2)''
and inserting ``section 1865(a)(2)''.
(c) Authority to Recognize JCAHO as a National
Accreditation Body.--The Secretary of Health and Human
Services may recognize the Joint Commission on Accreditation
of Healthcare Organizations as a national accreditation body
under section 1865 of the Social Security Act (42 U.S.C.
1395bb), as amended by this section, upon such terms and
conditions, and upon submission of such information, as the
Secretary may require.
(d) Effective Date; Transition Rule.--(1) Subject to
paragraph (2), the amendments made by this section shall
apply with respect to accreditations of hospitals granted on
or after the date that is 18 months after the date of the
enactment of this Act.
(2) For purposes of title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.), the amendments made by this section
shall not effect the accreditation of a hospital by the Joint
Commission on Accreditation of Healthcare Organizations, or
under accreditation or comparable approval standards found to
be essentially equivalent to accreditation or approval
standards of the Joint Commission on Accreditation of
Healthcare Organizations, for the period of time applicable
under such accreditation.
TITLE VI--OTHER PROVISIONS RELATING TO MEDICARE PART B
Subtitle A--Payment and Coverage Improvements
SEC. 601. PAYMENT FOR THERAPY SERVICES.
(a) Extension of Exceptions Process for Medicare Therapy
Caps.--Section 1833(g)(5) of the Social Security Act (42
U.S.C. 1395l(g)(5)), as amended by section 201 of the
Medicare Improvements and Extension Act of 2006 (division B
of Public Law 109-432), is amended by striking ``2007'' and
inserting ``2009''.
(b) Study and Report.--
(1) Study.--The Secretary of Health and Human Services, in
consultation with appropriate stakeholders, shall conduct a
study on refined and alternative payment systems to the
Medicare payment cap under section 1833(g) of the Social
Security Act (42 U.S.C. 1395l(g)) for physical therapy
services and speech-language pathology services, described in
paragraph (1) of such section and occupational therapy
services described in paragraph (3) of such section. Such
study shall consider, with respect to payment amounts under
Medicare, the following:
(A) The creation of multiple payment caps for such services
to better reflect costs associated with specific health
conditions.
(B) The development of a prospective payment system,
including an episode-based system of payments, for such
services.
(C) The data needed for the development of a system of
multiple payment caps (or an alternative payment methodology)
for such services and the availability of such data.
(2) Report.--Not later than January 1, 2009, the Secretary
shall submit to Congress a report on the study conducted
under paragraph (1).
SEC. 602. MEDICARE SEPARATE DEFINITION OF OUTPATIENT SPEECH-
LANGUAGE PATHOLOGY SERVICES.
(a) In General.--Section 1861(ll) of the Social Security
Act (42 U.S.C. 1395x(ll)) is amended--
(1) by redesignating paragraphs (2) and (3) as paragraphs
(3) and (4), respectively; and
(2) by inserting after paragraph (1) the following new
paragraph:
``(2) The term `outpatient speech-language pathology
services' has the meaning given
[[Page H9334]]
the term `outpatient physical therapy services' in subsection
(p), except that in applying such subsection--
``(A) `speech-language pathology' shall be substituted for
`physical therapy' each place it appears; and
``(B) `speech-language pathologist' shall be substituted
for `physical therapist' each place it appears.''.
(b) Conforming Amendments.--
(1) Section 1832(a)(2)(C) of the Social Security Act (42
U.S.C. 1395k(a)(2)(C)) is amended--
(A) by striking ``and outpatient'' and inserting ``,
outpatient''; and
(B) by inserting before the period at the end the
following: ``, and outpatient speech-language pathology
services (other than services to which the second sentence of
section 1861(p) applies through the application of section
1861(ll)(2))''.
(2) Subparagraphs (A) and (B) of section 1833(a)(8) of such
Act (42 U.S.C. 1395l(a)(8)) are each amended by striking
``(which includes outpatient speech-language pathology
services)'' and inserting ``, outpatient speech-language
pathology services,''.
(3) Section 1833(g)(1) of such Act (42 U.S.C. 1395l(g)(1))
is amended--
(A) by inserting ``and speech-language pathology services
of the type described in such section through the application
of section 1861(ll)(2)'' after ``1861(p)''; and
(B) by inserting ``and speech-language pathology services''
after ``and physical therapy services''.
(4) The second sentence of section 1835(a) of such Act (42
U.S.C. 1395n(a)) is amended--
(A) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861'' each place it
appears; and
(B) by inserting ``or outpatient speech-language pathology
services, respectively'' after ``occupational therapy
services''.
(5) Section 1861(p) of such Act (42 U.S.C. 1395x(p)) is
amended by striking the fourth sentence.
(6) Section 1861(s)(2)(D) of such Act (42 U.S.C.
1395x(s)(2)(D)) is amended by inserting ``, outpatient
speech-language pathology services,'' after ``physical
therapy services''.
(7) Section 1862(a)(20) of such Act (42 U.S.C.
1395y(a)(20)) is amended--
(A) by striking ``outpatient occupational therapy services
or outpatient physical therapy services'' and inserting
``outpatient physical therapy services, outpatient speech-
language pathology services, or outpatient occupational
therapy services''; and
(B) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861''.
(8) Section 1866(e)(1) of such Act (42 U.S.C. 1395cc(e)(1))
is amended--
(A) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861'' the first two
places it appears;
(B) by striking ``defined) or'' and inserting
``defined),''; and
(C) by inserting before the semicolon at the end the
following: ``, or (through the operation of section
1861(ll)(2)) with respect to the furnishing of outpatient
speech-language pathology''.
(c) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2008.
(d) Construction.--Nothing in this section shall be
construed to affect existing regulations and policies of the
Centers for Medicare & Medicaid Services that require
physician oversight of care as a condition of payment for
speech-language pathology services under part B of the
medicare program.
SEC. 603. INCREASED REIMBURSEMENT RATE FOR CERTIFIED NURSE-
MIDWIVES.
(a) In General.--Section 1833(a)(1)(K) of the Social
Security Act (42 U.S.C.1395l(a)(1)(K)) is amended by striking
``(but in no event'' and all that follows through ``performed
by a physician)''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to services furnished on or after April 1, 2008.
SEC. 604. ADJUSTMENT IN OUTPATIENT HOSPITAL FEE SCHEDULE
INCREASE FACTOR.
The first sentence of section 1833(t)(3)(C)(iv) of the
Social Security Act (42 U.S.C. 1395l(t)(3)(C)(iv)) is amended
by inserting before the period at the end the following:
``and reduced by 0.25 percentage point for such factor for
such services furnished in 2008''.
SEC. 605. EXCEPTION TO 60-DAY LIMIT ON MEDICARE SUBSTITUTE
BILLING ARRANGEMENTS IN CASE OF PHYSICIANS
ORDERED TO ACTIVE DUTY IN THE ARMED FORCES.
(a) In General.--Section 1842(b)(6)(D)(iii) of the Social
Security Act (42 U.S.C. 1395u(b)(6)(D)(iii)) is amended by
inserting after ``of more than 60 days'' the following: ``or
are provided over a longer continuous period during all of
which the first physician has been called or ordered to
active duty as a member of a reserve component of the Armed
Forces''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to services furnished on or after the date of the
enactment of this section.
SEC. 606. EXCLUDING CLINICAL SOCIAL WORKER SERVICES FROM
COVERAGE UNDER THE MEDICARE SKILLED NURSING
FACILITY PROSPECTIVE PAYMENT SYSTEM AND
CONSOLIDATED PAYMENT.
(a) In General.--Section 1888(e)(2)(A)(ii) of the Social
Security Act (42 U.S.C. 1395yy(e)(2)(A)(ii)) is amended by
inserting ``clinical social worker services,'' after
``qualified psychologist services,''..
(b) Conforming Amendment.--Section 1861(hh)(2) of the
Social Security Act (42 U.S.C. 1395x(hh)(2)) is amended by
striking ``and other than services furnished to an inpatient
of a skilled nursing facility which the facility is required
to provide as a requirement for participation''.
(c) Effective Date.--The amendments made by this section
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 607. COVERAGE OF MARRIAGE AND FAMILY THERAPIST SERVICES
AND MENTAL HEALTH COUNSELOR SERVICES.
(a) Coverage of Marriage and Family Therapist Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)) is amended--
(A) in subparagraph (Z), by striking ``and'' at the end;
(B) in subparagraph (AA), by adding ``and'' at the end; and
(C) by adding at the end the following new subparagraph:
``(BB) marriage and family therapist services (as defined
in subsection (ccc));''.
(2) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x) is amended by adding at the end the
following new subsection:
``(ccc) Marriage and Family Therapist Services.--(1) The
term `marriage and family therapist services' means services
performed by a marriage and family therapist (as defined in
paragraph (2)) for the diagnosis and treatment of mental
illnesses, which the marriage and family therapist is legally
authorized to perform under State law (or the State
regulatory mechanism provided by State law) of the State in
which such services are performed, provided such services are
covered under this title, as would otherwise be covered if
furnished by a physician or as incident to a physician's
professional service, but only if no facility or other
provider charges or is paid any amounts with respect to the
furnishing of such services.
``(2) The term `marriage and family therapist' means an
individual who--
``(A) possesses a master's or doctoral degree which
qualifies for licensure or certification as a marriage and
family therapist pursuant to State law;
``(B) after obtaining such degree has performed at least 2
years of clinical supervised experience in marriage and
family therapy; and
``(C) is licensed or certified as a marriage and family
therapist in the State in which marriage and family therapist
services are performed.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)) is amended by adding at the end the following
new clause:
``(v) marriage and family therapist services;''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)) is amended--
(i) by striking ``and'' before ``(V)''; and
(ii) by inserting before the semicolon at the end the
following: ``, and (W) with respect to marriage and family
therapist services under section 1861(s)(2)(BB), the amounts
paid shall be 80 percent of the lesser of (i) the actual
charge for the services or (ii) 75 percent of the amount
determined for payment of a psychologist under subparagraph
(L)''.
(B) Development of criteria with respect to consultation
with a physician.--The Secretary of Health and Human Services
shall, taking into consideration concerns for patient
confidentiality, develop criteria with respect to payment for
marriage and family therapist services for which payment may
be made directly to the marriage and family therapist under
part B of title XVIII of the Social Security Act (42 U.S.C.
1395j et seq.) under which such a therapist must agree to
consult with a patient's attending or primary care physician
in accordance with such criteria.
(5) Exclusion of marriage and family therapist services
from skilled nursing facility prospective payment system.--
Section 1888(e)(2)(A)(ii) of the Social Security Act (42
U.S.C. 1395yy(e)(2)(A)(ii)), is amended by inserting
``marriage and family therapist services (as defined in
subsection (ccc)(1)),'' after ``qualified psychologist
services,''.
(6) Coverage of marriage and family therapist services
provided in rural health clinics and federally qualified
health centers.--Section 1861(aa)(1)(B) of the Social
Security Act (42 U.S.C. 1395x(aa)(1)(B)) is amended by
striking ``or by a clinical social worker (as defined in
subsection (hh)(1)),'' and inserting ``, by a clinical social
worker (as defined in subsection (hh)(1)), or by a marriage
and family therapist (as defined in subsection (ccc)(2)),''.
(7) Inclusion of marriage and family therapists as
practitioners for assignment of claims.--Section
1842(b)(18)(C) of the Social Security Act (42 U.S.C.
1395u(b)(18)(C)) is amended by adding at the end the
following new clause:
``(vii) A marriage and family therapist (as defined in
section 1861(ccc)(2)).''.
(b) Coverage of Mental Health Counselor Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)), as amended in
subsection (a)(1), is further amended--
[[Page H9335]]
(A) in subparagraph (AA), by striking ``and'' at the end;
(B) in subparagraph (BB), by inserting ``and'' at the end;
and
(C) by adding at the end the following new subparagraph:
``(CC) mental health counselor services (as defined in
subsection (ddd)(2));''.
(2) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x), as amended by subsection (a)(2), is
further amended by adding at the end the following new
subsection:
``(ddd) Mental Health Counselor; Mental Health Counselor
Services.--(1) The term `mental health counselor' means an
individual who--
``(A) possesses a master's or doctor's degree which
qualifies the individual for licensure or certification for
the practice of mental health counseling in the State in
which the services are performed;
``(B) after obtaining such a degree has performed at least
2 years of supervised mental health counselor practice; and
``(C) is licensed or certified as a mental health counselor
or professional counselor by the State in which the services
are performed.
``(2) The term `mental health counselor services' means
services performed by a mental health counselor (as defined
in paragraph (1)) for the diagnosis and treatment of mental
illnesses which the mental health counselor is legally
authorized to perform under State law (or the State
regulatory mechanism provided by the State law) of the State
in which such services are performed, provided such services
are covered under this title, as would otherwise be covered
if furnished by a physician or as incident to a physician's
professional service, but only if no facility or other
provider charges or is paid any amounts with respect to the
furnishing of such services.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)), as amended by subsection (a)(3), is further
amended by adding at the end the following new clause:
``(vi) mental health counselor services;''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)), as amended by subsection (a)(4),
is further amended--
(i) by striking ``and'' before ``(W)''; and
(ii) by inserting before the semicolon at the end the
following: ``, and (X) with respect to mental health
counselor services under section 1861(s)(2)(CC), the amounts
paid shall be 80 percent of the lesser of (i) the actual
charge for the services or (ii) 75 percent of the amount
determined for payment of a psychologist under subparagraph
(L)''.
(B) Development of criteria with respect to consultation
with a physician.--The Secretary of Health and Human Services
shall, taking into consideration concerns for patient
confidentiality, develop criteria with respect to payment for
mental health counselor services for which payment may be
made directly to the mental health counselor under part B of
title XVIII of the Social Security Act (42 U.S.C. 1395j et
seq.) under which such a counselor must agree to consult with
a patient's attending or primary care physician in accordance
with such criteria.
(5) Exclusion of mental health counselor services from
skilled nursing facility prospective payment system.--Section
1888(e)(2)(A)(ii) of the Social Security Act (42 U.S.C.
1395yy(e)(2)(A)(ii)), as amended by subsection (a)(5), is
amended by inserting ``mental health counselor services (as
defined in section 1861(ddd)(2)),'' after ``marriage and
family therapist services (as defined in subsection
(ccc)(1)),''.
(6) Coverage of mental health counselor services provided
in rural health clinics and federally qualified health
centers.--Section 1861(aa)(1)(B) of the Social Security Act
(42 U.S.C. 1395x(aa)(1)(B)), as amended by subsection (a)(6),
is amended by striking ``or by a marriage and family
therapist (as defined in subsection (ccc)(2)),'' and
inserting ``by a marriage and family therapist (as defined in
subsection (ccc)(2)), or a mental health counselor (as
defined in subsection (ddd)(1)),''.
(7) Inclusion of mental health counselors as practitioners
for assignment of claims.--Section 1842(b)(18)(C) of the
Social Security Act (42 U.S.C. 1395u(b)(18)(C)), as amended
by subsection (a)(7), is amended by adding at the end the
following new clause:
``(viii) A mental health counselor (as defined in section
1861(fff)(1)).''.
(c) Effective Date.--The amendments made by this section
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 608. RENTAL AND PURCHASE OF POWER-DRIVEN WHEELCHAIRS.
(a) In General.--Section 1834(a)(7) of the Social Security
Act (42 U.S.C. 1395m(a)(7)) is amended--
(1) in subparagraph (A)--
(A) clause (i)(I), by striking ``Except as provided in
clause (iii), payment'' and inserting ``Payment'';
(B) by striking clause (iii); and
(C) in clause (iv)--
(i) by redesignating such clause as clause (iii); and
(ii) by striking ``or in the case of a power-driven
wheelchair for which a purchase agreement has been entered
into under clause (iii)''; and
(2) in subparagraph (C)(ii)(II), by striking ``or
(A)(iii)''.
(b) Effective Date.--
(1) In general.--Subject to paragraph (1), the amendments
made by subsection (a) shall take effect on January 1, 2008,
and shall apply to power-driven wheelchairs furnished on or
after such date.
(2) Application to competitive acquisition.--The amendments
made by subsection (a) shall not apply to contracts entered
into under section 1847 of the Social Security Act (42 U.S.C.
1395w-3) pursuant to a bid submitted under such section
before July 21, 2007.
SEC. 609. RENTAL AND PURCHASE OF OXYGEN EQUIPMENT.
(a) In General.--Section 1834(a)(5)(F) of the Social
Security Act (42 U.S.C. 1395m(a)(5)(F)) is amended--
(1) in clause (i)--
(A) by striking ``Payment'' and inserting ``Subject to
clause (iii), payment''; and
(B) by striking ``36 months'' and inserting ``13 months'';
(2) in clause (ii)(I), by striking ``36th continuous
month'' and inserting ``13th continuous month''; and
(3) by adding at the end the following new clause:
``(iii) Special rule for oxygen generating portable
equipment.--In the case of oxygen generating portable
equipment referred to in the final rule published in the
Federal Register on November 9, 2006 (71 Fed. Reg. 65897-
65899), in applying clauses (i) and (ii)(I) each reference to
`13 months' is deemed a reference to `36 months'.''.
(b) Effective Date.--
(1) In general.--Subject to paragraph (3), the amendments
made by subsection (a) shall apply to oxygen equipment
furnished on or after January 1, 2008.
(2) Transition.--In the case of an individual receiving
oxygen equipment on December 31, 2007, for which payment is
made under section 1834(a) of the Social Security Act (42
U.S.C. 1395m(a)), the 13-month period described in paragraph
(5)(F)(i) of such section, as amended by subsection (a),
shall begin on January 1, 2008, but in no case shall the
rental period for such equipment exceed 36 months.
(3) Application to competitive acquisition.--The amendments
made by subsection (a) shall not apply to contracts entered
into under section 1847 of the Social Security Act (42 U.S.C.
1395w-3) pursuant to a bid submitted under such section
before July 21, 2007.
(c) Study and Report.--
(1) Study.--The Secretary of Health and Human Services
shall conduct a study to examine the service component and
the equipment component of the provision of oxygen to
Medicare beneficiaries. The study shall assess--
(A) the type of services provided and variation across
suppliers in providing such services;
(B) whether the services are medically necessary or affect
patient outcomes;
(C) whether the Medicare program pays appropriately for
equipment in connection with the provision of oxygen;
(D) whether such program pays appropriately for necessary
services;
(E) whether such payment in connection with the provision
of oxygen should be divided between equipment and services,
and if so, how; and
(F) how such payment rate compares to a competitively bid
rate.
(2) Report.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of Health and Human
Services shall submit to Congress a report on the study
conducted under paragraph (1).
SEC. 610. ADJUSTMENT FOR MEDICARE MENTAL HEALTH SERVICES.
(a) In General.--For purposes of payment for services
furnished under the physician fee schedule under section 1848
of the Social Security Act (42 U.S.C. 1395w-4) during the
applicable period, the Secretary of Health and Human Services
shall increase the amount otherwise payable for applicable
services by 5 percent.
(b) Definitions.--For purposes of subsection (a):
(1) Applicable period.--The term ``applicable period''
means the period beginning on January 1, 2008, and ending on
December 31 of the year before the effective date of the
first review after January 1, 2008, of work relative value
units conducted under section 1848(c)(2)(B)(i) of the Social
Security Act.
(2) Applicable services.--The term ``applicable services''
means procedure codes for services--
(A) in the categories of psychiatric therapeutic procedures
furnished in office or other outpatient facility settings, or
inpatient hospital, partial hospital or residential care
facility settings; and
(B) which cover insight oriented, behavior modifying, or
supportive psychotherapy and interactive psychotherapy
services in the Healthcare Common Procedure Coding System
established by the Secretary of Health and Human Services
under section 1848(c)(5) of such Act.
(c) Implementation.--Notwithstanding any other provision of
law, the Secretary of Health and Human Services may implement
this section by program instruction or otherwise.
SEC. 611. EXTENSION OF BRACHYTHERAPY SPECIAL RULE.
Section 1833(t)(16)(C) of the Social Security Act (42
U.S.C. 1395l(t)(16)(C)) is amended by striking ``2008'' and
inserting ``2009''.
[[Page H9336]]
SEC. 612. PAYMENT FOR PART B DRUGS.
(a) Application of Consistent Volume Weighting in
Computation of ASP.--In order to assure that payments for
drugs and biologicals under section 1847A of the Social
Security Act (42 U.S.C. 1395w-3a) are correct and consistent
with law, the Secretary of Health and Human Services shall,
for payment for drugs and biologicals furnished on or after
July 1, 2008, compute the volume-weighted average sales price
using equation #2 (specified in appendix A of the report of
the Inspector General of the Department of Health and Human
Services on ``Calculation of Volume-Weighted Average Sales
Price for Medicare Part B Prescription Drugs'' (February
2006; OEI-03-05-00310)) used by the Office of Inspector
General to calculate a volume-weighted ASP.
(b) Improvements in the Competitive Acquisition Program
(CAP).--
(1) Continuous open enrollment; automatic reenrollment
without need for reapplication.--Subsection (a)(1)(A) of
section 1847B of the Social Security Act (42 U.S.C. 1395w-3b)
is amended--
(A) in clause (ii), by striking ``annually'' and inserting
``on an ongoing basis'';
(B) in clause (iii), by striking ``an annual selection''
and inserting ``a selection (which may be changed on an
annual basis)'' ; and
(C) by adding at the end the following: ``An election and
selection described in clauses (ii) and (iii) shall continue
to be effective without the need for any periodic reelection
or reapplication or selection.''.
(2) Permitting vender to deliver drugs to site of
administration.--Subsection (b)(4)(E) of such section is
amended--
(A) by striking ``or'' at the end of clause (I);
(B) by striking the period at the end of clause (ii) and
inserting ``; or''; and
(C) by adding at the end the following new clause:
``(iii) prevent a contractor from delivering drugs and
biologicals to the site in which the drugs or biologicals
will be administered.''.
(3) Physician outreach and education.--Subsection (a)(1) of
such section is amended by adding at the end the following
new subparagraph:
``(E) Physician outreach and education.--The Secretary
shall conduct a program of outreach to education physicians
concerning the program and the ongoing opportunity of
physicians to elect to obtain drugs and biologicals under the
program.''.
(4) Rebidding of contracts.--The Secretary of Health and
Human Services shall provide for the rebidding of contracts
under section 1847B(c) of the Social Security Act (42 U.S.C.
1395w-3b(c)) only for periods on or after the expiration of
the contract in effect under such section as of the date of
the enactment of this Act.
(c) Treatment of Certain Drugs.--Section 1847A(b) of the
Social Security Act (42 U.S.C. 1395w-3a(b)) is amended--
(1) in paragraph (1), by inserting ``paragraph (6) and''
after ``Subject to''; and
(2) by adding at the end the following new paragraph:
``(6) Special rule.--.In applying subsection (c)(6)(C)(ii),
beginning with January 1, 2008, the average sales price for
drugs or biologicals described in section 1842(o)(1)(G) is
the lower of the average sales price calculated including
drugs or biologicals to which such subsection applies and the
average sales price that would have been calculated if such
subsection were not applied.''.
(d) Effective Date.--Except as otherwise provided, the
amendments made by this section shall apply to drugs
furnished on or after January 1, 2008.
Subtitle B--Extension of Medicare Rural Access Protections
SEC. 621. 2-YEAR EXTENSION OF FLOOR ON MEDICARE WORK
GEOGRAPHIC ADJUSTMENT.
Section 1848(e)(1)(E) of such Act (42 U.S.C. 1395w-
4(e)(1)(E)) is amended by striking ``2008'' and inserting
``2010''.
SEC. 622. 2-YEAR EXTENSION OF SPECIAL TREATMENT OF CERTAIN
PHYSICIAN PATHOLOGY SERVICES UNDER MEDICARE.
Section 542(c) of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000, as amended
by section 732 of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, and section 104
of the Medicare Improvements and Extension Act of 2006
(division B of Public Law 109-432), is amended by striking
``and 2007'' and inserting ``2007, 2008, and 2009''.
SEC. 623. 2-YEAR EXTENSION OF MEDICARE REASONABLE COSTS
PAYMENTS FOR CERTAIN CLINICAL DIAGNOSTIC
LABORATORY TESTS FURNISHED TO HOSPITAL PATIENTS
IN CERTAIN RURAL AREAS.
Section 416(b) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173; 117 Stat. 2282; 42 U.S.C. 1395l-4(b)), as amended by
section 105 of the Medicare Improvement and Extension Act of
2006 (division B of Public Law 109-432), is amended by
striking ``3-year'' and inserting ``5-year''.
SEC. 624. 2-YEAR EXTENSION OF MEDICARE INCENTIVE PAYMENT
PROGRAM FOR PHYSICIAN SCARCITY AREAS .
(a) In General.--Section 1833(u)(1) of the Social Security
Act (42 U.S.C. 1395l(u)(1)) is amended by striking ``2008''
and inserting ``2010''.
(b) Transition.--With respect to physicians' services
furnished during 2008 and 2009, for purposes of subsection
(a), the Secretary of Health and Human Services shall use the
primary care scarcity areas and the specialty care scarcity
areas (as identified in section 1833(u)(4)) that the
Secretary was using under such subsection with respect to
physicians' services furnished on December 31, 2007.
SEC. 625. 2-YEAR EXTENSION OF MEDICARE INCREASE PAYMENTS FOR
GROUND AMBULANCE SERVICES IN RURAL AREAS.
Section 1834(l)(13) of the Social Security Act (42 U.S.C.
1395m(l)(13)) is amended--
(1) in subparagraph (A)--
(A) in the matter before clause (i), by striking
``furnished on or after July 1, 2004, and before January 1,
2007,'';
(B) in clause (i), by inserting ``for services furnished on
or after July 1, 2004, and before January 1, 2007, and on or
after January 1, 2008, and before January 1, 2010,'' after
``in such paragraph,''; and
(C) in clause (ii), by inserting ``for services furnished
on or after July 1, 2004, and before January 1, 2007,'' after
``in clause (i),''; and
(2) in subparagraph (B)--
(A) in the heading, by striking ``after 2006'' and
inserting ``for subsequent periods'';
(B) by inserting ``clauses (i) and (ii) of'' before
``subparagraph (A)''; and
(C) by striking ``in such subparagraph'' and inserting ``in
the respective clause''.
SEC. 626. EXTENDING HOLD HARMLESS FOR SMALL RURAL HOSPITALS
UNDER THE HOPD PROSPECTIVE PAYMENT SYSTEM.
Section 1833(t)(7)(D)(i)(II) of the Social Security Act (42
U.S.C. 1395l(t)(7)(D)(I)(II)) is amended--
(1) by striking ``January 1, 2009'' and inserting ``January
1, 2010'';
(2) by striking ``2007, or 2008,''; and
(3) by striking ``90 percent, and 85 percent,
respectively,'' and inserting ``, and with respect to such
services furnished after 2006 the applicable percentage shall
be 90 percent.''.
Subtitle C--End Stage Renal Disease Program
SEC. 631. CHRONIC KIDNEY DISEASE DEMONSTRATION PROJECTS.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary''), acting
through the Director of the National Institutes of Health,
shall establish demonstration projects to--
(1) increase public and medical community awareness
(particularly of those who treat patients with diabetes and
hypertension) about the factors that lead to chronic kidney
disease, how to prevent it, how to diagnose it, and how to
treat it;
(2) increase screening and use of prevention techniques for
chronic kidney disease for Medicare beneficiaries and the
general public (particularly among patients with diabetes and
hypertension, where prevention techniques are well
established and early detection makes prevention possible);
and
(3) enhance surveillance systems and expand research to
better assess the prevalence and incidence of chronic kidney
disease, (building on work done by Centers for Disease
Control and Prevention).
(b) Scope and Duration.--
(1) Scope.--The Secretary shall select at least 3 States in
which to conduct demonstration projects under this section.
In selecting the States under this paragraph, the Secretary
shall take into account the size of the population of
individuals with end-stage renal disease who are enrolled in
part B of title XVIII of the Social Security Act and ensure
the participation of individuals who reside in rural and
urban areas.
(2) Duration.--The demonstration projects under this
section shall be conducted for a period that is not longer
than 5 years and shall begin on January 1, 2009.
(c) Evaluation and Report.--
(1) Evaluation.--The Secretary shall conduct an evaluation
of the demonstration projects conducted under this section.
(2) Report.--Not later than 12 months after the date on
which the demonstration projects under this section are
completed, the Secretary shall submit to Congress a report on
the evaluation conducted under paragraph (1) together with
recommendations for such legislation and administrative
action as the Secretary determines appropriate.
SEC. 632. MEDICARE COVERAGE OF KIDNEY DISEASE PATIENT
EDUCATION SERVICES.
(a) Coverage of Kidney Disease Education Services.--
(1) Coverage.--Section 1861(s)(2) of the Social Security
Act (42 U.S.C. 1395x(s)(2)) is amended--
(A) in subparagraph (Z), by striking ``and'' after the
semicolon at the end;
(B) in subparagraph (AA), by adding ``and'' after the
semicolon at the end; and
(C) by adding at the end the following new subparagraph:
``(BB) kidney disease education services (as defined in
subsection (ccc));''.
(2) Services described.--Section 1861 of the Social
Security Act (42 U.S.C. 1395x) is amended by adding at the
end the following new subsection:
``Kidney Disease Education Services
``(ccc)(1) The term `kidney disease education services'
means educational services that are--
``(A) furnished to an individual with stage IV chronic
kidney disease who, according to accepted clinical guidelines
identified by the Secretary, will require dialysis or a
kidney transplant;
[[Page H9337]]
``(B) furnished, upon the referral of the physician
managing the individual's kidney condition, by a qualified
person (as defined in paragraph (2)); and
``(C) designed--
``(i) to provide comprehensive information (consistent with
the standards developed under paragraph (3)) regarding--
``(I) the management of comorbidities, including for
purposes of delaying the need for dialysis;
``(II) the prevention of uremic complications; and
``(III) each option for renal replacement therapy
(including hemodialysis and peritoneal dialysis at home and
in-center as well as vascular access options and
transplantation);
``(ii) to ensure that the individual has the opportunity to
actively participate in the choice of therapy; and
``(iii) to be tailored to meet the needs of the individual
involved.
``(2) The term `qualified person' means a physician,
physician assistant, nurse practitioner, or clinical nurse
specialist who furnishes services for which payment may be
made under the fee schedule established under section 1848.
Such term does not include a renal dialysis facility.
``(3) The Secretary shall set standards for the content of
such information to be provided under paragraph (1)(C)(i)
after consulting with physicians, other health professionals,
health educators, professional organizations, accrediting
organizations, kidney patient organizations, dialysis
facilities, transplant centers, network organizations
described in section 1881(c)(2), and other knowledgeable
persons. To the extent possible the Secretary shall consult
with a person or entity described in the previous sentence,
other than a dialysis facility, that has not received
industry funding from a drug or biological manufacturer or
dialysis facility.
``(4) In promulgating regulations to carry out this
subsection, the Secretary shall ensure that each individual
who is eligible for benefits for kidney disease education
services under this title receives such services in a timely
manner to maximize the benefit of those services.
``(5) The Secretary shall monitor the implementation of
this subsection to ensure that individuals who are eligible
for benefits for kidney disease education services receive
such services in the manner described in paragraph (4).
``(6) No individual shall be eligible to be provided more
than 6 sessions of kidney disease education services under
this title.''.
(3) Payment under the physician fee schedule.--Section
1848(j)(3) of the Social Security Act (42 U.S.C. 1395w-
4(j)(3)) is amended by inserting ``(2)(BB),'' after
``(2)(AA),''.
(4) Limitation on number of sessions.--Section 1862(a)(1)
of the Social Security Act (42 U.S.C. 1395y(a)(1)) is
amended--
(A) in subparagraph (M), by striking ``and'' at the end;
(B) in subparagraph (N), by striking the semicolon at the
end and inserting ``, and''; and
(C) by adding at the end the following new subparagraph:
``(O) in the case of kidney disease education services (as
defined in section 1861(ccc)), which are furnished in excess
of the number of sessions covered under such section;''.
(5) GAO report.--Not later than September 1, 2010, the
Comptroller General of the United States shall submit to
Congress a report on the following:
(A) The number of Medicare beneficiaries who are eligible
to receive benefits for kidney disease education services (as
defined in section 1861(ccc) of the Social Security Act, as
added by paragraph (2)) under title XVIII of such Act and who
receive such services.
(B) The extent to which there is a sufficient amount of
physicians, physician assistants, nurse practitioners, and
clinical nurse specialists to furnish kidney disease
education services (as so defined) under such title and
whether or not renal dialysis facilities (and appropriate
employees of such facilities) should be included as an entity
eligible under such section to furnish such services.
(C) Recommendations, if appropriate, for renal dialysis
facilities (and appropriate employees of such facilities) to
structure kidney disease education services (as so defined)
in a manner that is objective and unbiased and that provides
a range of options and alternative locations for renal
replacement therapy and management of co-morbidities that may
delay the need for dialysis.
(b) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2009.
SEC. 633. REQUIRED TRAINING FOR PATIENT CARE DIALYSIS
TECHNICIANS.
Section 1881 of the Social Security Act (42 U.S.C. 1395rr)
is amended by adding the following new subsection:
``(h)(1) Except as provided in paragraph (2), a provider of
services or a renal dialysis facility may not use, for more
than 12 months during 2009, or for any period beginning on
January 1, 2010, any individual as a patient care dialysis
technician unless the individual--
``(A) has completed a training program in the care and
treatment of an individual with chronic kidney failure who is
undergoing dialysis treatment; and
``(B) has been certified by a nationally recognized
certification entity for dialysis technicians.
``(2)(A) A provider of services or a renal dialysis
facility may permit an individual enrolled in a training
program described in paragraph (1)(A) to serve as a patient
care dialysis technician while they are so enrolled.
``(B) The requirements described in subparagraphs (A), (B),
and (C) of paragraph (1) do not apply to an individual who
has performed dialysis-related services for at least 5 years.
``(3) For purposes of paragraph (1), if, since the most
recent completion by an individual of a training program
described in paragraph (1)(A), there has been a period of 24
consecutive months during which the individual has not
furnished dialysis-related services for monetary
compensation, such individual shall be required to complete a
new training program or become recertified as described in
paragraph (1)(B).
``(4) A provider of services or a renal dialysis facility
shall provide such regular performance review and regular in-
service education as assures that individuals serving as
patient care dialysis technicians for the provider or
facility are competent to perform dialysis-related
services.''.
SEC. 634. MEDPAC REPORT ON TREATMENT MODALITIES FOR PATIENTS
WITH KIDNEY FAILURE.
(a) Evaluation.--
(1) In general.--Not later than March 1, 2009, the Medicare
Payment Advisory Commission (established under section 1805
of the Social Security Act) shall submit to the Secretary and
Congress a report evaluating the barriers that exist to
increasing the number of individuals with end-stage renal
disease who elect to receive home dialysis services under the
Medicare program under title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.).
(2) Report details.--The report shall include the
following:
(A) A review of Medicare home dialysis demonstration
projects initiated before the date of the enactment of this
Act, and the results of such demonstration projects and
recommendations for future Medicare home dialysis
demonstration projects or Medicare program changes that will
test models that can improve Medicare beneficiary access to
home dialysis.
(B) A comparison of current Medicare home dialysis costs
and payments with current in-center and hospital dialysis
costs and payments.
(C) An analysis of the adequacy of Medicare reimbursement
for patient training for home dialysis (including
hemodialysis and peritoneal dialysis) and recommendations for
ensuring appropriate payment for such home dialysis training.
(D) A catalogue and evaluation of the incentives and
disincentives in the current reimbursement system that
influence whether patients receive home dialysis services or
other treatment modalities.
(E) An evaluation of patient education services and how
such services impact the treatment choices made by patients.
(F) Recommendations for implementing incentives to
encourage patients to elect to receive home dialysis services
or other treatment modalities under the Medicare program
(3) Scope of review.--In preparing the report under
paragraph (1), the Medicare Payment Advisory Commission shall
consider a variety of perspectives, including the
perspectives of physicians, other health care professionals,
hospitals, dialysis facilities, health plans, purchasers, and
patients.
SEC. 635. ADJUSTMENT FOR ERYTHROPOIETIN STIMULATING AGENTS
(ESAS).
(a) In General.--Subsection (b)(13) of section 1881 of the
Social Security Act (42 U.S.C. 1395rr) is amended--
(1) in subparagraph (A)(iii), by striking ``For such
drugs'' and inserting ``Subject to subparagraph (C), for such
drugs''; and
(2) by adding at the end the following new subparagraph:
``(C)(i) The payment amounts under this title for
erythropoietin furnished during 2008 or 2009 to an individual
with end stage renal disease by a large dialysis facility
(as defined in subparagraph (D)) (whether to individuals
in the facility or at home), in an amount equal to $8.75
per thousand units (rounded to the nearest 100 units) or,
if less, 102 percent of the average sales price (as
determined under section 1847A) for such drug or
biological.
``(ii) The payment amounts under this title for darbepoetin
alfa furnished during 2008 or 2009 to an individual with end
stage renal disease by a large dialysis facility (as defined
in clause (iii)) (whether to individuals in the facility or
at home), in an amount equal to $2.92 per microgram or, if
less, 102 percent of the average sales price (as determined
under section 1847A) for such drug or biological.
``(iii) For purposes of this subparagraph, the term `large
dialysis facility' means a provider of services or renal
dialysis facility that is owned or managed by a corporate
entity that, as of July 24, 2007, owns or manages 300 or more
such providers or facilities, and includes a successor to
such a corporate entity''.
(b) No Impact on Drug Add-On Payment.--Nothing in the
amendments made by subsection (a) shall be construed to
affect the amount of any payment adjustment made under
section 1881(b)(12)(B)(ii) of the Social Security Act (42
U.S.C. 1395rr(b)(12)(B)(ii)).
SEC. 636. SITE NEUTRAL COMPOSITE RATE.
Subsection (b)(12)(A) of section 1881 of the Social
Security Act (42 U.S.C. 1395rr) is amended by adding at the
end the following
[[Page H9338]]
new sentence: ``Under such system the payment rate for
dialysis services furnished on or after January 1, 2008, by
providers of such services for hospital-based facilities
shall be the same as the payment rate (computed without
regard to this sentence) for such services furnished by renal
dialysis facilities that are not hospital-based, except that
in applying the geographic index under subparagraph (D) to
hospital-based facilities, the labor share shall be based on
the labor share otherwise applied for such facilities.''.
SEC. 637. DEVELOPMENT OF ESRD BUNDLING SYSTEM AND QUALITY
INCENTIVE PAYMENTS.
(a) Development of ESRD Bundling System.--Subsection (b) of
section 1881 of the Social Security Act (42 U.S.C. 1395rr) is
further amended--
(1) in paragraph (12)(A), by striking ``In lieu of
payment'' and inserting ``Subject to paragraph (14), in lieu
of payment'';
(2) in the second sentence of paragraph (12)(F)--
(A) by inserting ``or paragraph (14)'' after ``this
paragraph''; and
(B) by inserting ``or under the system under paragraph
(14)'' after ``subparagraph (B)'';
(3) in paragraph (12)(H)--
(A) by inserting ``or paragraph (14)'' after ``under this
paragraph'' the first place it appears; and
(B) by inserting before the period at the end the
following: ``or, under paragraph (14), the identification of
renal dialysis services included in the bundled payment, the
adjustment for outliers, the identification of facilities to
which the phase-in may apply, and the determination of
payment amounts under subparagraph (A) under such paragraph,
and the application of paragraph (13)(C)(iii))'';
(4) in paragraph (13)--
(A) in subparagraph (A), by striking ``The payment
amounts'' and inserting ``subject to paragraph (14), the
payment amounts''; and
(B) in subparagraph (B)--
(i) in clause (i), by striking ``(i)'' after ``(B)'' and by
inserting ``, subject to paragraph (14)'' before the period
at the end; and
(ii) by striking clause (ii); and
(5) by adding at the end the following new paragraph:
``(14)(A) Subject to subparagraph (E), for services
furnished on or after January 1, 2010, the Secretary shall
implement a payment system under which a single payment is
made under this title for renal dialysis services (as defined
in subparagraph (B)) in lieu of any other payment (including
a payment adjustment under paragraph (12)(B)(ii)) for such
services and items furnished pursuant to paragraph (4). In
implementing the system the Secretary shall ensure that the
estimated total amount of payments under this title for 2010
for renal dialysis services shall equal 96 percent of the
estimated amount of payments for such services, including
payments under paragraph (12)(B)(ii), that would have been
made if such system had not been implemented.
``(B) For purposes of this paragraph, the term `renal
dialysis services' includes--
``(i) items and services included in the composite rate for
renal dialysis services as of December 31, 2009;
``(ii) erythropoietin stimulating agents furnished to
individuals with end stage renal disease;
``(iii) other drugs and biologicals and diagnostic
laboratory tests, that the Secretary identifies as commonly
used in the treatment of such patients and for which payment
was (before the application of this paragraph) made
separately under this title, and any oral equivalent form of
such drugs and biologicals or of drugs and biologicals
described in clause (ii); and
``(iv) home dialysis training for which payment was (before
the application of this paragraph) made separately under this
section.
Such term does not include vaccines.
``(C) The system under this paragraph may provide for
payment on the basis of services furnished during a week or
month or such other appropriate unit of payment as the
Secretary specifies.
``(D) Such system--
``(i) shall include a payment adjustment based on case mix
that may take into account patient weight, body mass index,
comorbidities, length of time on dialysis, age, race,
ethnicity, and other appropriate factors;
``(ii) shall include a payment adjustment for high cost
outliers due to unusual variations in the type or amount of
medically necessary care, including variations in the amount
of erythropoietin stimulating agents necessary for anemia
management; and
``(iii) may include such other payment adjustments as the
Secretary determines appropriate, such as a payment
adjustment--
``(I) by a geographic index, such as the index referred to
in paragraph (12)(D), as the Secretary determines to be
appropriate;
``(II) for pediatric providers of services and renal
dialysis facilities;
``(III) for low volume providers of services and renal
dialysis facilities;
``(IV) for providers of services or renal dialysis
facilities located in rural areas; and
``(V) for providers of services or renal dialysis
facilities that are not large dialysis facilities.
``(E) The Secretary may provide for a phase-in of the
payment system described in subparagraph (A) for services
furnished by a provider of services or renal dialysis
facility described in any of subclauses (II) through (V) of
subparagraph (D)(iii), but such payment system shall be fully
implemented for services furnished in the case of any such
provider or facility on or after January 1, 2013.
``(F) The Secretary shall apply the annual increase that
would otherwise apply under subparagraph (F) of paragraph
(12) to payment amounts established under such paragraph (if
this paragraph did not apply) in an appropriate manner under
this paragraph.''.
(6) Prohibition of unbundling.--Section 1862(a) of such Act
(42 U.S.C. 1395y(a)) is amended--
(A) by striking ``or'' at the end of paragraph (21);
(B) by striking the period at the end of paragraph (22) and
inserting ``; or''; and
(C) by inserting after paragraph (22) the following new
paragraph:
``(23) where such expenses are for renal dialysis services
(as defined in subparagraph (B) of section 1881(b)(14)) for
which payment is made under such section (other than under
subparagraph (E) of such section) unless such payment is made
under such section to a provider of services or a renal
dialysis facility for such services.''.
(b) Quality Incentive Payments.--Section 1881 of such Act
is amended by adding at the end the following new subsection:
``(i) Quality Incentive Payments in the End-Stage Renal
Disease Program.--
``(1) Quality incentive payments for services furnished in
2008, 2009, and 2010.--
``(A) In general.--With respect to renal dialysis services
furnished during a performance period (as defined in
subparagraph (B)) by a provider of services or renal dialysis
facility that the Secretary determines meets the applicable
performance standard for the period under subparagraph (C)
and reports on measures for 2009 and 2010 under subparagraph
(D) for such services, in addition to the amount otherwise
paid under this section, subject to subparagraph (G), there
also shall be paid to the provider or facility an amount
equal to the applicable percentage (specified in subparagraph
(E) for the period) of the Secretary's estimate (based on
claims submitted not later than two months after the end of
the performance period) of the amount specified in
subparagraph (F) for such period.
``(B) Performance period.--In this paragraph, the term
`performance period' means each of the following:
``(i) The period beginning on July 1, 2008, and ending on
December 31, 2008.
``(ii) 2009.
``(iii) 2010.
``(C) Performance standard.--
``(i) 2008.--For the performance period occurring in 2008,
the applicable performance standards for a provider or
facility under this subparagraph are--
``(I) 92 percent or more of individuals with end stage
renal disease receiving erythopoetin stimulating agents who
have an average hematocrit of 33.0 percent or more; and
``(II) less than a percentage, specified by the Secretary,
of individuals with end stage renal disease receiving
erythopoetin stimulating agents who have an average
hematocrit of 39.0 percent or more.
``(ii) 2009 and 2010.--For the 2009 and 2010 performance
periods, the applicable performance standard for a provider
or facility under this subparagraph is successful performance
(relative to national average) on--
``(I) such measures of anemia management as the Secretary
shall specify, including measures of hemoglobin levels or
hematocrit levels for erythropoietin stimulating agents that
are consistent with the labeling for dosage of erythropoietin
stimulating agents approved by the Food and Drug
Administration for treatment of anemia in patients with end
stage renal disease, taking into account variations in
hemoglobin ranges or hematocrit levels of patients; and
``(II) such other measures, relating to subjects described
in subparagraph (D)(i), as the Secretary may specify.
``(D) Reporting performance measures.--The performance
measures under this subparagraph to be reported shall
include--
``(i) such measures as the Secretary specifies, before the
beginning of the performance period involved and taking into
account measures endorsed by the National Quality Forum,
including, to the extent feasible measures on--
``(I) iron management;
``(II) dialysis adequacy; and
``(III) vascular access, including for maximizing the
placement of arterial venous fistula; and
``(ii) to the extent feasible, such measure (or measures)
of patient satisfaction as the Secretary shall specify.
The provider or facility submitting information on such
measures shall attest to the completeness and accuracy of
such information.
``(E) Applicable percentage.--The applicable percentage
specified in this subparagraph for--
``(i) the performance period occurring in 2008, is 1.0
percent;
``(ii) the 2009 performance period, is 2.0 percent; and
``(iii) the 2010 performance period, is 2.0 percent.
In the case of any performance period which is less than an
entire year, the applicable percentage specified in this
subparagraph shall be multiplied by the ratio of the number
of months in the year to the number of months in such
performance period. In the
[[Page H9339]]
case of 2010, the applicable percentage specified in this
subparagraph shall be multiplied by the Secretary's estimate
of the ratio of the aggregate payment amount described in
subparagraph (F)(i) that would apply in 2010 if paragraph
(14) did not apply, to the aggregate payment base under
subparagraph (F)(ii) for 2010.
``(F) Payment base.--The payment base described in this
subparagraph for a provider or facility is--
``(i) for performance periods before 2010, the payment
amount determined under paragraph (12) for services furnished
by the provider or facility during the performance period,
including the drug payment adjustment described in
subparagraph (B)(ii) of such paragraph; and
``(ii) for the 2010 performance period is the amount
determined under paragraph (14) for services furnished by the
provider or facility during the period.
``(G) Limitation on funding.--
``(i) In general.--If the Secretary determines that the
total payments under this paragraph for a performance period
is projected to exceed the dollar amount specified in clause
(ii) for such period, the Secretary shall reduce, in a pro
rata manner, the amount of such payments for each provider or
facility for such period to eliminate any such projected
excess for the period.
``(ii) Dollar amount.--The dollar amount specified in this
clause--
``(I) for the performance period occurring in 2008, is
$50,000,000;
``(II) for the 2009 performance period is $100,000,000; and
``(III) for the 2010 performance period is $150,000,000.
``(H) Form of payment.--The payment under this paragraph
shall be in the form of a single consolidated payment.
``(2) Quality incentive payments for facilities and
providers for 2011.--
``(A) Increased payment.--For 2011, in the case of a
provider or facility that, for the performance period (as
defined in subparagraph (B))--
``(i) meets (or exceeds) the performance standard for
anemia management specified in paragraph (1)(C)(ii)(I);
``(ii) has substantially improved performance or exceeds a
performance standard (as determined under subparagraph (E));
and
``(iii) reports measures specified in paragraph (1)(D),
with respect to renal dialysis services furnished by the
provider or facility during the quality bonus payment period
(as specified in subparagraph (C)) the payment amount
otherwise made to such provider or facility under subsection
(b)(14) shall be increased, subject to subparagraph (F), by
the applicable percentage specified in subparagraph (D).
Payment amounts under paragraph (1) shall not be counted for
purposes of applying the previous sentence.
``(B) Performance period.--In this paragraph, the term
`performance period' means a multi-month period specified by
the Secretary .
``(C) Quality bonus payment period.--In this paragraph, the
term `quality bonus payment period' means, with respect to a
performance period, a multi-month period beginning on January
1, 2011, specified by the Secretary that begins at least 3
months (but not more than 9 months) after the end of the
performance period.
``(D) Applicable percentage.--The applicable percentage
specified in this subparagraph is a percentage, not to exceed
the 2.0 percent, specified by the Secretary consistent with
subparagraph (F). Such percentage may vary based on the level
of performance and improvement. The applicable percentage
specified in this subparagraph shall be multiplied by the
ratio applied under the third sentence of paragraph (1)(E)
for 2010.
``(E) Performance standard.--Based on performance of a
provider of services or a renal dialysis facility on
performance measures described in paragraph (1)(D) for a
performance period, the Secretary shall determine a composite
score for such period.
``(F) Limitation on funding.--If the Secretary determines
that the total amount to be paid under this paragraph for a
quality bonus payment period is projected to exceed
$200,000,000, the Secretary shall reduce, in a uniform
manner, the applicable percentage otherwise applied under
subparagraph (D) for services furnished during the period to
eliminate any such projected excess.
``(3) Application.--
``(A) Implementation.--Notwithstanding any other provision
of law, the Secretary may implement by program instruction or
otherwise this subsection.
``(B) Limitations on review.--
``(i) In general.--There shall be no administrative or
judicial review under section 1869 or 1878 or otherwise of--
``(I) the determination of performance measures and
standards under this subsection;
``(II) the determination of successful reporting, including
a determination of composite scores; and
``(III) the determination of the quality incentive payments
made under this subsection.
``(ii) Treatment of determinations.--A determination under
this subparagraph shall not be treated as a determination for
purposes of section 1869.
``(4) Technical assistance.--The Secretary shall identify
or establish an appropriately skilled group or organization,
such as the ESRD Networks, to provide technical assistance to
consistently low-performing facilities or providers that are
in the bottom quintile.
``(5) Public reporting.--
``(A) Annual notice.--The Secretary shall provide an annual
written notification to each individual who is receiving
renal dialysis services from a provider of services or renal
dialysis facility that--
``(i) informs such individual of the composite scores
described in subparagraph (A) and other relevant quality
measures with respect to providers of services or renal
dialysis facilities in the local area;
``(ii) compares such scores and measures to the average
local and national scores and measures; and
``(iii) provides information on how to access additional
information on quality of such services furnished and options
for alternative providers and facilities.
``(B) Certificates.--The Secretary shall provide
certificates to facilities and providers who provide services
to individuals with end-stage renal disease under this title
to display in patient areas. The certificate shall indicate
the composite score obtained by the facility or provider
under the quality initiative.
``(C) Web-based quality list.--The Secretary shall
establish a web-based list of facilities and providers who
furnish renal dialysis services under this section that
indicates their composite score of each provider and
facility.
``(6) Recommendations for reporting and quality incentive
intitiative for physicians.--The Secretary shall develop
recommendations for applying quality incentive payments under
this subsection to physicians who receive the monthly
capitated payment under this title. Such recommendations
shall include the following:
``(A) Recommendations to include pediatric specific
measures for physicians with at least 50 percent of their
patients with end stage renal disease being individuals under
18 years of age.
``(B) Recommendations on how to structure quality incentive
payments for physicians who demonstrate improvements in
quality or who attain quality standards, as specified by the
Secretary.
``(7) Reports.--
``(A) Initial report.--Not later than January 1, 2013, the
Secretary shall submit to Congress a report on the
implementation of the bundled payment system under subsection
(b)(14) and the quality initiative under this subsection.
Such report shall include the following information:
``(i) A comparison of the aggregate payments under
subsection (b)(14) for items and services to the cost of such
items and services.
``(ii) The changes in utilization rates for erythropoietin
stimulating agents.
``(iii) The mode of administering such agents, including
information on the proportion of such individuals receiving
such agents intravenously as compared to subcutaneously.
``(iv) The frequency of dialysis.
``(v) Other differences in practice patterns, such as the
adoption of new technology, different modes of practice, and
variations in use of drugs other than drugs described in
clause (iii).
``(vi) The performance of facilities and providers under
paragraph (2).
``(vii) Other recommendations for legislative and
administrative actions determined appropriate by the
Secretary.
``(B) Subsequent report.--Not later than January 1, 2015,
the Secretary shall submit to Congress a report that contains
the information described in each of clauses (ii) through
(vii) of subparagraph (A) and a comparison of the results of
the payment system under subsection (b)(14) for renal
dialysis services furnished during the 2-year period
beginning on January 1, 2013, and the results of such payment
system for such services furnished during the previous two-
year period.''.
SEC. 638. MEDPAC REPORT ON ESRD BUNDLING SYSTEM.
Not later than March 1, 2012, the Medicare Payment Advisory
Commission (established under section 1805 of the Social
Security Act) shall submit to Congress a report on the
implementation of the payment system under section
1881(b)(14) of the Social Security Act (as added by section
7) for renal dialysis services and related services (defined
in subparagraph (B) of such section). Such report shall
include, with respect to such payment system for such
services, an analysis of each of the following:
(1) An analysis of the overall adequacy of payment under
such system for all such services.
(2) An analysis that compares the adequacy of payment under
such system for services furnished by--
(A) a provider of services or renal dialysis facility that
is described in section 1881(b)(13)(C)(iv) of the Social
Security Act;
(B) a provider of services or renal dialysis facility not
described in such section;
(C) a hospital-based facility;
(D) a freestanding renal dialysis facility;
(E) a renal dialysis facility located in an urban area; and
(F) a renal dialysis facility located in a rural area.
(3) An analysis of the financial status of providers of
such services and renal dialysis facilities, including access
to capital, return on equity, and return on capital.
[[Page H9340]]
(4) An analysis of the adequacy of payment under such
method and the adequacy of the quality improvement payments
under section 1881(i) of the Social Security Act in ensuring
that payments for such services under the Medicare program
are consistent with costs for such services.
(5) Recommendations, if appropriate, for modifications to
such payment system.
SEC. 639. OIG STUDY AND REPORT ON ERYTHROPOIETIN.
(a) Study.--The Inspector General of the Department of
Health and Human Services shall conduct a study on the
following:
(1) The dosing guidelines, standards, protocols, and
alogorithms for erythropoietin stimulating agents recommended
or used by providers of services and renal dialysis
facilities that are described in section 1881(b)(13)(C)(iv)
of the Social Security Act and providers and facilities that
are not described in such section.
(2) The extent to which such guidelines, standards,
protocols, and algorithms are consistent with the labeling of
the Food and Drug Administration for such agents.
(3) The extent to which physicians sign standing orders for
such agents that are consistent with such guidelines,
standards, protocols, and algorithms recommended or used by
the provider or facility involved.
(4) The extent to which the prescribing decisions of
physicians, with respect to such agents, are independent of--
(A) such relevant guidelines, standards, protocols, and
algorithms; or
(B) recommendations of an anemia management nurse or other
appropriate employee of the provider or facility involved.
(5) The role of medical directors of providers of services
and renal dialysis facilities and the financial relationships
between such providers and facilities and the physicians
hired as medical directors of such providers and facilities,
respectively.
(b) Report.--Not later than January 1, 2009, the Inspector
General of the Department of Health and Human Services shall
submit to Congress a report on the study conducted under
subsection (a), together with such recommendations as the
Inspector General determines appropriate.
Subtitle D--Miscellaneous
SEC. 651. LIMITATION ON EXCEPTION TO THE PROHIBITION ON
CERTAIN PHYSICIAN REFERRALS FOR HOSPITALS.
(a) In General.--Section 1877 of the Social Security Act
(42 U.S.C. 1395) is amended--
(1) in subsection (d)(2)--
(A) in subparagraph (A), by striking ``and'' at the end;
(B) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subparagraph:
``(C) if the entity is a hospital, the hospital meets the
requirements of paragraph (3)(D).'';
(2) in subsection (d)(3)--
(A) in subparagraph (B), by striking ``and'' at the end;
(B) in subparagraph (C), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subparagraph:
``(D) the hospital meets the requirements described in
subsection (i)(1) not later than 18 months after the date of
the enactment of this subparagraph.''; and
(3) by adding at the end the following new subsection:
``(i) Requirements for Hospitals To Qualify for Hospital
Exception to Ownership or Investment Prohibition.--
``(1) Requirements described.--For purposes of paragraphs
subsection (d)(3)(D), the requirements described in this
paragraph for a hospital are as follows:
``(A) Provider agreement.--The hospital had a provider
agreement under section 1866 in effect on July 24, 2007.
``(B) Prohibition of expansion of facility capacity.--The
number of operating rooms and beds of the hospital at any
time on or after the date of the enactment of this subsection
are no greater than the number of operating rooms and beds as
of such date.
``(C) Preventing conflicts of interest.--
``(i) The hospital submits to the Secretary an annual
report containing a detailed description of--
``(I) the identity of each physician owner and any other
owners of the hospital; and
``(II) the nature and extent of all ownership interests in
the hospital.
``(ii) The hospital has procedures in place to require that
any referring physician owner discloses to the patient being
referred, by a time that permits the patient to make a
meaningful decision regarding the receipt of care ,as
determined by the Secretary--
``(I) the ownership interest of such referring physician in
the hospital; and
``(II) if applicable, any such ownership interest of the
treating physician.
``(iii) The hospital does not condition any physician
ownership interests either directly or indirectly on the
physician owner making or influencing referrals to the
hospital or otherwise generating business for the hospital.
``(D) Ensuring bona fide investment.--
``(i) Physician owners in the aggregate do not own more
than 40 percent of the total value of the investment
interests held in the hospital or in an entity whose assets
include the hospital.
``(ii) The investment interest of any individual physician
owner does not exceed 2 percent of the total value of the
investment interests held in the hospital or in an entity
whose assets include the hospital.
``(iii) Any ownership or investment interests that the
hospital offers to a physician owner are not offered on more
favorable terms than the terms offered to a person who is not
a physician owner.
``(iv) The hospital does not directly or indirectly provide
loans or financing for any physician owner investments in the
hospital.
``(v) The hospital does not directly or indirectly
guarantee a loan, make a payment toward a loan, or otherwise
subsidize a loan, for any individual physician owner or group
of physician owners that is related to acquiring any
ownership interest in the hospital.
``(vi) Investment returns are distributed to investors in
the hospital in an amount that is directly proportional to
the investment of capital by the physician owner in the
hospital.
``(vii) Physician owners do not receive, directly or
indirectly, any guaranteed receipt of or right to purchase
other business interests related to the hospital, including
the purchase or lease of any property under the control of
other investors in the hospital or located near the premises
of the hospital.
``(viii) The hospital does not offer a physician owner the
opportunity to purchase or lease any property under the
control of the hospital or any other investor in the hospital
on more favorable terms than the terms offered to an
individual who is not a physician owner.
``(E) Patient safety.--
``(i) Insofar as the hospital admits a patient and does not
have any physician available on the premises to provide
services during all hours in which the hospital is providing
services to such patient, before admitting the patient--
``(I) the hospital discloses such fact to a patient; and
``(II) following such disclosure, the hospital receives
from the patient a signed acknowledgment that the patient
understands such fact.
``(ii) The hospital has the capacity to--
``(I) provide assessment and initial treatment for
patients; and
``(II) refer and transfer patients to hospitals with the
capability to treat the needs of the patient involved.
``(2) Publication of information reported.--The Secretary
shall publish, and update on an annual basis, the information
submitted by hospitals under paragraph (1)(A)(i) on the
public Internet website of the Centers for Medicare &
Medicaid Services.
``(3) Collection of ownership and investment information.--
For purposes of clauses (i) and (ii) of paragraph (1)(D), the
Secretary shall collect physician ownership and investment
information for each hospital as it existed on the date of
the enactment of this subsection.
``(4) Physician owner defined.--For purposes of this
subsection, the term `physician owner' means a physician (or
an immediate family member of such physician) with a direct
or an indirect ownership interest in the hospital.''.
(b) Enforcement.--
(1) Ensuring compliance.--The Secretary of Health and Human
Services shall establish policies and procedures to ensure
compliance with the requirements described in such section
1877(i)(1) of the Social Security Act, as added by subsection
(a)(3), beginning on the date such requirements first apply.
Such policies and procedures may include unannounced site
reviews of hospitals.
(2) Audits.--Beginning not later than 18 months after the
date of the enactment of this Act, the Secretary of Health
and Human Services shall conduct audits to determine if
hospitals violate the requirements referred to in paragraph
(1).
TITLE VII--PROVISIONS RELATING TO MEDICARE PARTS A AND B
SEC. 701. HOME HEALTH PAYMENT UPDATE FOR 2008.
Section 1895(b)(3)(B)(ii) of the Social Security Act (42
U.S.C. 1395fff(b)(3)(B)(ii)) is amended--
(1) in subclause (IV) at the end, by striking ``and'';
(2) by redesignating subclause (V) as subclause (VII); and
(3) by inserting after subclause (IV) the following new
subclauses:
``(V) 2007, subject to clause (v), the home health market
basket percentage increase;
``(VI) 2008, subject to clause (v), 0 percent; and''.
SEC. 702. 2-YEAR EXTENSION OF TEMPORARY MEDICARE PAYMENT
INCREASE FOR HOME HEALTH SERVICES FURNISHED IN
A RURAL AREA.
Section 421 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (Public Law 108-173; 117 Stat.
2283; 42 U.S.C. 1395fff note), as amended by section 5201(b)
of the Deficit Reduction Act of 2005, is amended--
(1) in the heading, by striking ``ONE-YEAR'' and inserting
``TEMPORARY''; and
(2) in subsection (a), by striking ``and episodes and
visits beginning on or after January 1, 2006, and before
January 1, 2007'' and inserting ``episodes and visits
beginning on or after January 1, 2006, and before January 1,
2007, and episodes and visits beginning on or after January
1, 2008, and before January 1, 2010''.
SEC. 703. EXTENSION OF MEDICARE SECONDARY PAYER FOR
BENEFICIARIES WITH END STAGE RENAL DISEASE FOR
LARGE GROUP PLANS.
(a) In General.--Section 1862(b)(1)(C) of the Social
Security Act (42 U.S.C. 1395y(b)(1)(C)) is amended--
[[Page H9341]]
(1) by redesignating clauses (i) and (ii) as subclauses (I)
and (II), respectively, and indenting accordingly;
(2) by amending the text preceding subclause (I), as so
redesignated, to read as follows:
``(C) Individuals with end stage renal disease.--
``(i) In general.--A group health plan (as defined in
subparagraph
(A)(v))--'';
(3) in the matter following subclause (II), as so
redesignated--
(A) by striking ``clause (i)'' and inserting ``subclause
(I)'';
(B) by striking ``clause (ii)'' and inserting ``subclause
(II)''; and
(C) by striking ``clauses (i) and (ii)'' and inserting
``subclauses (I) and (II)''; and
(D) in the last sentence, by striking ``Effective for
items'' and inserting ``Subject to clause (ii), effective for
items''; and
(4) by adding at the end the following new clause:
``(ii) Special Rule for Large Group Plans.--In applying
clause (i) to a large group health plan (as defined in
subparagraph (B)(iii)). with respect to periods beginning on
or after the date that is 30 months prior to January 1, 2008,
subclauses (I) and (II) of such clause shall be applied by
substituting `42-month' for `12-month' each place it
appears.''.
SEC. 704. PLAN FOR MEDICARE PAYMENT ADJUSTMENTS FOR NEVER
EVENTS.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') shall
develop a plan (in this section referred to as the ``never
events plan'') to implement, beginning in fiscal year 2010, a
policy to reduce or eliminate payments under title XVIII of
the Social Security Act for never events.
(b) Never Event Defined.--For purposes of this section, the
term ``never event'' means an event involving the delivery of
(or failure to deliver) physicians' services, inpatient or
outpatient hospital services, or facility services furnished
in an ambulatory surgical facility in which there is an error
in medical care that is clearly identifiable, usually
preventable, and serious in consequences to patients, and
that indicates a deficiency in the safety and process
controls of the services furnished with respect to the
physician, hospital, or ambulatory surgical center involved.
(c) Plan Details.--
(1) Defining never events.--With respect to criteria for
identifying never events under the never events plan, the
Secretary should consider whether the event meets the
following characteristics:
(A) Clearly identifiable.--The event is clearly
identifiable and measurable and feasible to include in a
reporting system for never events.
(B) Usually preventable.--The event is usually preventable
taking into consideration that, because of the complexity of
medical care, certain medical events are not always
avoidable.
(C) Serious.--The event is serious and could result in
death or loss of a body part, disability, or more than
transient loss of a body function.
(D) Deficiency in safety and process controls.--The event
is indicative of a problem in safety systems and process
controls used by the physician, hospital, or ambulatory
surgical center involved and is indicative of the reliability
of the quality of services provided by the physician,
hospital, or ambulatory surgical center, respectively.
(2) Identification and payment issues.--With respect to
policies under the never events plan for identifying and
reducing (or eliminating) payment for never events, the
Secretary shall consider--
(A) mechanisms used by hospitals and physicians in
reporting and coding of services that would reliably identify
never events; and
(B) modifications in billing and payment mechanisms that
would enable the Secretary to efficiently and accurately
reduce or eliminate payments for never events.
(3) Priorities.--Under the never events plan the Secretary
shall identify priorities regarding the services to focus on
and, among those, the never events for which payments should
be reduced or eliminated.
(4) Consultation.--In developing the never events plan, the
Secretary shall consult with affected parties that are
relevant to payment reductions in response to never events.
(d) Congressional Report.--By not later than June 1, 2008,
the Secretary shall submit a report to Congress on the never
events plan developed under this subsection and shall include
in the report recommendations on specific methods for
implementation of the plan on a timely basis.
SEC. 705. TREATMENT OF MEDICARE HOSPITAL RECLASSIFICATIONS.
(a) Extending Certain Medicare Hospital Wage Index
Reclassifications Through Fiscal Year 2009.--
(1) In general.--Section 106(a) of the Medicare
Improvements and Extension Act of 2006 (division B of public
Law 109-432) is amended by striking ``September 30, 2007''
and inserting ``September 30, 2009''.
(2) Special exception reclassifications.--The Secretary of
Health and Human Services shall extend for discharges
occurring through September 30, 2009, the special exception
reclassification made under the authority of section
1886(d)(5)(I)(i) of the Social Security Act (42 U.S.C.
1395ww(d)(5)(I)(i)) and contained in the final rule
promulgated by the Secretary in the Federal Register on
August 11, 2004 (69 Fed. Reg. 49105, 49107).
(b) Disregarding Section 508 Hospital Reclassifications for
Purposes of Group Reclassifications.--Section 508 of the
Medicare Prescription Drug, Improvement, and Modernization
Act of 2003 (Public Law 108-173, 42 U.S.C. 1395ww note) is
amended by adding at the end the following new subsection:
``(g) Disregarding Hospital Reclassifications for Purposes
of Group Reclassifications.--For purposes of the
reclassification of a group of hospitals in a geographic area
under section 1886(d), a hospital reclassified under this
section (including any such reclassification which is
extended under section 106(a) of the Medicare Improvements
and Extension Act of 2006) shall not be taken into account
and shall not prevent the other hospitals in such area from
establishing such a group for such purpose.''.
TITLE VIII--MEDICAID
Subtitle A--Protecting Existing Coverage
SEC. 801. MODERNIZING TRANSITIONAL MEDICAID.
(a) Two-Year Extension.--
(1) In general.--Sections 1902(e)(1)(B) and 1925(f) of the
Social Security Act (42 U.S.C. 1396a(e)(1)(B), 1396r-6(f))
are each amended by striking ``September 30, 2003'' and
inserting ``September 30, 2009''.
(2) Effective date.--The amendments made by this subsection
shall take effect on October 1, 2007.
(b) State Option of Initial 12-Month Eligibility.--Section
1925 of the Social Security Act (42 U.S.C. 1396r-6) is
amended--
(1) in subsection (a)(1), by inserting ``but subject to
paragraph (5)'' after ``Notwithstanding any other provision
of this title'';
(2) by adding at the end of subsection (a) the following:
``(5) Option of 12-month initial eligibility period.--A
State may elect to treat any reference in this subsection to
a 6-month period (or 6 months) as a reference to a 12-month
period (or 12 months). In the case of such an election,
subsection (b) shall not apply.''; and
(3) in subsection (b)(1), by inserting ``but subject to
subsection (a)(5)'' after ``Notwithstanding any other
provision of this title''.
(c) Removal of Requirement for Previous Receipt of Medical
Assistance.--Section 1925(a)(1) of such Act (42 U.S.C. 1396r-
6(a)(1)), as amended by subsection (b)(1), is further
amended--
(1) by inserting ``subparagraph (B) and'' before
``paragraph (5)'';
(2) by redesignating the matter after ``Requirement.--'' as
a subparagraph (A) with the heading ``In general.--'' and
with the same indentation as subparagraph (B) (as added by
paragraph (3)); and
(3) by adding at the end the following:
``(B) State option to waive requirement for 3 months before
receipt of medical assistance.--A State may, at its option,
elect also to apply subparagraph (A) in the case of a family
that was receiving such aid for fewer than three months or
that had applied for and was eligible for such aid for fewer
than 3 months during the 6 immediately preceding months
described in such subparagraph.''.
(d) CMS Report on Enrollment and Participation Rates Under
TMA.--Section 1925 of such Act (42 U.S.C. 1396r-6), as
amended by this section, is further amended by adding at the
end the following new subsection:
``(g) Collection and Reporting of Participation
Information.--
``(1) Collection of information from states.--Each State
shall collect and submit to the Secretary (and make publicly
available), in a format specified by the Secretary,
information on average monthly enrollment and average monthly
participation rates for adults and children under this
section and of the number and percentage of children who
become ineligible for medical assistance under this section
whose medical assistance is continued under another
eligibility category or who are enrolled under the State's
child health plan under title XXI. Such information shall be
submitted at the same time and frequency in which other
enrollment information under this title is submitted to the
Secretary.
``(2) Annual reports to congress.--Using the information
submitted under paragraph (1), the Secretary shall submit to
Congress annual reports concerning enrollment and
participation rates described in such paragraph.''.
(e) Effective Date.--The amendments made by subsections (b)
through (d) shall take effect on the date of the enactment of
this Act.
SEC. 802. FAMILY PLANNING SERVICES.
(a) Coverage as Optional Categorically Needy Group.--
(1) In general.--Section 1902(a)(10)(A)(ii) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)) is amended--
(A) in subclause (XVIII), by striking ``or'' at the end;
(B) in subclause (XIX), by adding ``or'' at the end; and
(C) by adding at the end the following new subclause:
``(XX) who are described in subsection (ee) (relating to
individuals who meet certain income standards);''.
(2) Group described.--Section 1902 of the Social Security
Act (42 U.S.C. 1396a), as amended by section 112(c), is
amended by adding at the end the following new subsection:
[[Page H9342]]
``(ee)(1) Individuals described in this subsection are
individuals
``(A) whose income does not exceed an income eligibility
level established by the State that does not exceed the
highest income eligibility level established under the State
plan under this title (or under its State child health plan
under title XXI) for pregnant women; and
``(B) who are not pregnant.
``(2) At the option of a State, individuals described in
this subsection may include individuals who are determined to
meet the eligibility requirements referred to in paragraph
(1) under the terms, conditions, and procedures applicable to
making eligibility determinations for medical assistance
under this title under a waiver to provide the benefits
described in clause (XV) of the matter following subparagraph
(G) of section 1902(a)(10) granted to the State under section
1115 as of January 1, 2007.''.
(3) Limitation on benefits.--Section 1902(a)(10) of the
Social Security Act (42 U.S.C. 1396a(a)(10)) is amended in
the matter following subparagraph (G)--
(A) by striking ``and (XIV)'' and inserting ``(XIV)''; and
(B) by inserting ``, and (XV) the medical assistance made
available to an individual described in subsection (ee) shall
be limited to family planning services and supplies described
in section 1905(a)(4)(C) including medical diagnosis or
treatment services that are provided pursuant to a family
planning service in a family planning setting provided during
the period in which such an individual is eligible;'' after
``cervical cancer''.
(4) Conforming amendments.--Section 1905(a) of the Social
Security Act (42 U.S.C. 1396d(a)) is amended in the matter
preceding paragraph (1)--
(A) in clause (xii), by striking ``or'' at the end;
(B) in clause (xii), by adding ``or'' at the end; and
(C) by inserting after clause (xiii) the following:
``(xiv) individuals described in section 1902(ee),''.
(b) Presumptive Eligibility.--
(1) In general.--Title XIX of the Social Security Act (42
U.S.C. 1396 et seq.) is amended by inserting after section
1920B the following:
``PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING SERVICES
``Sec. 1920C. (a) State Option.-- State plan approved
under section 1902 may provide for making medical assistance
available to an individual described in section 1902(ee)
(relating to individuals who meet certain income eligibility
standard) during a presumptive eligibility period. In the
case of an individual described in section 1902(ee), such
medical assistance shall be limited to family planning
services and supplies described in 1905(a)(4)(C) and, at the
State's option, medical diagnosis or treatment services that
are provided in conjunction with a family planning service in
a family planning setting provided during the period in which
such an individual is eligible.
``(b) Definitions.--For purposes of this section:
``(1) Presumptive eligibility period.--The term
`presumptive eligibility period' means, with respect to an
individual described in subsection (a), the period that--
``(A) begins with the date on which a qualified entity
determines, on the basis of preliminary information, that the
individual is described in section 1902(ee); and
``(B) ends with (and includes) the earlier of--
``(i) the day on which a determination is made with respect
to the eligibility of such individual for services under the
State plan; or
``(ii) in the case of such an individual who does not file
an application by the last day of the month following the
month during which the entity makes the determination
referred to in subparagraph (A), such last day.
``(2) Qualified entity.--
``(A) In general.--Subject to subparagraph (B), the term
`qualified entity' means any entity that--
``(i) is eligible for payments under a State plan approved
under this title; and
``(ii) is determined by the State agency to be capable of
making determinations of the type described in paragraph
(1)(A).
``(B) Rule of construction.--Nothing in this paragraph
shall be construed as preventing a State from limiting the
classes of entities that may become qualified entities in
order to prevent fraud and abuse.
``(c) Administration.--
``(1) In general.--The State agency shall provide qualified
entities with--
``(A) such forms as are necessary for an application to be
made by an individual described in subsection (a) for medical
assistance under the State plan; and
``(B) information on how to assist such individuals in
completing and filing such forms.
``(2) Notification requirements.--A qualified entity that
determines under subsection (b)(1)(A) that an individual
described in subsection (a) is presumptively eligible for
medical assistance under a State plan shall--
``(A) notify the State agency of the determination within 5
working days after the date on which determination is made;
and
``(B) inform such individual at the time the determination
is made that an application for medical assistance is
required to be made by not later than the last day of the
month following the month during which the determination is
made.
``(3) Application for medical assistance.--In the case of
an individual described in subsection (a) who is determined
by a qualified entity to be presumptively eligible for
medical assistance under a State plan, the individual shall
apply for medical assistance by not later than the last day
of the month following the month during which the
determination is made.
``(d) Payment.--Notwithstanding any other provision of this
title, medical assistance that--
``(1) is furnished to an individual described in subsection
(a)--
``(A) during a presumptive eligibility period;
``(B) by a entity that is eligible for payments under the
State plan; and
``(2) is included in the care and services covered by the
State plan, shall be treated as medical assistance provided
by such plan for purposes of clause (4) of the first sentence
of section 1905(b).''.
(2) Conforming amendments.--
(A) Section 1902(a)(47) of the Social Security Act (42
U.S.C. 1396a(a)(47)) is amended by inserting before the
semicolon at the end the following: ``and provide for making
medical assistance available to individuals described in
subsection (a) of section 1920C during a presumptive
eligibility period in accordance with such section.''.
(B) Section 1903(u)(1)(D)(v) of such Act (42 U.S.C.
1396b(u)(1)(D)(v)) is amended--
(i) by striking ``or for'' and inserting ``, for''; and
(ii) by inserting before the period the following: ``, or
for medical assistance provided to an individual described in
subsection (a) of section 1920C during a presumptive
eligibility period under such section''.
(e) Clarification of Coverage of Family Planning Services
and Supplies.--Section 1937(b) of the Social Security Act (42
U.S.C. 1396u-7(b)) is amended by adding at the end the
following:
``(5) Coverage of family planning services and supplies.--
Notwithstanding the previous provisions of this section, a
State may not provide for medical assistance through
enrollment of an individual with benchmark coverage or
benchmark-equivalent coverage under this section unless such
coverage includes for any individual described in section
1905(a)(4)(C), medical assistance for family planning
services and supplies in accordance with such section.''.
(f) Effective Date.--The amendments made by this section
take effect on October 1, 2007.
SEC. 803. AUTHORITY TO CONTINUE PROVIDING ADULT DAY HEALTH
SERVICES APPROVED UNDER A STATE MEDICAID PLAN.
(a) In General.--During the period described in subsection
(b), the Secretary of Health and Human Services shall not--
(1) withhold, suspend, disallow, or otherwise deny Federal
financial participation under section 1903(a) of the Social
Security Act (42 U.S.C. 1396b(a)) for the provision of adult
day health care services, day activity and health services,
or adult medical day care services, as defined under a State
Medicaid plan approved during or before 1994, during such
period if such services are provided consistent with such
definition and the requirements of such plan; or
(2) withdraw Federal approval of any such State plan or
part thereof regarding the provision of such services (by
regulation or otherwise).
(b) Period Described.--The period described in this
subsection is the period that begins on November 3, 2005, and
ends on March 1, 2009.
SEC. 804. STATE OPTION TO PROTECT COMMUNITY SPOUSES OF
INDIVIDUALS WITH DISABILITIES.
Section 1924(h)(1)(A) of the Social Security Act (42
U.S.C. 1396r-5(h)(1)(A)) is amended by striking ``is
described in section 1902(a)(10)(A)(ii)(VI)'' and inserting
``is being provided medical assistance for home and
community-based services under subsection (c), (d), (e), (i),
or (j) of section 1915 or pursuant to section 1115''.
SEC. 805. COUNTY MEDICAID HEALTH INSURING ORGANIZATIONS .
(a) In General.--Section 9517(c)(3) of the Consolidated
Omnibus Budget Reconciliation Act of 1985 (42 U.S.C. 1396b
note), as added by section 4734 of the Omnibus Budget
Reconciliation Act of 1990 and as amended by section 704 of
the Medicare, Medicaid, and SCHIP Benefits Improvement and
Protection Act of 2000, is amended--
(1) in subparagraph (A), by inserting ``, in the case of
any health insuring organization described in such
subparagraph that is operated by a public entity established
by Ventura County, and in the case of any health insuring
organization described in such subparagraph that is operated
by a public entity established by Merced County'' after
``described in subparagraph (B)''; and
(2) in subparagraph (C), by striking ``14 percent'' and
inserting ``16 percent''.
(b) Effective Date.--The amendments made by subsection (a)
shall take effect on the date of the enactment of this Act.
Subtitle B--Payments
SEC. 811. PAYMENTS FOR PUERTO RICO AND TERRITORIES.
(a) Payment Ceiling.--Section 1108(g) of the Social
Security Act (42 U.S.C. 1308(g)) is amended--
(1) in paragraph (2), by striking ``paragraph (3)'' and
inserting ``paragraphs (3) and (4)''; and
[[Page H9343]]
(2) by adding at the end the following new paragraph:
``(4) Fiscal years 2009 through 2012 for certain insular
areas.--The amounts otherwise determined under this
subsection for Puerto Rico, the Virgin Islands, Guam, the
Northern Mariana Islands, and American Samoa for fiscal years
2009 through 2012 shall be increased by the following
amounts:
``(A) Puerto rico.--For Puerto Rico, $250,000,000 for
fiscal year 2009, $350,000,000 for fiscal year 2010,
$500,000,000 for fiscal year 2011, and $600,000,000 for
fiscal year 2012.
``(B) Virgin islands.--For the Virgin Islands, $5,000,000
for each of fiscal years 2009 through 2012.
``(C) Guam.--For Guam, $5,000,000 for each of fiscal years
2009 through 2012.
``(D) Northern mariana islands.--For the Northern Mariana
Islands, $4,000,000 for each of fiscal years 2009 through
2012.
``(E) American samoa.--For American Samoa, $4,000,000 for
each of fiscal years 2009 through 2012.
Such amounts shall not be taken into account in applying
paragraph (2) for fiscal years 2009 through 2012 but shall be
taken into account in applying such paragraph for fiscal year
2013 and subsequent fiscal years.''.
(b) Removal of Federal Matching Payments for Improving Data
Reporting Systems From the Overall Limit on Payments to
Territories Under Title XIX.--Such section is further amended
by adding at the end the following new paragraph:
``(5) Exclusion of certain expenditures from payment
limits.-- With respect to fiscal year 2008 and each fiscal
year thereafter, if Puerto Rico, the Virgin Islands, Guam,
the Northern Mariana Islands, or American Samoa qualify for a
payment under subparagraph (A)(i) or (B) of section
1903(a)(3) for a calendar quarter of such fiscal year with
respect to expenditures for improvements in data reporting
systems described in such subparagraph, the limitation on
expenditures under title XIX for such commonwealth or
territory otherwise determined under subsection (f) and this
subsection for such fiscal year shall be determined without
regard to payment for such expenditures.''.
SEC. 812. MEDICAID DRUG REBATE.
(a) Brand.--Paragraph (1)(B)(i) of section 1927(c) of the
Social Security Act (42 U.S.C. 1396r-8(c)) is amended--
(1) by striking ``and'' at the end of subclause (IV);
(2) in subclause (V)--
(A) by inserting ``and before January 1, 2008,'' after
``December 31, 1995''; and
(B) by striking the period at the end and inserting ``;
and''; and
(3) by adding at the end the following new subclause:
``(VI) after December 31, 2007, is 20.1 percent.''.
(b) PBMs to Best Price Definition.--
(1) In general.--Section 1927(c)(1)(C)(ii)(I) of the Social
Security Act (42 U.S.C. 1396r-8(c)(1)(C)(ii)(I)) is amended--
(A) by striking ``and'' before ``rebates''; and
(B) by inserting before the semicolon at the end the
following: ``, and rebates, discounts, and other price
concessions to pharmaceutical benefit managers (PBMs)''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to calendar quarters beginning on or after
January 1, 2008.
SEC. 813. ADJUSTMENT IN COMPUTATION OF MEDICAID FMAP TO
DISREGARD AN EXTRAORDINARY EMPLOYER PENSION
CONTRIBUTION.
(a) In General.--Only for purposes of computing the Federal
medical assistance percentage under section 1905(b) of the
Social Security Act (42 U.S.C. 1396d(b)) for a State for a
fiscal year (beginning with fiscal year 2006), any
significantly disproportionate employer pension contribution
described in subsection (b) shall be disregarded in computing
the per capita income of such State, but shall not be
disregarded in computing the per capita income for the
continental United States (and Alaska) and Hawaii.
(b) Significantly Disproportionate Employer Pension
Contribution.--For purposes of subsection (a), a
significantly disproportionate employer pension contribution
described in this subsection with respect to a State for a
fiscal year is an employer contribution towards pensions that
is allocated to such State for a period if the aggregate
amount so allocated exceeds 25 percent of the total increase
in personal income in that State for the period involved.
SEC. 814. MORATORIUM ON CERTAIN PAYMENT RESTRICTIONS.
Notwithstanding any other provision of law, the Secretary
of Health and Human Services shall not, prior to the date
that is 1 year after the date of enactment of this Act, take
any action (through promulgation of regulation, issuance of
regulatory guidance, use of federal payment audit procedures,
or other administrative action, policy, or practice,
including a Medical Assistance Manual transmittal or letter
to State Medicaid directors) to restrict coverage or payment
under title XIX of the Social Security Act for rehabilitation
services, or school-based administration, transportation, or
medical services if such restrictions are more restrictive in
any aspect than those applied to such coverage or payment as
of July 1, 2007.
SEC. 815. TENNESSEE DSH.
The DSH allotments for Tennessee for each fiscal year
beginning with fiscal year 2008 under subsection (f)(3) of
section 1923 of the Social Security Act (42 U.S.C. 13961396r-
4) are deemed to be $30,000,000. The Secretary of Health and
Human Services may impose a limitation on the total amount of
payments made to hospitals under the TennCare Section 1115
waiver only to the extent that such limitation is necessary
to ensure that a hospital does not receive payment in excess
of the amounts described in subsection (f) of such section or
as necessary to ensure that the waiver remains budget
neutral.
SEC. 816. CLARIFICATION TREATMENT OF REGIONAL MEDICAL CENTER.
(a) In General.--Nothing in section 1903(w) of the Social
Security Act (42 U.S.C. 1396b(w)) shall be construed by the
Secretary of Health and Human Services as prohibiting a
State's use of funds as the non-Federal share of expenditures
under title XIX of such Act where such funds are transferred
from or certified by a publicly-owned regional medical center
located in another State and described in subsection (b), so
long as the Secretary determines that such use of funds is
proper and in the interest of the program under title XIX.
(b) Center Described.--A center described in this
subsection is a publicly-owned regional medical center that--
(1) provides level 1 trauma and burn care services;
(2) provides level 3 neonatal care services;
(3) is obligated to serve all patients, regardless of
ability to pay;
(4) is located within a Standard Metropolitan Statistical
Area (SMSA) that includes at least 3 States;
(5) provides services as a tertiary care provider for
patients residing within a 125-mile radius; and
(6) meets the criteria for a disproportionate share
hospital under section 1923 of such Act (42 U.S.C. 1396r-4)
in at least one State other than the State in which the
center is located.
Subtitle C--Miscellaneous
SEC. 821. DEMONSTRATION PROJECT FOR EMPLOYER BUY-IN.
Title XXI of the Social Security Act, as amended by section
115(a)(1), is further amended by adding at the end the
following new section:
``SEC. 2112. DEMONSTRATION PROJECT FOR EMPLOYER BUY-IN.
``(a) Authority.--
``(1) In general.--The Secretary shall establish a
demonstration project under which up to 10 States (each
referred to in this section as a `participating State') that
meets the conditions of paragraph (2) may provide, under its
State child health plan (notwithstanding section
2102(b)(3)(C)) for a period of 5 years, for child health
assistance in relation to family coverage described in
subsection (d) for children who would be targeted low-income
children but for coverage as beneficiaries under a group
health plan as the children of participants by virtue of a
qualifying employer's contribution under subsection (b)(2). :
``(2) Conditions.--The conditions described in this
paragraph for a State are as follows:
``(A) No waiting lists.--The State does not impose any
waiting list, enrollment cap, or similar limitation on
enrollment of targeted low-income children under the State
child health plan.
``(B) Eligibility of all children under 200 percent of
poverty line.--The State is applying an income eligibility
level under section 2110(b)(1)(B)(ii)(I) that is at least 200
percent of the poverty line.
``(3) Qualifying employer defined.--In this section, the
term `qualifying employer' means an employer that has a
majority of its workforce composed of full-time workers with
family incomes reasonably estimated by the employer (based on
wage information available to the employer) at or below 200
percent of the poverty line. In applying the previous
sentence, two part-time workers shall be treated as a single
full-time worker.
``(b) Funding.--A demonstration project under this section
in a participating State shall be funded, with respect to
assistance provided to children described in subsection
(a)(1), consistent with the following:
``(1) Limited family contribution.--The family involved
shall be responsible for providing payment towards the
premium for such assistance of such amount as the State may
specify, except that the limitations on cost-sharing
(including premiums) under paragraphs (2) and (3) of section
2103(e) shall apply to all cost-sharing of such family under
this section.
``(2) Minimum employer contribution.--The qualifying
employer involved shall be responsible for providing payment
to the State child health plan in the State of at least 50
percent of the portion of the cost (as determined by the
State) of the family coverage in which the employer is
enrolling the family that exceeds the amount of the family
contribution under paragraph (1) applied towards such
coverage.
``(3) Limitation on federal financial participation.--In no
case shall the Federal financial participation under section
2105 with respect to a demonstration project under this
section be made for any portion of the costs of family
coverage described in subsection (d) (including the costs of
administration of such coverage) that are not attributable to
children described in subsection (a)(1).
``(c) Uniform Eligibility Rules.--In providing assistance
under a demonstration project under this section--
``(1) a State shall establish uniform rules of eligibility
for families to participate; and
[[Page H9344]]
``(2) a State shall not permit a qualifying employer to
select, within those families that meet such eligibility
rules, which families may participate.
``(d) Terms and Conditions.--The family coverage offered to
families of qualifying employers under a demonstration
project under this section in a State shall be the same as
the coverage and benefits provided under the State child
health plan in the State for targeted low-income children
with the highest family income level permitted.''.
SEC. 822. DIABETES GRANTS.
Section 2104 of the Social Security Act (42 U.C.C 1397dd),
as amended by section 101, is further amended--
(1) in subsection (a)(11), by inserting before the period
at the end the following: ``plus for fiscal year 2009 the
total of the amount specified in subsection (j)''; and
(2) by adding at the end the following new subsection:
``(j) Funding for Diabetes Grants.--From the amounts
appropriated under subsection (a)(11), for fiscal year 2009
from the amounts--
``(1) $150,000,000 is hereby transferred and made available
in such fiscal year for grants under section 330B of the
Public Health Service Act; and
``(2) $150,000,000 is hereby transferred and made available
in such fiscal year for grants under section 330C of such
Act.''.
SEC. 823. TECHNICAL CORRECTION.
(a) Correction of Reference to Children in Foster Care
Receiving Child Welfare Services.--Section
1937(a)(2)(B)(viii) of the Social Security Act (42 U.S.C.
1396u-7(a)(2)(B) is amended by striking ``aid or assistance
is made available under part B of title IV to children in
foster care'' and inserting ``child welfare services are made
available under part B of title IV on the basis of being a
child in foster care''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect as if included in the amendment made by
section 6044(a) of the Deficit Reduction Act of 2005.
TITLE IX--MISCELLANEOUS
SEC. 901. MEDICARE PAYMENT ADVISORY COMMISSION STATUS.
Section 1805(a) of the Social Security Act (42 U.S.C.
1395b-6(a)) is amended by inserting ``as an agency of
Congress'' after ``established''.
SEC. 902. REPEAL OF TRIGGER PROVISION.
Subtitle A of title VIII of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173) is repealed and the provisions of law amended by such
subtitle are restored as if such subtitle had never been
enacted.
SEC. 903. REPEAL OF COMPARATIVE COST ADJUSTMENT (CCA)
PROGRAM.
Section 1860C-1 of the Social Security Act (42 U.S.C.
1395w-29), as added by section 241(a) of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173), is repealed.
SEC. 904. COMPARATIVE EFFECTIVENESS RESEARCH.
(a) In General.--Part A of title XVIII of the Social
Security Act is amended by adding at the end the following
new section:
``COMPARATIVE EFFECTIVENESS RESEARCH
``Sec. 1822. (a) Center for Comparative Effectiveness
Research Established.--
``(1) In general.--The Secretary shall establish within the
Agency of Healthcare Research and Quality a Center for
Comparative Effectiveness Research (in this section referred
to as the `Center') to conduct, support, and synthesize
research (including research conducted or supported under
section 1013 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003) with respect to the outcomes,
effectiveness, and appropriateness of health care services
and procedures in order to identify the manner in which
diseases, disorders, and other health conditions can most
effectively and appropriately be prevented, diagnosed,
treated, and managed clinically.
``(2) Duties.--The Center shall--
``(A) conduct, support, and synthesize research relevant to
the comparative clinical effectiveness of the full spectrum
of health care treatments, including pharmaceuticals, medical
devices, medical and surgical procedures, and other medical
interventions;
``(B) conduct and support systematic reviews of clinical
research, including original research conducted subsequent to
the date of the enactment of this section;
``(C) use methodologies such as randomized controlled
clinical trials as well as other various types of clinical
research, such as observational studies;
``(D) submit to the Comparative Effectiveness Research
Commission, the Secretary, and Congress appropriate relevant
reports described in subsection (d)(2);
``(E) encourage, as appropriate, the development and use of
clinical registries and the development of clinical
effectiveness research data networks from electronic health
records, post marketing drug and medical device surveillance
efforts, and other forms of electronic health data; and
``(F) not later than 180 days after the date of the
enactment of this section, develop methodological standards
to be used when conducting studies of comparative clinical
effectiveness and value (and procedures for use of such
standards) in order to help ensure accurate and effective
comparisons and update such standards at least biennially.
``(b) Oversight by Comparative Effectiveness Research
Commission.--
``(1) In general.--The Secretary shall establish an
independent Comparative Effectiveness Research Commission (in
this section referred to as the `Commission') to oversee and
evaluate the activities carried out by the Center under
subsection (a) to ensure such activities result in highly
credible research and information resulting from such
research.
``(2) Duties.--The Commission shall--
``(A) determine national priorities for research described
in subsection (a) and in making such determinations consult
with patients and health care providers and payers;
``(B) monitor the appropriateness of use of the CERTF
described in subsection (f) with respect to the timely
production of comparative effectiveness research determined
to be a national priority under subparagraph (A);
``(C) identify highly credible research methods and
standards of evidence for such research to be considered by
the Center;
``(D) review and approve the methodological standards (and
updates to such standards) developed by the Center under
subsection (a)(2)(F);
``(E) enter into an arrangement under which the Institute
of Medicine of the National Academy of Sciences shall conduct
an evaluation and report on standards of evidence for such
research;
``(F) support forums to increase stakeholder awareness and
permit stakeholder feedback on the efforts of the Agency of
Healthcare Research and Quality to advance methods and
standards that promote highly credible research;
``(G) make recommendations for public data access policies
of the Center that would allow for access of such data by the
public while ensuring the information produced from research
involved is timely and credible;
``(H) appoint a clinical perspective advisory panel for
each research priority determined under subparagraph (A),
which shall frame the specific research inquiry to be
examined with respect to such priority to ensure that the
information produced from such research is clinically
relevant to decisions made by clinicians and patients at the
point of care;
``(I) make recommendations for the priority for periodic
reviews of previous comparative effectiveness research and
studies conducted by the Center under subsection (a);
``(J) routinely review processes of the Center with respect
to such research to confirm that the information produced by
such research is objective, credible, consistent with
standards of evidence established under this section, and
developed through a transparent process that includes
consultations with appropriate stakeholders;
``(K) at least annually, provide guidance or
recommendations to health care providers and consumers for
the use of information on the comparative effectiveness of
health care services by consumers, providers (as defined for
purposes of regulations promulgated under section 264(c) of
the Health Insurance Portability and Accountability Act of
1996) and public and private purchasers;
``(L) make recommendations for a strategy to disseminate
the findings of research conducted and supported under this
section that enables clinicians to improve performance,
consumers to make more informed health care decisions, and
payers to set medical policies that improve quality and
value;
``(M) provide for the public disclosure of relevant reports
described in subsection (d)(2); and
``(N) submit to Congress an annual report on the progress
of the Center in achieving national priorities determined
under subparagraph (A) for the provision of credible
comparative effectiveness information produced from such
research to all interested parties.
``(3) Composition of commission.--
``(A) In general.--The members of the Commission shall
consist of--
``(i) the Director of the Agency for Healthcare Research
and Quality;
``(ii) the Chief Medical Officer of the Centers for
Medicare & Medicaid Services; and
``(iii) up to 15 additional members who shall represent
broad constituencies of stakeholders including clinicians,
patients, researchers, third-party payers, consumers of
Federal and State beneficiary programs. .
``(B) Qualifications.--
``(i) Diverse representation of perspectives.--The members
of the Commission shall represent a broad range of
perspectives and shall collectively have experience in the
following areas:
``(I) Epidemiology.
``(II) Health services research.
``(III) Bioethics.
``(IV) Decision sciences.
``(V) Economics.
``(ii) Diverse representation of health care community.--At
least one member shall represent each of the following health
care communities:
``(I) Consumers.
``(II) Practicing physicians, including surgeons.
``(III) Employers.
``(IV) Public payers.
``(V) Insurance plans.
``(VI) Clinical researchers who conduct research on behalf
of pharmaceutical or device manufacturers.
``(4) Appointment.--The Comptroller General of the United
States, in consultation with the chairs of the committees of
jurisdiction of the House of Representatives and
[[Page H9345]]
the Senate, shall appoint the members of the Commission.
``(5) Chairman; vice chairman.--The Comptroller General of
the United States shall designate a member of the Commission,
at the time of appointment of the member, as Chairman and a
member as Vice Chairman for that term of appointment, except
that in the case of vacancy of the Chairmanship or Vice
Chairmanship, the Comptroller General may designate another
member for the remainder of that member's term.
``(6) Terms.--
``(A) In general.--Except as provided in subparagraph (B),
each member of the Commission shall be appointed for a term
of 4 years.
``(B) Terms of initial appointees.--Of the members first
appointed--
``(i) 10 shall be appointed for a term of 4 years; and
``(ii) 9 shall be appointed for a term of 3 years.
``(7) Coordination.--To enhance effectiveness and
coordination, the Comptroller General is encouraged, to the
greatest extent possible, to seek coordination between the
Commission and the National Advisory Council of the Agency
for Healthcare Research and Quality.
``(8) Conflicts of interest.--In appointing the members of
the Commission or a clinical perspective advisory panel
described in paragraph (2)(G), the Comptroller General of the
United States or the Commission, respectively, shall take
into consideration any financial conflicts of interest.
``(9) Compensation.--While serving on the business of the
Commission (including traveltime), a member of the Commission
shall be entitled to compensation at the per diem equivalent
of the rate provided for level IV of the Executive Schedule
under section 5315 of title 5, United States Code; and while
so serving away from home and the member's regular place of
business, a member may be allowed travel expenses, as
authorized by the Director of the Commission.
``(10) Availability of reports.--The Commission shall
transmit to the Secretary a copy of each report submitted
under this subsection and shall make such reports available
to the public.
``(11) Director and staff; experts and consultants.--
Subject to such review as the Secretary, in consultation with
the Comptroller General deems necessary to assure the
efficient administration of the Commission, the Commission
may--
``(A) employ and fix the compensation of an Executive
Director (subject to the approval of the Secretary, in
consultation with the Comptroller General) and such other
personnel as may be necessary to carry out its duties
(without regard to the provisions of title 5, United States
Code, governing appointments in the competitive service);
``(B) seek such assistance and support as may be required
in the performance of its duties from appropriate Federal
departments and agencies;
``(C) enter into contracts or make other arrangements, as
may be necessary for the conduct of the work of the
Commission (without regard to section 3709 of the Revised
Statutes (41 U.S.C. 5));
``(D) make advance, progress, and other payments which
relate to the work of the Commission;
``(E) provide transportation and subsistence for persons
serving without compensation; and
``(F) prescribe such rules and regulations as it deems
necessary with respect to the internal organization and
operation of the Commission.
``(12) Powers.--
``(A) Obtaining official data.--The Commission may secure
directly from any department or agency of the United States
information necessary to enable it to carry out this section.
Upon request of the Executive Director, the head of that
department or agency shall furnish that information to the
Commission on an agreed upon schedule.
``(B) Data collection.--In order to carry out its
functions, the Commission shall--
``(i) utilize existing information, both published and
unpublished, where possible, collected and assessed either by
its own staff or under other arrangements made in accordance
with this section,
``(ii) carry out, or award grants or contracts for,
original research and experimentation, where existing
information is inadequate, and
``(iii) adopt procedures allowing any interested party to
submit information for the Commission's use in making reports
and recommendations.
``(C) Access of gao to information.--The Comptroller
General shall have unrestricted access to all deliberations,
records, and nonproprietary data of the Commission,
immediately upon request.
``(D) Periodic audit.--The Commission shall be subject to
periodic audit by the Comptroller General.
``(c) Research Requirements.--Any research conducted,
supported, or synthesized under this section shall meet the
following requirements:
``(1) Ensuring transparency, credibility, and access.--
``(A) The establishment of the agenda and conduct of the
research shall be insulated from inappropriate political or
stakeholder influence.
``(B) Methods of conducting such research shall be
scientifically based.
``(C) All aspects of the prioritization of research,
conduct of the research, and development of conclusions based
on the research shall be transparent to all stakeholders.
``(D) The process and methods for conducting such research
shall be publicly documented and available to all
stakeholders.
``(E) Throughout the process of such research, the Center
shall provide opportunities for all stakeholders involved to
review and provide comment on the methods and findings of
such research.
``(2) Use of clinical perspective advisory panels.--The
research shall meet a national research priority determined
under subsection (b)(2)(A) and shall examine the specific
research inquiry framed by the clinical perspective advisory
panel for the national research priority.
``(3) Stakeholder input.--The priorities of the research,
the research, and the dissemination of the research shall
involve the consultation of patients, health care providers,
and health care consumer representatives through transparent
mechanisms recommended by the Commission.
``(d) Public Access to Comparative Effectiveness
Information.--
``(1) In general.--Not later than 90 days after receipt by
the Center or Commission, as applicable, of a relevant report
described in paragraph (2) made by the Center, Commission, or
clinical perspective advisory panel under this section,
appropriate information contained in such report shall be
posted on the official public Internet site of the Center and
of the Commission, as applicable.
``(2) Relevant reports described.--For purposes of this
section, a relevant report is each of the following submitted
by a grantee or contractor of the Center:
``(A) An interim progress report.
``(B) A draft final comparative effectiveness review.
``(C) A final progress report on new research submitted for
publication by a peer review journal.
``(D) Stakeholder comments.
``(E) A final report.
``(3) Access by congress and the commission to the center's
information.--Congress and the Commission shall each have
unrestricted access to all deliberations, records, and
nonproprietary data of the Center, immediately upon request.
``(e) Dissemination and Incorporation of Comparative
Effectiveness Information.--
``(1) Dissemination.--The Center shall provide for the
dissemination of appropriate findings produced by research
supported, conducted, or synthesized under this section to
health care providers, patients, vendors of health
information technology focused on clinical decision support,
appropriate professional associations, and Federal and
private health plans.
``(2) Incorporation.--The Center shall assist users of
health information technology focused on clinical decision
support to promote the timely incorporation of the findings
described in paragraph (1) into clinical practices and to
promote the ease of use of such incorporation.
``(f) Reports to Congress.--
``(1) Annual reports.--Beginning not later than one year
after the date of the enactment of this section, the Director
of the Agency of Healthcare Research and Quality and the
Center for Comparative Effectiveness Research shall submit to
Congress an annual report on the activities of the Center and
the Commission, as well as the research, conducted under this
section.
``(2) Recommendation for fair share per capita amount for
all-payer financing.--Beginning not later than December 31,
2009, the Secretary shall submit to Congress an annual
recommendation for a fair share per capita amount described
in subsection (c)(1) of section 9511 of the Internal Revenue
Code of 1986 for purposes of funding the CERTF under such
section.
``(3) Analysis and review.--Not later than December 31,
2011, the Secretary, in consultation with the Commission,
shall submit to Congress a report on all activities conducted
or supported under this section as of such date. Such report
shall include an evaluation of the return on investment
resulting from such activities, the overall costs of such
activities, and an analysis of the backlog of any research
proposals approved by the Commission but not funded. Such
report shall also address whether Congress should expand the
responsibilities of the Center and of the Commission to
include studies of the effectiveness of various aspects of
the health care delivery system, including health plans and
delivery models, such as health plan features, benefit
designs and performance, and the ways in which health
services are organized, managed, and delivered.
``(g) Coordinating Council for Health Services Research.--
``(1) Establishment.--The Secretary shall establish a
permanent council (in this section referred to as the
`Council') for the purpose of--
``(A) assisting the offices and agencies of the Department
of Health and Human Services, the Department of Veterans
Affairs, the Department of Defense, and any other Federal
department or agency to coordinate the conduct or support of
health services research; and
``(B) advising the President and Congress on--
``(i) the national health services research agenda;
``(ii) strategies with respect to infrastructure needs of
health services research; and
[[Page H9346]]
``(iii) appropriate organizational expenditures in health
services research by relevant Federal departments and
agencies.
``(2) Membership.--
``(A) Number and appointment.--The Council shall be
composed of 20 members. One member shall be the Director of
the Agency for Healthcare Research and Quality. The Director
shall appoint the other members not later than 30 days after
the enactment of this Act.
``(B) Terms.--
``(i) In general.--Except as provided in clause (ii), each
member of the Council shall be appointed for a term of 4
years.
``(ii) Terms of initial appointees.--Of the members first
appointed--
``(I) 8 shall be appointed for a term of 4 years; and
``(II) 7 shall be appointed for a term of 3 years.
``(iii) Vacancies.--Any vacancies shall not affect the
power and duties of the Council and shall be filled in the
same manner as the original appointment.
``(C) Qualifications.--
``(i) In general.--The members of the Council shall include
one senior official from each of the following agencies:
``(I) The Veterans Health Administration.
``(II) The Department of Defense Military Health Care
System.
``(III) The Centers for Disease Control and Prevention.
``(IV) The National Center for Health Statistics.
``(V) The National Institutes of Health.
``(VI) The Center for Medicare & Medicaid Services.
``(VII) The Federal Employees Health Benefits Program.
``(ii) National, philanthropic foundations.--The members of
the Council shall include 4 senior leaders from major
national, philanthropic foundations that fund and use health
services research.
``(iii) Stakeholders.--The remaining members of the Council
shall be representatives of other stakeholders in health
services research, including private purchasers, health
plans, hospitals and other health facilities, and health
consumer groups.
``(3) Annual report.--The Council shall submit to Congress
an annual report on the progress of the implementation of the
national health services research agenda.
``(h) Funding of Comparative Effectiveness Research.--For
fiscal year 2009 and each subsequent fiscal year, amounts in
the Comparative Effectiveness Research Trust Fund (referred
to in this section as the `CERTF') under section 9511 of the
Internal Revenue Code of 1986 shall be available to the
Secretary to carry out this section.''.
(b) Comparative Effectiveness Research Trust Fund;
Financing for Trust Fund.--
(1) Establishment of trust fund.--
(A) In general.--Subchapter A of chapter 98 of the Internal
Revenue Code of 1986 (relating to trust fund code) is amended
by adding at the end the following new section:
``SEC. 9511. HEALTH CARE COMPARATIVE EFFECTIVENESS RESEARCH
TRUST FUND.
``(a) Creation of Trust Fund.--There is established in the
Treasury of the United States a trust fund to be known as the
`Health Care Comparative Effectiveness Research Trust Fund'
(hereinafter in this section referred to as the `CERTF'),
consisting of such amounts as may be appropriated or credited
to such Trust Fund as provided in this section and section
9602(b).
``(b) Transfers to Fund.--There are hereby appropriated to
the Trust Fund the following:
``(1) For fiscal year 2008, $90,000,000.
``(2) For fiscal year 2009, $100,000,000.
``(3) For fiscal year 2010, $110,000,000.
``(4) For each fiscal year beginning with fiscal year
2011--
``(A) an amount equivalent to the net revenues received in
the Treasury from the fees imposed under subchapter B of
chapter 34 (relating to fees on health insurance and self-
insured plans) for such fiscal year; and
``(B) subject to subsection (c)(2), amounts determined by
the Secretary of Health and Human Services to be equivalent
to the fair share per capita amount computed under subsection
(c)(1) for the fiscal year multiplied by the average number
of individuals entitled to benefits under part A, or enrolled
under part B, of title XVIII of the Social Security Act
during such fiscal year.
The amounts appropriated under paragraphs (1), (2), (3), and
(4)(B) shall be transferred from the Federal Hospital
Insurance Trust Fund and from the Federal Supplementary
Medical Insurance Trust Fund (established under section 1841
of such Act), and from the Medicare Prescription Drug Account
within such Trust Fund, in proportion (as estimated by the
Secretary) to the total expenditures during such fiscal year
that are made under title XVIII of such Act from the
respective trust fund or account.
``(c) Fair Share Per Capita Amount.--
``(1) Computation.--
``(A) In general.--Subject to subparagraph (B), the fair
share per capita amount under this paragraph for a fiscal
year (beginning with fiscal year 2011) is an amount computed
by the Secretary of Health and Human Services for such fiscal
year that, when applied under this section and subchapter B
of chapter 34 of the Internal Revenue Code of 1986, will
result in revenues to the CERTF of $375,000,000 for the
fiscal year.
``(B) Alternative computation.--
``(i) In general.--If the Secretary is unable to compute
the fair share per capita amount under subparagraph (A) for a
fiscal year, the fair share per capita amount under this
paragraph for the fiscal year shall be the default amount
determined under clause (ii) for the fiscal year.
``(ii) Default amount.--The default amount under this
clause for--
``(I) fiscal year 2011 is equal to $2; or
``(II) a subsequent year is equal to the default amount
under this clause for the preceeding fiscal year increased by
the annual percentage increase in the medical care component
of the consumer price index (United States city average) for
the 12-month period ending with April of the preceding fiscal
year.
Any amount determined under subclause (II) shall be rounded
to the nearest penny.
``(2) Limitation on medicare funding.--In no case shall the
amount transferred under subsection (b)(4)(B) for any fiscal
year exceed $90,000,000.
``(d) Expenditures From Fund.--
``(1) In general.--Subject to paragraph (2), amounts in the
CERTF are available to the Secretary of Health and Human
Services for carrying out section 1822 of the Social Security
Act.
``(2) Allocation for commission.--The following amounts in
the CERTF for a fiscal year shall be available to carry out
the activities of the Comparative Effectiveness Research
Commission established under section 1822(b) of the Social
Security Act for such fiscal year:
``(A) For fiscal year 2008, $7,000,000.
``(B) For fiscal year 2009, $9,000,000.
``(C) For each fiscal year beginning with 2010,
$10,000,000.
Nothing in this paragraph shall be construed as preventing
additional amounts in the CERTF from being made available to
the Comparative Effectiveness Research Commission for such
activities.
``(e) Net Revenues.--For purposes of this section, the term
`net revenues' means the amount estimated by the Secretary
based on the excess of--
``(1) the fees received in the Treasury under subchapter B
of chapter 34, over
``(2) the decrease in the tax imposed by chapter 1
resulting from the fees imposed by such subchapter.''.
(B) Clerical amendment.--The table of sections for such
subchapter A is amended by adding at the end thereof the
following new item:
``Sec. 9511. Health Care Comparative Effectiveness Research Trust
Fund.''.
(2) Financing for fund from fees on insured and self-
insured health plans.--
(A) General rule.--Chapter 34 of the Internal Revenue Code
of 1986 is amended by adding at the end the following new
subchapter:
``Subchapter B--Insured and Self-Insured Health Plans
``Sec. 4375. Health insurance.
``Sec. 4376. Self-insured health plans.
``Sec. 4377. Definitions and special rules.
``SEC. 4375. HEALTH INSURANCE.
``(a) Imposition of Fee.--There is hereby imposed on each
specified health insurance policy for each policy year a fee
equal to the fair share per capita amount determined under
section 9511(c)(1) multiplied by the average number of lives
covered under the policy.
``(b) Liability for Fee.--The fee imposed by subsection (a)
shall be paid by the issuer of the policy.
``(c) Specified Health Insurance Policy.--For purposes of
this section--
``(1) In general.--Except as otherwise provided in this
section, the term `specified health insurance policy' means
any accident or health insurance policy issued with respect
to individuals residing in the United States.
``(2) Exemption of certain policies.--The term `specified
health insurance policy' does not include any insurance
policy if substantially all of the coverage provided under
such policy relates to--
``(A) liabilities incurred under workers' compensation
laws,
``(B) tort liabilities,
``(C) liabilities relating to ownership or use of property,
``(D) credit insurance,
``(E) medicare supplemental coverage, or
``(F) such other similar liabilities as the Secretary may
specify by regulations.
``(3) Treatment of prepaid health coverage arrangements.--
``(A) In general.--In the case of any arrangement described
in subparagraph (B)--
``(i) such arrangement shall be treated as a specified
health insurance policy, and
``(ii) the person referred to in such subparagraph shall be
treated as the issuer.
``(B) Description of arrangements.--An arrangement is
described in this subparagraph if under such arrangement
fixed payments or premiums are received as consideration for
any person's agreement to provide or arrange for the
provision of accident or health coverage to residents of the
United States, regardless of how such coverage is provided or
arranged to be provided.
``SEC. 4376. SELF-INSURED HEALTH PLANS.
``(a) Imposition of Fee.--In the case of any applicable
self-insured health plan for each plan year, there is hereby
imposed a fee equal to the fair share per capita amount
determined under section 9511(c)(1) multiplied by the average
number of lives covered under the plan.
``(b) Liability for Fee.--
[[Page H9347]]
``(1) In general.--The fee imposed by subsection (a) shall
be paid by the plan sponsor.
``(2) Plan sponsor.--For purposes of paragraph (1) the term
`plan sponsor' means--
``(A) the employer in the case of a plan established or
maintained by a single employer,
``(B) the employee organization in the case of a plan
established or maintained by an employee organization,
``(C) in the case of--
``(i) a plan established or maintained by 2 or more
employers or jointly by 1 or more employers and 1 or more
employee organizations,
``(ii) a multiple employer welfare arrangement, or
``(iii) a voluntary employees' beneficiary association
described in section 501(c)(9),
the association, committee, joint board of trustees, or other
similar group of representatives of the parties who establish
or maintain the plan, or
``(D) the cooperative or association described in
subsection (c)(2)(F) in the case of a plan established or
maintained by such a cooperative or association.
``(c) Applicable Self-Insured Health Plan.--For purposes of
this section, the term `applicable self-insured health plan'
means any plan for providing accident or health coverage if--
``(1) any portion of such coverage is provided other than
through an insurance policy, and
``(2) such plan is established or maintained--
``(A) by one or more employers for the benefit of their
employees or former employees,
``(B) by one or more employee organizations for the benefit
of their members or former members,
``(C) jointly by 1 or more employers and 1 or more employee
organizations for the benefit of employees or former
employees,
``(D) by a voluntary employees' beneficiary association
described in section 501(c)(9),
``(E) by any organization described in section 501(c)(6),
or
``(F) in the case of a plan not described in the preceding
subparagraphs, by a multiple employer welfare arrangement (as
defined in section 3(40) of Employee Retirement Income
Security Act of 1974), a rural electric cooperative (as
defined in section 3(40)(B)(iv) of such Act), or a rural
telephone cooperative association (as defined in section
3(40)(B)(v) of such Act).
``SEC. 4377. DEFINITIONS AND SPECIAL RULES.
``(a) Definitions.--For purposes of this subchapter--
``(1) Accident and health coverage.--The term `accident and
health coverage' means any coverage which, if provided by an
insurance policy, would cause such policy to be a specified
health insurance policy (as defined in section 4375(c)).
``(2) Insurance policy.--The term `insurance policy' means
any policy or other instrument whereby a contract of
insurance is issued, renewed, or extended.
``(3) United states.--The term `United States' includes any
possession of the United States.
``(b) Treatment of Governmental Entities.--
``(1) In general.--For purposes of this subchapter--
``(A) the term `person' includes any governmental entity,
and
``(B) notwithstanding any other law or rule of law,
governmental entities shall not be exempt from the fees
imposed by this subchapter except as provided in paragraph
(2).
``(2) Treatment of exempt governmental programs.--In the
case of an exempt governmental program, no fee shall be
imposed under section 4375 or section 4376 on any covered
life under such program.
``(3) Exempt governmental program defined.--For purposes of
this subchapter, the term `exempt governmental program'
means--
``(A) any insurance program established under title XVIII
of the Social Security Act,
``(B) the medical assistance program established by title
XIX or XXI of the Social Security Act,
``(C) any program established by Federal law for providing
medical care (other than through insurance policies) to
individuals (or the spouses and dependents thereof) by reason
of such individuals being--
``(i) members of the Armed Forces of the United States, or
``(ii) veterans, and
``(D) any program established by Federal law for providing
medical care (other than through insurance policies) to
members of Indian tribes (as defined in section 4(d) of the
Indian Health Care Improvement Act).
``(c) Treatment as Tax.--For purposes of subtitle F, the
fees imposed by this subchapter shall be treated as if they
were taxes.
``(d) No Cover Over to Possessions.--Notwithstanding any
other provision of law, no amount collected under this
subchapter shall be covered over to any possession of the
United States.''
(B) Clerical amendment.--Chapter 34 of such Code is amended
by striking the chapter heading and inserting the following:
``CHAPTER 34--TAXES ON CERTAIN INSURANCE POLICIES
``subchapter a. policies issued by foreign insurers
``subchapter b. insured and self-insured health plans
``Subchapter A--Policies Issued By Foreign Insurers''.
(C) Effective date.--The amendments made by this subsection
shall apply with respect to policies and plans for portions
of policy or plan years beginning on or after October 1,
2010.
SEC. 905. IMPLEMENTATION OF HEALTH INFORMATION TECHNOLOGY
(IT) UNDER MEDICARE.
(a) In General.--Not later than January 1, 2010, the
Secretary of Health and Human Services shall submit to
Congress a report that includes--
(1) a plan to develop and implement a health information
technology (health IT) system for all health care providers
under the Medicare program that meets the specifications
described in subsection (b); and
(2) an analysis of the impact, feasibility, and costs
associated with the use of health information technology in
medically underserved communities.
(b) Plan Specification.--The specifications described in
this subsection, with respect to a health information
technology system described in subsection (a), are the
following:
(1) The system protects the privacy and security of
individually identifiable health information.
(2) The system maintains and provides permitted access to
health information in an electronic format (such as through
computerized patient records or a clinical data repository).
(3) The system utilizes interface software that allows for
interoperability.
(4) The system includes clinical decision support.
(5) The system incorporates e-prescribing and computerized
physician order entry.
(6) The system incorporates patient tracking and reminders.
(7) The system utilizes technology that is open source (if
available) or technology that has been developed by the
government.
The report shall include an analysis of the financial and
administrative resources necessary to develop such system and
recommendations regarding the level of subsidies needed for
all such health care providers to adopt the system.
SEC. 906. DEVELOPMENT, REPORTING, AND USE OF HEALTH CARE
MEASURES.
(a) In General.--Part E of title XVIII of the Social
Security Act (42 U.S.C. 1395x et seq.) is amended by
inserting after section 1889 the following:
``DEVELOPMENT, REPORTING, AND USE OF HEALTH CARE MEASURES
``Sec. 1890. (a) Fostering Development of Health Care
Measures.--The Secretary shall designate, and have in effect
an arrangement with, a single organization (such as the
National Quality Forum) that meets the requirements described
in subsection (c), under which such organization provides the
Secretary with advice on, and recommendations with respect
to, the key elements and priorities of a national system for
establishing health care measures. The arrangement shall be
effective beginning no sooner than January 1, 2008, and no
later than September 30, 2008.
``(b) Duties.--The duties of the organization designated
under subsection (a) (in this title referred to as the
`designated organization') shall, in accordance with
subsection (d), include--
``(1) establishing and managing an integrated national
strategy and process for setting priorities and goals in
establishing health care measures;
``(2) coordinating the development and specifications of
such measures;
``(3) establishing standards for the development and
testing of such measures;
``(4) endorsing national consensus health care measures;
and
``(5) advancing the use of electronic health records for
automating the collection, aggregation, and transmission of
measurement information.
``(c) Requirements Described.--For purposes of subsection
(a), the requirements described in this subsection, with
respect to an organization, are the following:
``(1) Private nonprofit.--The organization is a private
nonprofit entity governed by a board and an individual
designated as president and chief executive officer.
``(2) Board membership.--The members of the board of the
organization include representatives of--
``(A) health care providers or groups representing such
providers;
``(B) health plans or groups representing health plans;
``(C) groups representing health care consumers;
``(D) health care purchasers and employers or groups
representing such purchasers or employers; and
``(E) health care practitioners or groups representing
practitioners.
``(3) Other membership requirements.--The membership of the
organization is representative of individuals with experience
with--
``(A) urban health care issues;
``(B) safety net health care issues;
``(C) rural and frontier health care issues; and
``(D) health care quality and safety issues.
``(4) Open and transparent.--With respect to matters
related to the arrangement described in subsection (a), the
organization conducts its business in an open and transparent
manner and provides the opportunity for public comment.
[[Page H9348]]
``(5) Voluntary consensus standards setting organization.--
The organization operates as a voluntary consensus standards
setting organization as defined for purposes of section 12(d)
of the National Technology Transfer and Advancement Act of
1995 (Public Law 104-113) and Office of Management and Budget
Revised Circular A-119 (published in the Federal Register on
February 10, 1998).
``(6) Experience.--The organization has at least 7 years
experience in establishing national consensus standards.
``(d) Requirements for Effectiveness Measures.--In carrying
out its duties under subsection (b), the designated
organization shall ensure the following:
``(1) Measures.--The designated organization shall ensure
that the measures established or endorsed under subsection
(b) are evidence-based, reliable, and valid; and include--
``(A) measures of clinical processes and outcomes, patient
experience, efficiency, and equity;
``(B) measures to assess effectiveness, timeliness, patient
self-management, patient centeredness, and safety; and
``(C) measures of under use and over use.
``(2) Priorities.--
``(A) In general.--The designated organization shall ensure
that priority is given to establishing and endorsing--
``(i) measures with the greatest potential impact for
improving the effectiveness and efficiency of health care;
``(ii) measures that may be rapidly implemented by group
health plans, health insurance issuers, physicians,
hospitals, nursing homes, long-term care providers, and other
providers;
``(iii) measures which may inform health care decisions
made by consumers and patients; and
``(iv) measures that apply to multiple services furnished
by different providers during an episode of care.
``(B) Annual report on priorities; secretarial publication
and comment.--
``(i) Annual report.--The designated organization shall
issue and submit to the Secretary a report by March 31 of
each year (beginning with 2009) on the organization's
recommendations for priorities and goals in establishing and
endorsing health care measures under this section over the
next five years.
``(ii) Secretarial review and comment.--After receipt of
the report under clause (i) for a year, the Secretary shall
publish the report in the Federal Register, including any
comments of the Secretary on the priorities and goals set
forth in the report.
``(3) Risk adjustment.--The designated organization, in
consultation with health care measure developers and other
stakeholders, shall establish procedures to assure that
health care measures established and endorsed under this
section account for differences in patient health status,
patient characteristics, and geographic location, as
appropriate.
``(4) Maintenance.--The designated organization, in
consultation with owners and developers of health care
measures, shall require the owners or developers of such
measures to update and enhance such measures, including the
development of more accurate and precise specifications, and
retire existing outdated measures. Such updating shall occur
not more often than once during each 12-month period, except
in the case of emergent circumstances requiring a more
immediate update to a measure.
``(e) Use of Health Care Measures; Reporting.--
``(1) Use of measures.--For purposes of activities
authorized or required under this title, the Secretary shall
select from health care measures--
``(A) recommended by multi-stakeholder groups; and
``(B) endorsed by the designated organization under
subsection (b)(4).
``(2) Reporting.--The Secretary shall implement procedures,
consistent with generally accepted standards, to enable the
Department of Health and Human Services to accept the
electronic submission of data for purposes of--
``(A) effectiveness measurement using the health care
measures developed pursuant to this section; and
``(B) reporting to the Secretary measures used to make
value-based payments under this title.
``(f) Contracts.--The Secretary, acting through the Agency
for Healthcare Research and Quality, may contract with
organizations to support the development and testing of
health care measures meeting the standards established by the
designated organization.
``(g) Dissemination of Information.--In order to make
comparative effectiveness information available to health
care consumers, health professionals, public health
officials, oversight organizations, researchers, and other
appropriate individuals and entities, the Secretary shall
work with multi-stakeholder groups to provide for the
dissemination of effectiveness information developed pursuant
to this title.
``(h) Funding.--For purposes of carrying out subsections
(a), (b), (c), and (d), including for expenses incurred for
the arrangement under subsection (a) with the designated
organization, there is payable from the Federal Hospital
Insurance Trust Fund (established under section 1817) and the
Federal Supplementary Medical Insurance Trust Fund
(established under section 1841)--
``(1) for fiscal year 2008, $15,000,000, multiplied by the
ratio of the total number of months in the year to the number
of months (and portions of months) of such year during which
the arrangement under subsection (a) is effective; and
``(2) for each of the fiscal years, 2009 through 2012,
$15,000,000.''.
SEC. 907. IMPROVEMENTS TO THE MEDIGAP PROGRAM.
(a) Implementation of NAIC Recommendations.--The Secretary
of Health and Human Services shall provide, under subsections
(p)(1)(E) of section 1882 of the Social Security Act (42
U.S.C. 1395s), for implementation of the changes in the NAIC
model law and regulations recommended by the National
Association of Insurance Commissioners in its Model #651
(``Model Regulation to Implement the NAIC Medicare Supplement
Insurance Minimum Standards Model Act'') on March 11, 2007,
as modified to reflect the changes made under this Act. In
carrying out the previous sentence, the benefit packages
classified as ``K'' and ``L'' shall be eliminated and such
NAIC recommendations shall be treated as having been adopted
by such Association as of January 1, 2008.
(b) Required Offering of a Range of Policies.--
(1) In general.--Subsection (o) of such section is amended
by adding at the end the following new paragraph:
``(4) In addition to the requirement of paragraph (2), the
issuer of the policy must make available to the individual at
least medicare supplemental policies with benefit packages
classified as `C' or `F'.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to medicare supplemental policies issued on or
after January 1, 2008.
(c) Removal of New Benefit Packages.--Such section is
further amended--
(1) in subsection (o)(1), by striking ``(p), (v), and (w)''
and inserting ``(p) and (v)'';
(2) in subsection (v)(3)(A)(i), by striking ``or a benefit
package described in subparagraph (A) or (B) of subsection
(w)(2)''; and
(3) in subsection (w)--
(A) by striking ``Policies'' and all that follows through
``The Secretary'' and inserting ``Policies.--The Secretary'';
(B) by striking the second sentence; and
(C) by striking paragraph (2) .
TITLE X--REVENUES
SEC. 1001. INCREASE IN RATE OF EXCISE TAXES ON TOBACCO
PRODUCTS AND CIGARETTE PAPERS AND TUBES.
(a) Small Cigarettes.--Paragraph (1) of section 5701(b) of
the Internal Revenue Code of 1986 is amended by striking
``$19.50 per thousand ($17 per thousand on cigarettes removed
during 2000 or 2001)'' and inserting ``$42 per thousand''.
(b) Large Cigarettes.--Paragraph (2) of section 5701(b) of
such Code is amended by striking ``$40.95 per thousand
($35.70 per thousand on cigarettes removed during 2000 or
2001)'' and inserting ``$88.20 per thousand''.
(c) Small Cigars.--Paragraph (1) of section 5701(a) of such
Code is amended by striking ``$1.828 cents per thousand
($1.594 cents per thousand on cigars removed during 2000 or
2001)'' and inserting ``$42 per thousand''.
(d) Large Cigars.--Paragraph (2) of section 5701(a) of such
Code is amended--
(1) by striking ``20.719 percent (18.063 percent on cigars
removed during 2000 or 2001)'' and inserting ``44.63
percent'', and
(2) by striking ``$48.75 per thousand ($42.50 per thousand
on cigars removed during 2000 or 2001)'' and inserting ``$1
per cigar''.
(e) Cigarette Papers.--Subsection (c) of section 5701 of
such Code is amended by striking ``1.22 cents (1.06 cents on
cigarette papers removed during 2000 or 2001)'' and inserting
``2.63 cents''.
(f) Cigarette Tubes.--Subsection (d) of section 5701 of
such Code is amended by striking ``2.44 cents (2.13 cents on
cigarette tubes removed during 2000 or 2001)'' and inserting
``5.26 cents''.
(g) Snuff.--Paragraph (1) of section 5701(e) of such Code
is amended by striking ``58.5 cents (51 cents on snuff
removed during 2000 or 2001)'' and inserting ``$1.26''.
(h) Chewing Tobacco.--Paragraph (2) of section 5701(e) of
such Code is amended by striking ``19.5 cents (17 cents on
chewing tobacco removed during 2000 or 2001)'' and inserting
``42 cents''.
(i) Pipe Tobacco.--Subsection (f) of section 5701 of such
Code is amended by striking ``$1.0969 cents (95.67 cents on
pipe tobacco removed during 2000 or 2001)'' and inserting
``$2.36''.
(j) Roll-Your-Own Tobacco.--
(1) In general.--Subsection (g) of section 5701 of such
Code is amended by striking ``$1.0969 cents (95.67 cents on
roll-your-own tobacco removed during 2000 or 2001)'' and
inserting ``$7.4667''.
(2) Inclusion of cigar tobacco.--Subsection (o) of section
5702 of such Code is amended by inserting ``or cigars, or for
use as wrappers for making cigars'' before the period at the
end.
(k) Effective Date.--The amendments made by this section
shall apply to articles removed after December 31, 2007.
(l) Floor Stocks Taxes.--
(1) Imposition of tax.--On cigarettes manufactured in or
imported into the United States which are removed before
January 1, 2008, and held on such date for sale by any
person, there is hereby imposed a tax in an amount equal to
the excess of--
(A) the tax which would be imposed under section 5701 of
the Internal Revenue Code of 1986 on the article if the
article had been removed on such date, over
[[Page H9349]]
(B) the prior tax (if any) imposed under section 5701 of
such Code on such article.
(2) Authority to exempt cigarettes held in vending
machines.--To the extent provided in regulations prescribed
by the Secretary, no tax shall be imposed by paragraph (1) on
cigarettes held for retail sale on January 1, 2008, by any
person in any vending machine. If the Secretary provides such
a benefit with respect to any person, the Secretary may
reduce the $500 amount in paragraph (3) with respect to such
person.
(3) Credit against tax.--Each person shall be allowed as a
credit against the taxes imposed by paragraph (1) an amount
equal to $500. Such credit shall not exceed the amount of
taxes imposed by paragraph (1) for which such person is
liable.
(4) Liability for tax and method of payment.--
(A) Liability for tax.--A person holding cigarettes on
January 1, 2008, to which any tax imposed by paragraph (1)
applies shall be liable for such tax.
(B) Method of payment.--The tax imposed by paragraph (1)
shall be paid in such manner as the Secretary shall prescribe
by regulations.
(C) Time for payment.--The tax imposed by paragraph (1)
shall be paid on or before April 14, 2008.
(5) Articles in foreign trade zones.--- Notwithstanding the
Act of June 18, 1934 (48 Stat. 998, 19 U.S.C. 81a) and any
other provision of law, any article which is located in a
foreign trade zone on January 1, 2008, shall be subject to
the tax imposed by paragraph (1) if--
(A) internal revenue taxes have been determined, or customs
duties liquidated, with respect to such article before such
date pursuant to a request made under the 1st proviso of
section 3(a) of such Act, or
(B) such article is held on such date under the supervision
of a customs officer pursuant to the 2d proviso of such
section 3(a).
(6) Definitions.--For purposes of this subsection--
(A) In general.--Terms used in this subsection which are
also used in section 5702 of the Internal Revenue Code of
1986 shall have the respective meanings such terms have in
such section.
(B) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury or the Secretary's delegate.
(7) Controlled groups.--Rules similar to the rules of
section 5061(e)(3) of such Code shall apply for purposes of
this subsection.
(8) Other laws applicable.--All provisions of law,
including penalties, applicable with respect to the taxes
imposed by section 5701 of such Code shall, insofar as
applicable and not inconsistent with the provisions of this
subsection, apply to the floor stocks taxes imposed by
paragraph (1), to the same extent as if such taxes were
imposed by such section 5701. The Secretary may treat any
person who bore the ultimate burden of the tax imposed by
paragraph (1) as the person to whom a credit or refund under
such provisions may be allowed or made.
SEC. 1002. EXEMPTION FOR EMERGENCY MEDICAL SERVICES
TRANSPORTATION.
(a) In General.--Subsection (l) of section 4041 of the
Internal Revenue Code of 1986 is amended to read as follows:
``(l) Exemption for Certain Uses.--
``(1) Certain aircraft.--No tax shall be imposed under this
section on any liquid sold for use in, or used in, a
helicopter or a fixed-wing aircraft for purposes of providing
transportation with respect to which the requirements of
subsection (f) or (g) of section 4261 are met.
``(2) Emergency medical services.--No tax shall be imposed
under this section on any liquid sold for use in, or used in,
any ambulance for purposes of providing transportation for
emergency medical services. The preceding sentence shall not
apply to any liquid used after December 31, 2009.''.
(b) Fuels Not Used for Taxable Purposes.--Section 6427 of
such Code is amended by inserting after subsection (e) the
following new subsection:
``(f) Use To Provide Emergency Medical Services.--Except as
provided in subsection (k), if any fuel on which tax was
imposed by section 4081 or 4041 is used in an ambulance for a
purpose described in section 4041(l)(2), the Secretary shall
pay (without interest) to the ultimate purchaser of such fuel
an amount equal to the aggregate amount of the tax imposed on
such fuel. The preceding sentence shall not apply to any
liquid used after December 31, 2009.''.
(c) Time for Filing Claims; Period Covered.--Paragraphs (1)
and (2)(A) of section 6427(i) of such Code are each amended
by inserting ``(f),'' after ``(d),''.
(d) Conforming Amendment.--Section 6427(d) of such Code is
amended by striking ``4041(l)'' and inserting ``4041(l)(1)''.
(e) Effective Date.--The amendments made by this section
shall apply to fuel used in transportation provided in
quarters beginning after the date of the enactment of this
Act.
The SPEAKER pro tempore (Mr. Tierney). Pursuant to House Resolution
594, the amendment in the nature of a substitute printed in the bill,
modified by the amendment printed in House Report 110-285, is adopted
and the bill, as amended, is considered read.
The text of the bill, as amended, is as follows:
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Children's
Health and Medicare Protection Act of 2007''.
(b) Table of Contents.--The table of contents of this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM
Sec. 100. Purpose.
Subtitle A--Funding
Sec. 101. Establishment of new base CHIP allotments.
Sec. 102. 2-year initial availability of CHIP allotments.
Sec. 103. Redistribution of unused allotments to address State funding
shortfalls.
Sec. 104. Extension of option for qualifying States.
Subtitle B--Improving Enrollment and Retention of Eligible Children
Sec. 111. CHIP performance bonus payment to offset additional
enrollment costs resulting from enrollment and retention
efforts.
Sec. 112. State option to rely on findings from an express lane agency
to conduct simplified eligibility determinations.
Sec. 113. Application of medicaid outreach procedures to all children
and pregnant women.
Sec. 114. Encouraging culturally appropriate enrollment and retention
practices.
Sec. 115. Continuous coverage under CHIP.
Subtitle C--Coverage
Sec. 121. Ensuring child-centered coverage.
Sec. 122. Improving benchmark coverage options.
Sec. 123. Premium grace period.
Subtitle D--Populations
Sec. 131. Optional coverage of children up to age 21 under CHIP.
Sec. 132. Optional coverage of legal immigrants under the Medicaid
program and CHIP.
Sec. 133. State option to expand or add coverage of certain pregnant
women under CHIP.
Sec. 134. Limitation on waiver authority to cover adults.
Sec. 135. No Federal funding for illegal aliens.
Sec. 136. Awaiting requirement to enforce citizenship restrictions on
eligibility for Medicaid and CHIP benefits.
Subtitle E--Access
Sec. 141. Children's Access, Payment, and Equality Commission.
Sec. 142. Model of Interstate coordinated enrollment and coverage
process.
Sec. 143. Medicaid citizenship documentation requirements.
Sec. 144. Access to dental care for children.
Sec. 145. Prohibiting initiation of new health opportunity account
demonstration programs.
Subtitle F--Quality and Program Integrity
Sec. 151. Pediatric health quality measurement program.
Sec. 152. Application of certain managed care quality safeguards to
CHIP.
Sec. 153. Updated Federal evaluation of CHIP.
Sec. 154. Access to records for IG and GAO audits and evaluations.
Sec. 155. References to title XXI.
Sec. 156. Reliance on law; exception for State legislation.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improvements in Benefits
Sec. 201. Coverage and waiver of cost-sharing for preventive services.
Sec. 202. Waiver of deductible for colorectal cancer screening tests
regardless of coding, subsequent diagnosis, or ancillary
tissue removal.
Sec. 203. Parity for mental health coinsurance.
Subtitle B--Improving, Clarifying, and Simplifying Financial Assistance
for Low Income Medicare Beneficiaries
Sec. 211. Improving assets tests for Medicare Savings Program and low-
income subsidy program.
Sec. 212. Making QI program permanent and expanding eligibility.
Sec. 213. Eliminating barriers to enrollment.
Sec. 214. Eliminating application of estate recovery.
Sec. 215. Elimination of part D cost-sharing for certain non-
institutionalized full-benefit dual eligible individuals.
Sec. 216. Exemptions from income and resources for determination of
eligibility for low-income subsidy.
Sec. 217. Cost-sharing protections for low-income subsidy-eligible
individuals.
Sec. 218. Intelligent assignment in enrollment.
Subtitle C--Part D Beneficiary Improvements
Sec. 221. Including costs incurred by AIDS drug assistance programs and
Indian Health Service in providing prescription drugs
toward the annual out of pocket threshold under Part D.
Sec. 222. Permitting mid-year changes in enrollment for formulary
changes adversely impact an enrollee.
Sec. 223. Removal of exclusion of benzodiazepines from required
coverage under the Medicare prescription drug program.
Sec. 224. Permitting updating drug compendia under part D using part B
update process.
Sec. 225. Codification of special protections for six protected drug
classifications.
[[Page H9350]]
Sec. 226. Elimination of Medicare part D late enrollment penalties paid
by low-income subsidy-eligible individuals.
Sec. 227. Special enrollment period for subsidy eligible individuals.
Subtitle D--Reducing Health Disparities
Sec. 231. Medicare data on race, ethnicity, and primary language.
Sec. 232. Ensuring effective communication in Medicare.
Sec. 233. Demonstration to promote access for Medicare beneficiaries
with limited English proficiency by providing
reimbursement for culturally and linguistically
appropriate services.
Sec. 234. Demonstration to improve care to previously uninsured.
Sec. 235. Office of the Inspector General report on compliance with and
enforcement of national standards on culturally and
linguistically appropriate services (CLAS) in medicare.
Sec. 236. IOM report on impact of language access services.
Sec. 237. Definitions.
TITLE III--PHYSICIANS' SERVICE PAYMENT REFORM
Sec. 301. Establishment of separate target growth rates for service
categories.
Sec. 302. Improving accuracy of relative values under the Medicare
physician fee schedule.
Sec. 303. Feedback mechanism on practice patterns.
Sec. 304. Payments for efficient areas.
Sec. 305. Recommendations on refining the physician fee schedule.
Sec. 306. Improved and expanded medical home demonstration project.
Sec. 307. Repeal of Physician Assistance and Quality Initiative Fund.
Sec. 308. Adjustment to Medicare payment localities.
Sec. 309. Payment for imaging services.
Sec. 310. Reducing frequency of meetings of the Practicing Physicians
Advisory Council.
TITLE IV--MEDICARE ADVANTAGE REFORMS
Subtitle A--Payment Reform
Sec. 401. Equalizing payments between Medicare Advantage plans and fee-
for-service Medicare.
Subtitle B--Beneficiary Protections
Sec. 411. NAIC development of marketing, advertising, and related
protections.
Sec. 412. Limitation on out-of-pocket costs for individual health
services.
Sec. 413. MA plan enrollment modifications.
Sec. 414. Information for beneficiaries on MA plan administrative
costs.
Subtitle C--Quality and Other Provisions
Sec. 421. Requiring all MA plans to meet equal standards.
Sec. 422. Development of new quality reporting measures on racial
disparities.
Sec. 423. Strengthening audit authority.
Sec. 424. Improving risk adjustment for MA payments.
Sec. 425. Eliminating special treatment of private fee-for-service
plans.
Sec. 426. Renaming of Medicare Advantage program.
Subtitle D--Extension of Authorities
Sec. 431. Extension and revision of authority for special needs plans
(SNPs).
Sec. 432. Extension and revision of authority for Medicare reasonable
cost contracts.
TITLE V--PROVISIONS RELATING TO MEDICARE PART A
Sec. 501. Inpatient hospital payment updates.
Sec. 502. Payment for inpatient rehabilitation facility (IRF) services.
Sec. 503. Long-term care hospitals.
Sec. 504. Increasing the DSH adjustment cap.
Sec. 505. PPS-exempt cancer hospitals.
Sec. 506. Skilled nursing facility payment update.
Sec. 507. Revocation of unique deeming authority of the Joint
Commission for the Accreditation of Healthcare
Organizations.
Sec. 508. Treatment of Medicare hospital reclassifications.
Sec. 509. Medicare critical access hospital designations.
TITLE VI--OTHER PROVISIONS RELATING TO MEDICARE PART B
Subtitle A--Payment and Coverage Improvements
Sec. 601. Payment for therapy services.
Sec. 602. Medicare separate definition of outpatient speech-language
pathology services.
Sec. 603. Increased reimbursement rate for certified nurse-midwives.
Sec. 604. Adjustment in outpatient hospital fee schedule increase
factor.
Sec. 605. Exception to 60-day limit on Medicare substitute billing
arrangements in case of physicians ordered to active duty
in the Armed Forces.
Sec. 606. Excluding clinical social worker services from coverage under
the medicare skilled nursing facility prospective payment
system and consolidated payment.
Sec. 607. Coverage of marriage and family therapist services and mental
health counselor services.
Sec. 608. Rental and purchase of power-driven wheelchairs.
Sec. 609. Rental and purchase of oxygen equipment.
Sec. 610. Adjustment for Medicare mental health services.
Sec. 611. Extension of brachytherapy special rule.
Sec. 612. Payment for part B drugs.
Subtitle B--Extension of Medicare Rural Access Protections
Sec. 621. 2-year extension of floor on medicare work geographic
adjustment.
Sec. 622. 2-year extension of special treatment of certain physician
pathology services under Medicare.
Sec. 623. 2-year extension of medicare reasonable costs payments for
certain clinical diagnostic laboratory tests furnished to
hospital patients in certain rural areas.
Sec. 624. 2-year extension of Medicare incentive payment program for
physician scarcity areas .
Sec. 625. 2-year extension of medicare increase payments for ground
ambulance services in rural areas.
Sec. 626. Extending hold harmless for small rural hospitals under the
HOPD prospective payment system.
Subtitle C--End Stage Renal Disease Program
Sec. 631. Chronic kidney disease demonstration projects.
Sec. 632. Medicare coverage of kidney disease patient education
services.
Sec. 633. Required training for patient care dialysis technicians.
Sec. 634. MedPAC report on treatment modalities for patients with
kidney failure.
Sec. 635. Adjustment for erythropoietin stimulating agents (ESAs).
Sec. 636. Site neutral composite rate.
Sec. 637. Development of ESRD bundling system and quality incentive
payments.
Sec. 638. MedPAC report on ESRD bundling system.
Sec. 639. OIG study and report on erythropoietin.
Subtitle D--Miscellaneous
Sec. 651. Limitation on exception to the prohibition on certain
physician referrals for hospitals.
TITLE VII--PROVISIONS RELATING TO MEDICARE PARTS A AND B
Sec. 701. Home health payment update for 2008.
Sec. 702. 2-year extension of temporary Medicare payment increase for
home health services furnished in a rural area.
Sec. 703. Extension of Medicare secondary payer for beneficiaries with
end stage renal disease for large group plans.
Sec. 704. Plan for Medicare payment adjustments for never events.
Sec. 705. Reinstatement of residency slots.
Sec. 706. Studies relating to home health.
Sec. 707. Rural home health quality demonstration products.
TITLE VIII--MEDICAID
Subtitle A--Protecting Existing Coverage
Sec. 801. Modernizing transitional Medicaid.
Sec. 802. Family planning services.
Sec. 803. Authority to continue providing adult day health services
approved under a State Medicaid plan.
Sec. 804. State option to protect community spouses of individuals with
disabilities.
Sec. 805. County medicaid health insuring organizations.
Subtitle B--Payments
Sec. 811. Payments for Puerto Rico and territories.
Sec. 812. Medicaid drug rebate.
Sec. 813. Adjustment in computation of Medicaid FMAP to disregard an
extraordinary employer pension contribution.
Sec. 814. Moratorium on certain payment restrictions.
Sec. 815. Tennessee DSH.
Sec. 816. Clarification treatment of regional medical center.
Sec. 817. Extension of SSI web-based asset demonstration project to the
Medicaid program.
Subtitle C--Miscellaneous
Sec. 821. Demonstration project for employer buy-in.
Sec. 822. Diabetes grants.
Sec. 823. Technical correction.
TITLE IX--MISCELLANEOUS
Sec. 901. Medicare Payment Advisory Commission status.
Sec. 902. Repeal of trigger provision.
Sec. 903. Repeal of comparative cost adjustment (CCA) program.
Sec. 904. Comparative effectiveness research.
Sec. 905. Implementation of health information technology (IT) under
Medicare.
Sec. 906. Development, reporting, and use of health care measures.
Sec. 907. Improvements to the Medigap program.
Sec. 908. Implementation funding.
Sec. 909. Access to data on prescription drug plans and Medicare
advantage plans.
Sec. 910. Abstinence education.
TITLE X--REVENUES
Sec. 1001. Increase in rate of excise taxes on tobacco products and
cigarette papers and tubes.
Sec. 1002. Exemption for emergency medical services transportation.
TITLE I--CHILDREN'S HEALTH INSURANCE PROGRAM
SEC. 100. PURPOSE.
It is the purpose of this title to provide dependable and
stable funding for children's
[[Page H9351]]
health insurance under titles XXI and XIX of the Social
Security Act in order to enroll all six million uninsured
children who are eligible, but not enrolled, for coverage
today through such titles.
Subtitle A--Funding
SEC. 101. ESTABLISHMENT OF NEW BASE CHIP ALLOTMENTS.
Section 2104 of the Social Security Act (42 U.S.C. 1397dd)
is amended--
(1) in subsection (a)--
(A) in paragraph (9), by striking ``and'' at the end;
(B) in paragraph (10), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new paragraph:
``(11) for fiscal year 2008 and each succeeding fiscal
year, the sum of the State allotments provided under
subsection (i) for such fiscal year.''; and
(2) in subsections (b)(1) and (c)(1), by striking
``subsection (d)'' and inserting ``subsections (d) and (i)'';
and
(3) by adding at the end the following new subsection:
``(i) Allotments for States and Territories Beginning With
Fiscal Year 2008.--
``(1) General allotment computation.--Subject to the
succeeding provisions of this subsection, the Secretary shall
compute a State allotment for each State for each fiscal year
as follows:
``(A) For fiscal year 2008.--For fiscal year 2008, the
allotment of a State is equal to the greater of--
``(i) the State projection (in its submission on forms CMS-
21B and CMS-37 for May 2007) of Federal payments to the State
under this title for such fiscal year, except that, in the
case of a State that has enacted legislation to modify its
State child health plan during 2007, the State may substitute
its projection in its submission on forms CMS-21B and CMS-37
for August 2007, instead of such forms for May 2007; or
``(ii) the allotment of the State under this section for
fiscal year 2007 multiplied by the allotment increase factor
under paragraph (2) for fiscal year 2008.
``(B) Inflation update for fiscal year 2009 and each second
succeeding fiscal year.--For fiscal year 2009 and each second
succeeding fiscal year, the allotment of a State is equal to
the amount of the State allotment under this paragraph for
the previous fiscal year multiplied by the allotment increase
factor under paragraph (2) for the fiscal year involved.
``(C) Rebasing in fiscal year 2010 and each second
succeeding fiscal year.--For fiscal year 2010 and each second
succeeding fiscal year, the allotment of a State is equal to
the Federal payments to the State that are attributable to
(and countable towards) the total amount of allotments
available under this section to the State (including
allotments made available under paragraph (3) as well as
amounts redistributed to the State) in the previous fiscal
year multiplied by the allotment increase factor under
paragraph (2) for the fiscal year involved.
``(D) Special rules for territories.--Notwithstanding the
previous subparagraphs, the allotment for a State that is not
one of the 50 States or the District of Columbia for fiscal
year 2008 and for a succeeding fiscal year is equal to the
Federal payments provided to the State under this title for
the previous fiscal year multiplied by the allotment increase
factor under paragraph (2) for the fiscal year involved (but
determined by applying under paragraph (2)(B) as if the
reference to `in the State' were a reference to `in the
United States').
``(2) Allotment increase factor.--The allotment increase
factor under this paragraph for a fiscal year is equal to the
product of the following:
``(A) Per capita health care growth factor.--1 plus the
percentage increase in the projected per capita amount of
National Health Expenditures from the calendar year in which
the previous fiscal year ends to the calendar year in which
the fiscal year involved ends, as most recently published by
the Secretary before the beginning of the fiscal year.
``(B) Child population growth factor.--1 plus the
percentage increase (if any) in the population of children
under 19 years of age in the State from July 1 in the
previous fiscal year to July 1 in the fiscal year involved,
as determined by the Secretary based on the most recent
published estimates of the Bureau of the Census before the
beginning of the fiscal year involved, plus 1 percentage
point.
``(3) Performance-based shortfall adjustment.--
``(A) In general.--If a State's expenditures under this
title in a fiscal year (beginning with fiscal year 2008)
exceed the total amount of allotments available under this
section to the State in the fiscal year (determined without
regard to any redistribution it receives under subsection (f)
that is available for expenditure during such fiscal year,
but including any carryover from a previous fiscal year) and
if the average monthly unduplicated number of children
enrolled under the State plan under this title (including
children receiving health care coverage through funds under
this title pursuant to a waiver under section 1115) during
such fiscal year exceeds its target average number of such
enrollees (as determined under subparagraph (B)) for that
fiscal year, the allotment under this section for the State
for the subsequent fiscal year (or, pursuant to subparagraph
(F), for the fiscal year involved) shall be increased by the
product of--
``(i) the amount by which such average monthly caseload
exceeds such target number of enrollees; and
``(ii) the projected per capita expenditures under the
State child health plan (as determined under subparagraph (C)
for the original fiscal year involved), multiplied by the
enhanced FMAP (as defined in section 2105(b)) for the State
and fiscal year involved.
``(B) Target average number of child enrollees.--In this
subsection, the target average number of child enrollees for
a State--
``(i) for fiscal year 2008 is equal to the monthly average
unduplicated number of children enrolled in the State child
health plan under this title (including such children
receiving health care coverage through funds under this title
pursuant to a waiver under section 1115) during fiscal year
2007 increased by the population growth for children in that
State for the year ending on June 30, 2006 (as estimated by
the Bureau of the Census) plus 1 percentage point; or
``(ii) for a subsequent fiscal year is equal to the target
average number of child enrollees for the State for the
previous fiscal year increased by the population growth for
children in that State for the year ending on June 30 before
the beginning of the fiscal year (as estimated by the Bureau
of the Census) plus 1 percentage point.
``(C) Projected per capita expenditures.--For purposes of
subparagraph (A)(ii), the projected per capita expenditures
under a State child health plan--
``(i) for fiscal year 2008 is equal to the average per
capita expenditures (including both State and Federal
financial participation) under such plan for the targeted
low-income children counted in the average monthly caseload
for purposes of this paragraph during fiscal year 2007,
increased by the annual percentage increase in the per capita
amount of National Health Expenditures (as estimated by the
Secretary) for 2008; or
``(ii) for a subsequent fiscal year is equal to the
projected per capita expenditures under such plan for the
previous fiscal year (as determined under clause (i) or this
clause) increased by the annual percentage increase in the
per capita amount of National Health Expenditures (as
estimated by the Secretary) for the year in which such
subsequent fiscal year ends.
``(D) Availability.--Notwithstanding subsection (e), an
increase in allotment under this paragraph shall only be
available for expenditure during the fiscal year in which it
is provided.
``(E) No redistribution of performance-based shortfall
adjustment.--In no case shall any increase in allotment under
this paragraph for a State be subject to redistribution to
other States.
``(F) Interim allotment adjustment.--The Secretary shall
develop a process to administer the performance-based
shortfall adjustment in a manner so it is applied to (and
before the end of) the fiscal year (rather than the
subsequent fiscal year) involved for a State that the
Secretary estimates will be in shortfall and will exceed its
enrollment target for that fiscal year.
``(G) Periodic auditing.--The Comptroller General of the
United States shall periodically audit the accuracy of data
used in the computation of allotment adjustments under this
paragraph. Based on such audits, the Comptroller General
shall make such recommendations to the Congress and the
Secretary as the Comptroller General deems appropriate.
``(4) Continued reporting.--For purposes of paragraph (3)
and subsection (f), the State shall submit to the Secretary
the State's projected Federal expenditures, even if the
amount of such expenditures exceeds the total amount of
allotments available to the State in such fiscal year.''.
SEC. 102. 2-YEAR INITIAL AVAILABILITY OF CHIP ALLOTMENTS.
Section 2104(e) of the Social Security Act (42 U.S.C.
1397dd(e)) is amended to read as follows:
``(e) Availability of Amounts Allotted.--
``(1) In general.--Except as provided in paragraph (2) and
subsection (i)(3)(D), amounts allotted to a State pursuant to
this section--
``(A) for each of fiscal years 1998 through 2007, shall
remain available for expenditure by the State through the end
of the second succeeding fiscal year; and
``(B) for fiscal year 2008 and each fiscal year thereafter,
shall remain available for expenditure by the State through
the end of the succeeding fiscal year.
``(2) Availability of amounts redistributed.--Amounts
redistributed to a State under subsection (f) shall be
available for expenditure by the State through the end of the
fiscal year in which they are redistributed, except that
funds so redistributed to a State that are not expended by
the end of such fiscal year shall remain available after the
end of such fiscal year and shall be available in the
following fiscal year for subsequent redistribution under
such subsection.''.
SEC. 103. REDISTRIBUTION OF UNUSED ALLOTMENTS TO ADDRESS
STATE FUNDING SHORTFALLS.
Section 2104(f) of the Social Security Act (42 U.S.C.
1397dd(f)) is amended--
(1) by striking ``The Secretary'' and inserting the
following:
``(1) In general.--The Secretary'';
(2) by striking ``States that have fully expended the
amount of their allotments under this section.'' and
inserting ``States that the Secretary determines with respect
to the fiscal year for which unused allotments are available
for redistribution under this subsection, are shortfall
States described in paragraph (2) for such fiscal year, but
not to exceed the amount of the shortfall described in
paragraph (2)(A) for each such State (as may be adjusted
under paragraph (2)(C)). The amount of allotments not
expended or redistributed under the previous sentence shall
remain available for redistribution in the succeeding fiscal
year.''; and
(3) by adding at the end the following new paragraph:
``(2) Shortfall states described.--
``(A) In general.--For purposes of paragraph (1), with
respect to a fiscal year, a shortfall State described in this
subparagraph is a State
[[Page H9352]]
with a State child health plan approved under this title for
which the Secretary estimates on the basis of the most recent
data available to the Secretary, that the projected
expenditures under such plan for the State for the fiscal
year will exceed the sum of--
``(i) the amount of the State's allotments for any
preceding fiscal years that remains available for expenditure
and that will not be expended by the end of the immediately
preceding fiscal year;
``(ii) the amount (if any) of the performance based
adjustment under subsection (i)(3)(A); and
``(iii) the amount of the State's allotment for the fiscal
year.
``(B) Proration rule.--If the amounts available for
redistribution under paragraph (1) for a fiscal year are less
than the total amounts of the estimated shortfalls determined
for the year under subparagraph (A), the amount to be
redistributed under such paragraph for each shortfall State
shall be reduced proportionally.
``(C) Retrospective adjustment.--The Secretary may adjust
the estimates and determinations made under paragraph (1) and
this paragraph with respect to a fiscal year as necessary on
the basis of the amounts reported by States not later than
November 30 of the succeeding fiscal year, as approved by the
Secretary.''.
SEC. 104. EXTENSION OF OPTION FOR QUALIFYING STATES.
Section 2105(g)(1)(A) of the Social Security Act (42 U.S.C.
1397ee(g)(1)(A)) is amended by inserting after ``or 2007''
the following: ``or 100 percent of any allotment under
section 2104 for any subsequent fiscal year''.
Subtitle B--Improving Enrollment and Retention of Eligible Children
SEC. 111. CHIP PERFORMANCE BONUS PAYMENT TO OFFSET ADDITIONAL
ENROLLMENT COSTS RESULTING FROM ENROLLMENT AND
RETENTION EFFORTS.
(a) In General.--Section 2105(a) of the Social Security Act
(42 U.S.C. 1397ee(a)) is amended by adding at the end the
following new paragraphs:
(b) GAO Study.--
(1) In general.--The Comptroller General of the United
States shall conduct a study on the effectiveness of the
performance bonus payment program under the amendment made by
subsection (a) on the enrollment and retention of eligible
children under the Medicaid and CHIP programs and in reducing
the rate of uninsurance among such children.
(2) Report.--Not later than January 1, 2013, the
Comptroller General shall submit a report to Congress on such
study and shall include in such report such recommendations
for extending or modifying such program as the Comptroller
General determines appropriate.
``(3) Performance bonus payment to offset additional
medicaid and chip child enrollment costs resulting from
enrollment and retention efforts.--
``(A) In general.--In addition to the payments made under
paragraph (1), for each fiscal year (beginning with fiscal
year 2008 and ending with fiscal year 2013) the Secretary
shall pay to each State that meets the condition under
paragraph (4) for the fiscal year, an amount equal to the
amount described in subparagraph (B) for the State and fiscal
year. The payment under this paragraph shall be made, to a
State for a fiscal year, as a single payment not later than
the last day of the first calendar quarter of the following
fiscal year.
``(B) Amount.--The amount described in this subparagraph
for a State for a fiscal year is equal to the sum of the
following amounts:
``(i) For above baseline medicaid child enrollment costs.--
``(I) First tier above baseline medicaid enrollees.--An
amount equal to the number of first tier above baseline child
enrollees (as determined under subparagraph (C)(i)) under
title XIX for the State and fiscal year multiplied by 35
percent of the projected per capita State Medicaid
expenditures (as determined under subparagraph (D)(i)) for
the State and fiscal year under title XIX.
``(II) Second tier above baseline medicaid enrollees .--An
amount equal to the number of second tier above baseline
child enrollees (as determined under subparagraph (C)(ii))
under title XIX for the State and fiscal year multiplied by
90 percent of the projected per capita State Medicaid
expenditures (as determined under subparagraph (D)(i)) for
the State and fiscal year under title XIX.
``(ii) For above baseline chip enrollment costs.--
``(I) First tier above baseline chip enrollees.--An amount
equal to the number of first tier above baseline child
enrollees under this title (as determined under subparagraph
(C)(i)) for the State and fiscal year multiplied by 5 percent
of the projected per capita State CHIP expenditures (as
determined under subparagraph (D)(ii)) for the State and
fiscal year under this title.
``(II) Second tier above baseline chip enrollees.--An
amount equal to the number of second tier above baseline
child enrollees under this title (as determined under
subparagraph (C)(ii)) for the State and fiscal year
multiplied by 75 percent of the projected per capita State
CHIP expenditures (as determined under subparagraph (D)(ii))
for the State and fiscal year under this title.
``(C) Number of first and second tier above baseline child
enrollees; baseline number of child enrollees.--For purposes
of this paragraph:
``(i) First tier above baseline child enrollees.--The
number of first tier above baseline child enrollees for a
State for a fiscal year under this title or title XIX is
equal to the number (if any, as determined by the Secretary)
by which--
``(I) the monthly average unduplicated number of qualifying
children (as defined in subparagraph (E)) enrolled during the
fiscal year under the State child health plan under this
title or under the State plan under title XIX, respectively;
exceeds
``(II) the baseline number of enrollees described in clause
(iii) for the State and fiscal year under this title or title
XIX, respectively;
but not to exceed 3 percent (in the case of title XIX) or 7.5
percent (in the case of this title) of the baseline number of
enrollees described in subclause (II).
``(ii) Second tier above baseline child enrollees.--The
number of second tier above baseline child enrollees for a
State for a fiscal year under this title or title XIX is
equal to the number (if any, as determined by the Secretary)
by which--
``(I) the monthly average unduplicated number of qualifying
children (as defined in subparagraph (E)) enrolled during the
fiscal year under this title or under title XIX,
respectively, as described in clause (i)(I); exceeds
``(II) the sum of the baseline number of child enrollees
described in clause (iii) for the State and fiscal year under
this title or title XIX, respectively, as described in clause
(i)(II), and the maximum number of first tier above baseline
child enrollees for the State and fiscal year under this
title or title XIX, respectively, as determined under clause
(i).
``(iii) Baseline number of child enrollees.--The baseline
number of child enrollees for a State under this title or
title XIX--
``(I) for fiscal year 2008 is equal to the monthly average
unduplicated number of qualifying children enrolled in the
State child health plan under this title or in the State plan
under title XIX, respectively, during fiscal year 2007
increased by the population growth for children in that State
for the year ending on June 30, 2006 (as estimated by the
Bureau of the Census) plus 1 percentage point; or
``(II) for a subsequent fiscal year is equal to the
baseline number of child enrollees for the State for the
previous fiscal year under this title or title XIX,
respectively, increased by the population growth for children
in that State for the year ending on June 30 before the
beginning of the fiscal year (as estimated by the Bureau of
the Census) plus 1 percentage point.
``(D) Projected per capita state expenditures.--For
purposes of subparagraph (B)--
``(i) Projected per capita state medicaid expenditures.--
The projected per capita State Medicaid expenditures for a
State and fiscal year under title XIX is equal to the average
per capita expenditures (including both State and Federal
financial participation) for children under the State plan
under such title, including under waivers but not including
such children eligible for assistance by virtue of the
receipt of benefits under title XVI, for the most recent
fiscal year for which actual data are available (as
determined by the Secretary), increased (for each subsequent
fiscal year up to and including the fiscal year involved) by
the annual percentage increase in per capita amount of
National Health Expenditures (as estimated by the Secretary)
for the calendar year in which the respective subsequent
fiscal year ends and multiplied by a State matching
percentage equal to 100 percent minus the Federal medical
assistance percentage (as defined in section 1905(b)) for the
fiscal year involved.
``(ii) Projected per capita state chip expenditures.--The
projected per capita State CHIP expenditures for a State and
fiscal year under this title is equal to the average per
capita expenditures (including both State and Federal
financial participation) for children under the State child
health plan under this title, including under waivers, for
the most recent fiscal year for which actual data are
available (as determined by the Secretary), increased (for
each subsequent fiscal year up to and including the fiscal
year involved) by the annual percentage increase in per
capita amount of National Health Expenditures (as estimated
by the Secretary) for the calendar year in which the
respective subsequent fiscal year ends and multiplied by a
State matching percentage equal to 100 percent minus the
enhanced FMAP (as defined in section 2105(b)) for the fiscal
year involved.
``(E) Qualifying children defined.--For purposes of this
subsection, the term `qualifying children' means, with
respect to this title or title XIX, children who meet the
eligibility criteria (including income, categorical
eligibility, age, and immigration status criteria) in effect
as of July 1, 2007, for enrollment under this title or title
XIX, respectively, taking into account crtieria applied as of
such date under this title or title XIX, respectively,
pursuant to a waiver under section 1115.
``(4) Enrollment and retention provisions for children.--
For purposes of paragraph (3)(A), a State meets the condition
of this paragraph for a fiscal year if it is implementing at
least 4 of the following enrollment and retention provisions
(treating each subparagraph as a separate enrollment and
retention provision) throughout the entire fiscal year:
``(A) Continuous eligibility.--The State has elected the
option of continuous eligibility for a full 12 months for all
children described in section 1902(e)(12) under title XIX
under 19 years of age, as well as applying such policy under
its State child health plan under this title.
``(B) Liberalization of asset requirements.--The State
meets the requirement specified in either of the following
clauses:
``(i) Elimination of asset test.--The State does not apply
any asset or resource test for eligibility for children under
title XIX or this title.
``(ii) Administrative verification of assets.--The State--
``(I) permits a parent or caretaker relative who is
applying on behalf of a child for medical assistance under
title XIX or child health assistance under this title to
declare and certify by
[[Page H9353]]
signature under penalty of perjury information relating to
family assets for purposes of determining and redetermining
financial eligibility; and
``(II) takes steps to verify assets through means other
than by requiring documentation from parents and applicants
except in individual cases of discrepancies or where
otherwise justified.
``(C) Elimination of in-person interview requirement.--The
State does not require an application of a child for medical
assistance under title XIX (or for child health assistance
under this title), including an application for renewal of
such assistance, to be made in person nor does the State
require a face-to-face interview, unless there are
discrepancies or individual circumstances justifying an in-
person application or face-to-face interview.
``(D) Use of joint application for medicaid and chip.--The
application form and supplemental forms (if any) and
information verification process is the same for purposes of
establishing and renewing eligibility for children for
medical assistance under title XIX and child health
assistance under this title.
``(E) Automatic renewal (use of administrative renewal).--
``(i) In general.--The State provides, in the case of
renewal of a child's eligibility for medical assistance under
title XIX or child health assistance under this title, a pre-
printed form completed by the State based on the information
available to the State and notice to the parent or caretaker
relative of the child that eligibility of the child will be
renewed and continued based on such information unless the
State is provided other information. Nothing in this clause
shall be construed as preventing a State from verifying,
through electronic and other means, the information so
provided.
``(ii) Satisfaction through demonstrated use of ex parte
process.--A State shall be treated as satisfying the
requirement of clause (i) if renewal of eligibility of
children under title XIX or this title is determined without
any requirement for an in-person interview, unless sufficient
information is not in the State's possession and cannot be
acquired from other sources (including other State agencies)
without the participation of the applicant or the applicant's
parent or caretaker relative.
``(F) Presumptive eligibility for children.--The State is
implementing section 1920A under title XIX as well as,
pursuant to section 2107(e)(1), under this title .
``(G) Express lane.--The State is implementing the option
described in section 1902(e)(13) under title XIX as well as,
pursuant to section 2107(e)(1), under this title.''.
SEC. 112. STATE OPTION TO RELY ON FINDINGS FROM AN EXPRESS
LANE AGENCY TO CONDUCT SIMPLIFIED ELIGIBILITY
DETERMINATIONS.
(a) Medicaid.--Section 1902(e) of the Social Security Act
(42 U.S.C. 1396a(e)) is amended by adding at the end the
following:
``(13) Express lane option.--
``(A) In general.--
``(i) Option to use a finding from an express lane
agency.--At the option of the State, the State plan may
provide that in determining eligibility under this title for
a child (as defined in subparagraph (F)), the State may rely
on a finding made within a reasonable period (as determined
by the State) from an Express Lane agency (as defined in
subparagraph (E)) when it determines whether a child
satisfies one or more components of eligibility for medical
assistance under this title. The State may rely on a finding
from an Express Lane agency notwithstanding sections
1902(a)(46)(B), 1903(x), and 1137(d) and any differences in
budget unit, disregard, deeming or other methodology, if the
following requirements are met:
``(I) Prohibition on determining children ineligible for
coverage.-- If a finding from an Express Lane agency would
result in a determination that a child does not satisfy an
eligibility requirement for medical assistance under this
title and for child health assistance under title XXI, the
State shall determine eligibility for assistance using its
regular procedures.
``(II) Notice requirement.--For any child who is found
eligible for medical assistance under the State plan under
this title or child health assistance under title XXI and who
is subject to premiums based on an Express Lane agency's
finding of such child's income level, the State shall provide
notice that the child may qualify for lower premium payments
if evaluated by the State using its regular policies and of
the procedures for requesting such an evaluation.
``(III) Compliance with screen and enroll requirement.--The
State shall satisfy the requirements under (A) and (B) of
section 2102(b)(3) (relating to screen and enroll) before
enrolling a child in child health assistance under title XXI.
At its option, the State may fulfill such requirements in
accordance with either option provided under subparagraph (C)
of this paragraph.
``(ii) Option to apply to renewals and redeterminations.--
The State may apply the provisions of this paragraph when
conducting initial determinations of eligibility,
redeterminations of eligibility, or both, as described in the
State plan.
``(B) Rules of construction.--Nothing in this paragraph
shall be construed--
``(i) to limit or prohibit a State from taking any actions
otherwise permitted under this title or title XXI in
determining eligibility for or enrolling children into
medical assistance under this title or child health
assistance under title XXI; or
``(ii) to modify the limitations in section 1902(a)(5)
concerning the agencies that may make a determination of
eligibility for medical assistance under this title.
``(C) Options for satisfying the screen and enroll
requirement.--
``(i) In general.--With respect to a child whose
eligibility for medical assistance under this title or for
child health assistance under title XXI has been evaluated by
a State agency using an income finding from an Express Lane
agency, a State may carry out its duties under subparagraphs
(A) and (B) of section 2102(b)(3) (relating to screen and
enroll) in accordance with either clause (ii) or clause
(iii).
``(ii) Establishing a screening threshold.--
``(I) In general.--Under this clause, the State establishes
a screening threshold set as a percentage of the Federal
poverty level that exceeds the highest income threshold
applicable under this title to the child by a minimum of 30
percentage points or, at State option, a higher number of
percentage points that reflects the value (as determined by
the State and described in the State plan) of any differences
between income methodologies used by the program administered
by the Express Lane agency and the methodologies used by the
State in determining eligibility for medical assistance under
this title.
``(II) Children with income not above threshold.--If the
income of a child does not exceed the screening threshold,
the child is deemed to satisfy the income eligibility
criteria for medical assistance under this title regardless
of whether such child would otherwise satisfy such criteria.
``(III) Children with income above threshold.--If the
income of a child exceeds the screening threshold, the child
shall be considered to have an income above the Medicaid
applicable income level described in section 2110(b)(4) and
to satisfy the requirement under section 2110(b)(1)(C)
(relating to the requirement that CHIP matching funds be used
only for children not eligible for Medicaid). If such a child
is enrolled in child health assistance under title XXI, the
State shall provide the parent, guardian, or custodial
relative with the following:
``(aa) Notice that the child may be eligible to receive
medical assistance under the State plan under this title if
evaluated for such assistance under the State's regular
procedures and notice of the process through which a parent,
guardian, or custodial relative can request that the State
evaluate the child's eligibility for medical assistance under
this title using such regular procedures.
``(bb) A description of differences between the medical
assistance provided under this title and child health
assistance under title XXI, including differences in cost-
sharing requirements and covered benefits.
``(iii) Temporary enrollment in chip pending screen and
enroll.--
``(I) In general.--Under this clause, a State enrolls a
child in child health assistance under title XXI for a
temporary period if the child appears eligible for such
assistance based on an income finding by an Express Lane
agency.
``(II) Determination of eligibility.--During such temporary
enrollment period, the State shall determine the child's
eligibility for child health assistance under title XXI or
for medical assistance under this title in accordance with
this clause.
``(III) Prompt follow up.--In making such a determination,
the State shall take prompt action to determine whether the
child should be enrolled in medical assistance under this
title or child health assistance under title XXI pursuant to
subparagraphs (A) and (B) of section 2102(b)(3) (relating to
screen and enroll).
``(IV) Requirement for simplified determination.--In making
such a determination, the State shall use procedures that, to
the maximum feasible extent, reduce the burden imposed on the
individual of such determination. Such procedures may not
require the child's parent, guardian, or custodial relative
to provide or verify information that already has been
provided to the State agency by an Express Lane agency or
another source of information unless the State agency has
reason to believe the information is erroneous.
``(V) Availability of chip matching funds during temporary
enrollment period.--Medical assistance for items and services
that are provided to a child enrolled in title XXI during a
temporary enrollment period under this clause shall be
treated as child health assistance under such title.
``(D) Option for automatic enrollment.--
``(i) In general.-- At its option, a State may initiate an
evaluation of an individual's eligibility for medical
assistance under this title without an application and
determine the individual's eligibility for such assistance
using findings from one or more Express Lane agencies and
information from sources other than a child, if the
requirements of clauses (ii) and (iii) are met.
``(ii) Individual choice requirement.--The requirement of
this clause is that the child is enrolled in medical
assistance under this title or child health assistance under
title XXI only if the child (or a parent, caretaker relative,
or guardian on the behalf of the child) has affirmatively
assented to such enrollment.
``(iii) Information requirement.--The requirement of this
clause is that the State informs the parent, guardian, or
custodial relative of the child of the services that will be
covered, appropriate methods for using such services, premium
or other cost sharing charges (if any) that apply, medical
support obligations (under section 1912(a)) created by
enrollment (if applicable), and the actions the parent,
guardian, or relative must take to maintain enrollment and
renew coverage.
``(E) Express lane agency defined.--In this paragraph, the
term `express lane agency' means an agency that meets the
following requirements:
``(i) The agency determines eligibility for assistance
under the Food Stamp Act of 1977, the Richard B. Russell
National School Lunch Act, the Child Nutrition Act of 1966,
or the Child Care and Development Block Grant Act of 1990.
[[Page H9354]]
``(ii) The agency notifies the child (or a parent,
caretaker relative, or guardian on the behalf of the child)--
``(I) of the information which shall be disclosed;
``(II) that the information will be used by the State
solely for purposes of determining eligibility for and for
providing medical assistance under this title or child health
assistance under title XXI; and
``(III) that the child, or parent, caretaker relative, or
guardian, may elect to not have the information disclosed for
such purposes.
``(iii) The agency and the State agency are subject to an
interagency agreement limiting the disclosure and use of such
information to such purposes.
``(iv) The agency is determined by the State agency to be
capable of making the determinations described in this
paragraph and is identified in the State plan under this
title or title XXI.
For purposes of this subparagraph, the term `State agency'
refers to the agency determining eligibility for medical
assistance under this title or child health assistance under
title XXI.
``(F) Child defined.--For purposes of this paragraph, the
term `child' means an individual under 19 years of age, or,
at the option of a State, such higher age, not to exceed 21
years of age, as the State may elect.''.
(b) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397gg(e)(1)) is amended by redesignating subparagraphs (B),
(C), and (D) as subparagraphs (E), (H), and (I),
respectively, and by inserting after subparagraph (A) the
following new subparagraph:
``(C) Section 1902(e)(13) (relating to the State option to
rely on findings from an Express Lane agency to help evaluate
a child's eligibility for medical assistance).''.
(c) Electronic Transmission of Information.--Section 1902
of such Act (42 U.S.C. 1396a) is amended by adding at the end
the following new subsection:
``(dd) Electronic Transmission of Information.--If the
State agency determining eligibility for medical assistance
under this title or child health assistance under title XXI
verifies an element of eligibility based on information from
an Express Lane Agency (as defined in subsection (e)(13)(F)),
or from another public agency, then the applicant's signature
under penalty of perjury shall not be required as to such
element. Any signature requirement for an application for
medical assistance may be satisfied through an electronic
signature, as defined in section 1710(1) of the Government
Paperwork Elimination Act (44 U.S.C. 3504 note). The
requirements of subparagraphs (A) and (B) of section
1137(d)(2) may be met through evidence in digital or
electronic form.''.
(d) Authorization of Information Disclosure.--
(1) In general.--Title XIX of the Social Security Act is
amended--
(A) by redesignating section 1939 as section 1940; and
(B) by inserting after section 1938 the following new
section:
``SEC. 1939. AUTHORIZATION TO RECEIVE PERTINENT INFORMATION.
``(a) In General.--Notwithstanding any other provision of
law, a Federal or State agency or private entity in
possession of the sources of data potentially pertinent to
eligibility determinations under this title (including
eligibility files maintained by Express Lane agencies
described in section 1902(e)(13)(F), information described in
paragraph (2) or (3) of section 1137(a), vital records
information about births in any State, and information
described in sections 453(i) and 1902(a)(25)(I)) is
authorized to convey such data or information to the State
agency administering the State plan under this title, to the
extent such conveyance meets the requirements of subsection
(b).
``(b) Requirements for Conveyance.--Data or information may
be conveyed pursuant to subsection (a) only if the following
requirements are met:
``(1) The individual whose circumstances are described in
the data or information (or such individual's parent,
guardian, caretaker relative, or authorized representative)
has either provided advance consent to disclosure or has not
objected to disclosure after receiving advance notice of
disclosure and a reasonable opportunity to object.
``(2) Such data or information are used solely for the
purposes of--
``(A) identifying individuals who are eligible or
potentially eligible for medical assistance under this title
and enrolling or attempting to enroll such individuals in the
State plan; and
``(B) verifying the eligibility of individuals for medical
assistance under the State plan.
``(3) An interagency or other agreement, consistent with
standards developed by the Secretary--
``(A) prevents the unauthorized use, disclosure, or
modification of such data and otherwise meets applicable
Federal requirements safeguarding privacy and data security;
and
``(B) requires the State agency administering the State
plan to use the data and information obtained under this
section to seek to enroll individuals in the plan.
``(c) Criminal Penalty.--A private entity described in the
subsection (a) that publishes, discloses, or makes known in
any manner, or to any extent not authorized by Federal law,
any information obtained under this section shall be fined
not more than $1,000 or imprisoned not more than 1 year, or
both, for each such unauthorized publication or disclosure.
``(d) Rule of Construction.--The limitations and
requirements that apply to disclosure pursuant to this
section shall not be construed to prohibit the conveyance or
disclosure of data or information otherwise permitted under
Federal law (without regard to this section).''.
(2) Conforming amendment to title xxi.--Section 2107(e)(1)
of such Act (42 U.S.C. 1397gg(e)(1)), as amended by
subsection (b), is amended by adding at the end the following
new subparagraph:
``(J) Section 1939 (relating to authorization to receive
data potentially pertinent to eligibility determinations).''.
(3) Conforming amendment to provide access to data about
enrollment in insurance for purposes of evaluating
applications and for chip.--Section 1902(a)(25)(I)(i) of such
Act (42 U.S.C. 1396a(a)(25)(I)(i)) is amended--
(A) by inserting ``(and, at State option, individuals who
are potentially eligible or who apply)'' after ``with respect
to individuals who are eligible''; and
(B) by inserting ``under this title (and, at State option,
child health assistance under title XXI)'' after ``the State
plan''.
(e) Effective Date.--The amendments made by this section
are effective on January 1, 2008.
SEC. 113. APPLICATION OF MEDICAID OUTREACH PROCEDURES TO ALL
CHILDREN AND PREGNANT WOMEN.
(a) In General.--Section 1902(a)(55) of the Social Security
Act (42 U.S.C. 1396a(a)(55)) is amended--
(1) in the matter before subparagraph (A), by striking
``individuals for medical assistance under subsection
(a)(10)(A)(i)(IV), (a)(10)(A)(i)(VI), (a)(10)(A)(i)(VII), or
(a)(10)(A)(ii)(IX)'' and inserting ``children and pregnant
women for medical assistance under any provision of this
title''; and
(2) in subparagraph (B), by inserting before the semicolon
at the end the following: ``, which need not be the same
application form for all such individuals''.
(b) Effective Date.--The amendments made by subsection (a)
take effect on January 1, 2008.
SEC. 114. ENCOURAGING CULTURALLY APPROPRIATE ENROLLMENT AND
RETENTION PRACTICES.
(a) Use of Medicaid Funds.--Section 1903(a)(2) of the
Social Security Act (42 U.S.C. 1396b(a)(2)) is amended by
adding at the end the following new subparagraph:
``(E) an amount equal to 75 percent of so much of the sums
expended during such quarter (as found necessary by the
Secretary for the proper and efficient administration of the
State plan) as are attributable to translation or
interpretation services in connection with the enrollment and
retention under this title of children of families for whom
English is not the primary language; plus''.
(b) Use of Community Health Workers for Outreach
Activities.--
(1) In general.--Section 2102(c)(1) of such Act (42 U.S.C.
1397bb(c)(1)) is amended by inserting ``(through community
health workers and others)'' after ``Outreach''.
(2) In federal evaluation.--Section 2108(c)(3)(B) of such
Act (42 U.S.C. 1397hh(c)(3)(B)) is amended by inserting
``(such as through community health workers and others)''
after ``including practices''.
SEC. 115. CONTINUOUS COVERAGE UNDER CHIP.
(a) In General.--Section 2102(b) of the Social Security Act
(42 U.S.C. 1397bb(b)) is amended by adding at the end the
following new paragraph:
``(5) 12-months continuous eligibility.--In the case of a
State child health plan that provides child health assistance
under this title through a means other than described in
section 2101(a)(2), the plan shall provide for implementation
under this title of the 12-months continuous eligibility
option described in section 1902(e)(12) for targeted low-
income children whose family income is below 200 percent of
the poverty line.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to determinations (and redeterminations) of
eligibility made on or after January 1, 2008.
Subtitle C--Coverage
SEC. 121. ENSURING CHILD-CENTERED COVERAGE.
(a) Additional Required Services.--
(1) Child-centered coverage.--Section 2103 of the Social
Security Act (42 U.S.C. 1397cc) is amended----
(A) in subsection (a)--
(i) in the matter before paragraph (1), by striking
``subsection (c)(5)'' and inserting ``paragraphs (5) and (6)
of subsection (c)''; and
(ii) in paragraph (1), by inserting ``at least'' after
``that is''; and
(B) in subsection (c)--
(i) by redesignating paragraph (5) as paragraph (6); and
(ii) by inserting after paragraph (4), the following:
``(5) Dental, fqhc, and rhc services.--The child health
assistance provided to a targeted low-income child (whether
through benchmark coverage or benchmark-equivalent coverage
or otherwise) shall include coverage of the following:
``(A) Dental services necessary to prevent disease and
promote oral health, restore oral structures to health and
function, and treat emergency conditions.
``(B) Federally-qualified health center services (as
defined in section 1905(l)(2)) and rural health clinic
services (as defined in section 1905(l)(1)).
Nothing in this section shall be construed as preventing a
State child health plan from providing such services as part
of benchmark coverage or in addition to the benefits provided
through benchmark coverage.''.
(2) Required payment for fqhc and rhc services.--Section
2107(e)(1) of such Act (42 U.S.C. 1397gg(e)(1)), as amended
by sections 112(b) and 112(d)(2), is amended by inserting
after subparagraph (C) the following new subparagraph:
``(D) Section 1902(bb) (relating to payment for services
provided by Federally-qualified health centers and rural
health clinics).''.
(3) Mental health parity.--Section 2103(a)(2)(C) of such
Act (42 U.S.C.
[[Page H9355]]
1397aa(a)(2)(C)) is amended by inserting ``(or 100 percent in
the case of the category of services described in
subparagraph (B) of such subsection)'' after ``75 percent''.
(4) Effective date.--The amendments made by this subsection
and subsection (d) shall apply to health benefits coverage
provided on or after October 1, 2008.
(b) Clarification of Requirement to Provide EPSDT Services
for All Children in Benchmark Benefit Packages Under
Medicaid.--
(1) In general.--Section 1937(a)(1) of the Social Security
Act (42 U.S.C. 1396u-7(a)(1)) is amended--
(A) in subparagraph (A)--
(i) in the matter before clause (i), by striking
``Notwithstanding any other provision of this title'' and
inserting ``Subject to subparagraph (E)''; and
(ii) by striking ``enrollment in coverage that provides''
and all that follows and inserting ``benchmark coverage
described in subsection (b)(1) or benchmark equivalent
coverage described in subsection (b)(2).'';
(B) by striking subparagraph (C) and inserting the
following new subparagraph:
``(C) State option to provide additional benefits.--A
State, at its option, may provide such additional benefits to
benchmark coverage described in subsection (b)(1) or
benchmark equivalent coverage described in subsection (b)(2)
as the State may specify.''; and
(C) by adding at the end the following new subparagraph:
``(E) Requiring coverage of epsdt services.--Nothing in
this paragraph shall be construed as affecting a child's
entitlement to care and services described in subsections
(a)(4)(B) and (r) of section 1905 and provided in accordance
with section 1902(a)(43) whether provided through benchmark
coverage, benchmark equivalent coverage, or otherwise.''.
(c) Clarification of Coverage of Services in School-Based
Health Centers Included as Child Health Assistance.--
(1) In general.--Section 2110(a)(5) of such Act (42 U.S.C.
1397jj(a)(5)) is amended by inserting after ``health center
services'' the following: ``and school-based health center
services for which coverage is otherwise provided under this
title when furnished by a school-based health center that is
authorized to furnish such services under State law''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to child health assistance furnished on or after
the date of the enactment of this Act.
(d) Assuring Access to Care.--
(1) State child health plan requirement.--Section
2102(a)(7)(B) of such Act (42 U.S.C. 1397bb(c)(2)) is amended
by inserting ``and services described in section 2103(c)(5)''
after ``emergency services''.
(2) Reference to effective date.--For the effective date
for the amendments made by this subsection, see subsection
(a)(5).
SEC. 122. IMPROVING BENCHMARK COVERAGE OPTIONS.
(a) Limitation on Secretary-Approved Coverage.--
(1) Under chip.--Section 2103(a)(4) of the Social Security
Act (42 U.S.C. 1397cc(a)(4)) is amended by inserting before
the period at the end the following: ``if the health benefits
coverage is at least equivalent to the benefits coverage in a
benchmark benefit package described in subsection (b)''.
(2) Under medicaid.--Section 1937(b)(1)(D) of the Social
Security Act (42 U.S.C. 1396u-7(b)(1)(D)) is amended by
inserting before the period at the end the following: ``if
the health benefits coverage is at least equivalent to the
benefits coverage in benchmark coverage described in
subparagraph (A), (B), or (C)''.
(b) Requirement for Most Popular Family Coverage for State
Employee Coverage Benchmark.--
(1) CHIP.--Section 2103(b)(2) of such Act (42 U.S.C.
1397(b)(2)) is amended by inserting ``and that has been
selected most frequently by employees seeking dependent
coverage, among such plans that provide such dependent
coverage, in either of the previous 2 plan years'' before the
period at the end.
SEC. 123. PREMIUM GRACE PERIOD.
(a) In General.--Section 2103(e)(3) of the Social Security
Act (42 U.S.C. 1397cc(e)(3)) is amended by adding at the end
the following new subparagraph:
``(C) Premium grace period.--The State child health plan--
``(i) shall afford individuals enrolled under the plan a
grace period of at least 30 days from the beginning of a new
coverage period to make premium payments before the
individual's coverage under the plan may be terminated; and
``(ii) shall provide to such an individual, not later than
7 days after the first day of such grace period, notice--
``(I) that failure to make a premium payment within the
grace period will result in termination of coverage under the
State child health plan; and
``(II) of the individual's right to challenge the proposed
termination pursuant to the applicable Federal regulations.
For purposes of clause (i), the term `new coverage period'
means the month immediately following the last month for
which the premium has been paid.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to new coverage periods beginning on or after
January 1, 2009.
Subtitle D--Populations
SEC. 131. OPTIONAL COVERAGE OF CHILDREN UP TO AGE 21 UNDER
CHIP.
(a) In General.--Section 2110(c)(1) of the Social
Security Act (42 U.S.C. 1397jj(c)(1)) is amended by inserting
``(or, at the option of the State, under 20 or 21 years of
age)'' after ``19 years of age''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect on January 1, 2008.
(F) Section 1932(a)(2)(A) of such Act (42 U.S.C. 1396u-
2(a)(2)(A)) is amended by inserting ``(or under such higher
age as the State has elected under section 1902(l)(1)(D))''
after ``19 years of age''.
(b) Title XXI.--Section 2110(c)(1) of such Act (42 U.S.C.
1397jj(c)(1)) is amended by inserting ``(or, at the option of
the State and subject to section 131(d) of the Children's
Health and Medicare Protection Act of 2007, under such higher
age as the State has elected under section 1902(l)(1)(D))''
after ``19 years of age''.
(c) Effective Date.--Subject to subsection (d), the
amendments made by this section take effect on January 1,
2010.
(d) Transition.--In carrying out the amendments made by
subsections (a) and (b)--
(1) for 2010, a State election under section 1902(l)(1)(D)
shall only apply with respect to title XXI of such Act and
the age elected may not exceed 21 years of age;
SEC. 132. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE
MEDICAID PROGRAM AND CHIP.
(a) Medicaid Program.--Section 1903(v) of the Social
Security Act (42 U.S.C. 1396b(v)) is amended--
(1) in paragraph (1), by striking ``paragraph (2)'' and
inserting ``paragraphs (2) and (4)''; and
(2) by adding at the end the following new paragraph:
``(4)(A) A State may elect (in a plan amendment under this
title) to provide medical assistance under this title,
notwithstanding sections 401(a), 402(b), 403, and 421 of the
Personal Responsibility and Work Opportunity Reconciliation
Act of 1996, for aliens who are lawfully residing in the
United States (including battered aliens described in section
431(c) of such Act) and who are otherwise eligible for such
assistance, within either or both of the following
eligibility categories:
``(i) Pregnant women.--Women during pregnancy (and during
the 60-day period beginning on the last day of the
pregnancy).
``(ii) Children.--Individuals under age 19 (or such higher
age as the State has elected under section 1902(l)(1)(D)),
including optional targeted low-income children described in
section 1905(u)(2)(B).
``(B) In the case of a State that has elected to provide
medical assistance to a category of aliens under subparagraph
(A), no debt shall accrue under an affidavit of support
against any sponsor of such an alien on the basis of
provision of medical assistance to such category and the cost
of such assistance shall not be considered as an unreimbursed
cost.''.
(b) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397gg(e)(1)), as amended by section 112(b), 112(d)(2),and
121(a)(2), is amended by inserting after subparagraph (E) the
following new subparagraphs:
``(F) Section 1903(v)(4)(A) (relating to optional coverage
of certain categories of lawfully residing immigrants),
insofar as it relates to the category of pregnant women
described in clause (i) of such section, but only if the
State has elected to apply such section with respect to such
women under title XIX and the State has elected the option
under section 2111 to provide assistance for pregnant women
under this title.
``(G) Section 1903(v)(4)(A) (relating to optional coverage
of categories of lawfully residing immigrants), insofar as it
relates to the category of children described in clause (ii)
of such section, but only if the State has elected to apply
such section with respect to such children under title
XIX.''.
(c) Effective Date.--The amendments made by this section
take effect on the date of the enactment of this Act.
SEC. 133. STATE OPTION TO EXPAND OR ADD COVERAGE OF CERTAIN
PREGNANT WOMEN UNDER CHIP.
(a) CHIP.--
(1) Coverage.--Title XXI (42 U.S.C. 1397aa et seq.) of the
Social Security Act is amended by adding at the end the
following new section:
``SEC. 2111. OPTIONAL COVERAGE OF TARGETED LOW-INCOME
PREGNANT WOMEN.
``(a) Optional Coverage.--Notwithstanding any other
provision of this title, a State may provide for coverage,
through an amendment to its State child health plan under
section 2102, of assistance for pregnant women for targeted
low-income pregnant women in accordance with this section,
but only if--
``(1) the State has established an income eligibility
level--
``(A) for pregnant women, under any of clauses (i)(III),
(i)(IV), or (ii)(IX) of section 1902(a)(10)(A), that is at
least 185 percent (or such higher percent as the State has in
effect for pregnant women under this title) of the poverty
line applicable to a family of the size involved, but in no
case a percent lower than the percent in effect under any
such clause as of July 1, 2007; and
``(B) for children under 19 years of age under this title
(or title XIX) that is at least 200 percent of the poverty
line applicable to a family of the size involved; and
``(2) the State does not impose, with respect to the
enrollment under the State child health plan of targeted low-
income children during the quarter, any enrollment cap or
other numerical limitation on enrollment, any waiting list,
any procedures designed to delay the consideration of
applications for enrollment, or similar limitation with
respect to enrollment.
``(b) Definitions.--For purposes of this title:
``(1) Assistance for pregnant women.--The term `assistance
for pregnant women' has the meaning given the term child
health assistance in section 2110(a) as if any reference to
targeted low-income children were a reference to targeted
low-income pregnant women.
[[Page H9356]]
``(2) Targeted low-income pregnant woman.--The term
`targeted low-income pregnant woman' means a woman--
``(A) during pregnancy and through the end of the month in
which the 60-day period (beginning on the last day of her
pregnancy) ends;
``(B) whose family income exceeds 185 percent (or, if
higher, the percent applied under subsection (a)(1)(A)) of
the poverty level applicable to a family of the size
involved, but does not exceed the income eligibility level
established under the State child health plan under this
title for a targeted low-income child; and
``(C) who satisfies the requirements of paragraphs (1)(A),
(1)(C), (2), and (3) of section 2110(b), applied as if any
reference to a child was a reference to a pregnant woman.
``(c) References to Terms and Special Rules.--In the case
of, and with respect to, a State providing for coverage of
assistance for pregnant women to targeted low-income pregnant
women under subsection (a), the following special rules
apply:
``(1) Any reference in this title (other than in subsection
(b)) to a targeted low-income child is deemed to include a
reference to a targeted low-income pregnant woman.
``(2) Any reference in this title to child health
assistance (other than with respect to the provision of early
and periodic screening, diagnostic, and treatment services)
with respect to such women is deemed a reference to
assistance for pregnant women.
``(3) Any such reference (other than in section 2105(d)) to
a child is deemed a reference to a woman during pregnancy and
the period described in subsection (b)(2)(A).
``(4) In applying section 2102(b)(3)(B), any reference to
children found through screening to be eligible for medical
assistance under the State medicaid plan under title XIX is
deemed a reference to pregnant women.
``(5) There shall be no exclusion of benefits for services
described in subsection (b)(1) based on any preexisting
condition and no waiting period (including any waiting period
imposed to carry out section 2102(b)(3)(C)) shall apply.
``(6) In applying section 2103(e)(3)(B) in the case of a
pregnant woman provided coverage under this section, the
limitation on total annual aggregate cost-sharing shall be
applied to such pregnant woman.
``(7) In applying section 2104(i)--
``(A) in the case of a State which did not provide for
coverage for pregnant women under this title (under a waiver
or otherwise) during fiscal year 2007, the allotment amount
otherwise computed for the first fiscal year in which the
State elects to provide coverage under this section shall be
increased by an amount (determined by the Secretary) equal to
the enhanced FMAP of the expenditures under this title for
such coverage, based upon projected enrollment and per capita
costs of such enrollment; and
``(B) in the case of a State which provided for coverage of
pregnant women under this title for the previous fiscal
year--
``(i) in applying paragraph (2)(B) of such section, there
shall also be taken into account (in an appropriate
proportion) the percentage increase in births in the State
for the relevant period; and
``(ii) in applying paragraph (3), pregnant women (and per
capita expenditures for such women) shall be accounted for
separately from children, but shall be included in the total
amount of any allotment adjustment under such paragraph.
``(d) Automatic Enrollment for Children Born to Women
Receiving Assistance for Pregnant Women.--If a child is born
to a targeted low-income pregnant woman who was receiving
assistance for pregnant women under this section on the date
of the child's birth, the child shall be deemed to have
applied for child health assistance under the State child
health plan and to have been found eligible for such
assistance under such plan or to have applied for medical
assistance under title XIX and to have been found eligible
for such assistance under such title on the date of such
birth, based on the mother's reported income as of the time
of her enrollment under this section and applicable income
eligibility levels under this title and title XIX, and to
remain eligible for such assistance until the child attains 1
year of age. During the period in which a child is deemed
under the preceding sentence to be eligible for child health
or medical assistance, the assistance for pregnant women or
medical assistance eligibility identification number of the
mother shall also serve as the identification number of the
child, and all claims shall be submitted and paid under such
number (unless the State issues a separate identification
number for the child before such period expires).''.
(2) Additional amendment.--Section 2107(e)(1)(I) of such
Act (42 U.S.C. 1397gg(e)(1)(H)), as redesignated by section
112(b), is amended to read as follows:
``(I) Sections 1920 and 1920A (relating to presumptive
eligibility for pregnant women and children).''.
(b) Amendments to Medicaid.--
(1) Eligibility of a newborn.--Section 1902(e)(4) of the
Social Security Act (42 U.S.C. 1396a(e)(4)) is amended in the
first sentence by striking ``so long as the child is a member
of the woman's household and the woman remains (or would
remain if pregnant) eligible for such assistance''.
(2) Application of qualified entities to presumptive
eligibility for pregnant women under medicaid.--Section
1920(b) of the Social Security Act (42 U.S.C. 1396r-1(b)) is
amended by adding after paragraph (2) the following flush
sentence:
``The term `qualified provider' also includes a qualified
entity, as defined in section 1920A(b)(3).''.
SEC. 134. LIMITATION ON WAIVER AUTHORITY TO COVER ADULTS.
Section 2102 of the Social Security Act (42 U.S.C. 1397bb)
is amended by adding at the end the following new subsection:
``(d) Limitation on Coverage of Adults.--Notwithstanding
any other provision of this title, the Secretary may not,
through the exercise of any waiver authority on or after
January 1, 2008, provide for Federal financial participation
to a State under this title for health care services for
individuals who are not targeted low-income children or
pregnant women unless the Secretary determines that no
eligible targeted low-income child in the State would be
denied coverage under this title for health care services
because of such eligibility. In making such determination,
the Secretary must receive assurances that--
``(1) there is no waiting list under this title in the
State for targeted low-income children to receive child
health assistance under this title; and
``(2) the State has in place an outreach program to reach
all targeted low-income children in families with incomes
less than 200 percent of the poverty line.''.
SEC. 135. NO FEDERAL FUNDING FOR ILLEGAL ALIENS.
Nothing in this Act allows Federal payment for
individuals who are not legal residents.
SEC. 136. AUDITING REQUIREMENT TO ENFORCE CITIZENSHIP
RESTRICTIONS ON ELIGIBILITY FOR MEDICAID AND
CHIP BENEFITS.
Section 1903(x) of the Social Security Act (as amended by
section 405(c)(1)(A) of division B of the Tax Relief and
Health Care Act of 2006 (Public Law 109-432)) is amended by
adding at the end the following new paragraph:
``(4)(A) Each State shall audit a statistically-based
sample of cases of individuals whose eligibility for medical
assistance (or child health assistance) is determined under
section 1902(a)(46)(B) or under subsection (v)(4)(A) in order
to demonstrate to the satisfaction of the Secretary that
Federal funds under this title or title XXI are not
unlawfully spent for benefits for individuals who are not
legal residents. In conducting such audits, a State may rely
on case reviews regularly conducted pursuant to its Medicaid
Quality Control or Payment Error Rate Measurement (PERM)
eligibility reviews under subsection (u) and the provisions
of subsection (e) of section 1137 shall apply under this
paragraph in the same manner as they apply under subsection
(b) of such section.
``(B) The State shall remit to the Secretary the Federal
share of any unlawful expenditures for benefits, for aliens
who are not legal residents, which are identified under an
audit conducted under subparagraph (A).''.
Subtitle E--Access
SEC. 141. CHILDREN'S ACCESS, PAYMENT, AND EQUALITY
COMMISSION.
Title XIX of the Social Security Act is amended by
inserting before section 1901 the following new section:
``CHILDREN'S ACCESS, PAYMENT, AND EQUALITY COMMISSION
``Sec. 1900. (a) Establishment.--There is hereby
established as an agency of Congress the Children's Access,
Payment, and Equality Commission (in this section referred to
as the `Commission').
``(b) Duties.--
``(1) Review of payment policies and annual reports.--The
Commission shall--
``(A) review Federal and State payment policies of the
Medicaid program established under this title (in this
section referred to as `Medicaid') and the State Children's
Health Insurance Program established under title XXI (in this
section referred to as `CHIP'), including topics described in
paragraph (2);
``(B) review access to, and affordability of, coverage and
services for enrollees under Medicaid and CHIP;
``(C) make recommendations to Congress concerning such
policies;
``(D) by not later than March 1 of each year, submit to
Congress a report containing the results of such reviews and
its recommendations concerning such policies; and
``(E) by not later than June 1 of each year, submit to
Congress a report containing an examination of issues
affecting Medicaid and CHIP, including the implications of
changes in health care delivery in the United States and in
the market for health care services on such programs.
``(2) Specific topics to be reviewed.--Specifically, the
Commission shall review the following:
``(A) The factors affecting expenditures for services in
different sectors (such as physician, hospital and other
sectors), payment methodologies, and their relationship to
access and quality of care for Medicaid and CHIP
beneficiaries.
``(B) The impact of Federal and State Medicaid and CHIP
payment policies on access to services (including dental
services) for children (including children with disabilities)
and other Medicaid and CHIP populations.
``(C) The impact of Federal and State Medicaid and CHIP
policies on reducing health disparities, including geographic
disparities and disparities among minority populations.
``(D) The overall financial stability of the health care
safety net, including Federally-qualified health centers,
rural health centers, school-based clinics, disproportionate
share hospitals, public hospitals, providers and grantees
under section 2612(a)(5) of the Public Health Service Act
(popularly known as the Ryan White CARE Act), and other
providers that have a patient base which includes a
disproportionate number of uninsured or low-income
individuals and the impact of CHIP and Medicaid policies on
such stability.
``(E) The relation (if any) between payment rates for
providers and improvement in care for children as measured
under the children's
[[Page H9357]]
health quality measurement program established under section
151 of the Children's Health and Medicare Protection Act of
2007.
``(F) The affordability, cost effectiveness, and
accessibility of services needed by special populations under
Medicaid and CHIP as compared with private-sector coverage.
``(G) The extent to which the operation of Medicaid and
CHIP ensures access, comparable to access under employer-
sponsored or other private health insurance coverage (or in
the case of federally-qualified health center services (as
defined in section 1905(l)(2)) and rural health clinic
services (as defined in section 1905(l)(1)), access
comparable to the access to such services under title XIX),
for targeted low-income children.
``(H) The effect of demonstrations under section 1115,
benchmark coverage under section 1937, and other coverage
under section 1938, on access to care, affordability of
coverage, provider ability to achieve children's health
quality performance measures, and access to safety net
services.
``(3) Comments on certain secretarial reports.--If the
Secretary submits to Congress (or a committee of Congress) a
report that is required by law and that relates to payment
policies under Medicaid or CHIP, the Secretary shall transmit
a copy of the report to the Commission. The Commission shall
review the report and, not later than 6 months after the date
of submittal of the Secretary's report to Congress, shall
submit to the appropriate committees of Congress written
comments on such report. Such comments may include such
recommendations as the Commission deems appropriate.
``(4) Agenda and additional reviews.--The Commission shall
consult periodically with the Chairmen and Ranking Minority
Members of the appropriate committees of Congress regarding
the Commission's agenda and progress towards achieving the
agenda. The Commission may conduct additional reviews, and
submit additional reports to the appropriate committees of
Congress, from time to time on such topics relating to the
program under this title or title XXI as may be requested by
such Chairmen and Members and as the Commission deems
appropriate.
``(5) Availability of reports.--The Commission shall
transmit to the Secretary a copy of each report submitted
under this subsection and shall make such reports available
to the public.
``(6) Appropriate committee of congress.--For purposes of
this section, the term `appropriate committees of Congress'
means the Committees on Energy and Commerce of the House of
Representatives and the Committee on Finance of the Senate.
``(7) Voting and reporting requirements.--With respect to
each recommendation contained in a report submitted under
paragraph (1), each member of the Commission shall vote on
the recommendation, and the Commission shall include, by
member, the results of that vote in the report containing the
recommendation.
``(8) Examination of budget consequences.--Before making
any recommendations, the Commission shall examine the budget
consequences of such recommendations, directly or through
consultation with appropriate expert entities.
``(c) Application of Provisions.--The following provisions
of section 1805 shall apply to the Commission in the same
manner as they apply to the Medicare Payment Advisory
Commission:
``(1) Subsection (c) (relating to membership), except that
the membership of the Commission shall also include
representatives of children, pregnant women, individuals with
disabilities, seniors, low-income families, and other groups
of CHIP and Medicaid beneficiaries.
``(2) Subsection (d) (relating to staff and consultants).
``(3) Subsection (e) (relating to powers).
``(d) Authorization of Appropriations.--
``(1) Request for appropriations.--The Commission shall
submit requests for appropriations in the same manner as the
Comptroller General submits requests for appropriations, but
amounts appropriated for the Commission shall be separate
from amounts appropriated for the Comptroller General.
``(2) Authorization.--There are authorized to be
appropriated such sums as may be necessary to carry out the
provisions of this section.''.
SEC. 142. MODEL OF INTERSTATE COORDINATED ENROLLMENT AND
COVERAGE PROCESS.
(a) In General.--In order to assure continuity of coverage
of low-income children under the Medicaid program and the
State Children's Health Insurance Program (CHIP), not later
than 18 months after the date of the enactment of this Act,
the Comptroller General of the United States, in consultation
with State Medicaid and CHIP directors and organizations
representing program beneficiaries, shall develop a model
process for the coordination of the enrollment, retention,
and coverage under such programs of children who, because of
migration of families, emergency evacuations, educational
needs, or otherwise, frequently change their State of
residency or otherwise are temporarily located outside of the
State of their residency.
(b) Report to Congress.--After development of such model
process, the Comptroller General shall submit to Congress a
report describing additional steps or authority needed to
make further improvements to coordinate the enrollment,
retention, and coverage under CHIP and Medicaid of children
described in subsection (a).
SEC. 143. MEDICAID CITIZENSHIP DOCUMENTATION REQUIREMENTS.
(a) State Option To Require Children To Present
Satisfactory Documentary Evidence of Proof of Citizenship or
Nationality for Purposes of Eligibility for Medicaid;
Requirement for Auditing.--
(1) In general.--Section 1902 of the Social Security Act
(42 U.S.C. 1396a) is amended--
(A) in subsection (a)(46)--
(i) by inserting ``(A)'' after ``(46)''; and
(ii) by adding at the end the following new subparagraphs:
``(B) at the option of the State, require that, with
respect to a child under 21 years of age (other than an
individual described in section 1903(x)(2)) who declares to
be a citizen or national of the United States for purposes of
establishing initial eligibility for medical assistance under
this title (or, at State option, for purposes of renewing or
redetermining such eligibility to the extent that such
satisfactory documentary evidence of citizenship or
nationality has not yet been presented), there is presented
satisfactory documentary evidence of citizenship or
nationality of the individual (using criteria determined by
the State, which shall be no more restrictive than the
documentation specified in section 1903(x)(3)); and
``(C) comply with the auditing requirements of section
1903(x)(4);''; and
(B) in subsection (b)(3), by inserting ``or any citizenship
documentation requirement for a child under 21 years of age
that is more restrictive than what a State may provide under
section 1903(x)'' before the period at the end.
(2) Elimination of denial of payments for children.--
Section 1903(i)(22) of such Act (42 U.S.C. 1396b(i)(22)) is
amended by inserting ``(other than a child under the age of
21)'' after ``for an individual''.
(b) Clarification of Rules for Children Born in the United
States to Mothers Eligible for Medicaid.--Section 1903(x)(2)
of such Act (42 U.S.C. 1396b(x)(2)) is amended--
(1) in subparagraph (C), by striking ``or'' at the end;
(2) by redesignating subparagraph (D) as subparagraph (E);
and
(3) by inserting after subparagraph (C) the following new
subparagraph:
``(D) pursuant to the application of section 1902(e)(4)
(and, in the case of an individual who is eligible for
medical assistance on such basis, the individual shall be
deemed to have provided satisfactory documentary evidence of
citizenship or nationality and shall not be required to
provide further documentary evidence on any date that occurs
during or after the period in which the individual is
eligible for medical assistance on such basis; or''.
(c) Documentation for Native Americans .--Section
1903(x)(3)(B) of such Act is amended--
(1) by redesignating clause (v) as clause (vi); and
(2) by inserting after clause (iv) the following new
clause:
``(v) For an individual who is a member of, or enrolled in
or affiliated with, a federally-recognized Indian tribe, a
document issued by such tribe evidencing such membership,
enrollment, or affiliation with the tribe (such as a tribal
enrollment card or certificate of degree of Indian blood),
and, only with respect to those federally-recognized Indian
tribes located within States having an international border
whose membership includes individuals who are not citizens of
the United States, such other forms of documentation
(including tribal documentation, if appropriate) as the
Secretary, after consulting with such tribes, determines to
be satisfactory documentary evidence of citizenship or
nationality for purposes of satisfying the requirement of
this subparagraph.''.
(d) Reasonable Opportunity.--Section 1903(x) of such Act,
as amended by subsection (a)(2), is further amended by adding
at the end the following new paragraph:
``(5) In the case of an individual declaring to be a
citizen or national of the United States with respect to whom
a State requires the presentation of satisfactory documentary
evidence of citizenship or nationality under section
1902(a)(46)(B), the individual shall be provided at least the
reasonable opportunity to present satisfactory documentary
evidence of citizenship or nationality under this subsection
as is provided under clauses (i) and (ii) of section
1137(d)(4)(A) to an individual for the submittal to the State
of evidence indicating a satisfactory immigration status and
shall not be denied medical assistance on the basis of
failure to provide such documentation until the individual
has had such an opportunity.''.
(e) Effective Date.--
(1) Retroactive application.--The amendments made by this
section shall take effect as if included in the enactment of
the Deficit Reduction Act of 2005 (Public Law 109-171; 120
Stat. 4).
(2) Restoration of eligibility.--In the case of an
individual who, during the period that began on July 1, 2006,
and ends on the date of the enactment of this Act, was
determined to be ineligible for medical assistance under a
State Medicaid program solely as a result of the application
of subsections (i)(22) and (x) of section 1903 of the Social
Security Act (as in effect during such period), but who would
have been determined eligible for such assistance if such
subsections, as amended by this section, had applied to the
individual, a State may deem the individual to be eligible
for such assistance as of the date that the individual was
determined to be ineligible for such medical assistance on
such basis.
SEC. 144. ACCESS TO DENTAL CARE FOR CHILDREN.
(a) Dental Education for Parents of Newborns.--The
Secretary of Health and Human Services shall develop and
implement, through entities that fund or provide perinatal
care services to targeted low-income children under a State
child health plan under title XXI of the Social Security Act,
a program to deliver oral health educational materials that
inform new parents about risks for, and prevention of, early
childhood caries and the need for a dental visit within their
newborn's first year of life.
[[Page H9358]]
(b) Provision of Dental Services Through FQHCs.--
(1) Medicaid.--Section 1902(a) of the Social Security Act
(42 U.S.C. 1396a(a)) is amended--
(A) by striking ``and'' at the end of paragraph (69);
(B) by striking the period at the end of paragraph (70) and
inserting ``; and''; and
(C) by inserting after paragraph (70) the following new
paragraph:
``(71) provide that the State will not prevent a Federally-
qualified health center from entering into contractual
relationships with private practice dental providers in the
provision of Federally-qualified health center services.''.
(2) CHIP.--Section 2107(e)(1) of such Act (42 U.S.C.
1397g(e)(1)), as amended by section 112(b), is amended by
inserting after subparagraph (A) the following new
subparagraph:
``(B) Section 1902(a)(71) (relating to limiting FQHC
contracting for provision of dental services).''.
(3) Effective date.--The amendments made by this subsection
shall take effect on January 1, 2008.
(c) Reporting Information on Dental Health.--
(1) Medicaid.--Section 1902(a)(43)(D)(iii) of such Act (42
U.S.C. 1396a(a)(43)(D)(iii)) is amended by inserting ``and
other information relating to the provision of dental
services to such children described in section 2108(e)''
after ``receiving dental services,''.
(2) CHIP.--Section 2108 of such Act (42 U.S.C. 1397hh) is
amended by adding at the end the following new subsection:
``(e) Information on Dental Care for Children.--
``(1) In general.--Each annual report under subsection (a)
shall include the following information with respect to care
and services described in section 1905(r)(3) provided to
targeted low-income children enrolled in the State child
health plan under this title at any time during the year
involved:
``(A) The number of enrolled children by age grouping used
for reporting purposes under section 1902(a)(43).
``(B) For children within each such age grouping,
information of the type contained in questions 12(a)-(c) of
CMS Form 416 (that consists of the number of enrolled
targeted low income children who receive any, preventive, or
restorative dental care under the State plan).
``(C) For the age grouping that includes children 8 years
of age, the number of such children who have received a
protective sealant on at least one permanent molar tooth.
``(2) Inclusion of information on enrollees in managed care
plans.--The information under paragraph (1) shall include
information on children who are enrolled in managed care
plans and other private health plans and contracts with such
plans under this title shall provide for the reporting of
such information by such plans to the State.''.
(3) Effective date.--The amendments made by this subsection
shall be effective for annual reports submitted for years
beginning after date of enactment.
(d) GAO Study and Report.--
(1) Study.--The Comptroller General of the United States
shall provide for a study that examines--
(A) access to dental services by children in underserved
areas; and
(B) the feasibility and appropriateness of using qualified
mid-level dental health providers, in coordination with
dentists, to improve access for children to oral health
services and public health overall.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Comptroller General shall submit
to Congress a report on the study conducted under paragraph
(1).
SEC. 145. PROHIBITING INITIATION OF NEW HEALTH OPPORTUNITY
ACCOUNT DEMONSTRATION PROGRAMS.
After the date of the enactment of this Act, the Secretary
of Health and Human Services may not approve any new
demonstration programs under section 1938 of the Social
Security Act (42 U.S.C. 1396u-8).
Subtitle F--Quality and Program Integrity
SEC. 151. PEDIATRIC HEALTH QUALITY MEASUREMENT PROGRAM.
(a) Quality Measurement of Children's Health.--
(1) Establishment of program to develop quality measures
for children's health.--The Secretary of Health and Human
Services (in this section referred to as the ``Secretary'')
shall establish a child health care quality measurement
program (in this subsection referred to as the ``children's
health quality measurement program'') to develop and
implement--
(A) pediatric quality measures on children's health care
that may be used by public and private health care purchasers
(and a system for reporting such measures); and
(B) measures of overall program performance that may be
used by public and private health care purchasers.
The Secretary shall publish, not later than September 30,
2009, the recommended measures under the program for
application under the amendments made by subsection (b) for
years beginning with 2010.
(2) Measures.--
(A) Scope.--The measures developed under the children's
health quality measurement program shall--
(i) provide comprehensive information with respect to the
provision and outcomes of health care for young children,
school age children, and older children.
(ii) be designed to identify disparities by pediatric
characteristics (including, at a minimum, those specified in
subparagraph (C)) in child health and the provision of health
care;
(iii) be designed to ensure that the data required for such
measures is collected and reported in a standard format that
permits comparison at a State, plan, and provider level, and
between insured and uninsured children;
(iv) take into account existing measures of child health
quality and be periodically updated;
(v) include measures of clinical health care quality which
meet the requirements for pediatric quality measures in
paragraph (1);
(vi) improve and augment existing measures of clinical
health care quality for children's health care and develop
new and emerging measures; and
(vii) increase the portfolio of evidence-based pediatric
quality measures available to public and private purchasers,
providers, and consumers.
(B) Specific measures.--Such measures shall include
measures relating to at least the following aspects of health
care for children:
(i) The proportion of insured (and uninsured) children who
receive age-appropriate preventive health and dental care
(including age appropriate immunizations) at each stage of
child health development.
(ii) The proportion of insured (and uninsured) children who
receive dental care for restoration of teeth, relief of pain
and infection, and maintenance of dental health.
(iii) The effectiveness of early health care interventions
for children whose assessments indicate the presence or risk
of physical or mental conditions that could adversely affect
growth and development.
(iv) The effectiveness of treatment to ameliorate the
effects of diagnosed physical and mental health conditions,
including chronic conditions.
(v) The proportion of children under age 21 who are
continuously insured for a period of 12 months or longer.
(vi) The effectiveness of health care for children with
disabilities.
In carrying out clause (vi), the Secretary shall develop
quality measures and best practices relating to cystic
fibrosis.
(vii) Data on State efforts to reduce hospitalization rate
of premature infants under the age of 12 months who were born
prior to 35 weeks.
(C) Reporting methodology for analysis by pediatric
characteristics.--The children's health quality measurement
program shall describe with specificity such measures and the
process by which such measures will be reported in a manner
that permits analysis based on each of the following
pediatric characteristics:
(i) Age.
(ii) Gender.
(iii) Race.
(iv) Ethnicity.
(v) Primary language of the child's parents (or caretaker
relative).
(vi) Disability or chronic condition (including cystic
fibrosis).
(vii) Geographic location.
(viii) Coverage status under public and private health
insurance programs.
(D) Pediatric quality measure.--In this subsection, the
term ``pediatric quality measure'' means a measurement of
clinical care that assesses one or more aspects of pediatric
health care quality (in various settings) including the
structure of the clinical care system, the process and
outcome of care, or patient experience in such care.
(3) Consultation in developing quality measures for
children's health services.--In developing and implementing
the children's health quality measurement program, the
Secretary shall consult with--
(A) States;
(B) pediatric hospitals, pediatricians, and other primary
and specialized pediatric health care professionals
(including members of the allied health professions) who
specialize in the care and treatment of children,
particularly children with special physical, mental, and
developmental health care needs;
(C) dental professionals;
(D) health care providers that furnish primary health care
to children and families who live in urban and rural
medically underserved communities or who are members of
distinct population sub-groups at heightened risk for poor
health outcomes;
(E) national organizations representing children, including
children with disabilities and children with chronic
conditions;
(F) national organizations and individuals with expertise
in pediatric health quality performance measurement; and
(G) voluntary consensus standards setting organizations and
other organizations involved in the advancement of evidence
based measures of health care.
(4) Use of grants and contracts.--In carrying out the
children's health quality measurement program, the Secretary
may award grants and contracts to develop, test, validate,
update, and disseminate quality measures under the program.
(5) Technical assistance.--The Secretary shall provide
technical assistance to States to establish for the reporting
of quality measures under titles XIX and XXI of the Social
Security Act in accordance with the children's health quality
measurement program.
(b) Dissemination of Information on the Quality of Program
Performance.--Not later than January 1, 2009, and annually
thereafter, the Secretary shall collect, analyze, and make
publicly available on a public website of the Department of
Health and Human Services in an online format--
(1) a complete list of all measures in use by States as of
such date and used to measure the quality of medical and
dental health services furnished to children enrolled under
title XIX of XXI of the Social Security Act by participating
providers, managed care entities, and plan issuers; and
(2) information on health care quality for children
contained in external quality review reports required under
section 1932(c)(2) of such
[[Page H9359]]
Act (42 U.S.C. 1396u-2) or produced by States that administer
separate plans under title XXI of such Act.
(c) Reports to Congress on Program Performance.--Not later
than January 1, 2010, and every 2 years thereafter, the
Secretary shall report to Congress on--
(1) the quality of health care for children enrolled under
title XIX and XXI of the Social Security Act under the
children's health quality measurement program; and
(2) patterns of health care utilization with respect to the
measures specified in subsection (a)(2)(B) among children by
the pediatric characteristics listed in subsection (a)(2)(C).
SEC. 152. APPLICATION OF CERTAIN MANAGED CARE QUALITY
SAFEGUARDS TO CHIP.
(a) In General.--Section 2103(f) of Social Security Act (42
U.S.C. 1397bb(f)) is amended by adding at the end the
following new paragraph:
``(3) Compliance with managed care requirements.--The State
child health plan shall provide for the application of
subsections (a)(4), (a)(5), (b), (c), (d), and (e) of section
1932 (relating to requirements for managed care) to coverage,
State agencies, enrollment brokers, managed care entities,
and managed care organizations under this title in the same
manner as such subsections apply to coverage and such
entities and organizations under title XIX.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contract years for health plans beginning on
or after July 1, 2008.
SEC. 153. UPDATED FEDERAL EVALUATION OF CHIP.
Section 2108(c) of the Social Security Act (42 U.S.C.
1397hh(c)) is amended by striking paragraph (5) and inserting
the following:
``(5) Subsequent evaluation using updated information.--
``(A) In general.--The Secretary, directly or through
contracts or interagency agreements, shall conduct an
independent subsequent evaluation of 10 States with approved
child health plans.
``(B) Selection of states and matters included.--Paragraphs
(2) and (3) shall apply to such subsequent evaluation in the
same manner as such provisions apply to the evaluation
conducted under paragraph (1).
``(C) Submission to congress.--Not later than December 31,
2010, the Secretary shall submit to Congress the results of
the evaluation conducted under this paragraph.
``(D) Funding.--Out of any money in the Treasury of the
United States not otherwise appropriated, there are
appropriated $10,000,000 for fiscal year 2009 for the purpose
of conducting the evaluation authorized under this paragraph.
Amounts appropriated under this subparagraph shall remain
available for expenditure through fiscal year 2011.'' .
SEC. 154. ACCESS TO RECORDS FOR IG AND GAO AUDITS AND
EVALUATIONS.
Section 2108(d) of the Social Security Act (42 U.S.C.
1397hh(d)) is amended to read as follows:
``(d) Access to Records for IG and GAO Audits and
Evaluations.--For the purpose of evaluating and auditing the
program established under this title, the Secretary, the
Office of Inspector General, and the Comptroller General
shall have access to any books, accounts, records,
correspondence, and other documents that are related to the
expenditure of Federal funds under this title and that are in
the possession, custody, or control of States receiving
Federal funds under this title or political subdivisions
thereof, or any grantee or contractor of such States or
political subdivisions.''.
SEC. 155. REFERENCES TO TITLE XXI.
Section 704 of the Medicare, Medicaid, and SCHIP Balanced
Budget Refinement Act of 1999 (Appendix F, 113 Stat. 1501A-
321), as enacted into law by section 1000(a)(6) of Public Law
106-113) is repealed and the item relating to such section in
the table of contents of such Act is repealed.
SEC. 156. RELIANCE ON LAW; EXCEPTION FOR STATE LEGISLATION.
(a) Reliance on Law.--With respect to amendments made by
this title or title VIII that become effective as of a date--
(1) such amendments are effective as of such date whether
or not regulations implementing such amendments have been
issued; and
(2) Federal financial participation for medical assistance
or child health assistance furnished under title XIX or XXI,
respectively, of the Social Security Act on or after such
date by a State in good faith reliance on such amendments
before the date of promulgation of final regulations, if any,
to carry out such amendments (or before the date of guidance,
if any, regarding the implementation of such amendments)
shall not be denied on the basis of the State's failure to
comply with such regulations or guidance.
(b) Exception for State Legislation.--In the case of a
State plan under title XIX or State child health plan under
XXI of the Social Security Act, which the Secretary of Health
and Human Services determines requires State legislation in
order for respective plan to meet one or more additional
requirements imposed by amendments made by this title or
title VIII, the respective State plan shall not be regarded
as failing to comply with the requirements of such title
solely on the basis of its failure to meet such an additional
requirement before the first day of the first calendar
quarter beginning after the close of the first regular
session of the State legislature that begins after the date
of enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year
legislative session, each year of the session shall be
considered to be a separate regular session of the State
legislature.
TITLE II--MEDICARE BENEFICIARY IMPROVEMENTS
Subtitle A--Improvements in Benefits
SEC. 201. COVERAGE AND WAIVER OF COST-SHARING FOR PREVENTIVE
SERVICES.
(a) Preventive Services Defined; Coverage of Additional
Preventive Services.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x) is amended--
(1) in subsection (s)(2)--
(A) in subparagraph (Z), by striking ``and'' after the
semicolon at the end;
(B) in subparagraph (AA), by adding ``and'' after the
semicolon at the end; and
(C) by adding at the end the following new subparagraph:
``(BB) additional preventive services (described in
subsection (ccc)(1)(M));''; and
(2) by adding at the end the following new subsection:
``Preventive Services
``(ccc)(1) The term `preventive services' means the
following:
``(A) Prostate cancer screening tests (as defined in
subsection (oo)).
``(B) Colorectal cancer screening tests (as defined in
subsection (pp)).
``(C) Diabetes outpatient self-management training services
(as defined in subsection (qq)).
``(D) Screening for glaucoma for certain individuals (as
described in subsection (s)(2)(U)).
``(E) Medical nutrition therapy services for certain
individuals (as described in subsection (s)(2)(V)).
``(F) An initial preventive physical examination (as
defined in subsection (ww)).
``(G) Cardiovascular screening blood tests (as defined in
subsection (xx)(1)).
``(H) Diabetes screening tests (as defined in subsection
described in subsection (s)(2)(Y)).
``(I) Ultrasound screening for abdominal aortic aneurysm
for certain individuals (as described in described in
subsection (s)(2)(AA)).
``(J) Pneumococcal and influenza vaccine and their
administration (as described in subsection (s)(10)(A)).
``(K) Hepatitis B vaccine and its administration for
certain individuals (as described in subsection (s)(10)(B)).
``(L) Screening mammography (as defined in subsection
(jj)).
``(M) Screening pap smear and screening pelvic exam (as
described in subsection (s)(14)).
``(N) Bone mass measurement (as defined in subsection
(rr)).
``(O) Additional preventive services (as determined under
paragraph (2)).
``(2)(A) The term `additional preventive services' means
items and services, including mental health services, not
described in subparagraphs (A) through (N) of paragraph (1)
that the Secretary determines to be reasonable and necessary
for the prevention or early detection of an illness or
disability.
``(B) In making determinations under subparagraph (1), the
Secretary shall--
``(i) take into account evidence-based recommendations by
the United States Preventive Services Task Force and other
appropriate organizations; and
``(ii) use the process for making national coverage
determinations (as defined in section 1869(f)(1)(B)) under
this title.''.
(b) Payment and Elimination of Cost-Sharing.--
(1) In general.--
(A) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)) is amended--
(i) in clause (T), by striking ``80 percent'' and inserting
``100 percent''; and
(ii) by striking ``and'' before ``(V)''; and
(iii) by inserting before the semicolon at the end the
following: ``, and (W) with respect to additional preventive
services (as defined in section 1861(ccc)(2)) and other
preventive services for which a payment rate is not otherwise
established under this section, the amount paid shall be 100
percent of the lesser of the actual charge for the services
or the amount determined under a fee schedule established by
the Secretary for purposes of this clause''.
(B) Application to sigmoidoscopies and colonoscopies.--
Section 1834(d) of such Act (42 U.S.C. 1395m(d)) is amended--
(i) in paragraph (2)(C), by amending clause (ii) to read as
follows:
``(ii) No coinsurance.--In the case of a beneficiary who
receives services described in clause (i), there shall be no
coinsurance applied.''; and.
(ii) in paragraph (3)(C), by amending clause (ii) to read
as follows:
``(ii) No coinsurance.--In the case of a beneficiary who
receives services described in clause (i), there shall be no
coinsurance applied.''.
(2) Elimination of coinsurance in outpatient hospital
settings.--
(A) Exclusion from opd fee schedule.--Section
1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395l(t)(1)(B)(iv)) is amended by striking ``screening
mammography (as defined in section 1861(jj)) and diagnostic
mammography'' and inserting ``diagnostic mammography and
preventive services (as defined in section 1861(ccc)(1))''.
(B) Conforming amendments.--Section 1833(a)(2) of the
Social Security Act (42 U.S.C. 1395l(a)(2)) is amended--
(i) in subparagraph (F), by striking ``and'' after the
semicolon at the end;
(ii) in subparagraph (G)(ii), by adding ``and'' at the end;
and
(iii) by adding at the end the following new subparagraph:
``(H) with respect to additional preventive services (as
defined in section 1861(ccc)(2)) furnished by an outpatient
department of a hospital, the amount determined under
paragraph (1)(W);''.
(3) Waiver of application of deductible for all preventive
services.--The first sentence of section 1833(b) of the
Social Security Act (42 U.S.C. 1395l(b)) is amended--
[[Page H9360]]
(A) in clause (1), by striking ``items and services
described in section 1861(s)(10)(A)'' and inserting
``preventive services (as defined in section 1861(ccc)(1))'';
(B) by inserting ``and'' before ``(4)''; and
(C) by striking clauses (5) through (8).
(c) Inclusion as Part of Initial Preventive Physical
Examination.--Section 1861(ww)(2) of the Social Security Act
(42 U.S.C. 1395x(ww)(2)) is amended by adding at the end the
following new subparagraph:
``(M) Additional preventive services (as defined in
subsection (ccc)(2)).''.
(d) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2008.
SEC. 202. WAIVER OF DEDUCTIBLE FOR COLORECTAL CANCER
SCREENING TESTS REGARDLESS OF CODING,
SUBSEQUENT DIAGNOSIS, OR ANCILLARY TISSUE
REMOVAL.
(a) In General.--Section 1833(b) of the Social Security Act
(42 U.S.C. 1395l(b)), as amended by section 201(b), is
amended by adding at the end the following new sentence:
``Clause (1) of the first sentence of this subsection shall
apply with respect to a colorectal cancer screening test
regardless of the code applied, of the establishment of a
diagnosis as a result of the test, or of the removal of
tissue or other matter or other procedure that is performed
in connection with and as a result of the screening test.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 203. PARITY FOR MENTAL HEALTH COINSURANCE.
Section 1833(c) of the Social Security Act (42 U.S.C.
1395l(c)) is amended by inserting ``before 2008'' after ``in
any calendar year''.
Subtitle B--Improving, Clarifying, and Simplifying Financial Assistance
for Low Income Medicare Beneficiaries
SEC. 211. IMPROVING ASSETS TESTS FOR MEDICARE SAVINGS PROGRAM
AND LOW-INCOME SUBSIDY PROGRAM.
(a) Application of Highest Level Permitted Under LIS.--
(1) To full-premium subsidy eligible individuals.--Section
1860D-14(a) of the Social Security Act (42 U.S.C. 1395w-
114(a)) is amended--
(A) in paragraph (1), in the matter before subparagraph
(A), by inserting ``(or, beginning with 2009, paragraph
(3)(E))'' after ``paragraph (3)(D)''; and
(B) in paragraph (3)(A)(iii), by striking ``(D) or''.
(2) Annual increase in lis resource test.--Section 1860D-
14(a)(3)(E)(i) of such Act (42 U.S.C. 1395w-114(a)(3)(E)(i))
is amended--
(A) by striking ``and'' at the end of subclause (I);
(B) in subclause (II), by inserting ``(before 2009)'' after
``subsequent year'';
(C) by striking the period at the end of subclause (II) and
inserting a semicolon;
(D) by inserting after subclause (II) the following new
subclauses:
``(III) for 2009, $17,000 (or $34,000 in the case of the
combined value of the individual's assets or resources and
the assets or resources of the individual's spouse); and
``(IV) for a subsequent year, the dollar amounts specified
in this subclause (or subclause (III)) for the previous year
increased by the annual percentage increase in the consumer
price index (all items; U.S. city average) as of September of
such previous year; and,''
(E) in the last sentence, by inserting ``or (IV)'' after
``subclause (II)''.
(3) Application of lis test under medicare savings
program.--Section 1905(p)(1)(C) of such Act (42 U.S.C.
1396d(p)(1)(C)) is amended by inserting before the period at
the end the following: ``or, effective beginning with January
1, 2009, whose resources (as so determined) do not exceed the
maximum resource level applied for the year under section
1860D-14(a)(3)(E) applicable to an individual or to the
individual and the individual's spouse (as the case may
be)''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to eligibility determinations for income-related
subsidies and medicare cost-sharing furnished for periods
beginning on or after January 1, 2009.
SEC. 212. MAKING QI PROGRAM PERMANENT AND EXPANDING
ELIGIBILITY.
(a) Making Program Permanent.--
(1) In general.--Section 1902(a)(10)(E)(iv) of the Social
Security Act (42 U.S.C. 1396b(a)(10)(E)(iv)) is amended--
(A) by striking ``sections 1933 and'' and by inserting
``section''; and
(B) by striking ``(but only for'' and all that follows
through ``September 2007)''.
(2) Elimination of funding limitation.--
(A) In general.--Section 1933 of such Act (42 U.S.C. 1396u-
3) is amended--
(i) in subsection (a), by striking ``who are selected to
receive such assistance under subsection (b)''
(ii) by striking subsections (b), (c), (e), and (g);
(iii) in subsection (d), by striking ``furnished in a
State'' and all that follows and inserting ``the Federal
medical assistance percentage shall be equal to 100
percent.''; and
(iv) by redesignating subsections (d) and (f) as
subsections (b) and (c), respectively.
(B) Conforming amendment.--Section 1905(b) of such Act (42
U.S.C. 1396d(b)) is amended by striking ``1933(d)'' and
inserting ``1933(b)''.
(C) Effective date.--The amendments made by subparagraph
(A) shall take effect on October 1, 2007.
(b) Increase in Eligibility to 150 Percent of the Federal
Poverty Level.--Section 1902(a)(10)(E)(iv) of such Act is
further amended by inserting ``(or, effective January 1,
2008, 150 percent)'' after ``135 percent''.
SEC. 213. ELIMINATING BARRIERS TO ENROLLMENT.
(a) Administrative Verification of Income and Resources
Under the Low-Income Subsidy Program.--Clause (iii) of
section 1860D-14(a)(3)(E) of the Social Security Act (42
U.S.C. 1395w-114(a)(3)(E)) is amended to read as follows:
``(iii) Certification of income and resources.--For
purposes of applying this section--
``(I) an individual shall be permitted to apply on the
basis of self-certification of income and resources; and
``(II) matters attested to in the application shall be
subject to appropriate methods of verification without the
need of the individual to provide additional documentation,
except in extraordinary situations as determined by the
Commissioner.''.
(b) Automatic Reenrollment Without Need to Reapply Under
Low-Income Subsidy Program.--Section 1860D-14(a)(3) of such
Act (42 U.S.C. 1395w-114(a)(3)), is amended by adding at the
end the following new subparagraph:
``(G) Automatic reenrollment.--For purposes of applying
this section, in the case of an individual who has been
determined to be a subsidy eligible individual (and within a
particular class of such individuals, such as a full-subsidy
eligible individual or a partial subsidy eligible
individual), the individual shall be deemed to continue to be
so determined without the need for any annual or periodic
application unless and until the individual notifies a
Federal or State official responsible for such determinations
that the individual's eligibility conditions have changed so
that the individual is no longer a subsidy eligible
individual (or is no longer within such class of such
individuals).''.
(c) Encouraging Application of Procedures Under Medicare
Savings Program.--Section 1905(p) of such Act (42 U.S.C.
1396d(p)) is amended by adding at the end the following new
paragraph:
``(7) The Secretary shall take all reasonable steps to
encourage States to provide for administrative verification
of income and automatic reenrollment (as provided under
``subparagraphs (c)(iii) and (G) of section 1860D-14(a)(3)''
in the case of the low-income subsidy program).''.
(d) SSA Assistance With Medicare Savings Program and Low-
Income Subsidy Program Applications.--Section 1144 of such
Act (42 U.S.C. 1320b-14) is amended by adding at the end the
following new subsection:
``(c) Assistance With Medicare Savings Program and Low-
Income Subsidy Program Applications.--
``(1) Distribution of applications to applicants for
medicare.--In the case of each individual applying for
hospital insurance benefits under section 226 or 226A, the
Commissioner shall provide the following:
``(A) Information describing the low-income subsidy program
under section 1860D-14 and the medicare savings program under
title XIX.
``(B) An application for enrollment under such low-income
subsidy program as well as a simplified application form
(developed under section 1905(p)(5)) for medical assistance
for medicare cost-sharing under title XIX.
``(C) Information on how the individual may obtain
assistance in completing such applications, including
information on how the individual may contact the State
health insurance assistance program (SHIP) for the State in
which the individual is located.
The Commissioner shall make such application forms available
at local offices of the Social Security Administration.
``(2) Training personnel in assisting in completing
applications.--The Commissioner shall provide training to
those employees of the Social Security Administration who are
involved in receiving applications for benefits described in
paragraph (1) in assisting applicants in completing a
medicare savings program application described in paragraph
(1). Such employees who are so trained shall provide such
assistance upon request.
``(3) Transmittal of application.--If such an employee
assists in completing such an application, the employee, with
the consent of the applicant, shall transmit the application
to the appropriate State medicaid agency for processing.
``(4) Coordination with outreach.--The Commissioner shall
coordinate outreach activities under this subsection with
outreach activities conducted by States in connection with
the low-income subsidy program and the medicare savings
program.''.
(e) Medicaid Agency Consideration of Applications.--Section
1935(a) of such Act (42 U.S.C. 1396u-5(a)) is amended by
adding at the end the following new paragraph:
``(4) Consideration of msp applications.--The State shall
accept medicare savings program applications transmitted
under section 1144(c)(3) and act on such applications in the
same manner and deadlines as if they had been submitted
directly by the applicant.''.
(f) Translation of Model Form.--Section 1905(p)(5)(A) of
the Social Security Act (42 U.S.C. 1396d(p)(5)(A)) is amended
by adding at the end the following: ``The Secretary shall
provide for the translation of such application form into at
least the 10 languages (other than English) that are most
often used by individuals applying for hospital insurance
benefits under section 226 or 226A and shall make the
translated forms available to the States and to the
Commissioner of Social Security.''.
(g) Disclosure of Tax Return Information for Purposes of
Providing Low-Income Subsidies Under Medicare.--
(1) In general.--Subsection (l) of section 6103 of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new paragraph:
[[Page H9361]]
``(21) Disclosure of return information for purposes of
providing low-income subsidies under medicare.--
``(A) Return information from internal revenue service to
social security administration.--The Secretary, upon written
request from the Commissioner of Social Security, shall
disclose to the officers and employees of the Social Security
Administration with respect to any individual identified by
the Commissioner as potentially eligible (based on
information other than return information) for low-income
subsidies under section 1860D-14 of the Social Security Act--
``(i) whether the adjusted gross income for the applicable
year is less than 135 percent of the poverty line (as
specified by the Commissioner in such request),
``(ii) whether such adjusted gross income is between 135
percent and 150 percent of the poverty line (as so
specified),
``(iii) whether any designated distributions (as defined in
section 3405(e)(1)) were reported with respect to such
individual under section 6047(d) for the applicable year, and
the amount (if any) of the distributions so reported,
``(iv) whether the return was a joint return for the
applicable year, and
``(v) the applicable year.
``(B) Applicable year.--
``(i) In general.--For the purposes of this paragraph, the
term `applicable year' means the most recent taxable year for
which information is available in the Internal Revenue
Service's taxpayer data information systems, or, if there is
no return filed for the individual for such year, the prior
taxable year.
``(ii) No return.--If no return is filed for such
individual for both taxable years referred to in clause (i),
the Secretary shall disclose the fact that there is no return
filed for such individual for the applicable year in lieu of
the information described in subparagraph (A).
``(C) Restriction on use of disclosed information.--Return
information disclosed under this paragraph may be used only
for the purpose of improving the efforts of the Social
Security Administration to contact and assist eligible
individuals for, and administering, low-income subsidies
under section 1860D-14 of the Social Security Act.
``(D) Termination.--No disclosure shall be made under this
paragraph after the 2-year period beginning on the date of
the enactment of this paragraph.''.
(2) Procedures and recordkeeping related to disclosures.--
Paragraph (4) of section 6103(p) of such Code is amended by
striking ``or (17)'' each place it appears and inserting
``(17), or (21)''.
(3) Report.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of the Treasury, after
consultation with the Commissioner of Social Security, shall
submit a written report to Congress regarding the use of
disclosures made under section 6103(l)(21) of the Internal
Revenue Code of 1986, as added by this subsection, in
identifying individuals eligible for the low-income subsidies
under section 1860D-14 of the Social Security Act.
(4) Effective date.--The amendment made by this subsection
shall apply to disclosures made after the date of the
enactment of this Act.
(h) Effective Date.--Except as otherwise provided, the
amendments made by this section shall take effect on January
1, 2009.
SEC. 214. ELIMINATING APPLICATION OF ESTATE RECOVERY.
(a) In General.--Section 1917(b)(1)(B)(ii) of the Social
Security Act (42 U.S.C. 1396p(b)(1)(B)(ii)) is amended by
inserting ``(but not including medical assistance for
medicare cost-sharing or for benefits described in section
1902(a)(10)(E))'' before the period at the end.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect as of January 1, 2008.
SEC. 215. ELIMINATION OF PART D COST-SHARING FOR CERTAIN NON-
INSTITUTIONALIZED FULL-BENEFIT DUAL ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 1860D-14(a)(1)(D)(i) of the Social
Security Act (42 U.S.C. 1395w-114(a)(1)(D)(i)) is amended--
(1) by striking ``Institutionalized individuals.--In'' and
inserting ``Elimination of cost-sharing for certain full-
benefit dual eligible individuals.--
``(I) Institutionalized individuals.--In''; and
(2) by adding at the end the following new subclause:
``(II) Certain other individuals.--In the case of an
individual who is a full-benefit dual eligible individual and
with respect to whom there has been a determination that but
for the provision of home and community based care (whether
under section 1915 or under a waiver under section 1115) the
individual would require the level of care provided in a
hospital or a nursing facility or intermediate care facility
for the mentally retarded the cost of which could be
reimbursed under the State plan under title XIX, the
elimination of any beneficiary coinsurance described in
section 1860D-2(b)(2) (for all amounts through the total
amount of expenditures at which benefits are available under
section 1860D-2(b)(4)).''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to drugs dispensed on or after January 1, 2009.
SEC. 216. EXEMPTIONS FROM INCOME AND RESOURCES FOR
DETERMINATION OF ELIGIBILITY FOR LOW-INCOME
SUBSIDY.
(a) In General.--Section 1860D-14(a)(3) of the Social
Security Act (42 U.S.C. 1395w-114(a)(3)), as amended by
subsections (a) and (b) of section 213, is further amended--
(1) in subparagraph (C)(i), by inserting ``and except that
support and maintenance furnished in kind shall not be
counted as income'' after ``section 1902(r)(2)'';
(2) in subparagraph (D), in the matter before clause (i),
by inserting ``subject to the additional exclusions provided
under subparagraph (G)'' before ``)'';
(3) in subparagraph (E)(i), in the matter before subclause
(I), by inserting ``subject to the additional exclusions
provided under subparagraph (G)'' before ``)''; and
(4) by adding at the end the following new subparagraph:
``(I) Additional exclusions.--In determining the resources
of an individual (and the eligible spouse of the individual,
if any) under section 1613 for purposes of subparagraphs (D)
and (E) the following additional exclusions shall apply:
``(i) Life insurance policy.--No part of the value of any
life insurance policy shall be taken into account.
``(ii) Pension or retirement plan.--No balance in any
pension or retirement plan shall be taken into account.''.
(b) Effective Date.--The amendments made by this section
shall take effect on January 1, 2009, and shall apply to
determinations of eligibility for months beginning with
January 2009.
SEC. 217. COST-SHARING PROTECTIONS FOR LOW-INCOME SUBSIDY-
ELIGIBLE INDIVIDUALS.
(a) In General.--Section 1860D-14(a) of the Social Security
Act (42 U.S.C. 1395w-114(a)) is amended--
(1) in paragraph (1)(D), by adding at the end the following
new clause:
``(iv) Overall limitation on cost-sharing.--In the case of
all such individuals, a limitation on aggregate cost-sharing
under this part for a year not to exceed 5 percent of
income.''; and
(2) in paragraph (2), by adding at the end the following
new subparagraph:
``(F) Overall limitation on cost-sharing.--A limitation on
aggregate cost-sharing under this part for a year not to
exceed 5 percent of income.''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply as of January 1, 2009.
SEC. 218. INTELLIGENT ASSIGNMENT IN ENROLLMENT.
(a) In General.--Section 1860D-1(b)(1) of the Social
Security Act (42 U.S.C. 1395w-101(b)(1)) is amended--
(1) in the second sentence of subparagraph (C), by
inserting ``, subject to subparagraph (D),'' before ``on a
random basis''; and
(2) by adding at the end the following new subparagraph:
``(D) Intelligent assignment.--In the case of any auto-
enrollment under subparagraph (C), no part D eligible
individual described in such subparagraph shall be enrolled
in a prescription drug plan which does not meet the following
requirements:
``(i) Formulary.--The plan has a formulary that covers at
least--
``(I) 95 percent of the 100 most commonly prescribed non-
duplicative generic covered part D drugs for the population
of individuals entitled to benefits under part A or enrolled
under part B; and
``(II) 95 percent of the 100 most commonly prescribed non-
duplicative brand name covered part D drugs for such
population.
``(ii) Pharmacy network.--The plan has a network of
pharmacies that substantially exceeds the minimum
requirements for prescription drug plans in the State and
that provides access in areas where lower income individuals
reside.
``(iii) Quality.--
``(I) In general.--Subject to subclause (I), the plan has
an above average score on quality ratings of the Secretary of
prescription drug plans under this part.
``(II) Exception.--Subclause (I) shall not apply to a plan
that is a new plan (as defined by the Secretary), with
respect to the plan year involved.
``(iv) Low cost.--The total cost under this title of
providing prescription drug coverage under the plan
consistent with the previous clauses of this subparagraph is
among the lowest 25th percentile of prescription drug plans
under this part in the State.
In the case that no plan meets the requirements under clauses
(i) through (iv), the Secretary shall implement this
subparagraph to the greatest extent possible with the goal of
protecting beneficiary access to drugs without increasing the
cost relative to the enrollment process under subparagraph
(C) as in existence before the date of the enactment of this
subparagraph.''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect for enrollments effected on or after
November 15, 2009.
Subtitle C--Part D Beneficiary Improvements
SEC. 221. INCLUDING COSTS INCURRED BY AIDS DRUG ASSISTANCE
PROGRAMS AND INDIAN HEALTH SERVICE IN PROVIDING
PRESCRIPTION DRUGS TOWARD THE ANNUAL OUT OF
POCKET THRESHOLD UNDER PART D.
(a) In General.--Section 1860D-2(b)(4)(C) of the Social
Security Act (42 U.S.C. 1395w-102(b)(4)(C)) is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii)--
(A) by striking ``such costs shall be treated as incurred
only if'' and inserting ``subject to clause (iii), such costs
shall be treated as incurred only if'';
(B) by striking ``, under section 1860D-14, or under a
State Pharmaceutical Assistance Program''; and
(C) by striking the period at the end and inserting ``;
and''; and
(3) by inserting after clause (ii) the following new
clause:
``(iii) such costs shall be treated as incurred and shall
not be considered to be reimbursed
[[Page H9362]]
under clause (ii) if such costs are borne or paid--
``(I) under section 1860D-14;
``(II) under a State Pharmaceutical Assistance Program;
``(III) by the Indian Health Service, an Indian tribe or
tribal organization, or an urban Indian organization (as
defined in section 4 of the Indian Health Care Improvement
Act); or
``(IV) under an AIDS Drug Assistance Program under part B
of title XXVI of the Public Health Service Act.''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to costs incurred on or after January 1, 2009.
SEC. 222. PERMITTING MID-YEAR CHANGES IN ENROLLMENT FOR
FORMULARY CHANGES ADVERSELY IMPACT AN ENROLLEE.
(a) In General.--Section 1860D-1(b)(3) of the Social
Security Act (42 U.S.C. 1395w-101(b)(3)) is amended by adding
at the end the following new subparagraph:
``(F) Change in formulary resulting in increase in cost-
sharing.--
``(i) In general.--Except as provided in clause (ii), in
the case of an individual enrolled in a prescription drug
plan (or MA-PD plan) who has been prescribed a covered part D
drug while so enrolled, if the formulary of the plan is
materially changed (other than at the end of a contract year)
so to reduce the coverage (or increase the cost-sharing) of
the drug under the plan.
``(ii) Exception.--Clause (i) shall not apply in the case
that a drug is removed from the formulary of a plan because
of a recall or withdrawal of the drug issued by the Food and
Drug Administration.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to contract years beginning on or after January
1, 2009.
SEC. 223. REMOVAL OF EXCLUSION OF BENZODIAZEPINES FROM
REQUIRED COVERAGE UNDER THE MEDICARE
PRESCRIPTION DRUG PROGRAM.
(a) In General.--Section 1860D-2(e)(2)(A) of the Social
Security Act (42 U.S.C. 1395w-102(e)(2)(A)) is amended--
(1) by striking ``subparagraph (E)'' and inserting
``subparagraphs (E) and (J)''; and
(2) by inserting ``and benzodiazepines, respectively''
after ``smoking cessation agents''.
(b) Effective Date.--The amendments made by subsection (a)
shall apply to prescriptions dispensed on or after January 1,
2013.
SEC. 224. PERMITTING UPDATING DRUG COMPENDIA UNDER PART D
USING PART B UPDATE PROCESS.
Section 1860D-4(b)(3)(C) of the Social Security Act (42
U.S.C. 1395w-104(b)(3)(C)) is amended by adding at the end
the following new clause:
``(iv) Updating drug compendia using part b process.--The
Secretary may apply under this subparagraph the same process
for updating drug compendia that is used for purposes of
section 1861(t)(2)(B)(ii).''.
SEC. 225. CODIFICATION OF SPECIAL PROTECTIONS FOR SIX
PROTECTED DRUG CLASSIFICATIONS.
(a) In General.--Section 1860D-4(b)(3) of the Social
Security Act (42 U.S.C. 1395w-104(b)(3)) is amended--
(1) in subparagraph (C)(i), by inserting ``, except as
provided in subparagraph (G),'' after ``although''; and
(2) by inserting after subparagraph (F) the following new
subparagraph:
``(G) Required inclusion of drugs in certain therapeutic
classes.--
``(i) In general.--The formulary must include all or
substantially all covered part D drugs in each of the
following therapeutic classes of covered part D drugs:
``(I) Anticonvulsants.
``(II) Antineoplastics.
``(III) Antiretrovirals.
``(IV) Antidepressants.
``(V) Antipsychotics.
``(VI) Immunosuppresessants.
``(ii) Use of utilization management tools.--A PDP sponsor
of a prescription drug plan may use prior authorization or
step therapy for the initiation of medications within one of
the classifications specified in clause (i) but only when
approved by the Secretary, except that such prior
authorization or step therapy may not be used in the case of
antiretrovirals and in the case of individuals who already
are stabilized on a drug treatment regimen.''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply for plan years beginning on or after January 1,
2009.
SEC. 226. ELIMINATION OF MEDICARE PART D LATE ENROLLMENT
PENALTIES PAID BY LOW-INCOME SUBSIDY-ELIGIBLE
INDIVIDUALS.
(a) Individuals With Income Below 135 Percent of Poverty
Line.--Paragraph (1)(A)(ii) of section 1860D-14(a) of the
Social Security Act (42 U.S.C. 1395w-114(a)) is amended to
read as follows:
``(ii) 100 percent of any late enrollment penalties imposed
under section 1860D-13(b) for such individual.''.
(b) Individuals With Income Between 135 and 150 Percent of
Poverty Line.--Paragraph (2)(A) of such section is amended--
(1) by inserting ``equal to (i) an amount'' after ``premium
subsidy'';
(2) by striking ``paragraph (1)(A)'' and inserting ``clause
(i) of paragraph (1)(A)''; and
(3) by adding at the end before the period the following:
``, plus (ii) 100 percent of the amount described in clause
(ii) of such paragraph for such individual''.
(c) Effective Date.--The amendments made by this section
shall apply to subsidies for months beginning with January
2008.
SEC. 227. SPECIAL ENROLLMENT PERIOD FOR SUBSIDY ELIGIBLE
INDIVIDUALS.
(a) In General.--Section 1860D-1(b)(3) of the Social
Security Act (42 U.S.C. 1395w-101(b)(3)), as amended by
section 222(a), is further amended by adding at the end the
following new subparagraph:
``(G) Eligibility for low-income subsidy.--
``(i) In general.--In the case of an applicable subsidy
eligible individual (as defined in clause (ii)), the special
enrollment period described in clause (iii).
``(ii) Applicable subsidy eligible individual defined.--For
purposes of this subparagraph, the term `applicable subsidy
eligible individual' means a part D eligible individual who
is determined under subparagraph (B) of section 1860D-
14(a)(3) to be a subsidy eligible individual (as defined in
subparagraph (A) of such section), and includes such an
individual who was enrolled in a prescription drug plan or an
MA-PD plan on the date of such determination.
``(iii) Special enrollment period described.--The special
enrollment period described in this clause, with respect to
an applicable subsidy eligible individual, is the 90-day
period beginning on the date the individual receives
notification that such individual has been determined under
section 1860D-14(a)(3)(B) to be a subsidy eligible individual
(as so defined).''.
(b) Automatic Enrollment Process for Certain Subsidy
Eligible Individuals.--Section 1860D-1(b)(1) of the Social
Security Act (42 U.S.C. 1395w-101(b)(1)), as amended by
section 218(a)(2), is further amended by adding at the end
the following new subparagraph:
``(E) Special rule for subsidy eligible individuals.--The
process established under subparagraph (A) shall include, in
the case of an applicable subsidy eligible individual (as
defined in clause (ii) of paragraph (3)(F)) who fails to
enroll in a prescription drug plan or an MA-PD plan during
the special enrollment period described in clause (iii) of
such paragraph applicable to such individual, a process for
the facilitated enrollment of the individual in the
prescription drug plan or MA-PD plan that is most appropriate
for such individual (as determined by the Secretary). Nothing
in the previous sentence shall prevent an individual
described in such sentence from declining enrollment in a
plan determined appropriate by the Secretary (or in the
program under this part) or from changing such enrollment.''.
(c) Effective Date.--The amendments made by this section
shall apply to subsidy determinations made for months
beginning with January 2008.
Subtitle D--Reducing Health Disparities
SEC. 231. MEDICARE DATA ON RACE, ETHNICITY, AND PRIMARY
LANGUAGE.
(a) Requirements.--
(1) In general.--The Secretary of Health and Human Services
(in this subtitle referred to as the ``Secretary'') shall--
(A) collect data on the race, ethnicity, and primary
language of each applicant for and recipient of benefits
under title XVIII of the Social Security Act--
(i) using, at a minimum, the categories for race and
ethnicity described in the 1997 Office of Management and
Budget Standards for Maintaining, Collecting, and Presenting
Federal Data on Race and Ethnicity;
(ii) using the standards developed under subsection (e) for
the collection of language data;
(iii) where practicable, collecting data for additional
population groups if such groups can be aggregated into the
minimum race and ethnicity categories; and
(iv) where practicable, through self-reporting;
(B) with respect to the collection of the data described in
subparagraph (A) for applicants and recipients who are minors
or otherwise legally incapacitated, require that--
(i) such data be collected from the parent or legal
guardian of such an applicant or recipient; and
(ii) the preferred language of the parent or legal guardian
of such an applicant or recipient be collected;
(C) systematically analyze at least annually such data
using the smallest appropriate units of analysis feasible to
detect racial and ethnic disparities in health and health
care and when appropriate, for men and women separately;
(D) report the results of analysis annually to the Director
of the Office for Civil Rights, the Committee on Health,
Education, Labor, and Pensions and the Committee on Finance
of the Senate, and the Committee on Energy and Commerce and
the Committee on Ways and Means of the House of
Representatives; and
(E) ensure that the provision of assistance to an applicant
or recipient of assistance is not denied or otherwise
adversely affected because of the failure of the applicant or
recipient to provide race, ethnicity, and primary language
data.
(2) Rules of construction.--Nothing in this subsection
shall be construed--
(A) to permit the use of information collected under this
subsection in a manner that would adversely affect any
individual providing any such information; and
(B) to require health care providers to collect data.
(b) Protection of Data.--The Secretary shall ensure
(through the promulgation of regulations or otherwise) that
all data collected pursuant to subsection (a) is protected--
(1) under the same privacy protections as the Secretary
applies to other health data under the regulations
promulgated under section 264(c) of the Health Insurance
Portability and Accountability Act of 1996 (Public Law 104-
191; 110 Stat. 2033) relating to the privacy of individually
identifiable health information and other protections; and
(2) from all inappropriate internal use by any entity that
collects, stores, or receives the data, including use of such
data in determinations of eligibility (or continued
eligibility) in health plans, and from other inappropriate
uses, as defined by the Secretary.
[[Page H9363]]
(c) Collection Plan.--In carrying out the duties specified
in subsection (a), the Secretary shall develop and implement
a plan to improve the collection, analysis, and reporting of
racial, ethnic, and primary language data within the programs
administered under title XVIII of the Social Security Act,
and, in consultation with the National Committee on Vital
Health Statistics, the Office of Minority Health, and other
appropriate public and private entities, shall make
recommendations on how to--
(1) implement subsection (a) while minimizing the cost and
administrative burdens of data collection and reporting;
(2) expand awareness that data collection, analysis, and
reporting by race, ethnicity, and primary language is legal
and necessary to assure equity and non-discrimination in the
quality of health care services;
(3) ensure that future patient record systems including
electronic health records, electronic medical records and
patient health records, have data code sets for racial,
ethnic, and primary language identifiers and that such
identifiers can be retrieved from clinical records, including
records transmitted electronically;
(4) improve health and health care data collection and
analysis for more population groups if such groups can be
aggregated into the minimum race and ethnicity categories;
(5) provide researchers with greater access to racial,
ethnic, and primary language data, subject to privacy and
confidentiality regulations; and
(6) safeguard and prevent the misuse of data collected
under subsection (a).
(d) Compliance With Standards.--Data collected under
subsection (a) shall be obtained, maintained, and presented
(including for reporting purposes and at a minimum) in
accordance with the 1997 Office of Management and Budget
Standards for Maintaining, Collecting, and Presenting Federal
Data on Race and Ethnicity.
(e) Language Collection Standards.--Not later than 1 year
after the date of enactment of this Act, the Director of the
Office of Minority Health, in consultation with the Office
for Civil Rights of the Department of Health and Human
Services, shall develop and disseminate Standards for the
Classification of Federal Data on Preferred Written and
Spoken Language.
(f) Technical Assistance for the Collection and Reporting
of Data.--
(1) In general.--The Secretary may, either directly or
through grant or contract, provide technical assistance to
enable a health care provider or plan operating under the
Medicare program to comply with the requirements of this
section.
(2) Types of assistance.--Assistance provided under this
subsection may include assistance to--
(A) enhance or upgrade computer technology that will
facilitate racial, ethnic, and primary language data
collection and analysis;
(B) improve methods for health data collection and analysis
including additional population groups beyond the Office of
Management and Budget categories if such groups can be
aggregated into the minimum race and ethnicity categories;
(C) develop mechanisms for submitting collected data
subject to existing privacy and confidentiality regulations;
and
(D) develop educational programs to raise awareness that
data collection and reporting by race, ethnicity, and
preferred language are legal and essential for eliminating
health and health care disparities; and,
(E) provide for the revision of existing HIPAA claims-
related code sets to mandate the collection of racial and
ethnicity data, and to provide a code set for primary
language.
(g) Analysis of Racial and Ethnic Data.--The Secretary,
acting through the Director of the Agency for Health Care
Research and Quality and in coordination with the
Administrator of the Centers for Medicare & Medicaid
Services, shall--
(1) identify appropriate quality assurance mechanisms to
monitor for health disparities under the Medicare program;
(2) specify the clinical, diagnostic, or therapeutic
measures which should be monitored;
(3) develop new quality measures relating to racial and
ethnic disparities in health and health care;
(4) identify the level at which data analysis should be
conducted; and
(5) share data with external organizations for research and
quality improvement purposes, in compliance with applicable
Federal privacy laws.
(h) Report.--Not later than 2 years after the date of
enactment of this Act, and biennially thereafter, the
Secretary shall submit to the appropriate committees of
Congress a report on the effectiveness of data collection,
analysis, and reporting on race, ethnicity, and primary
language under the programs administered through title XVIII
of the Social Security Act. The report shall evaluate the
progress made with respect to the plan under subsection (c)
or subsequent revisions thereto.
(i) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section, such sums as
may be necessary for each of fiscal years 2008 through 2012.
SEC. 232. ENSURING EFFECTIVE COMMUNICATION IN MEDICARE.
(a) Ensuring Effective Communication by the Centers for
Medicare & Medicaid Services.--
(1) Study on medicare payments for language services.--The
Secretary of Health and Human Services shall conduct a study
that examines ways that Medicare should develop payment
systems for language services using the results of the
demonstration program conducted under section 233.
(2) Analyses.-- The study shall include an analysis of each
of the following:
(A) How to develop and structure appropriate payment
systems for language services for all Medicare service
providers.
(B) The feasibility of adopting a payment methodology for
on-site interpreters, including interpreters who work as
independent contractors and interpreters who work for
agencies that provide on-site interpretation, pursuant to
which such interpreters could directly bill Medicare for
services provided in support of physician office services for
an LEP Medicare patient.
(C) The feasibility of Medicare contracting directly with
agencies that provide off-site interpretation including
telephonic and video interpretation pursuant to which such
contractors could directly bill Medicare for the services
provided in support of physician office services for an LEP
Medicare patient.
(D) The feasibility of modifying the existing Medicare
resource-based relative value scale (RBRVS) by using
adjustments (such as multipliers or add-ons) when a patient
is LEP.
(E) How each of options described in a previous paragraph
would be funded and how such funding would affect physician
payments, a physician's practice, and beneficiary cost-
sharing.
(3) Variation in payment system described.--The payment
systems described in subsection (b) may allow variations
based upon types of service providers, available delivery
methods, and costs for providing language services including
such factors as--
(A) the type of language services provided (such as
provision of health care or health care related services
directly in a non-English language by a bilingual provider or
use of an interpreter);
(B) type of interpretation services provided (such as in-
person, telephonic, video interpretation);
(C) the methods and costs of providing language services
(including the costs of providing language services with
internal staff or through contract with external independent
contractors and/or agencies);
(D) providing services for languages not frequently
encountered in the United States; and
(E) providing services in rural areas.
(4) Report.--The Secretary shall submit a report on the
study conducted under subsection (a) to appropriate
committees of Congress not later than 1 year after the
expiration of the demonstration program conducted under
section 3.
(b) Health Plans.--Section 1857(g)(1) of the Social
Security Act (42 U.S.C. 1395w-27(g)(1)) is amended--
(1) by striking ``or'' at the end of subparagraph (F);
(2) by adding ``or'' at the end of subparagraph (G); and
(3) by inserting after subparagraph (G) the following new
subparagraph:
``(H) fails substantially to provide language services to
limited English proficient beneficiaries enrolled in the plan
that are required under law;''.
SEC. 233. DEMONSTRATION TO PROMOTE ACCESS FOR MEDICARE
BENEFICIARIES WITH LIMITED ENGLISH PROFICIENCY
BY PROVIDING REIMBURSEMENT FOR CULTURALLY AND
LINGUISTICALLY APPROPRIATE SERVICES.
(a) In General.--Within one year after the date of the
enactment of this Act the Secretary, acting through the
Centers for Medicare & Medicaid Services, shall award 24 3-
year demonstration grants to eligible Medicare service
providers to improve effective communication between such
providers and Medicare beneficiaries who are ``living in
communities where racial and ethnic minorities, including
populations that face language barriers, are underserved with
respect to such services''. The Secretary shall not authorize
a grant larger than $500,000 over three years for any
grantee.
(b) Eligibility; Priority.--
(1) Eligibility.--To be eligible to receive a grant under
subsection (1) an entity shall--
(A) be--
(i) a provider of services under part A of title XVIII of
the Social Security Act;
(ii) a service provider under part B of such title;
(iii) a part C organization offering a Medicare part C plan
under part C of such title; or
(iv) a PDP sponsor of a prescription drug plan under part D
of such title; and
(B) prepare and submit to the Secretary an application, at
such time, in such manner, and accompanied by such additional
information as the Secretary may require.
(2) Priority.--
(A) Distribution.--To the extent feasible, in awarding
grants under this section, the Secretary shall award--
(i) 6 grants to providers of services described in
paragraph (1)(A)(i);
(ii) 6 grants to service providers described in paragraph
(1)(A)(ii);
(iii) 6 grants to organizations described in paragraph
(1)(A)(iii); and
(iv) 6 grants to sponsors described in paragraph
(1)(A)(iv).
(B) For community organizations.--The Secretary shall give
priority to applicants that have developed partnerships with
community organizations or with agencies with experience in
language access.
(C) Variation in grantees.--The Secretary shall also ensure
that the grantees under this section represent, among other
factors, variations in--
(i) different types of service providers and organizations
under parts A through D of title XVIII of the Social Security
Act;
(ii) languages needed and their frequency of use;
(iii) urban and rural settings;
(iv) at least two geographic regions; and
[[Page H9364]]
(v) at least two large metropolitan statistical areas with
diverse populations.
(c) Use of Funds.--
(1) In general.--A grantee shall use grant funds received
under this section to pay for the provision of competent
language services to Medicare beneficiaries who are limited
English proficient. Competent interpreter services may be
provided through on-site interpretation, telephonic
interpretation, or video interpretation or direct provision
of health care or health care related services by a bilingual
health care provider. A grantee may use bilingual providers,
staff, or contract interpreters. A grantee may use grant
funds to pay for competent translation services. A grantee
may use up to 10 percent of the grant funds to pay for
administrative costs associated with the provision of
competent language services and for reporting required under
subsection (E).
(2) Organizations.--Grantees that are part C organizations
or PDP sponsors must ensure that their network providers
receive at least 50 percent of the grant funds to pay for the
provision of competent language services to Medicare
beneficiaries who are limited English proficient, including
physicians and pharmacies.
(3) Determination of payments for language services.--
Payments to grantees shall be calculated based on the
estimated numbers of LEP Medicare beneficiaries in a
grantee's service area utilizing--
(A) data on the numbers of limited English proficient
individuals who speak English less than ``very well'' from
the most recently available data from the Bureau of the
Census or other State-based study the Secretary determines
likely to yield accurate data regarding the number of LEP
individuals served by the grantee; or
(B) the grantee's own data if the grantee routinely
collects data on Medicare beneficiaries' primary language in
a manner determined by the Secretary to yield accurate data
and such data shows greater numbers of LEP individuals than
the data listed in subparagraph (A).
(4) Limitations.--
(A) Reporting.--Payments shall only be provided under this
section to grantees that report their costs of providing
language services as required under subsection (e). If a
grantee fails to provide the reports under such section for
the first year of a grant, the Secretary may terminate the
grant and solicit applications from new grantees to
participate in the subsequent two years of the demonstration
program.
(B) Type of services.--
(i) In general.--Subject to clause (ii), payments shall be
provided under this section only to grantees that utilize
competent bilingual staff or competent interpreter or
translation services which--
(I) if the grantee operates in a State that has statewide
health care interpreter standards, meet the State standards
currently in effect; or
(II) if the grantee operates in a State that does not have
statewide health care interpreter standards, utilizes
competent interpreters who follow the National Council on
Interpreting in Health Care's Code of Ethics and Standards of
Practice.
(ii) Exemptions.--The requirements of clause (i) shall not
apply--
(I) in the case of a Medicare beneficiary who is limited
English proficient (who has been informed in the
beneficiary's primary language of the availability of free
interpreter and translation services) and who requests the
use of family, friends, or other persons untrained in
interpretation or translation and the grantee documents the
request in the beneficiary's record; and
(II) in the case of a medical emergency where the delay
directly associated with obtaining a competent interpreter or
translation services would jeopardize the health of the
patient.
Nothing in clause (ii)(II) shall be construed to exempt an
emergency rooms or similar entities that regularly provide
health care services in medical emergencies from having in
place systems to provide competent interpreter and
translation services without undue delay.
(d) Assurances.--Grantees under this section shall--
(1) ensure that appropriate clinical and support staff
receive ongoing education and training in linguistically
appropriate service delivery; ensure the linguistic
competence of bilingual providers;
(2) offer and provide appropriate language services at no
additional charge to each patient with limited English
proficiency at all points of contact, in a timely manner
during all hours of operation;
(3) notify Medicare beneficiaries of their right to receive
language services in their primary language;
(4) post signage in the languages of the commonly
encountered group or groups present in the service area of
the organization; and
(5) ensure that--
(A) primary language data are collected for recipients of
language services; and
(B) consistent with the privacy protections provided under
the regulations promulgated pursuant to section 264(c) of the
Health Insurance Portability and Accountability Act of 1996
(42 U.S.C. 1320d-2 note), if the recipient of language
services is a minor or is incapacitated, the primary language
of the parent or legal guardian is collected and utilized.
(e) Reporting Requirements.--Grantees under this section
shall provide the Secretary with reports at the conclusion of
the each year of a grant under this section. each report
shall include at least the following information:
(1) The number of Medicare beneficiaries to whom language
services are provided.
(2) The languages of those Medicare beneficiaries.
(3) The types of language services provided (such as
provision of services directly in non-English language by a
bilingual health care provider or use of an interpreter).
(4) Type of interpretation (such as in-person, telephonic,
or video interpretation).
(5) The methods of providing language services (such as
staff or contract with external independent contractors or
agencies).
(6) The length of time for each interpretation encounter.
(7) The costs of providing language services (which may be
actual or estimated, as determined by the Secretary).
(f) No Cost Sharing.--LEP Beneficiaries shall not have to
pay cost-sharing or co-pays for language services provided
through this demonstration program.
(g) Evaluation and Report.--The Secretary shall conduct an
evaluation of the demonstration program under this section
and shall submit to the appropriate committees of Congress a
report not later than 1 year after the completion of the
program. The report shall include the following:
(1) An analysis of the patient outcomes and costs of
furnishing care to the LEP Medicare beneficiaries
participating in the project as compared to such outcomes and
costs for limited English proficient Medicare beneficiaries
not participating.
(2) The effect of delivering culturally and linguistically
appropriate services on beneficiary access to care,
utilization of services, efficiency and cost-effectiveness of
health care delivery, patient satisfaction, and select health
outcomes.
(3) Recommendations regarding the extension of such project
to the entire Medicare program.
(h) General Provisions.--Nothing in this section shall be
construed to limit otherwise existing obligations of
recipients of Federal financial assistance under title VI of
the Civil Rights Act of 1964 (42 U.S.C. 2000(d) et. seq.) or
any other statute.
(i) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section $10,000,000 for
each fiscal year of the demonstration.
SEC. 234. DEMONSTRATION TO IMPROVE CARE TO PREVIOUSLY
UNINSURED.
(a) Establishment.--Within one year after the date of
enactment of this Act, the Secretary shall establish a
demonstration project to determine the greatest needs and
most effective methods of outreach to medicare beneficiaries
who were previously uninsured.
(b) Scope.--The demonstration shall be in no fewer than 10
sites, and shall include state health insurance assistance
programs, community health centers, community-based
organizations, community health workers, and other service
providers under parts A, B, and C of title XVIII of the
Social Security Act. Grantees that are plans operating under
part C shall document that enrollees who were previously
uninsured receive the ``Welcome to Medicare'' physical exam.
(c) Duration.--The Secretary shall conduct the
demonstration project for a period of 2 years.
(d) Report and Evaluation.--The Secretary shall conduct an
evaluation of the demonstration and not later than 1 year
after the completion of the project shall submit to Congress
a report including the following:
(1) An analysis of the effectiveness of outreach activities
targeting beneficiaries who were previously uninsured, such
as revising outreach and enrollment materials (including the
potential for use of video information), providing one-on-one
counseling, working with community health workers, and
amending the Medicare and You handbook.
(2) The effect of such outreach on beneficiary access to
care, utilization of services, efficiency and cost-
effectiveness of health care delivery, patient satisfaction,
and select health outcomes.
SEC. 235. OFFICE OF THE INSPECTOR GENERAL REPORT ON
COMPLIANCE WITH AND ENFORCEMENT OF NATIONAL
STANDARDS ON CULTURALLY AND LINGUISTICALLY
APPROPRIATE SERVICES (CLAS) IN MEDICARE.
(a) Report.--Not later than two years after the date of the
enactment of this Act, the Inspector General of the
Department of Health and Human Services shall prepare and
publish a report on--
(1) the extent to which Medicare providers and plans are
complying with the Office for Civil Rights' Guidance to
Federal Financial Assistance Recipients Regarding Title VI
Prohibition Against National Origin Discrimination Affecting
Limited English Proficient Persons and the Office of Minority
Health's Culturally and Linguistically Appropriate Services
Standards in health care; and
(2) a description of the costs associated with or savings
related to the provision of language services.
Such report shall include recommendations on improving
compliance with CLAS Standards and recommendations on
improving enforcement of CLAS Standards.
(b) Implementation.--Not later than one year after the date
of publication of the report under subsection (a), the
Department of Health and Human Services shall implement
changes responsive to any deficiencies identified in the
report.
SEC. 236. IOM REPORT ON IMPACT OF LANGUAGE ACCESS SERVICES.
(a) In General.--The Secretary of Health and Human Services
shall seek to enter into an arrangement with the Institute of
Medicine under which the Institute will prepare and publish,
not later than 3 years after the date of the enactment of
this Act, a report on the impact of language access services
on the health and health care of limited English proficient
populations.
(b) Contents.--Such report shall include--
(1) recommendations on the development and implementation
of policies and practices by
[[Page H9365]]
health care organizations and providers for limited English
proficient patient populations;
(2) a description of the effect of providing language
access services on quality of health care and access to care
and reduced medical error; and
(3) a description of the costs associated with or savings
related to provision of language access services.
SEC. 237. DEFINITIONS.
In this subtitle:
(1) Bilingual.--The term ``bilingual'' with respect to an
individual means a person who has sufficient degree of
proficiency in two languages and can ensure effective
communication can occur in both languages.
(2) Competent interpreter services.--The term ``competent
interpreter services'' means a trans-language rendition of a
spoken message in which the interpreter comprehends the
source language and can speak comprehensively in the target
language to convey the meaning intended in the source
language. The interpreter knows health and health-related
terminology and provides accurate interpretations by choosing
equivalent expressions that convey the best matching and
meaning to the source language and captures, to the greatest
possible extent, all nuances intended in the source message.
(3) Competent translation services.--The term ``competent
translation services'' means a trans-language rendition of a
written document in which the translator comprehends the
source language and can write comprehensively in the target
language to convey the meaning intended in the source
language. The translator knows health and health-related
terminology and provides accurate translations by choosing
equivalent expressions that convey the best matching and
meaning to the source language and captures, to the greatest
possible extent, all nuances intended in the source document.
(4) Effective communication.--The term ``effective
communication'' means an exchange of information between the
provider of health care or health care-related services and
the limited English proficient recipient of such services
that enables limited English proficient individuals to
access, understand, and benefit from health care or health
care-related services.
(5) Interpreting/interpretation.--The terms
``interpreting'' and ``interpretation'' mean the transmission
of a spoken message from one language into another,
faithfully, accurately, and objectively.
(6) Health care services.--The term ``health care
services'' means services that address physical as well as
mental health conditions in all care settings.
(7) Health care-related services.--The term ``health care-
related services'' means human or social services programs or
activities that provide access, referrals or links to health
care.
(8) Language access.--The term ``language access'' means
the provision of language services to an LEP individual
designed to enhance that individual's access to,
understanding of or benefit from health care or health care-
related services.
(9) Language services.--The term ``language services''
means provision of health care services directly in a non-
English language, interpretation, translation, and non-
English signage.
(10) Limited english proficient.--The term ``limited
English proficient'' or ``LEP'' with respect to an individual
means an individual who speaks a primary language other than
English and who cannot speak, read, write or understand the
English language at a level that permits the individual to
effectively communicate with clinical or nonclinical staff at
an entity providing health care or health care related
services.
(11) Medicare program.--The term ``Medicare program'' means
the programs under parts A through D of title XVIII of the
Social Security Act.
(12) Service provider.--The term ``service provider''
includes all suppliers, providers of services, or entities
under contract to provide coverage, items or services under
any part of title XVIII of the Social Security Act.
TITLE III--PHYSICIANS' SERVICE PAYMENT REFORM
SEC. 301. ESTABLISHMENT OF SEPARATE TARGET GROWTH RATES FOR
SERVICE CATEGORIES.
(a) Establishment of Service Categories.--Subsection (j) of
section 1848 of the Social Security Act (42 U.S.C. 1395w-4)
is amended by adding at the end the following new paragraph:
``(5) Service categories.--For services furnished on or
after January 1, 2008, each of the following categories of
physicians' services shall be treated as a separate `service
category':
``(A) Evaluation and management services for primary care
(including new and established patient office visits
delivered by physicians who the Secretary determines provide
accessible, continuous, coordinated, and comprehensive care
for Medicare beneficiaries, emergency department visits, and
home visits), and for preventive services (including
screening mammography, colorectal cancer screening, and other
services as defined by the Secretary, limited to the
recommendations of the United States Preventive Services Task
Force).
``(B) Evaluation and management services not described in
subparagraph (A).
``(C) Imaging services (as defined in subsection (b)(4)(B))
and diagnostic tests (other than clinical diagnostic
laboratory tests) not described in subparagraph (A).
``(D) Procedures that are subject (under regulations
promulgated to carry out this section) to a 10-day or 90-day
global period (in this paragraph referred to as `major
procedures'), except that the Secretary may reclassify as
minor procedures under subparagraph (F) any procedures that
would otherwise be included in this category if the Secretary
determines that such procedures are not major procedures.
``(E) Anesthesia services that are paid on the basis of the
separate conversion factor for anesthesia services determined
under subsection (d)(1)(D).
``(F) Minor procedures and any other physicians' services
that are not described in a preceding subparagraph.''.
(b) Establishment of Separate Conversion Factors for Each
Service Category.--Subsection (d)(1) of section 1848 of the
Social Security Act (42 U.S.C. 1395w-4) is amended--
(1) in subparagraph (A)--
(A) by designating the sentence beginning ``The conversion
factor'' as clause (i) with the heading ``Application of
single conversion factor.--'' and with appropriate
indentation;
(B) by striking ``The conversion factor'' and inserting
``Subject to clause (ii), the conversion factor''; and
(C) by adding at the end the following new clause:
``(ii) Application of multiple conversion factors beginning
with 2008.--
``(I) In general.--In applying clause (i) for years
beginning with 2008, separate conversion factors shall be
established for each service category of physicians' services
(as defined in subsection (j)(5)) and any reference in this
section to a conversion factor for such years shall be deemed
to be a reference to the conversion factor for each of such
categories.
``(II) Initial conversion factors; special rule for
anesthesia services.-- Such factors for 2008 shall be based
upon the single conversion factor for 2007 multiplied by the
update established under paragraph (8) for such category for
2008. In the case of the service category described in
subsection (j)(5)(F) (relating to anesthesia services), the
conversion factor for 2008 shall be based on the separate
conversion factor specified in subparagraph (D) for 2007
multiplied by the update established under paragraph (8) for
such category for 2008.
``(III) Updating of conversion factors.-- Such factor for a
service category for a subsequent year shall be based upon
the conversion factor for such category for the previous year
and adjusted by the update established for such category
under paragraph (8) for the year involved.''; and
(2) in subparagraph (D), by inserting ``(before 2008)''
after ``for a year''.
(c) Establishing Updates for Conversion Factors for Service
Categories.--Section 1848(d) of the Social Security Act (42
U.S.C. 1395w-4(d)) is amended--
(1) in paragraph (4)(B), by striking ``and (6)'' and
inserting ``, (6), (8), and (9).
(2) in paragraph (4)(C)(iii), by striking ``The allowed''
and inserting ``Subject to paragraph (8)(B), the allowed'';
(3) in paragraph (4)(D), by striking ``The update'' and
inserting ``Subject to paragraph (8)(E), the update''; and
(4) by adding at the end the following new paragraph:
``(8) Updates for service categories beginning with 2008
and ending with 2012.
``(9) No update for service categories beginning with
2013.--The update to the conversion factor for each of the
service categories established under paragraph (8) for 2013
and each succeeding year shall be 0 percent.''.
``(A) In general.--In applying paragraph (4) for a year
beginning with 2008 and ending with 2012, the following rules
apply:
``(i) Application of separate update adjustments for each
service category.--Pursuant to paragraph (1)(A)(ii)(I), the
update shall be made to the conversion factor for each
service category (as defined in subsection (j)(5)) based upon
an update adjustment factor for the respective category and
year and the update adjustment factor shall be computed, for
a year, separately for each service category.
``(ii) Computation of allowed and actual expenditures based
on service categories.--In computing the prior year
adjustment component and the cumulative adjustment component
under clauses (i) and (ii) of paragraph (4)(B), the following
rules apply:
``(I) Application based on service categories.--The allowed
expenditures and actual expenditures shall be the allowed and
actual expenditures for the service category, as determined
under subparagraph (B).
``(II) Limitation to physician fee-schedule services.--
Actual expenditures shall only take into account expenditures
for services furnished under the physician fee schedule.
``(III) Application of category specific target growth
rate.--The growth rate applied under clause (ii)(II) of such
paragraph shall be the target growth rate for the service
category involved under subsection (f)(5).
``(IV) Allocation of cumulative overhang.--There shall be
substituted for the difference described in subparagraph
(B)(ii)(I) of such paragraph the amount described in
subparagraph (C)(i) for the service category involved.
``(B) Determination of allowed expenditures.--In applying
paragraph (4) for a year beginning with 2008, notwithstanding
subparagraph (C)(iii) of such paragraph, the allowed
expenditures for a service category for a year is an amount
computed by the Secretary as follows:
``(i) For 2008.-- For 2008:
``(I) Total 2007 allowed expenditures for all services
included in sgr computation.--Compute total allowed
expenditures for physicians' services (as defined in
subsection (f)(4)(A)) for 2007 that would otherwise be
calculated under subsection (d) but for this paragraph.
``(II) Total 2007 allowed expenditures for physician fee
schedule services.--Compute total allowed expenditures for
services furnished under the physician fee schedule for 2007
by
[[Page H9366]]
subtracting, from the total allowed expenditures computed
under subclause (I), the Secretary's estimate of the amount
of the actual expenditures for 2007 for services included in
such subclause for which payment is not made under the fee
schedule established pursuant to this section.
``(III) Allocation of 2007 allowed expenditures to service
category.--Compute allowed expenditures for the service
category involved for 2007 by multiplying the total allowed
expenditures computed under subclause (II) by the overhang
allocation factor for the service category (as defined in
subparagraph (C)(iii)).
``(IV) Increase by growth rate to obtain 2008 allowed
expenditures for service category.--Compute allowed
expenditures for the service category for 2008 by increasing
the allowed expenditures for the service category for 2007
computed under subclause (III) by the target growth rate for
such service category under subsection (f) for 2008.
``(ii) For subsequent years.--For a subsequent year, take
the amount of allowed expenditures for such category for the
preceding year (under clause (i) or this clause) and increase
it by the target growth rate determined under subsection (f)
for such category and year.
``(C) Computation and application of cumulative overhang
among categories.--
``(i) In general.--For purposes of applying paragraph
(4)(B)(ii)(II) under clause (ii)(IV), the amount described in
this clause for a year (beginning with 2008) is the sum of
the following:
``(I) Pre-2008 cumulative overhang.--The amount of the pre-
2008 cumulative excess spending (as defined in clause (ii))
multiplied by the overhang allocation factor for the service
category (under clause (iii)).
``(II) Post-2007 cumulative amounts.--For a year beginning
with 2009, the difference (which may be positive or negative)
between the amount of the allowed expenditures for
physicians' services (as determined under paragraph (4)(C))
in the service category from January 1, 2008, through the end
of the prior year and the amount of the actual expenditures
for such services in such category during that period.
``(ii) Pre-2008 cumulative excess spending defined.--For
purposes of clause (i)(I), the term `pre-2008 cumulative
excess spending' means the difference described in paragraph
(4)(B)(ii)(I) as determined for the year 2008, taking into
account expenditures through December 31, 2007. Such
difference takes into account expenditures included in
subsection (f)(4)(A).
``(iii) Overhang allocation factor.--For purposes of this
paragraph, the term `overhang allocation factor' means, for a
service category, the proportion, as determined by the
Secretary of total actual expenditures under this part for
items and services in such category during 2007 to the total
of such actual expenditures for all the service categories.
In calculating such proportion, the Secretary shall only take
into account services furnished under the physician fee
schedule.
``(D) Updates for 2008 and 2009.--The update to the
conversion factors for each service category for each of 2008
and 2009 shall be equal to 0.5 percent.
``(E) Change in restriction on update adjustment factor for
2010 and 2011.--The update adjustment factor determined under
subparagraph (4)(B), as modified by this paragraph, for a
service category for a year (beginning with 2010 and ending
with 2011) may be less than -0.07, but may not be less than -
0.14.''.
(d) Application of Separate Target Growth Rates for Each
Category.--
(1) In general.--Section 1848(f) of the Social Security Act
(42 U.S.C. 1395w-4(f)) is amended by adding at the end the
following new paragraph:
``(5) Application of separate target growth rates for each
service category beginning with 2008.--The target growth rate
for a year beginning with 2008 shall be computed and applied
separately under this subsection for each service category
(as defined in subsection (j)(5)) and shall be computed using
the same method for computing the sustainable growth rate
except for the following:
``(A) The reference in paragraphs (2)(A) and (2)(D) to `all
physicians' services' is deemed a reference to the
physicians' services included in such category but shall not
take into account items and services included in physicians'
services through the operation of paragraph (4)(A).
``(B) The factor described in paragraph (2)(C) for the
service category described in subsection (j)(5)(A) shall be
increased by 0.025.
``(C) A national coverage determination (as defined in
section 1869(f)(1)(B)) shall be treated as a change in
regulation described in paragraph (2)(D).''.
(2) Use of target growth rates.--Section 1848 of such Act
is further amended--
(A) in subsection (d)--
(i) in paragraph (1)(E)(ii), by inserting ``or target''
after ``sustainable''; and
(ii) in paragraph (4)(B)(ii)(II), by inserting ``or
target'' after ``sustainable''; and
(B) in subsection (f)--
(i) in the heading by inserting ``; Target Growth Rate''
after ``Sustainable Growth Rate''
(ii) in paragraph (1)--
(I) by striking ``and'' at the end of subparagraph (A);
(II) in subparagraph (B), by inserting ``before 2008''
after ``each succeeding year'' and by striking the period at
the end and inserting ``; and''; and
(III) by adding at the end the following new subparagraph:
``(C) November 1 of each succeeding year the target growth
rate for such succeeding year and each of the 2 preceding
years.''; and
(iii) in paragraph (2), in the matter before subparagraph
(A), by inserting after ``beginning with 2000'' the
following: ``and ending with 2007'' .
(e) Reports on Expenditures for Part B Drugs and Clinical
Diagnostic Laboratory Tests.--
(1) Reporting requirement.--The Secretary of Health and
Human Services shall include information in the annual
physician fee schedule proposed rule on the change in the
annual rate of growth of actual expenditures for clinical
diagnostic laboratory tests or drugs, biologicals, and
radiopharmaceuticals for which payment is made under part B
of title XVIII of the Social Security Act.
(2) Recommendations.--The report submitted under paragraph
(1) shall include an analysis of the reasons for such excess
expenditures and recommendations for addressing them in the
future.
SEC. 302. IMPROVING ACCURACY OF RELATIVE VALUES UNDER THE
MEDICARE PHYSICIAN FEE SCHEDULE.
(a) Use of Expert Panel to Identify Misvalued Physicians'
Services.--Section 1848(c) of the Social Security Act (42
U.S.C. 1395w(c)) is amended by adding at the end the
following new paragraph:
``(7) Use of expert panel to identify misvalued physicians'
services.--
``(A) In general.--The Secretary shall establish an expert
panel (in this paragraph referred to as the `expert panel')--
``(i) to identify, through data analysis, physicians'
services for which the relative value under this subsection
is potentially misvalued, particularly those services for
which such relative value may be overvalued;
``(ii) to assess whether those misvalued services warrant
review using existing processes (referred to in paragraph
(2)(J)(ii)) for the consideration of coding changes; and
``(iii) to advise the Secretary concerning the exercise of
authority under clauses (ii)(III) and (vi) of paragraph
(2)(B).
``(B) Composition of panel.--The expert panel shall be
appointed by the Secretary and composed of--
``(i) members with expertise in medical economics and
technology diffusion;
``(ii) members with clinical expertise;
``(iii) physicians, particularly physicians (such as a
physician employed by the Veterans Administration or a
physician who has a full time faculty appointment at a
medical school) who are not directly affected by changes in
the physician fee schedule under this section;
``(iv) carrier medical directors; and
``(v) representatives of private payor health plans.
``(C) Appointment considerations.--In appointing members to
the expert panel, the Secretary shall assure racial and
ethnic diversity on the panel and may consider appointing a
liaison from organizations with experience in the
consideration of coding changes to the panel.''.
(b) Examination of Services With Substantial Changes.--Such
section is further amended by adding at the end the following
new paragraph:
``(8) Examination of services with substantial changes.--
The Secretary, in consultation with the expert panel under
paragraph (7), shall--
``(A) conduct a five-year review of physicians' services in
conjunction with the RUC 5-year review, particularly for
services that have experienced substantial changes in length
of stay, site of service, volume, practice expense, or other
factors that may indicate changes in physician work;
``(B) identify new services to determine if they are likely
to experience a reduction in relative value over time and
forward a list of the services so identified for such five-
year review; and
``(C) for physicians' services that are otherwise
unreviewed under the process the Secretary has established,
periodically review a sample of relative value units within
different types of services to assess the accuracy of the
relative values contained in the Medicare physician fee
schedule.''.
(c) Authority to Reduce Work Component for Services With
Accelerated Volume Growth.--
(1) In general.--Paragraph (2)(B) of such section is
amended--
(A) in clause (v), by adding at the end the following new
subclause:
``(III) Reductions in work value units for services with
accelerated volume growth.--Effective January 1, 2009,
reduced expenditures attributable to clause (vi).''; and
(B) by adding at the end the following new clauses:
``(vi) Authorizing reduction in work value units for
services with accelerated volume growth.--The Secretary may
provide (without using existing processes the Secretary has
established for review of relative value) for a reduction in
the work value units for a particular physician's service if
the annual rate of growth in the expenditures for such
service for which payment is made under this part for
individuals for 2006 or a subsequent year exceeds the average
annual rate of growth in expenditures of all physicians'
services for which payment is made under this part by more
than 10 percentage points for such year.
``(vii) Consultation with expert panel and based on
clinical evidence.--The Secretary shall exercise authority
under clauses (ii)(III) and (vi) in consultation with the
expert panel established under paragraph (7) and shall take
into account clinical evidence supporting or refuting the
merits of such accelerated growth.''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply with respect to payment for services furnished on
or after January 1, 2009.
(d) Adjustment Authority for Efficiency Gains for New
Procedures.--Paragraph (2)(B)(ii) of such section is amended
by adding at the end the following new subclause:
[[Page H9367]]
``(III) Adjustment authority for efficiency gains for new
procedures.--In carrying out subclauses (I) and (II), the
Secretary may apply a methodology, based on supporting
evidence, under which there is imposed a reduction over a
period of years in specified relative value units in the case
of a new (or newer) procedure to take into account inherent
efficiencies that are typically or likely to be gained during
the period of initial increased application of the
procedure.''.
SEC. 303. FEEDBACK MECHANISM ON PRACTICE PATTERNS.
By not later than July 1, 2008, the Secretary of Health and
Human Services shall develop and implement a mechanism to
measure resource use on a per capita and an episode basis in
order to provide confidential feedback to physicians in the
Medicare program on how their practice patterns compare to
physicians generally, both in the same locality as well as
nationally. Such feedback shall not be subject to disclosure
under section 552 of title 5, United States Code). The
Secretary shall consider extending such mechanism to other
suppliers as necessary.
SEC. 304. PAYMENTS FOR EFFICIENT AREAS.
Section 1833 of the Social Security Act (42 U.S.C. 1395l)
is amended by adding at the end the following new subsection:
``(v) Incentive Payments for Efficient Areas.--
``(1) In general.--In the case of services furnished under
the physician fee schedule under section 1848 on or after
January 1, 2009, and before January 1, 2011, by a supplier
that is paid under such fee schedule in an efficient area (as
identified under paragraph (2)), in addition to the amount of
payment that would otherwise be made for such services under
this part, there also shall be paid an amount equal to 5
percent of the payment amount for the services under this
part.
``(2) Identification of efficient areas.--
``(A) In general.--Based upon available data, the Secretary
shall identify those counties or equivalent areas in the
United States in the lowest fifth percentile of utilization
based on per capita spending for services provided in 2007
under this part and part A, ``as standardized to eliminate
the effect of geographic adjustments in payment rates''.
``(B) Identification of counties where service is
furnished..--For purposes of paying the additional amount
specified in paragraph (1), if the Secretary uses the 5-digit
postal ZIP Code where the service is furnished, the dominant
county of the postal ZIP Code (as determined by the United
States Postal Service, or otherwise) shall be used to
determine whether the postal ZIP Code is in a county
described in subparagraph (A).
``(C) Judicial review.-- There shall be no administrative
or judicial review under section 1869, 1878, or otherwise,
respecting--
``(i) the identification of a county or other area under
subparagraph (A); or
``(ii) the assignment of a postal ZIP Code to a county or
other area under subparagraph (B).
``(D) Publication of list of counties; posting on
website.--With respect to a year for which a county or area
is identified under this paragraph, the Secretary shall
identify such counties or areas as part of the proposed and
final rule to implement the physician fee schedule under
section 1848 for the applicable year. The Secretary shall
post the list of counties identified under this paragraph on
the Internet website of the Centers for Medicare & Medicaid
Services.''.
SEC. 305. RECOMMENDATIONS ON REFINING THE PHYSICIAN FEE
SCHEDULE.
(a) Recommendations on Consolidated Coding for Services
Commonly Performed Together.--Not later than December 31,
2008, the Comptroller General of the United States shall--
(1) complete an analysis of codes paid under the Medicare
physician fee schedule to determine whether the codes for
procedures that are commonly furnished together should be
combined; and
(2) submit to Congress a report on such analysis and
include in the report recommendations on whether an
adjustment should be made to the relative value units for
such combined code.
(b) Recommendations on Increased Use of Bundled Payments.--
Not later than December 31, 2008, the Comptroller General of
the United States shall--
(1) complete an analysis of those procedures under the
Medicare physician fee schedule for which no global payment
methodology is applied but for which a ``bundled'' payment
methodology would be appropriate; and
(2) submit to Congress a report on such analysis and
include in the report recommendations on increasing the use
of ``bundled'' payment methodology under such schedule.
(c) Medicare Physician Fee Schedule.--In this section, the
term ``Medicare physician fee schedule'' means the fee
schedule established under section 1848 of the Social
Security Act (42 U.S.C. 1395w-4).
SEC. 306. IMPROVED AND EXPANDED MEDICAL HOME DEMONSTRATION
PROJECT.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') shall
establish under title XVIII of the Social Security Act an
expanded medical home demonstration project (in this section
referred to as the ``expanded project'') under this section.
The expanded project supersedes the project that was
initiated under section 204 of the Medicare Improvement and
Extension Act of 2006 (division B of Public Law 109-432). The
purpose of the expanded project is--
(1) to guide the redesign of the health care delivery
system to provide accessible, continuous, comprehensive, and
coordinated, care to Medicare beneficiaries; and
(2) to provide care management fees to personal physicians
delivering continuous and comprehensive care in qualified
medical homes.
(b) Nature and Scope of Project.--
(1) Duration; scope.--The expanded project shall operate
during a period of three years, beginning not later than
October 1, 2009, and shall include a nationally
representative sample of physicians serving urban, rural, and
underserved areas throughout the United States.
(2) Encouraging participation of small physician
practices.--
(A) In general.--The expanded project shall be designed to
include the participation of physicians in practices with
fewer than four full-time equivalent physicians, as well as
physicians in larger practices particularly in rural and
underserved areas.
(B) Technical assistance.-- In order to facilitate the
participation under the expanded project of physicians in
such practices, the Secretary shall make available additional
technical assistance to such practices during the first year
of the expanded project.
(3) Selection of homes to participate.--The Secretary shall
select up to 500 medical homes to participate in the expanded
project and shall give priority to--
(A) the selection of up to 100 HIT-enhanced medical homes;
and
(B) the selection of other medical homes that serve
communities whose populations are at higher risk for health
disparities,
(4) Beneficiary participation.--The Secretary shall
establish a process for any Medicare beneficiary who is
served by a medical home participating in the expanded
project to elect to participate in the project. Each
beneficiary who elects to so participate shall be eligible--
(A) for enhanced medical home services under the project
with no cost sharing for the additional services; and
(B) for a reduction of up to 50 percent in the coinsurance
for services furnished under the physician fee schedule under
section 1848 of the Social Security Act by the medical home.
The Secretary shall develop standard recruitment materials
and election processes for Medicare beneficiaries who are
electing to participate in the expanded project.
(c) Standards for Medical Homes, HIT-Enhanced Medical
Homes.--
(1) Standard setting and certification process.--The
Secretary shall establish a process for selection of a
qualified standard setting and certification organization--
(A) to establish standards, consistent with this section,
for medical practices to qualify as medical homes or as HIT-
enhanced medical homes; and
(B) to provide for the review and certification of medical
practices as meeting such standards.
(2) Basic standards for medical homes.--For purposes of
this subsection, the term ``medical home'' means a physician-
directed practice that has been certified, under paragraph
(1), as meeting the following standards:
(A) Access and communication with patients.--The practice
applies standards for access to care and communication with
participating beneficiaries.
(B) Managing patient information and using information in
management to support patient care.--The practice has readily
accessible, clinically useful information on participating
beneficiaries that enables the practice to treat such
beneficiaries comprehensively and systematically.
(C) Managing and coordinating care according to individual
needs.--The practice maintains continuous relationships with
participating beneficiaries by implementing evidence-based
guidelines and applying them to the identified needs of
individual beneficiaries over time and with the intensity
needed by such beneficiaries.
(D) Providing ongoing assistance and encouragement in
patient self-management.--The practice--
(i) collaborates with participating beneficiaries to pursue
their goals for optimal achievable health; and
(ii) assesses patient-specific barriers to communication
and conducts activities to support patient self-management.
(E) Resources to manage care.--The practice has in place
the resources and processes necessary to achieve improvements
in the management and coordination of care for participating
beneficiaries.
(F) Monitoring performance.--The practice monitors its
clinical process and performance (including outcome measures)
in meeting the applicable standards under this subsection and
provides information in a form and manner specified by the
Secretary with respect to such process and performance.
(3) Additional standards for hit-enhanced medical home.--
For purposes of this subsection, the term ``HIT-enhanced
medical home'' means a medical home that has been certified,
under paragraph (1), as using a health information technology
system that includes at least the following elements:
(A) Electronic health record (ehr).--The system uses, for
participating beneficiaries, an electronic health record that
meets the following standards:
(i) In general.--The record--
(I) has the capability of interoperability with secure data
acquisition from health information technology systems of
other health care providers in the area served by the home;
or
(II) the capability to securely acquire clinical data
delivered by such other health care providers to a secure
common data source.
(ii) The record protects the privacy and security of health
information.
(iii) The record has the capability to acquire, manage, and
display all the types of clinical information commonly
relevant to services furnished by the medical home, such as
complete medical records, radiographic image retrieval, and
clinical laboratory information.
[[Page H9368]]
(iv) The record is integrated with decision support
capacities that facilitate the use of evidence-based medicine
and clinical decision support tools to guide decision-making
at the point-of-care based on patient-specific factors.
(B) E-prescribing.--The system supports e-prescribing and
computerized physician order entry.
(C) Outcome measurement.--The system supports the secure,
confidential provision of clinical process and outcome
measures approved by the National Quality Forum to the
Secretary for use in confidential manner for provider
feedback and peer review and for outcomes and clinical
effectiveness research.
(D) Patient education capability.--The system actively
facilitates participating beneficiaries engaging in the
management of their own health through education and support
systems and tools for shared decision-making.
(E) Support of basic standards.-- The elements of such
system, such as the electronic health record, email
communications, patient registries, and clinical-decision
support tools, are integrated in a manner to better achieve
the basic standards specified in paragraph (2) for a medical
home.
(4) Use of data.--The Secretary shall use the data
submitted under paragraph (1)(F) in a confidential manner for
feedback and peer review for medical homes and for outcomes
and clinical effectiveness research. After the first two
years of the expanded project, these data may be used for
adjustment in the monthly medical home care management fee
under subsection (d)(2)(E).
(d) Monthly Medical Home Care Management Fee.--
(1) In general.--Under the expanded project, the Secretary
shall provide for payment to the personal physician of each
participating beneficiary of a monthly medical home care
management fee.
(2) Amount of payment.-- In determining the amount of such
fee, the Secretary shall consider the following:
(A) Operating expenses.--The additional practice expenses
for the delivery of services through a medical home, taking
into account the additional expenses for an HIT-enhanced
medical home. Such expenses include costs associated with--
(i) structural expenses, such as equipment, maintenance,
and training costs;
(ii) enhanced access and communication functions;
(iii) population management and registry functions;
(iv) patient medical data and referral tracking functions;
(v) provision of evidence-based care;
(vi) implementation and maintenance of health information
technology;
(vii) reporting on performance and improvement conditions;
and
(viii) patient education and patient decision support,
including print and electronic patient education materials.
(B) Added value services.--The value of additional
physician work, such as augmented care plan oversight,
expanded e-mail and telephonic consultations, extended
patient medical data review (including data stored and
transmitted electronically), and physician supervision of
enhanced self management education, and expanded follow-up
accomplished by non-physician personnel, in a medical home
that is not adequately taken into account in the
establishment of the physician fee schedule under section
1848 of the Social Security Act.
(C) Risk adjustment.--The development of an appropriate
risk adjustment mechanism to account for the varying costs of
medical homes based upon characteristics of participating
beneficiaries.
(D) HIT adjustment.--Variation of the fee based on the
extensiveness of use of the health information technology in
the medical home.
(E) Performance-based.--After the first two years of the
expanded project, an adjustment of the fee based on
performance of the medical home in achieving quality or
outcomes standards.
(3) Personal physician defined.--For purposes of this
subsection, the term ``personal physician'' means, with
respect to a participating Medicare beneficiary, a physician
(as defined in section 1861(r)(1) of the Social Security Act
(42 U.S.C. 1395x(r)(1)) who provides accessible, continuous,
coordinated, and comprehensive care for the beneficiary as
part of a medical practice that is a qualified medical home.
Such a physician may be a specialist for a beneficiary
requiring ongoing care for a chronic condition or multiple
chronic conditions (such as severe asthma, complex diabetes,
cardiovascular disease, rheumatologic disorder) or for a
beneficiary with a prolonged illness.
(e) Funding.--
(1) Use of current project funding.--Funds otherwise
applied to the demonstration under section 204 of the
Medicare Improvement and Extension Act of 2006 (division B of
Public Law 109-432) shall be available to carry out the
expanded project
(2) Additional funding from smi trust fund.--
(A) In general.--In addition to the funds provided under
paragraph (1), there shall be available, from the Federal
Supplementary Medical Insurance Trust Fund (under section
1841 of the Social Security Act), the amount of $500,000,000
to carry out the expanded project, including payments to of
monthly medical home care management fees under subsection
(d), reductions in coinsurance for participating
beneficiaries under subsection (b)(4)(B), and funds for the
design, implementation, and evaluation of the expanded
project.
(B) Monitoring expenditures; early termination.--The
Secretary shall monitor the expenditures under the expanded
project and may terminate the project early in order that
expenditures not exceed the amount of funding provided for
the project under subparagraph (A).
(f) Evaluations and Reports.--.
(1) Annual interim evaluations and reports.--For each year
of the expanded project, the Secretary shall provide for an
evaluation of the project and shall submit to Congress, by a
date specified by the Secretary, a report on the project and
on the evaluation of the project for each such year.
(2) Final evaluation and report.--The Secretary shall
provide for an evaluation of the expanded project and shall
submit to Congress, not later than 18 months after the date
of completion of the project, a report on the project and on
the evaluation of the project.
SEC. 307. REPEAL OF PHYSICIAN ASSISTANCE AND QUALITY
INITIATIVE FUND.
Subsection (l) of section 1848 of the Social Security Act
(42 U.S.C. 1395w-4) is repealed.
SEC. 308. ADJUSTMENT TO MEDICARE PAYMENT LOCALITIES.
Section 1848(e) of the Social Security Act (42 U.S.C.1395w-
4(e)) is amended by adding at the end the following new
paragraph:
``(6) Fee schedule geographic areas.--
``(A) In general.--
``(i) Revision.--Subject to clause (ii), for services
furnished on or after January 1, 2008, the Secretary shall
revise the fee schedule areas used for payment under this
section applicable to the State of California using the
county-based geographic adjustment factor as specified in
option 3 (table 9) in the proposed rule for the 2008
physician fee schedule published at 72 Fed. Reg. 38,122 (July
12, 2007).
``(ii) Transition.--For services furnished during the
period beginning January 1, 2008, and ending December 31,
2010, after calculating the work, practice expense, and
malpractice geographic indices described in clauses (i),
(ii), and (iii) of paragraph (1)(A) that would otherwise
apply, the Secretary shall increase any such geographic index
for any county in California that is lower than the
geographic index used for payment for services under this
section as of December 31, 2007, in such county to such
geographic index level.
``(B) Subsequent revisions.--
``(i) Timing.--Not later than January 1, 2011, the
Secretary shall review and make revisions to fee schedule
areas in all States for which more than one fee schedule area
is used for payment of services under this section. The
Secretary may revise fee schedule areas in States in which a
single fee schedule area is used for payment for services
under this section using the same methodology applied in the
previous sentence.
``(ii) Link with geographic index data revision.--The
revision described in clause (i) shall be made effective
concurrently with the application of the periodic review of
geographic adjustment factors required under paragraph (1)(C)
for 2011 and subsequent periods.''.
SEC. 309. PAYMENT FOR IMAGING SERVICES.
(a) Payment Under Part B of the Medicare Program for
Diagnostic Imaging Services Furnished in Facilities
Conditioned on Accreditation of Facilities.--
(1) Special payment rule.--
(A) In general.--Section 1848(b)(4) of the Social Security
Act (42 U.S.C. 1395w-4(b)(4)) is amended--
(i) in the heading, by striking ``rule'' and inserting
``rules'';
(ii) in subparagraph (A), by striking ``In general'' and
inserting ``Limitation''; and
(iii) by adding at the end the following new subparagraph:
``(C) Payment only for services provided in accredited
facilities.--
``(i) In general.--In the case of imaging services that are
diagnostic imaging services described in clause (ii), the
payment amount for the technical component and the
professional component of the services established for a year
under the fee schedule described in paragraph (1) shall each
be zero, unless the services are furnished at a diagnostic
imaging services facility that meets the certificate
requirement described in section 354(b)(1) of the Public
Health Service Act, as applied under subsection (m). The
previous sentence shall not apply with respect to the
technical component if the imaging equipment meets
certification standards and the professional component of a
diagnostic imaging service that is furnished by a physician.
``(ii) Diagnostic imaging services.--For purposes of clause
(i) and subsection (m), the term `diagnostic imaging
services' means all imaging modalities, including diagnostic
magnetic resonance imaging (`MRI'), computed tomography
(`CT'), positron emission tomography (`PET'), nuclear
medicine procedures, x-rays, sonograms, ultrasounds,
echocardiograms, and such emerging diagnostic imaging
technologies as specified by the Secretary.''.
(B) Effective date.--
(i) In general.--Subject to clause (ii), the amendments
made by subparagraph (A) shall apply to diagnostic imaging
services furnished on or after January 1, 2010.
(ii) Extension for ultrasound services.--The amendments
made by subparagraph (A) shall apply to diagnostic imaging
services that are ultrasound services on or after January 1,
2012.
(2) Certification of facilities that furnish diagnostic
imaging services.--Section 1848 of the Social Security Act
(42 U.S.C. 1395w-4) is amended by adding at the end the
following new subsection:
``(m) Certification of Facilities That Furnish Diagnostic
Imaging Services.--
``(1) In general.--For purposes of subsection (b)(4)(C)(i),
except as provided under paragraphs (2) through (8), the
provisions of section 354 of the Public Health Service Act
(as in effect as of June 1, 2007), relating to the
certification of mammography facilities, shall apply, with
respect to the provision of diagnostic imaging
[[Page H9369]]
services (as defined in subsection (b)(4)(C)(ii)) and to a
diagnostic imaging services facility defined in paragraph (8)
(and to the process of accrediting such facilities) in the
same manner that such provisions apply, with respect to the
provision of mammograms and to a facility defined in
subsection (a)(3) of such section (and to the process of
accrediting such mammography facilities).
``(2) Terminology and references.--For purposes of applying
section 354 of the Public Health Service Act under paragraph
(1)--
``(A) any reference to `mammography', or `breast imaging'
is deemed a reference to `diagnostic imaging services (as
defined in section 1848(b)(4)(C)(ii) of the Social Security
Act)';
``(B) any reference to a mammogram or film is deemed a
reference to an image, as defined in paragraph (8);
``(C) any reference to `mammography facility' or to a
`facility' under such section 354 is deemed a reference to a
diagnostic imaging services facility, as defined in paragraph
(8);
``(D) any reference to radiological equipment used to image
the breast is deemed a reference to medical imaging equipment
used to provide diagnostic imaging services;
``(E) any reference to radiological procedures or
radiological is deemed a reference to medical imaging
services, as defined in paragraph (8) or medical imaging,
respectively;
``(F) any reference to an inspection (as defined in
subsection (a)(4) of such section) or inspector is deemed a
reference to an audit (as defined in paragraph (8)) or
auditor, respectively;
``(G) any reference to a medical physicist (as described in
subsection (f)(1)(E) of such section) is deemed to include a
reference to a magnetic resonance scientist or the
appropriate qualified expert as determined by the accrediting
body;
``(H) in applying subsection (d)(1)(A)(i) of such section,
the reference to `type of each x-ray machine, image receptor,
and processor' is deemed a reference to `type of imaging
equipment';
``(I) in applying subsection (d)(1)(B) of such section, the
reference that `the person or agent submits to the Secretary'
is deemed a reference that `the person or agent submits to
the Secretary, through the appropriate accreditation body';
``(J) in applying subsection (d)(1)(B)(i) of such section,
the reference to standards established by the Secretary is
deemed a reference to standards established by an
accreditation body and approved by the Secretary;
``(K) in applying subsection (e) of such section, relating
to an accreditation body--
``(i) in paragraph (1)(A), the reference to `may' is deemed
a reference to `shall';
``(ii) in paragraph (1)(B)(i)(II), the reference to `a
random sample of clinical images from such facilities' is
deemed a reference to `a statistically significant random
sample of clinical images from a statistically significant
random sample of facilities';
``(iii) in paragraph (3)(A) of such section--
``(I) the reference to `paragraph (1)(B)' in such
subsection is deemed to be a reference to `paragraph (1)(B)
and subsection (f)'; and
``(II) the reference to the `Secretary' is deemed a
reference to `an accreditation body, with the approval of the
Secretary'; and
``(iv) in paragraph (6)(B), the reference to the Committee
on Labor and Human Resources of the Senate is deemed to be
the Committee on Finance of the Senate and the reference to
the Committee on Energy and Commerce of the House of
Representatives is deemed to include a reference to the
Committee on Ways and Means of the House of Representatives;
``(L) in applying subsection (f), relating to quality
standards--
``(i) each reference to standards established by the
Secretary is deemed a reference to standards established by
an accreditation body involved and approved by the Secretary
under subsection (d)(1)(B)(i) of such section
``(ii) in paragraph (1)(A), the reference to `radiation
dose' is deemed a reference to `radiation dose, as
appropriate';
``(iii) in paragraph (1)(B), the reference to `radiological
standards' is deemed a reference to `medical imaging
standards, as appropriate';
``(iv) in paragraphs (1)(D)(ii) and (1)(E)(iii), the
reference to `the Secretary' is deemed a reference to `an
accreditation body with the approval of the Secretary';
``(v) in each of subclauses (III) and (IV) of paragraph
(1)(G)(ii), each reference to `patient' is deemed a reference
to `patient, if requested by the patient'; and
``(M) in applying subsection (g), relating to inspections--
``(i) each reference to the `Secretary or State or local
agency acting on behalf of the Secretary' is deemed to
include a reference to an accreditation body involved;
``(ii) in the first sentence of paragraph (1)(F), the
reference to `annual inspections required under this
paragraph' is deemed a reference to `the audits carried out
in facilities at least every three years from the date of
initial accreditation under this paragraph'; and
``(iii) in the second sentence of paragraph (1)(F), the
reference to `inspections carried out under this paragraph'
is deemed a reference to `audits conducted under this
paragraph during the previous year'.
``(3) Dates and periods.--For purposes of paragraph (1), in
applying section 354 of the Public Health Service Act, the
following applies:
``(A) In general.--Except as provided in subparagraph (B)--
``(i) any reference to `October 1, 1994' shall be deemed a
reference to `January 1, 2010';
``(ii) the reference to `the date of the enactment of this
section' in each of subsections (e)(1)(D) and (f)(1)(E)(iii)
is deemed to be a reference to `the date of the enactment of
the Children's Health and Medicare Protection Act of 2007';
``(iii) the reference to `annually' in subsection (g)(1)(E)
is deemed a reference to `every three years';
``(iv) the reference to `October 1, 1996' in subsection (l)
is deemed to be a reference to `January 1, 2011';
``(v) the reference to `October 1, 1999' in subsection
(n)(3)(H) is deemed to be a reference to `January 1, 2012';
and
``(vi) the reference to `October 1, 1993' in the matter
following paragraph (3)(J) of subsection (n) is deemed to be
a reference `January 1, 2010'.
``(B) Ultrasound services.--With respect to diagnostic
imaging services that are ultrasounds--
``(i) any reference to `October 1, 1994' shall be deemed a
reference to `January 1, 2012';
``(ii) the reference to `the date of the enactment of this
section' in subsection (f)(1)(E)(iii) is deemed to be a
reference to `7 years after the date of the enactment of the
Children's Health and Medicare Protection Act of 2007';
``(iii) the reference to `October 1, 1996' in subsection
(l) is deemed to be a reference to `January 1, 2013';
``(4) Provisions not applicable.--For purposes of paragraph
(1), in applying section 354 of the Public Health Service
Act, the following provision shall not apply:
``(A) Subsections (e) and (f) of such section, in so far as
the respective subsection imposes any requirement for a
physician to be certified, accredited, or otherwise meet
requirements, with respect to the provision of any diagnostic
imaging services, as a condition of payment under subsection
(b)(4)(C)(i), with respect to the professional or technical
component, for such service.
``(B) Subsection (e)(1)(B)(v).
``(C) Subsection (f)(1)(H) of such section, relating to
standards for special techniques for mammograms of patients
with breast implants.
``(D) Subsection (g)(6) of such section, relating to an
inspection demonstration program.
``(E) Subsection (n) of such section, relating to the
national advisory committee.
``(F) Subsection (p) of such section, relating to breast
cancer screening surveillance research grants.
``(g) Paragraphs (1)(B) and (2) of subsection (r) of such
section, related to funding.
``(5) Accreditation bodies.--For purposes of paragraph (1),
in applying section 354(e)(1) of the Public Health Service,
the following shall apply:
``(A) Approval of two accreditation bodies for each
treatment modality.--In the case that there is more than one
accreditation body for a treatment modality that qualifies
for approval under this subsection, the Secretary shall
approve at least two accreditation bodies for such treatment
modality.
``(B) Additional accreditation body standards.--In addition
to the standards described in subparagraph (B) of such
section for accreditation bodies, the Secretary shall
establish standards that require--
``(i) the timely integration of new technology by
accreditation bodies for purposes of accrediting facilities
under this subsection; and
``(ii) the accreditation body involved to evaluate the
annual medical physicist survey (or annual medical survey of
another appropriate qualified expert chosen by the
accreditation body) of a facility upon onsite review of such
facility.
``(6) Additional quality standards.--For purposes of
paragraph (1), in applying subsection (f)(1) of section 354
of the Public Health Service--
``(A) the quality standards under such subsection shall,
with respect to a facility include--
``(i) standards for qualifications of medical personnel who
are not physicians and who perform diagnostic imaging
services at the facility that require such personnel to
ensure that individuals, prior to performing medical imaging,
demonstrate compliance with the standards established under
subsection (a) through successful completion of certification
by a nationally recognized professional organization,
licensure, completion of an examination, pertinent coursework
or degree program, verified pertinent experience, or through
other ways determined appropriate by an accreditation body
(with the approval of the Secretary, or through some
combination thereof);
``(ii) standards requiring the facility to maintain records
of the credentials of physicians and other medical personnel
described in clause (i);
``(iii) standards for qualifications and responsibilities
of medical directors and other personnel with supervising
roles at the facility;
``(iv) standards that require the facility has procedures
to ensure the safety of patients of the facility; and
``(v) standards for the establishment of a quality control
program at the facility to be implemented as described in
subparagraph (E) of such subsection;
``(B) the quality standards described in subparagraph (B)
of such subsection shall be deemed to include standards that
require the establishment and maintenance of a quality
assurance and quality control program at each facility that
is adequate and appropriate to ensure the reliability,
clarity, and accuracy of the technical quality of diagnostic
images produced at such facilities; and
``(C) the quality standard described in subparagraph (C) of
such subsection, relating to a requirement for personnel who
perform specified services, shall include in such requirement
that such personnel must meet continuing medical education
standards as
[[Page H9370]]
specified by an accreditation body (with the approval of the
Secretary) and update such standards at least once every
three years.
``(7) Additional requirements.--Notwithstanding any
provision of section 354 of the Public Health Service Act,
the following shall apply to the accreditation process under
this subsection for purposes of subsection (b)(4)(C)(i):
``(A) Any diagnostic imaging services facility accredited
before January 1, 2010 (or January 1, 2012 in the case of
ultrasounds), by an accrediting body approved by the
Secretary shall be deemed a facility accredited by an
approved accreditation body for purposes of such subsection
as of such date if the facility submits to the Secretary
proof of such accreditation by transmittal of the certificate
of accreditation, including by electronic means.
``(B) The Secretary may require the accreditation under
this subsection of an emerging technology used in the
provision of a diagnostic imaging service as a condition of
payment under subsection (b)(4)(C)(i) for such service at
such time as the Secretary determines there is sufficient
empirical and scientific information to properly carry out
the accreditation process for such technology.
``(8) Definitions.--For purposes of this subsection:
``(A) Audit.--The term `audit' means an onsite evaluation,
with respect to a diagnostic imaging services facility, by
the Secretary, State or local agency on behalf of the
Secretary, or accreditation body approved under this
subsection that includes the following:
``(i) Equipment verification.
``(ii) Evaluation of policies and procedures for compliance
with accreditation requirements.
``(iii) Evaluation of personnel qualifications and
credentialing.
``(iv) Evaluation of the technical quality of images.
``(v) Evaluation of patient reports.
``(vi) Evaluation of peer-review mechanisms and other
quality assurance activities.
``(vii) Evaluation of quality control procedures, results,
and follow-up actions.
``(viii) Evaluation of medical physicists (or other
appropriate professionals chosen by the accreditation body)
and magnetic resonance scientist surveys.
``(ix) Evaluation of consumer complaint mechanisms.
``(x) Provision of recommendations for improvement based on
findings with respect to clauses (i) through (ix).
``(B) Diagnostic imaging services facility.--The term
`diagnostic imaging services facility' has the meaning given
the term `facility' in section 354(a)(3) of the Public Health
Service Act (42 U.S.C. 263b(a)(3)) subject to the reference
changes specified in paragraph (2), but does not include any
facility that does not furnish diagnostic imaging services
for which payment may be made under this section.
``(C) Image.--The term `image' means the portrayal of
internal structures of the human body for the purpose of
detecting and determining the presence or extent of disease
or injury and may be produced through various techniques or
modalities, including radiant energy or ionizing radiation
and ultrasound and magnetic resonance. Such term does not
include image guided procedures.
``(D) Medical imaging service.--The term `medical imaging
service' means a service that involves the science of an
image.''.
(b) Adjustment in Practice Expense to Reflect Higher
Presumed Utilization.--Section 1848 of the Social Security
Act (42 U.S.C. 1395w) is amended--
(1) in subsection (b)(4)--
(A) in subparagraph (B), by striking ``subparagraph (A)''
and inserting ``this paragraph''; and
(B) by adding at the end the following new subparagraph:
``(D) Adjustment in practice expense to reflect higher
presumed utilization.--In computing the number of practice
expense relative value units under subsection (c)(2)(C)(ii)
with respect to imaging services described in subparagraph
(B), the Secretary shall adjust such number of units so it
reflects a 75 percent (rather than 50 percent) presumed rate
of utilization of imaging equipment.''; and
(2) in subsection (c)(2)(B)(v)(II), by inserting ``and
other provisions'' after ``OPD payment cap''
(c) Adjustment in Technical Component ``discount'' on
Single-Session Imaging to Consecutive Body Parts.--Section
1848(b)(4) of such Act is further amended by adding at the
end the following new subparagraph:
``(E) Adjustment in technical component discount on single-
session imaging involving consecutive body parts.--The
Secretary shall increase the reduction in expenditures
attributable to the multiple procedure payment reduction
applicable to the technical component for imaging under the
final rule published by the Secretary in the Federal Register
on November 21, 2005 (42 CFR 405, et al.) from 25 percent to
50 percent.''.
(d) Adjustment in Assumed Interest Rate for Capital
Purchases.--Section 1848(b)(4) of such Act is further amended
by adding at the end the following new subparagraph:
``(F) Adjustment in assumed interest rate for capital
purchases.--In computing the practice expense component for
imaging services under this section, the Secretary shall
change the interest rate assumption for capital purchases of
imaging devices to reflect the prevailing rate in the market,
but in no case higher than 11 percent.''.
(e) Disallowance of Global Billing.--Effective for claims
filed for imaging services (as defined in subsection
(b)(4)(B) of section 1848 of the Social Security Act)
furnished on or after the first day of the first month that
begins more than 1 year after the date of the enactment of
this Act, the Secretary of Health and Human Services shall
not accept (or pay) a claim under such section unless the
claim is made separately for each component of such services.
(f) Effective Date.--Except as otherwise provided, this
section, and the amendments made by this section, shall apply
to services furnished on or after January 1, 2008.
SEC. 310. REDUCING FREQUENCY OF MEETINGS OF THE PRACTICING
PHYSICIANS ADVISORY COUNCIL.
Section 1868(a)(2) of the Social Security Act (42 U.S.C.
1395ee(a)(2)) is amended by striking ``once during each
calendar quarter'' and inserting ``once each year (and at
such other times as the Secretary may specify)''.
TITLE IV--MEDICARE ADVANTAGE REFORMS
Subtitle A--Payment Reform
SEC. 401. EQUALIZING PAYMENTS BETWEEN MEDICARE ADVANTAGE
PLANS AND FEE-FOR-SERVICE MEDICARE.
(a) Phase in of Payment Based on Fee-for-Service Costs.--
Section 1853 of the Social Security Act (42 U.S.C. 1395w-23)
is amended--
(1) in subsection (j)(1)(A)--
(A) by striking ``beginning with 2007'' and inserting ``for
2007 and 2008''; and
(B) by inserting after ``(k)(1)'' the following: ``, or,
beginning with 2009, \1/12\ of the blended benchmark amount
determined under subsection (l)(1)''; and
(2) by adding at the end the following new subsection:
``(l) Determination of Blended Benchmark Amount.--
``(1) In general.--For purposes of subsection (j), subject
to paragraphs (2) and (3), the term `blended benchmark
amount' means for an area--
``(A) for 2009 the sum of--
``(i) \2/3\ of the applicable amount (as defined in
subsection (k)(1)) for the area and year; and
``(ii) \1/3\ of the amount specified in subsection
(c)(1)(D)(i) for the area and year;
``(B) for 2010 the sum of--
``(i) \1/3\ of the applicable amount for the area and year;
and
``(ii) \2/3\ of the amount specified in subsection
(c)(1)(D)(i) for the area and year; and
``(C) for a subsequent year the amount specified in
subsection (c)(1)(D)(i) for the area and year.
``(2) Fee-for-service payment floor.--In no case shall the
blended benchmark amount for an area and year be less than
the amount specified in subsection (c)(1)(D)(i) for the area
and year.
``(3) Exception for pace plans.--This subsection shall not
apply to payments to a PACE program under section 1894.''.
(b) Phase in of Payment Based on IME Costs.--
(1) In general.--Section 1853(c)(1)(D)(i) of such Act (42
U.S.C. 1395w-23(c)(1)(D)(i)) is amended by inserting ``and
costs attributable to payments under section 1886(d)(5)(B)''
after ``1886(h)''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to the capitation rate for years beginning with
2009.
(c) Limitation on Plan Enrollment in Cases of Excess Bids
for 2009 and 2010.--
(1) In general.--In the case of a Medicare Part C
organization that offers a Medicare Part C plan in the 50
States or the District of Columbia for which--
(A) bid amount described in paragraph (2) for a Medicare
Part C plan for 2009 or 2010, exceeds
(B) the percent specified in paragraph (4) of the fee-for-
service amount described in paragraph (3),
the Medicare Part C plan may not enroll any new enrollees in
the plan during the annual, coordinated election period
(under section 1851(e)(3)(B) of such Act (42 U.S.C. 1395w-
21(e)(3)(B)) for the year or during the year (if the
enrollment becomes effective during the year).
(2) Bid amount for part a and b services.--
(A) In general.--Except as provided in subparagraph (B),
the bid amount described in this paragraph is the unadjusted
Medicare Part C statutory non-drug monthly bid amount (as
defined in section 1854(b)(2)(E) of the Social Security Act
(42 U.S.C. 1395w-24(b)(2)(E)).
(B) Treatment of msa plans.--In the case of an MSA plan (as
defined in section 1859(b)(3) of the Social Security Act, 42
U.S.C. 1935w-28(b)(3)), the bid amount described in this
paragraph is the amount described in section 1854(a)(3)(A) of
such Act (42 U.S.C. 1395w-24(a)(3)(A)).
(3) Fee-for-service amount described.--
(A) In general.--Subject to subparagraph (B), the fee-for-
service amount described in this paragraph for an Medicare
Part C local area is the amount described in section
1853(c)(1)(D)(i) of the Social Security Act (42 U.S.C. 1395w-
23) for such area.
(B) Treatment of multi-county plans.--In the case of an MA
plan the service area for which covers more than one Medicare
Part C local area, the fee-for-service amount described in
this paragraph is the amount described in section
1853(c)(1)(D)(i) of the Social Security Act for each such
area served, weighted for each such area by the proportion of
the enrollment of the plan that resides in the county (as
determined based on amounts posted by the Administrator of
the Centers for Medicare & Medicaid Services in the April bid
notice for the year involved).
(4) Percentage phase down.--For purposes of paragraph (1),
the percentage specified in this paragraph--
[[Page H9371]]
(A) for 2009 is 106 percent; and
(B) for 2010 is 103 percent.
(5) Exemption of age-ins.--For purposes of paragraph (1),
the term ``new enrollee'' with respect to a Medicare Part C
plan offered by a Medicare Part C organization, does not
include an individual who was enrolled in a plan offered by
the organization in the month immediately before the month in
which the individual was eligible to enroll in such a
Medicare Part C plan offered by the organization.
(d) Annual Rebasing of Fee-for-Service Rates.--Section
1853(c)(1)(D)(ii) of the Social Security Act (42 U.S.C.
1395w-23(c)(1)(D)(ii)) is amended--
(1) by inserting ``(before 2009)'' after ``for subsequent
years''; and
(2) by inserting before the period at the end the
following: ``and for each year beginning with 2009''.
(e) Repeal of PPO Stabilization Fund.--Section 1858 of the
Social Security Act (42 U.S.C. 1395) is amended--
(1) by striking subsection (e); and
(2) in subsection (f)(1), by striking ``subject to
subsection (e),''.
Subtitle B--Beneficiary Protections
SEC. 411. NAIC DEVELOPMENT OF MARKETING, ADVERTISING, AND
RELATED PROTECTIONS.
(a) In General.--Section 1852 of the Social Security Act
(42 U.S.C. 1395w-22) is amended by adding at the end the
following new subsection:
``(m) Application of Model Marketing and Enrollment
Standards.--
``(1) In general.--The National Association of Insurance
Commissioners (in this subsection referred to as the `NAIC')
is requested to develop, and to submit to the Secretary of
Health and Human Services not later than 12 months after the
date of the enactment of this Act, model regulations (in this
section referred to as `model regulations') regarding
Medicare plan marketing, enrollment, broker and agent
training and certification, agent and broker commissions, and
market conduct by plans, agents and brokers for
implementation (under paragraph (7)) under this part and part
D, including for enforcement by States under section
1856(b)(3).
``(2) Marketing guidelines.--
``(A) In general.--The model regulations shall address the
sales and advertising techniques used by Medicare private
plans, agents and brokers in selling plans, including
defining and prohibiting cold calls, unsolicited door-to-door
sales, cross-selling, and co-branding.
``(B) Special considerations.--The model regulations shall
specifically address the marketing--
``(i) of plans to full benefit dual-eligible individuals
and qualified medicare beneficiaries;
``(ii) of plans to populations with limited English
proficiency;
``(iii) of plans to beneficiaries in senior living
facilities; and
``(iv) of plans at educational events.
``(3) Enrollment guidelines.--
``(A) In general.--The model regulations shall address the
disclosures Medicare private plans, agents, and brokers must
make when enrolling beneficiaries, and a process--
``(i) for affirmative beneficiary sign off before
enrollment in a plan; and
``(ii) in the case of Medicare Part C plans, for plans to
conduct a beneficiary call-back to confirm beneficiary sign
off and enrollment.
``(B) Specific considerations.--The model regulations shall
specially address beneficiary understanding of the Medicare
plan through required disclosure (or beneficiary
verification) of each of the following:
``(i) The type of Medicare private plan involved.
``(ii) Attributes of the plan, including premiums, cost
sharing, formularies (if applicable), benefits, and provider
access limitations in the plan.
``(iii) Comparative quality of the plan.
``(iv) The fact that plan attributes may change annually.
``(4) Appointment, certification and training of agents and
brokers.--The model regulations shall establish procedures
and requirements for appointment, certification (and periodic
recertification), and training of agents and brokers that
market or sell Medicare private plans consistent with
existing State appointment and certification procedures and
with this paragraph.
``(5) Agent and broker commissions.--
``(A) In general.--The model regulations shall establish
standards for fair and appropriate commissions for agents and
brokers consistent with this paragraph.
``(B) Limitation on types of commission.--The model
regulations shall specifically prohibit the following:
``(i) Differential commissions--
``(I) for Medicare Part C plans based on the type of
Medicare private plan; or
``(II) prescription drug plans under part D based on the
type of prescription drug plan.
``(ii) Commissions in the first year that are more than 200
percent of subsequent year commissions.
``(iii) The payment of extra bonuses or incentives (such as
trips, gifts, and other non-commission cash payments).
``(C) Agent disclosure.--In developing the model
regulations, the NAIC shall consider requiring agents and
brokers to disclose commissions to a beneficiary upon request
of the beneficiary before enrollment.
``(D) Prevention of fraud.--The model regulations shall
consider the opportunity for fraud and abuse and beneficiary
steering in setting standards under this paragraph and shall
provide for the ability of State commissioners to investigate
commission structures.
``(6) Market conduct.--
``(A) In general.--The model regulations shall establish
standards for the market conduct of organizations offering
Medicare private plans, and of agents and brokers selling
such plans, and for State review of plan market conduct.
``(B) Matters to be included.--Such standards shall include
standards for--
``(i) timely payment of claims;
``(ii) beneficiary complaint reporting and disclosure; and
``(iii) State reporting of market conduct violations and
sanctions.
``(7) Implementation.--
``(A) Publication of naic model regulations.--If the model
regulations are submitted on a timely basis under paragraph
(1)--
``(i) the Secretary shall publish them in the Federal
Register upon receipt and request public comment on the issue
of whether such regulations are consistent with the
requirements established in this subsection for such
regulations;
``(ii) not later than 6 months after the date of such
publication, the Secretary shall determine whether such
regulations are so consistent with such requirements and
shall publish notice of such determination in the Federal
Register; and
``(iii) if the Secretary makes the determination under
clause (ii) that such regulations are consistent with such
requirements, in the notice published under clause (ii) the
Secretary shall publish notice of adoption of such model
regulations as constituting the marketing and enrollment
standards adopted under this subsection to be applied under
this title; and
``(iv) if the Secretary makes the determination under such
clause that such regulations are not consistent with such
requirements, the procedures of clauses (ii) and (iii) of
subparagraph (B) shall apply (in relation to the notice
published under clause (ii)), in the same manner as such
clauses would apply in the case of publication of a notice
under subparagraph (B)(i).
``(B) No model regulations.--If the model regulations are
not submitted on a timely basis under paragraph (1)--
``(i) the Secretary shall publish notice of such fact in
the Federal Register;
``(ii) not later than 6 months after the date of
publication of such notice, the Secretary shall propose
regulations that provide for marketing and enrollment
standards that incorporate the requirements of this
subsection for the model regulations and request public
comments on such proposed regulations; and
``(iii) not later than 6 months after the date of
publication of such proposed regulations, the Secretary shall
publish final regulations that shall constitute the marketing
and enrollment standards adopted under this subsection to be
applied under this title.
``(C) References to marketing and enrollment standards.--In
this title, a reference to marketing and enrollment standards
adopted under this subsection is deemed a reference to the
regulations constituting such standards adopted under
subparagraph (A) or (B), as the case may be.
``(D) Effective date of standards.--In order to provide for
the orderly and timely implementation of marketing and
enrollment standards adopted under this subsection, the
Secretary, in consultation with the NAIC, shall specify (by
program instruction or otherwise) effective dates with
respect to all components of such standards consistent with
the following:
``(i) In the case of components that relate predominantly
to operations in relation to Medicare private plans, the
effective date shall be for plan years beginning on or after
such date (not later than 1 year after the date of
promulgation of the standards) as the Secretary specifies.
``(ii) In the case of other components, the effective date
shall be such date, not later than 1 year after the date of
promulgation of the standards, as the Secretary specifies.
``(E) Consultation.-- In promulgating marketing and
enrollment standards under this paragraph, the NAIC or
Secretary shall consult with a working group composed of
representatives of issuers of Medicare private plans,
consumer groups, medicare beneficiaries, State Health
Insurance Assistance Programs, and other qualified
individuals. Such representatives shall be selected in a
manner so as to assure balanced representation among the
interested groups.
``(8) Enforcement.--
``(A) In general.--Any Medicare private plan that violates
marketing and enrollment standards is subject to sanctions
under section 1857(g).
``(B) State responsibilities.--Nothing in this subsection
or section 1857(g) shall prohibit States from imposing
sanctions against Medicare private plans, agents, or brokers
for violations of the marketing and enrollment standards
adopted under section 1852(m). States shall have the sole
authority to regulate agents and brokers.
``(9) Medicare private plan defined.--In this subsection,
the term `Medicare private plan' means a Medicare Part C plan
and a prescription drug plan under part D.''.
(b) Expansion of Exception to Preemption of State Role.--
(1) In general.--Section 1856(b)(3) of the Social Security
Act (42 U.S.C. 1395w-26(b)(3)) is amended by striking
``(other than State licensing laws or State laws relating to
plan solvency)'' and inserting ``(other than State laws
relating to licensing or plan solvency and State laws or
regulations adopting the marketing and enrollment standards
adopted under section 1852(m))''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to plans offered on or after July 1, 2008.
(c) Application to Prescription Drug Plans.--
(1) In general.--Section 1860D-1 of such Act is amended by
adding at the end the following new subsection:
[[Page H9372]]
``(d) Application of Marketing and Enrollment Standards.--
The marketing and enrollment standards adopted under section
1852(m) shall apply to prescription drug plans (and sponsors
of such plans) in the same manner as they apply to Medicare
Part C plans and organizations offering such plans.''.
(2) Reference to current law provisions.--The amendment
made by subsection (a) and (b) apply, pursuant to section
1860D-1(b)(1)(B)(ii) of the Social Security Act (42 U.S.C.
1395w-101(b)(1)(B)(ii)), to prescription drug plans under
part D of title XVIII of such Act.
(d) Contract Requirement to Meet Marketing and Advertising
Standards.--
(1) In general.--Section 1857(d) of the Social Security Act
(42 U.S.C. 1395w-27(d)), as amended by subsection (b)(1), is
further amended by adding at the end the following new
paragraph:
``(7) Marketing and advertising standards.--The contract
shall require the organization to meet all standards adopted
under section 1852(m) (including those enforced by the State
involved pursuant to section 1856(b)(3)) relating to
marketing and advertising conduct.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to contracts for plan years beginning on or after
January 1, 2011.
(e) Application of Sanctions.--
(1) Application to violation of marketing and enrollment
standards.--Section 1857(g)(1) of such Act (42 U.S.C. 1395w-
27(g)(1)), as amended by the preceding provisions of this
Act, is further amended--
(A) by striking ``and'' at the end of subparagraph (G);
(B) by adding ``and'' at the end of subparagraph (H); and
(C) by inserting after subparagraph (H) the following new
subparagraph:
``(I) violates marketing and enrollment standards adopted
under section 1852(m);''.
(2) Enhanced civil money sanctions.--Such section is
further amended--
(A) in paragraph (2)(A), by striking ``$25,000'',
``$100,000'', and ``$15,000'' and inserting ``$50,000'',
``$200,000'', and ``$30,000'', respectively; and
(B) in subparagraphs (A), (B), and (D) of paragraph (3), by
striking ``$25,000'', ``$10,000'', and ``$100,000'',
respectively, and inserting ``$50,000'', ``$20,000'', and
``$200,000'', respectively.
(3) Effective date.--The amendments made by paragraph (2)
shall apply to violations occurring on or after the date of
the enactment of this Act.
(f) Disclosure of Market and Advertising Contract
Violations and Imposed Sanctions.--Section 1857 of such Act
is amended by adding at the end the following new subsection
``(j) Disclosure of Market and Advertising Contract
Violations and Imposed Sanctions.--For years beginning with
2009, the Secretary shall post on its public website for the
Medicare program an annual report that--
``(1) lists each MA organization for which the Secretary
made during the year a determination under subsection (c)(2)
the basis of which is described in paragraph (1)(E); and
``(2) that describes any applicable sanctions under
subsection (g) applied to such organization pursuant to such
determination.''.
(g) Standard Definitions of Benefits and Formats for Use in
Marketing Materials.--Section 1851(h) of such Act (42 U.S.C.
1395w-21(h)) is amended by adding at the end the following
new paragraph:
``(6) Standard definitions of benefits and formats for use
in marketing materials.--
``(A) In general.--Not later than January 1, 2010, the
Secretary, in consultation with the National Association of
Insurance Commissioners and a working group of the type
described in section 1852(m)(7)(E), shall develop standard
descriptions and definitions for benefits under this title
for use in marketing material distributed by Medicare Part C
organizations and formats for including such descriptions in
such marketing material.
``(B) Required use of standard definitions.-- For plan
years beginning on or after January 1, 2011, the Secretary
shall disapprove the distribution of marketing material under
paragraph (1)(B) if such marketing material does not use,
without modification, the applicable descriptions and formats
specified under subparagraph (A).''.
(h) Support for State Health Insurance Assistance Programs
(SHIPs).--Section 1857(e)(2) of the Social Security Act (42
U.S.C. 1395w-27(e)(2)) is amended--
(1) in subparagraph (B), by adding at the end the
following: ``Of the amounts so collected, no less than
$55,000,000 for fiscal year 2009, $65,000,000 for fiscal year
2010, $75,000,000 for fiscal year 2011, and $85,000,000 for
fiscal year 2012 and each succeeding fiscal year shall be
used to support Medicare Part C and Part D counseling and
assistance provided by State Health Insurance Assistance
Programs.'';
(2) in subparagraph (C)--
(A) by striking ``and'' after ``$100,000,000,'' and
(B) by striking ``an amount equal to $200,000,000'' and
inserting ``and ending with fiscal year 2008 an amount equal
to $200,000,000, for fiscal year 2009 an amount equal to
$255,000,000, for fiscal year 2010 an amount equal to
$265,000,000, for fiscal year 2011 an amount equal to
$275,000,000, and for fiscal year 2012 and each succeeding
fiscal year an amount equal to $285,000,000.''
(3) in subparagraph (D)(ii)--
(A) by striking ``and'' at the end of subclause (IV);
(B) in subclause (V), by striking the period at the end and
inserting ``before fiscal year 2009; and''; and
(C) by adding at the end the following new subclause:
``(VI) for fiscal year 2009 and each succeeding fiscal year
the applicable portion (as so defined) of the amount
specified in subparagraph (C) for that fiscal year.''.
SEC. 412. LIMITATION ON OUT-OF-POCKET COSTS FOR INDIVIDUAL
HEALTH SERVICES.
(a) In General.--Section 1852(a)(1) of the Social Security
Act (42 U.S.C. 1395w-22(a)(1)) is amended--
(1) in subparagraph (A), by inserting before the period at
the end the following: ``with cost-sharing that is no greater
(and may be less) than the cost-sharing that would otherwise
be imposed under such program option'';
(2) in subparagraph (B)(i), by striking ``or an actuarially
equivalent level of cost-sharing as determined in this
part''; and
(3) by amending clause (ii) of subparagraph (B) to read as
follows:
``(ii) Permitting use of flat copayment or per diem rate.--
Nothing in clause (i) shall be construed as prohibiting a
Medicare part C plan from using a flat copayment or per diem
rate, in lieu of the cost-sharing that would be imposed under
part A or B, so long as the amount of the cost-sharing
imposed does not exceed the amount of the cost-sharing that
would be imposed under the respective part if the individual
were not enrolled in a plan under this part.''.
(b) Limitation for Dual Eligibles and Qualified Medicare
Beneficiaries.--Section 1852(a) of such Act is amended by
adding at the end the following new paragraph:
``(7) Limitation on cost-sharing for dual eligibles and
qualified medicare beneficiaries.--In the case of a
individual who is a full-benefit dual eligible individual (as
defined in section 1935(c)(6)) or a qualified medicare
beneficiary (as defined in section 1905(p)(1)) who is
enrolled in a Medicare Part C plan, the plan may not impose
cost-sharing that exceeds the amount of cost-sharing that
would be permitted with respect to the individual under this
title and title XIX if the individual were not enrolled with
such plan.''.
(c) Effective Dates.--
(1) The amendments made by subsection (a) shall apply to
plan years beginning on or after January 1, 2009.
(2) The amendments made by subsection (b) shall apply to
plan years beginning on or after January 1, 2008.
SEC. 413. MA PLAN ENROLLMENT MODIFICATIONS.
(a) Improved Plan Enrollment, Disenrollment, and Change of
Enrollment.--
(1) Continuous open enrollment for full-benefit dual
eligible individuals and qualified medicare beneficiaries
(qmb).--Section 1851(e)(2)(D) of the Social Security Act (42
U.S.C. 1395w-21(e)(2)(D)) is amended--
(A) in the heading, by inserting``, full-benefit dual
eligible individuals, and qualified medicare beneficiaries''
after ``institutionalized individuals''; and
(B) in the matter before clause (i), by inserting ``, a
full-benefit dual eligible individual (as defined in section
1935(c)(6)), or a qualified medicare beneficiary (as defined
in section 1905(p)(1))'' after ``institutionalized (as
defined by the Secretary)''; and
(C) in clause (i), by inserting ``or disenroll'' after
``enroll''.
(2) Special election periods for additional categories of
individuals.--Section 1851(e)(4) of such Act (42 U.S.C.
1395w(e)(4)) is amended--
(A) in subparagraph (C), by striking at the end ``or'';
(B) in subparagraph (D), by inserting ``, taking into
account the health or well-being of the individual'' before
the period and redesignating such subparagraph as
subparagraph (F); and
(C) by inserting after subparagraph (C) the following new
subparagraphs:
``(D) the individual is described in section
1902(a)(10)(E)(iii) (relating to specified low-income
medicare beneficiaries);
``(E) the individual is enrolled in an MA plan and
enrollment in the plan is suspended under paragraph (2)(B) or
(3)(C) of section 1857(g) because of a failure of the plan to
meet applicable requirements; or''.
(3) Effective date.--The amendments made by this subsection
shall take effect on the date of the enactment of this Act.
(b) Access to Medigap Coverage for Individuals Who Leave MA
Plans.--
(1) In general.--Section 1882(s)(3) of the Social Security
Act (42 U.S.C. 1395ss(s)(3)) is amended--
(A) in each of clauses (v)(III) and (vi) of subparagraph
(B), by striking ``12 months'' and inserting ``24 months'';
and
(B) in each of subclauses (I) and (II) of subparagraph
(F)(i), by striking ``12 months'' and inserting ``24
months''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to terminations of enrollments in MA plans
occurring on or after the date of the enactment of this Act.
(c) Improved Enrollment Policies.--
(1) No auto-enrollment of medicaid beneficiaries.--
(A) In general.--Section 1851(e) of such Act (42 U.S.C.
1395w-21(e)) is amended by adding at the end the following
new paragraph:
``(7) No auto-enrollment of medicaid beneficiaries.--In no
case may the Secretary provide for the enrollment in a MA
plan of a Medicare Advantage eligible individual who is
eligible to receive medical assistance under title XIX as a
full-benefit dual eligible individual or a qualified medicare
beneficiary, without the affirmative application of such
individual (or authorized representative of the individual)
to be enrolled in such plan.''.
(B) No application to prescription drug plans.--Section
1860D-1(b)(1)(B)(iii) of such Act (42 U.S.C. 1395w-
101(b)(1)(B)(iii)) is amended--
(i) by striking ``paragraph (2) and'' and by inserting
``paragraph (2),''; and
[[Page H9373]]
(ii) by inserting ``, and paragraph (7),'' after
``paragraph (4)''.
(C) Effective date.--The amendments made by this paragraph
shall apply to enrollments that are effective on or after the
date of the enactment of this Act.
SEC. 414. INFORMATION FOR BENEFICIARIES ON MA PLAN
ADMINISTRATIVE COSTS.
(a) Disclosure of Medical Loss Ratios and Other Expense
Data.--Section 1851 of the Social Security Act (42 U.S.C.
1395w21) is amended by adding at the end the following new
subsection:
``(j) Publication of Medical Loss Ratios and Other Cost-
Related Information.--
``(1) In general.--The Secretary shall publish, not later
than October 1 of each year (beginning with 2009), for each
Medicare Part C plan contract, the following:
``(A) The medical loss ratio of the plan in the previous
year.
``(B) The per enrollee payment under this part to the plan,
as adjusted to reflect a risk score (based on factors
described in section 1853(a)(1)(C)(i)) of 1.0.
``(C) The average risk score (as so based).
``(2) Submission of data.--
``(A) In general.--Each Medicare Part C organization shall
submit to the Secretary, in a form and manner specified by
the Secretary, data necessary for the Secretary to publish
the information described in paragraph (1) on a timely basis,
including the information described in paragraph (3).
``(B) Data for 2008 and 2009.--The data submitted under
subparagraph (A) for 2008 and for 2009 shall be consistent in
content with the data reported as part of the Medicare Part C
plan bid in June 2007 for 2008.
``(C) Medical loss ratio data.--The data to be submitted
under subparagraph (A) relating to medical loss ratio for a
year--
``(i) shall be submitted not later than June 1 of the
following year; and
``(ii) beginning with 2010, shall be submitted based on the
standardized elements and definitions developed under
paragraph (4).
``(D) Audited data.--Data submitted under this paragraph
shall be data that has been audited by an independent third
party auditor.
``(3) MLR information.--The information described in this
paragraph with respect to a Medicare Part C plan for a year
is as follows:
``(A) The costs for the plan in the previous year for each
of the following:
``(i) Total medical expenses, separately indicated for
benefits for the original medicare fee-for-service program
option and for supplemental benefits.
``(ii) Non-medical expenses, shown separately for each of
the following categories of expenses:
``(I) Marketing and sales.
``(II) Direct administration.
``(III) Indirect administration.
``(IV) Net cost of private reinsurance.
``(B) Gain or loss margin.
``(C) Total revenue requirement, computed as the total of
medical and nonmedical expenses and gain or loss margin,
multiplied by the gain or loss margin.
``(D) Percent of revenue ratio, computed as the total
revenue requirement expressed as a percentage of revenue.
``(4) Development of data reporting standards.--
``(A) In general.--The Secretary shall develop and
implement standardized data elements and definitions for
reporting under this subsection, for contract years beginning
with 2010, of data necessary for the calculation of the
medical loss ratio for Medicare Part C plans. Not later than
December 31, 2008, the Secretary shall publish a report
describing the elements and definitions so developed.
``(B) Consultation.--The Secretary shall consult with
representatives of Medicare Part C organizations, experts on
health plan accounting systems, and representatives of the
National Association of Insurance Commissioners, in the
development of such data elements and definitions
``(5) Medical loss ratio defined.--For purposes of this
part, the term `medical loss ratio' means, with respect to an
MA plan for a year, the ratio of--
``(A) the aggregate benefits (excluding nonmedical expenses
described in paragraph (3)(A)(ii)) paid under the plan for
the year, to
``(B) the aggregate amount of premiums (including basic and
supplemental beneficiary premiums) and payments made under
sections 1853 and 1860D-15) collected for the plan and year.
Such ratio shall be computed without regard to whether the
benefits or premiums are for required or supplemental
benefits under the plan.''.
(b) Audit of Administrative Costs and Compliance With the
Federal Acquisition Regulation.--
(1) In general.--Section 1857(d)(2)(B) of such Act (42
U.S.C. 1395w-27(d)(2)(B)) is amended--
(A) by striking ``or (ii)'' and inserting ``(ii)''; and
(B) by inserting before the period at the end the
following: ``, or (iii) to compliance with the requirements
of subsection (e)(4) and the extent to which administrative
costs comply with the applicable requirements for such costs
under the Federal Acquisition Regulation''.
(2) Effective date.--The amendments made by this subsection
shall apply for contract years beginning after the date of
the enactment of this Act.
(c) Minimum Medical Loss Ratio.--Section 1857(e) of the
Social Security Act (42 U.S.C. 1395w-27(e)) is amended by
adding at the end the following new paragraph:
``(4) Requirement for minimum medical loss ratio.--If the
Secretary determines for a contract year (beginning with
2010) that an MA plan has failed to have a medical loss ratio
(as defined in section 1851(j)(4)) of at least .85--
``(A) for that contract year, the Secretary shall reduce
the blended benchmark amount under subsection (l) for the
second succeeding contract year by the numer of percentage
points by which such loss ratio was less than 85 percent;
``(B) for 3 consecutive contract years, the Secretary shall
not permit the enrollment of new enrollees under the plan for
coverage during the second succeeding contract year; and
``(C) the Secretary shall terminate the plan contract if
the plan fails to have such a medical loss ratio for 5
consecutive contract years.''.
(d) Information on Medicare Part C Plan Enrollment and
Services.--Section 1851 of such Act, as amended by subsection
(a), is further amended by adding at the end the following
new subsection:
``(k) Publication of Enrollment and Other Information.--
``(1) Monthly publication of plan-specific enrollment
data.--The Secretary shall publish (on the public website of
the Centers for Medicare & Medicaid Services or otherwise)
not later than 30 days after the end of each month (beginning
with January 2008) on the actual enrollment in each Medicare
Part C plan by contract and by county.
``(2) Availability of other information.--The Secretary
shall make publicly available data and other information in a
format that may be readily used for analysis of the Medicare
Part C program under this part and will contribute to the
understanding of the organization and operation of such
program.''.
(e) MedPAC Report on Varying Minimum Medical Loss Ratios.--
(1) Study.--The Medicare Payment Advisory Commission shall
conduct a study of the need and feasibility of providing for
different minimum medical loss ratios for different types of
Medicare Part C plans, including coordinated care plans,
group model plans, coordinated care independent practice
association plans, preferred provider organization plans, and
private fee-for-services plans.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, submit to Congress a report on the
study conducted under paragraph (1).
Subtitle C--Quality and Other Provisions
SEC. 421. REQUIRING ALL MA PLANS TO MEET EQUAL STANDARDS.
(a) Collection and Reporting of Information.--
(1) In general.--Section 1852(e)(1) of the Social Security
Act (42 U.S.C. 1395w-112(e)(1)) is amended by striking
``(other than an MA private fee-for-service plan or an MSA
plan)''.
(2) Reporting for private fee-for-services and msa plans.--
Section 1852(e)(3) of such Act is amended by adding at the
end the following new subparagraph:
``(C) Data collection requirements by private fee-for-
service plans and msa plans.--
``(i) Using measures for ppos for contract year 2009.--For
contract year 2009, the Medicare Part C organization offering
a private fee-for-service plan or an MSA plan shall submit to
the Secretary for such plan the same information on the same
performance measures for which such information is required
to be submitted for Medicare Part C plans that are preferred
provider organization plans for that year.
``(ii) Application of same measures as coordinated care
plans beginning in contract year 2010.--For a contract year
beginning with 2010, a Medicare Part C organization offering
a private fee-for-service plan or an MSA plan shall submit to
the Secretary for such plan the same information on the same
performance measures for which such information is required
to be submitted for such contract year Medicare Part C plans
described in section 1851(a)(2)(A)(i) for contract year such
contract year.''.
(3) Effective date.--The amendment made by paragraph (1)
shall apply to contract years beginning on or after January
1, 2009.
(b) Employer Plans.--
(1) In general.--The first sentence of paragraph (2) of
section 1857(i) of such Act (42 U.S.C. 1395w-27(i)) is
amended by inserting before the period at the end the
following: ``, but only if 90 percent of the Medicare part C
eligible individuals enrolled under such plan reside in a
county in which the Medicare Part C organization offers a
Medicare Part C local plan''.
(2) Limitation on application of waiver authority.--
Paragraphs (1) and (2) of such section are each amended by
inserting ``that were in effect before the date of the
enactment of the Children's Health and Medicare Protection
Act of 2007'' after ``waive or modify requirements''.
(3) Effective dates.--The amendment made by paragraph (1)
shall apply for plan years beginning on or after January 1,
2009, and the amendments made by paragraph (2) shall take
effect on the date of the enactment of this Act.
SEC. 422. DEVELOPMENT OF NEW QUALITY REPORTING MEASURES ON
RACIAL DISPARITIES.
(a) New Quality Reporting Measures.--
(1) In general.--Section 1852(e)(3) of the Social Security
Act (42 U.S.C. 1395w-22(e)(3)), as amended by section
421(a)(2), is amended--
(A) in subparagraph (B)--
(i) in clause (i), by striking ``The Secretary'' and
inserting ``Subject to subparagraph (D), the Secretary''; and
(ii) in clause (ii), by striking ``subclause (iii)'' and
inserting ``clause (iii) and subparagraph (C)'' ; and
(B) by adding at the end the following new subparagraph:
``(D) Additional quality reporting measures.--
``(i) In general.--The Secretary shall develop by October
1, 2009, quality measures for Medicare Part C plans that
measure disparities in the amount and quality of health
services provided to racial and ethnic minorities.
[[Page H9374]]
``(ii) Data to measure racial and ethnic disparities in the
amount and quality of care provided to enrollees.--The
Secretary shall provide for Medicare Part C organizations to
submit data under this paragraph, including data similar to
those submitted for other quality measures, that permits
analysis of disparities among racial and ethnic minorities in
health services, quality of care, and health status among
Medicare Part C plan enrollees for use in submitting the
reports under paragraph (5).''.
(2) Effective date.--The amendments made by this subsection
shall apply to reporting of quality measures for plan years
beginning on or after January 1, 2010.
(b) Biennial Report on Racial and Ethnic Minorities.--
Section 1852(e) of such Act (42 U.S.C. 1395w-22(e)) is
amended by adding at the end the following new paragraph:
``(5) Report to congress.--
``(A) In general.--Not later than 2 years after the date of
the enactment of this paragraph, and biennially thereafter,
the Secretary shall submit to Congress a report regarding how
quality assurance programs conducted under this subsection
measure and report on disparities in the amount and quality
of health care services furnished to racial and ethnic
minorities.
``(B) Contents of report.--Each such report shall include
the following:
``(i) A description of the means by which such programs
focus on such racial and ethnic minorities.
``(ii) An evaluation of the impact of such programs on
eliminating health disparities and on improving health
outcomes, continuity and coordination of care, management of
chronic conditions, and consumer satisfaction.
``(iii) Recommendations on ways to reduce clinical outcome
disparities among racial and ethnic minorities.
``(iv) Data for each MA plan from HEDIS and other source
reporting the disparities in the amount and quality of health
services furnished to racial and ethnic minorities.''.
SEC. 423. STRENGTHENING AUDIT AUTHORITY.
(a) For Part C Payments Risk Adjustment.--Section
1857(d)(1) of the Social Security Act (42 U.S.C. 1395w-
27(d)(1)) is amended by inserting after ``section 1858(c))''
the following: ``, and data submitted with respect to risk
adjustment under section 1853(a)(3)''.
(b) Enforcement of Audits and Deficiencies.--
(1) In general.--Section 1857(e) of such Act is amended by
adding at the end the following new paragraph:
``(5) Enforcement of audits and deficiencies.--
``(A) Information in contract.--The Secretary shall require
that each contract with a Medicare Part C organization under
this section shall include terms that inform the organization
of the provisions in subsection (d).
``(B) Enforcement authority.--The Secretary is authorized,
in connection with conducting audits and other activities
under subsection (d), to take such actions, including pursuit
of financial recoveries, necessary to address deficiencies
identified in such audits or other activities.''.
(2) Application under part d.--For provision applying the
amendment made by paragraph (1) to prescription drug plans
under part D, see section 1860D-12(b)(3)(D) of the Social
Security Act.
(c) Effective Date.--The amendments made by this section
shall take effect the date of the enactment of this Act and
shall apply to audits and activities conducted for contract
years beginning on or after January 1, 2009.
SEC. 424. IMPROVING RISK ADJUSTMENT FOR MA PAYMENTS.
(a) In General.--Not later than 1 year after the date of
the enactment of this Act, the Secretary of Health and Human
Services shall submit to Congress a report that evaluates the
adequacy of the Medicare Advantage risk adjustment system
under section 1853(a)(1)(C) of the Social Security Act (42
U.S.C. 1395-23(a)(1)(C)).
(b) Particulars.--The report under subsection (a) shall
include an evaluation of at least the following:
(1) The need and feasibility of improving the adequacy of
the risk adjustment system in predicting costs for
beneficiaries with co-morbid conditions and associated
cognitive impairments.
(2) The need and feasibility of including further
gradations of diseases and conditions (such as the degree of
severity of congestive heart failure).
(3) The feasibility of measuring difference in coding over
time between Medicare part C plans and the medicare
traditional fee-for-service program and, to the extent this
difference exists, the options for addressing it.
(4) The feasibility and value of including part D and other
drug utilization data in the risk adjustment model.
SEC. 425. ELIMINATING SPECIAL TREATMENT OF PRIVATE FEE-FOR-
SERVICE PLANS.
(a) Elimination of Extra Billing Provision.--Section
1852(k)(2) of the Social Security Act (42 U.S.C. 1395w-
22(k)(2)) is amended--
(1) in subparagraph (A)(i), by striking ``115 percent'' and
inserting ``100 percent''; and
(2) in subparagraph (C)(i), by striking ``including any
liability for balance billing consistent with this
subsection)''.
(b) Review of Bid Information.--Section 1854(a)(6)(B) of
such Act (42 U.S.C. 1395w-24(a)(6)(B)) is amended--
(1) in clause (i), by striking ``clauses (iii) and (iv)''
and inserting ``clause (iii)''; and
(2) by striking clause (iv).
(c) Effective Date.--The amendments made by this section
shall apply to contract years beginning with 2009.
SEC. 426. RENAMING OF MEDICARE ADVANTAGE PROGRAM.
(a) In General.--The program under part C of title XVIII of
the Social Security Act is henceforth to be known as the
``Medicare Part C program''.
(b) Change in References.--
(1) Amending social security act.--The Social Security Act
is amended by striking ``Medicare Advantage'', ``MA'', and
``Medicare+Choice'' and inserting ``Medicare Part C'' each
place it appears, with the appropriate, respective
typographic formatting, including typeface and
capitalization.
(2) Additional references.--Notwithstanding section 201(b)
of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (Public Law 108-173), any reference
to the program under part C of title XVIII of the Social
Security Act shall be deemed a reference to the ``Medicare
Part C'' program and, with respect to such part, any
reference to ``Medicare+Choice''. ``Medicare Advantage'', or
``MA'' is deemed a reference to the program under such part.
Subtitle D--Extension of Authorities
SEC. 431. EXTENSION AND REVISION OF AUTHORITY FOR SPECIAL
NEEDS PLANS (SNPS).
(a) Extending Restriction on Enrollment Authority for SNPs
for 3 Years.--Subsection (f) of section 1859 of the Social
Security Act (42 U.S.C. 1395w-28) is amended by striking
``2009'' and inserting ``2012''.
(b) Structure of Authority for SNPs.--
(1) In general.--Such section is further amended--
(A) in subsection (b)(6)(A), by striking all that follows
``means'' and inserting the following: ``an MA plan and
``(i) that serves special needs individuals (as defined in
subparagraph (B));
``(ii) as of January 1, 2009--
``(I) at least 90 percent of the enrollees in which are
described in subparagraph (B)(i), as determined under
regulations in effect as of July 1, 2007;
``(II) at least 90 percent of the enrollees in which are
described in subparagraph (B)(ii) and are full-benefit dual
eligible individuals (as defined in section 1935(c)(6)) or
qualified medicare beneficiaries (as defined in section
1905(p)(1)); or
``(III) at least 90 percent of the enrollees in which have
a severe or disabling chronic condition of the type that the
plan is committed to serve as indicated by the data submitted
for the risk-adjustment of plan payments; and''.
``(iii) as of January 1, 2009, meets the applicable
requirements of paragraph (2) or (3) of subsection (f), as
the case may be.'';
(B) in subsection (f)--
(i) by amending the heading to read as follows:
``Requirements for Enrollment in Part C Plans for Special
Needs Beneficiaries'';
(ii) by designating the sentence beginning ``In the case
of'' as paragraph (1) with the heading ``Requirements for
enrollment.--'' and with appropriate indentation; and
(iii) by adding at the end the following new paragraphs:
``(2) Additional requirements for institutional snps.--In
the case of a specialized MA plan for special needs
individuals described in subsection (b)(6)(A)(ii)(I), the
applicable requirements of this subsection are as follows:
``(A) The plan has an agreement with the State that
includes provisions regarding cooperation on the coordination
of care for such individuals. Such agreement shall include a
description of the manner that the State Medicaid program
under title XIX will pay for the costs of services for
individuals eligible under such title for medical assistance
for acute care and long-term care services.
``(B) The plan has a contract with long-term care
facilities and other providers in the area sufficient to
provide care for enrollees described in subsection
(b)(6)(B)(i).
``(C) The plan reports to the Secretary information on
additional quality measures specified by the Secretary under
section 1852(e)(3)(D)(iv)(I) for such plans.
``(3) Additional requirements for dual snps.--In the case
of a specialized MA plan for special needs individuals
described in subsection (b)(6)(A)(ii)(II), the applicable
requirements of this subsection are as follows:
``(A) The plan has an agreement with the State Medicaid
agency that--
``(i) includes provisions regarding cooperation on the
coordination of the financing of care for such individuals;
``(ii) includes a description of the manner that the State
Medicaid program under title XIX will pay for the costs of
cost-sharing and supplemental services for individuals
enrolled in the plan eligible under such title for medical
assistance for acute and long-term care services; and
``(iii) effective January 1, 2011, provides for capitation
payments to cover costs of supplemental benefits for
individuals described in subsection (b)(6)(A)(ii)(II).
``(B) The out-of-pocket costs for services under parts A
and B that are charged to enrollees may not exceed the out-
of-pocket costs for same services permitted for such
individuals under title XIX.
``(C) The plan reports to the Secretary information on
additional quality measures specified by the Secretary under
section 1852(e)(3)(D)(iv)(II) for such plans.''.
``(4) Additional requirements for severe or disabling
chronic condition snps.--In the case of a specialized MA plan
for special needs individuals described in subsection
(b)(6)(A)(ii)(III), the applicable requirements of this
subsection are as follows:
``(A) The plan is designated to serve, and serves, Medicare
beneficiaries with one or more of the following specific
severe or disabling chronic conditions:
``(i) Cardiovascular.
[[Page H9375]]
``(ii) Cerebrovascular.
``(iii) Congestive health failure.
``(iv) Diabetes.
``(v) Chronic obstructive pulmonary disease.
``(vi) HIV/AIDS.
``(B) The plan has an average risk score under section
1853(a)(1)(C) of 1.35 or greater.
``(C) The plan has established and actively manages a
chronic care improvement program under section 1852(e)(2) for
each of the conditions that it serves under subparagraph (A)
that significantly exceeds the features and results of such
programs established and managed by Medicare Part C plans
that are not specialized Medicare Part C plans for special
needs individuals of the type described in this paragraph.
``(D) The plan has a network of a sufficient number of
primary care and specialty physicians, hospitals, and other
health care providers under contract to the plan so that the
plan can clearly meet the routine and specialty needs of the
severely ill and disabled enrollees of the plan throughout
the service area of the plan.
``(E) The plan reports to the Secretary information on
additional quality measures specified by the Secretary under
section 1852(e)(3)(D)(iv)(III) for such plans.''.
(2) Quality standards and quality reporting.--Section
1852(e)(3) of such Act (42 U.S.C. 1395w-22(e)(3) is amended--
(A) in subparagraph (A)(i), by adding at the end the
following: ``In the case of a specialized Medicare Part C
plan for special needs individuals described in paragraph
(2), (3), or (4) of section 1859(f), the organization shall
provide for the reporting on quality measures developed for
the plan under subparagraph (D)(iii).''; and
(B) in subparagraph (D), as added by section 422(a)(1), by
adding at the end the following new clause:
``(iii) Specification of additional quality measurements
for specialized part c plans.--For implementation for plan
years beginning not later than January 1, 2010, the Secretary
shall develop new quality measures appropriate to meeting the
needs of--
``(I) beneficiaries enrolled in specialized Medicare Part C
plans for special needs individuals (described in section
1859(b)(6)(A)(ii)(I)) that serve predominantly individuals
who are dual-eligible individuals eligible for medical
assistance under title XIX by measuring the special needs for
care of individuals who are both Medicare and Medicaid
beneficiaries; and
``(II) beneficiaries enrolled in specialized Medicare Part
C plans for special needs individuals (described in section
1859(b)(6)(A)(ii)(II)) that serve predominantly
institutionalized individuals by measuring the special needs
for care of individuals who are a resident in long-term care
institution.''; and
``(III) beneficiaries enrolled in specialized Medicare Part
C plans for special needs individuals (described in section
1859(b)(6)(A)(ii)(III)) that serve predominantly individuals
with severe or disabling chronic conditions by measuring the
special needs for care of such individuals.''.
(3) Effective date; grandfather.--The amendments made by
paragraph (1) shall take effect for enrollments occurring on
or after January 1, 2009, and shall not apply--
(A) to a Medicare Advantage plan with a contract with a
State Medicaid integrated Medicare-Medicaid plan program that
had been approved by the Centers for Medicare & Medicaid
Services as of January 1, 2004; and
(B) to plans that are operational as of the date of the
enactment of this Act as approved Medicare demonstration
projects and that provide services predominantly to
individuals with end-stage renal disease.
(4) Transition for non-qualifying snps.--
(A) Restrictions in 2008 for chronic care snps.--In the
case of a specialized MA plan for special needs individuals
(as defined in section 1859(b)(6)(A) of the Social Security
Act (42 U.S.C. 1395w-28(b)(6)(A)) that, as of December 31,
2007, is not described in either subclause (I) or subclause
(II) of clause (ii) of such section, as amended by paragraph
(1), then as of January 1, 2008--
(i) the plan may not be offered unless it was offered
before such date;
(ii) no new members may be enrolled with the plan; and
(iii) there may be no expansion of the service area of such
plan.
(B) Transition of enrollees.--The Secretary of Health and
Human Services shall provide for an orderly transition of
those specialized MA plans for special needs individuals (as
defined in section 1859(b)(6)(A) of the Social Security Act
(42 U.S.C. 1395w-28(b)(6)(A)), as of the date of the
enactment of this Act), and their enrollees, that no longer
qualify as such plans under such section, as amended by this
subsection.
(c) Sunset of Additional Designation Authority.--
(1) In general.--Subsection (d) of section 231 of the
Medicare Prescription Drug, Improvement, and Modernization
Act of 2003 (Public Law 108-173) is repealed.
(2) Effective date.--The repeal made by paragraph (1) shall
take effect on January 1, 2009, and shall apply to plans
offered on or after such date.
SEC. 432. EXTENSION AND REVISION OF AUTHORITY FOR MEDICARE
REASONABLE COST CONTRACTS.
(a) Extension for 3 Years of Period Reasonable Cost Plans
Can Remain in the Market.--Section 1876(h)(5)(C)(ii) of the
Social Security Act (42 U.S.C. 1395mm(h)(5)(C)(ii)) is
amended, in the matter preceding subclause (I), by striking
``January 1, 2008'' and inserting ``January 1, 2011''.
(b) Application of Certain Medicare Advantage Requirements
to Cost Contracts Extended or Renewed After Enactment.--
Section 1876(h) of such Act (42 U.S.C. 1395mm(h)), as amended
by subsection (a), is amended--
(1) by redesignating paragraph (5) as paragraph (6); and
(2) by inserting after paragraph (4) the following new
paragraph:
``(5)(A) Any reasonable cost reimbursement contract with an
eligible organization under this subsection that is extended
or renewed on or after the date of enactment of the
Children's Health and Medicare Protection Act of 2007 shall
provide that the provisions of the Medicare Part C program
described in subparagraph (B) shall apply to such
organization and such contract in a substantially similar
manner as such provisions apply to Medicare Part C
organizations and Medicare Part C plans under part C.
``(B) The provisions described in this subparagraph are as
follows:
``(i) Section 1851(h) (relating to the approval of
marketing material and application forms).
``(ii) Section 1852(e) (relating to the requirement of
having an ongoing quality improvement program and treatment
of accreditation in the same manner as such provisions apply
to Medicare Part C local plans that are preferred provider
organization plans).
``(iii) Section 1852(f) (relating to grievance mechanisms).
``(iv) Section 1852(g) (relating to coverage
determinations, reconsiderations, and appeals).
``(v) Section 1852(j)(4) (relating to limitations on
physician incentive plans).
``(vi) Section 1854(c) (relating to the requirement of
uniform premiums among individuals enrolled in the plan).
``(vii) Section 1854(g) (relating to restrictions on
imposition of premium taxes with respect to payments to
organizations).
``(viii) Section 1856(b)(3) (relating to relation to State
laws).
``(ix) The provisions of part C relating to timelines for
contract renewal and beneficiary notification.''.
TITLE V--PROVISIONS RELATING TO MEDICARE PART A
SEC. 501. INPATIENT HOSPITAL PAYMENT UPDATES.
(a) For Acute Hospitals.--Clause (i) of section
1886(b)(3)(B) of the Social Security Act (42 U.S.C.
1395ww(b)(3)(B)) is amended--
(1) in subclause (XIX), by striking ``and'';
(2) by redesignating subclause (XX) as subclause (XXII);
and
(3) by inserting after subclause (XIX) the following new
subclauses:
``(XX) for fiscal year 2007, subject to clause (viii), the
market basket percentage increase for hospitals in all areas,
``(XXI) for fiscal year 2008, subject to clause (viii), the
market basket percentage increase minus 0.25 percentage point
for hospitals in all areas, and''.
(b) For Other Hospitals.--Clause (ii) of such section is
amended--
(1) in subclause (VII) by striking ``and'';
(2) by redesignating subclause (VIII) as subclause (X); and
(3) by inserting after subclause (VII) the following new
subclauses:
``(VIII) fiscal years 2003 through 2007, is the market
basket percentage increase,
``(IX) fiscal year 2008, is the market basket percentage
increase minus 0.25 percentage point, and''.
(c) Delayed Effective Date.--
(1) Acute care hospitals.--The amendments made by
subsection (a) shall not apply to discharges occurring before
January 1, 2008.
(2) Other hospitals.--The amendments made by subsection (b)
shall be applied, only with respect to cost reporting periods
beginning during fiscal year 2008 and not with respect to the
computation for any succeeding cost reporting period, by
substituting ``0.1875 percentage point'' for ``0.25
percentage point''.
SEC. 502. PAYMENT FOR INPATIENT REHABILITATION FACILITY (IRF)
SERVICES.
(a) Payment Update.--
(1) In general.--Section 1886(j)(3)(C) of the Social
Security Act (42 U.S.C. 1395ww(j)(3)(C)) is amended by adding
at the end the following: ``The increase factor to be applied
under this subparagraph for fiscal year 2008 shall be 1
percent.''
(2) Delayed effective date.--The amendment made by
paragraph (1) shall not apply to payment units occurring
before January 1, 2008.
(b) Inpatient Rehabilitation Facility Classification
Criteria.--
(1) In general.--Section 5005 of the Deficit Reduction Act
of 2005 (Public Law 109-171) is amended--
(A) in subsection (a), by striking ``apply the applicable
percent specified in subsection (b)'' and inserting ``require
a compliance rate that is no greater than the 60 percent
compliance rate that became effective for cost reporting
periods beginning on or after July 1, 2006,''; and
(B) by amending subsection (b) to read as follows:
``(b) Continued Use of Comorbidities.--For portions of cost
reporting periods occurring on or after the date of the
enactment of the Children's Health and Medicare Protection
Act of 2007, the Secretary shall include patients with
comorbidities as described in section 412.23(b)(2)(i) of
title 42, Code of Federal Regulations (as in effect as of
January 1, 2007), in the inpatient population that counts
towards the percent specified in subsection (a).''.
(2) Effective date.--The amendment made by paragraph (1)(A)
shall apply to portions of cost reporting periods beginning
on or after the date of the enactment of this Act.
(c) Payment for Certain Medical Conditions Treated in
Inpatient Rehabilitation Facilities.--
(1) In general.--Section 1886(j) of the Social Security Act
(42 U.S.C. 1395ww(j)) is amended--
(A) by redesignating paragraph (7) as paragraph (8);
[[Page H9376]]
(B) by inserting after paragraph (6) the following new
paragraph:
``(7) Special payment rule for certain medical
conditions.--
``(A) In general.--Subject to subparagraph (H), in the case
of discharges occurring on or after October 1, 2008, in lieu
of the standardized payment amount (as determined pursuant to
the preceding provisions of this subsection) that would
otherwise be applicable under this subsection, the Secretary
shall substitute, for payment units with respect to an
applicable medical condition (as defined in subparagraph
(G)(i)) that is treated in an inpatient rehabilitation
facility, the modified standardized payment amount determined
under subparagraph (B).
``(B) Modified standardized payment amount.--The modified
standardized payment amount for an applicable medical
condition shall be based on the amount determined under
subparagraph (C) for such condition, as adjusted under
subparagraphs (D), (E), and (F).
``(C) Amount determined.--
``(i) In general.--The amount determined under this
subparagraph for an applicable medical condition shall be
based on the sum of the following:
``(I) An amount equal to the average per stay skilled
nursing facility payment rate for the applicable medical
condition (as determined under clause (ii)).
``(II) An amount equal to 25 percent of the difference
between the overhead costs (as defined in subparagraph
(G)(ii)) component of the average inpatient rehabilitation
facility per stay payment amount for the applicable medical
condition (as determined under the preceding paragraphs of
this subsection) and the overhead costs component of the
average per stay skilled nursing facility payment rate for
such condition (as determined under clause (ii)).
``(III) An amount equal to 33 percent of the difference
between the patient care costs (as defined in subparagraph
(G)(iii)) component of the average inpatient rehabilitation
facility per stay payment amount for the applicable medical
condition (as determined under the preceding paragraphs of
this subsection) and the patient care costs component of the
average per stay skilled nursing facility payment rate for
such condition (as determined under clause (ii)).
``(ii) Determination of average per stay skilled nursing
facility payment rate.--For purposes of clause (i), the
Secretary shall convert skilled nursing facility payment
rates for applicable medical conditions, as determined under
section 1888(e), to average per stay skilled nursing facility
payment rates for each such condition.
``(D) Adjustments.--The Secretary shall adjust the amount
determined under subparagraph (C) for an applicable medical
condition using the adjustments to the prospective payment
rates for inpatient rehabilitation facilities described in
paragraphs (2), (3), (4), and (6).
``(E) Update for inflation.--Except in the case of a fiscal
year for which the Secretary rebases the amounts determined
under subparagraph (C) for applicable medical conditions
pursuant to subparagraph (F), the Secretary shall annually
update the amounts determined under subparagraph (C) for each
applicable medical condition by the increase factor for
inpatient rehabilitation facilities (as described in
paragraph (3)(C)).
``(F) Rebasing.--The Secretary shall periodically (but in
no case less than once every 5 years) rebase the amounts
determined under subparagraph (C) for applicable medical
conditions using the methodology described in such
subparagraph and the most recent and complete cost report and
claims data available.
``(G) Definitions.--In this paragraph:
``(i) Applicable medical condition.--The term `applicable
medical condition' means--
``(I) unilateral knee replacement;
``(II) unilateral hip replacement; and
``(III) unilateral hip fracture.
``(ii) Overhead costs.--The term `overhead costs' means
those Medicare-allowable costs that are contained in the
General Service cost centers of the Medicare cost reports for
inpatient rehabilitation facilities and for skilled nursing
facilities, respectively, as determined by the Secretary.
``(iii) Patient care costs.--The term `patient care costs'
means total Medicare-allowable costs minus overhead costs.
``(H) Sunset.--The provisions of this paragraph shall cease
to apply as of the date the Secretary implements an
integrated, site-neutral payment methodology under this title
for post-acute care.''; and
(C) in paragraph (8), as redesignated by paragraph (1)--
(i) in subparagraph (C), by striking ``and'' at the end;
(ii) in subparagraph (D), by striking the period at the end
and inserting ``, and''; and
(iii) by adding at the end the following new subparagraph:
``(E) modified standardized payment amounts under paragraph
(7).''.
(2) Special rule for discharges occurring in the second
half of fiscal year 2008.--
(A) In general.--In the case of discharges from an
inpatient rehabilitation facility occurring during the period
beginning on April 1, 2008, and ending on September 30, 2008,
for applicable medical conditions (as defined in paragraph
(7)(G)(i) of section 1886(j) of the Social Security Act (42
U.S.C. 1395ww(j)), as inserted by paragraph (1)(B), in lieu
of the standardized payment amount determined pursuant to
such section, the standardized payment amount shall be $9,507
for unilateral knee replacement, $10,398 for unilateral hip
replacement, and $10,958 for unilateral hip fracture. Such
amounts are the amounts that are estimated would be
determined under paragraph (7)(C) of such section 1886(j) for
such conditions if such paragraph applied for such period.
Such standardized payment amounts shall be multiplied by the
relative weights for each case-mix group and tier, as
published in the final rule of the Secretary of Health and
Human Services for inpatient rehabilitation facility services
prospective payment for fiscal year 2008, to obtain the
applicable payment amounts for each such condition for each
case-mix group and tier.
(B) Implementation.--Notwithstanding any other provision of
law, the Secretary of Health and Human Services may implement
this subsection by program instruction or otherwise.
Paragraph (8)(E) of such section 1886(j) of the Social
Security Act, as added by paragraph (1)(C), shall apply for
purposes of this subsection in the same manner as such
paragraph applies for purposes of paragraph (7) of such
section 1886(j).
(d) Recommendations for Classifying Inpatient
Rehabilitation Hospitals and Units.--
(1) Report to congress.--Not later than 12 months after the
date of the enactment of this Act, the Secretary of Health
and Human Services, in consultation with physicians
(including geriatricians and physiatrists), administrators of
inpatient rehabilitation, acute care hospitals, skilled
nursing facilities, and other settings providing
rehabilitation services, Medicare beneficiaries, trade
organizations representing inpatient rehabilitation hospitals
and units and skilled nursing facilities, and the Medicare
Payment Advisory Commission, shall submit to the Committee on
Ways and Means of the House of Representatives and the
Committee on Finance of the Senate a report that includes--
(A) an examination of Medicare beneficiaries' access to
medically necessary rehabilitation services;
(B) alternatives or refinements to the 75 percent rule
policy for determining exclusion criteria for inpatient
rehabilitation hospital and unit designation under the
Medicare program, including determining clinical
appropriateness of inpatient rehabilitation hospital and unit
admissions and alternative criteria which would consider a
patient's functional status, diagnosis, co-morbidities, and
other relevant factors; and
(C) an examination that identifies any condition for which
individuals are commonly admitted to inpatient rehabilitation
hospitals that is not included as a condition described in
section 412.23(b)(2)(iii) of title 42, Code of Federal
Regulations, to determine the appropriate setting of care,
and any variation in patient outcomes and costs, across
settings of care, for treatment of such conditions.
For the purposes of this subsection, the term ``75 percent
rule'' means the requirement of section 412.23(b)(2) of title
42, Code of Federal Regulations, that 75 percent of the
patients of a rehabilitation hospital or converted
rehabilitation unit are in 1 or more of 13 listed treatment
categories.
(2) Considerations.--In developing the report described in
paragraph (1), the Secretary shall include the following:
(A) The potential effect of the 75 percent rule on access
to rehabilitation care by Medicare beneficiaries for the
treatment of a condition, whether or not such condition is
described in section 412.23(b)(2)(iii) of title 42, Code of
Federal Regulations.
(B) An analysis of the effectiveness of rehabilitation care
for the treatment of conditions, whether or not such
conditions are described in section 412.23(b)(2)(iii) of
title 42, Code of Federal Regulations, available to Medicare
beneficiaries in various health care settings, taking into
account variation in patient outcomes and costs across
different settings of care, and which may include whether the
Medicare program and Medicare beneficiaries may incur higher
costs of care for the entire episode of illness due to
readmissions, extended lengths of stay, and other factors.
SEC. 503. LONG-TERM CARE HOSPITALS.
(a) Long-Term Care Hospital Payment Update.--
(1) In general.--Section 1886 of the Social Security Act
(42 U.S.C. 1395ww) is amended by adding at the end the
following new subsection:
``(m) Prospective Payment for Long-Term Care Hospitals.--
``(1) Reference to establishment and implementation of
system.--For provisions related to the establishment and
implementation of a prospective payment system for payments
under this title for inpatient hospital services furnished by
a long-term care hospital described in subsection
(d)(1)(B)(iv), see section 123 of the Medicare, Medicaid, and
SCHIP Balanced Budget Refinement Act of 1999 and section
307(b) of Medicare, Medicaid, and SCHIP Benefits Improvement
and Protection Act of 2000.
``(2) Update for rate year 2008.--In implementing the
system described in paragraph (1) for discharges occurring
during the rate year ending in 2008 for a hospital, the base
rate for such discharges for the hospital shall be the same
as the base rate for discharges for the hospital occurring
during the previous rate year.''.
(2) Delayed effective date.--Subsection (m)(2) of section
1886 of the Social Security Act, as added by paragraph (1),
shall not apply to discharges occurring on or after July 1,
2007, and before January 1, 2008.
(b) Payment for Long-Term Care Hospital Services; Patient
and Facility Criteria.--
(1) Definition of long-term care hospital.--
(A) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x), as amended by section 201(a)(2), is
amended by adding at the end the following new subsection:
``Long-Term Care Hospital
``(ddd) The term `long-term care hospital' means an
institution which--
``(1) is primarily engaged in providing inpatient services,
by or under the supervision of a physician, to Medicare
beneficiaries whose
[[Page H9377]]
medically complex conditions require a long hospital stay and
programs of care provided by a long-term care hospital;
``(2) has an average inpatient length of stay (as
determined by the Secretary) for Medicare beneficiaries of
greater than 25 days, or as otherwise defined in section
1886(d)(1)(B)(iv);
``(3) satisfies the requirements of subsection (e);
``(4) meets the following facility criteria:
``(A) the institution has a patient review process,
documented in the patient medical record, that screens
patients prior to admission for appropriateness of admission
to a long-term care hospital, validates within 48 hours of
admission that patients meet admission criteria for long-term
care hospitals, regularly evaluates patients throughout their
stay for continuation of care in a long-term care hospital,
and assesses the available discharge options when patients no
longer meet such continued stay criteria;
``(B) the institution has active physician involvement with
patients during their treatment through an organized medical
staff, physician-directed treatment with physician on-site
availability on a daily basis to review patient progress, and
consulting physicians on call and capable of being at the
patient's side within a moderate period of time, as
determined by the Secretary;
``(C) the institution has interdisciplinary team treatment
for patients, requiring interdisciplinary teams of health
care professionals, including physicians, to prepare and
carry out an individualized treatment plan for each patient;
and
``(5) meets patient criteria relating to patient mix and
severity appropriate to the medically complex cases that
long-term care hospitals are designed to treat, as measured
under section 1886(n).''.
(B) New patient criteria for long-term care hospital
prospective payment.--Section 1886 of such Act (42 U.S.C.
1395ww), as amended by subsection (a), is further amended by
adding at the end the following new subsection:
``(n) Patient Criteria for Prospective Payment to Long-Term
Care Hospitals.--
``(1) In general.--To be eligible for prospective payment
under this section as a long-term care hospital, a long-term
care hospital must admit not less than a majority of patients
who have a high level of severity, as defined by the
Secretary, and who are assigned to one or more of the
following major diagnostic categories:
``(A) Circulatory diagnoses.
``(B) Digestive, endocrine, and metabolic diagnoses.
``(C) Infection disease diagnoses.
``(D) Neurological diagnoses.
``(E) Renal diagnoses.
``(F) Respiratory diagnoses.
``(G) Skin diagnoses.
``(H) Other major diagnostic categories as selected by the
Secretary.
``(2) Major diagnostic category defined.--In paragraph (1),
the term `major diagnostic category' means the medical
categories formed by dividing all possible principle
diagnosis into mutually exclusive diagnosis areas which are
referred to in 67 Federal Register 49985 (August 1, 2002).''.
(C) Establishment of rehabilitation units within certain
long-term care hospitals.--If the Secretary of Health and
Human Services does not include rehabilitation services
within a major diagnostic category under section 1886(n)(2)
of the Social Security Act, as added by subparagraph (B), the
Secretary shall approve for purposes of title XVIII of such
Act distinct part inpatient rehabilitation hospital units in
long-term care hospitals consistent with the following:
(i) A hospital that, on or before October 1, 2004, was
classified by the Secretary as a long-term care hospital, as
described in section 1886(d)(1)(B)(iv)(I) of such Act (42
U.S.C. 1395ww(d)(1)(V)(iv)(I)), and was accredited by the
Commission on Accreditation of Rehabilitation Facilities, may
establish a hospital rehabilitation unit that is a distinct
part of the long-term care hospital, if the distinct part
meets the requirements (including conditions of
participation) that would otherwise apply to a distinct-part
rehabilitation unit if the distinct part were established by
a subsection (d) hospital in accordance with the matter
following clause (v) of section 1886(d)(1)(B) of such Act,
including any regulations adopted by the Secretary in
accordance with this section, except that the one-year
waiting period described in section 412.30(c) of title 42,
Code of Federal Regulations, applicable to the conversion of
hospital beds into a distinct-part rehabilitation unit shall
not apply to such units.
(ii) Services provided in inpatient rehabilitation units
established under clause (i) shall not be reimbursed as long-
term care hospital services under section 1886 of such Act
and shall be subject to payment policies established by the
Secretary to reimburse services provided by inpatient
hospital rehabilitation units.
(D) Effective date.--The amendments made by subparagraphs
(A) and (B), and the provisions of subparagraph (C), shall
apply to discharges occurring on or after January 1, 2008.
(2) Implementation of facility and patient criteria.--
(A) Report.--No later than 1 year after the date of the
enactment of this Act, the Secretary of Health and Human
Services (in this section referred to as the ``Secretary'')
shall submit to the appropriate committees of Congress a
report containing recommendations regarding the promulgation
of the national long-term care hospital facility and patient
criteria for application under paragraphs (4) and (5) of
section 1861(ccc) and section 1886(n) of the Social Security
Act, as added by subparagraphs (A) and (B), respectively, of
paragraph (1). In the report, the Secretary shall consider
recommendations contained in a report to Congress by the
Medicare Payment Advisory Commission in June 2004 for long-
term care hospital-specific facility and patient criteria to
ensure that patients admitted to long-term care hospitals are
medically complex and appropriate to receive long-term care
hospital services.
(B) Implementation.--No later than 1 year after the date of
submittal of the report under subparagraph (A), the Secretary
shall, after rulemaking, implement the national long-term
care hospital facility and patient criteria referred to in
such subparagraph. Such long-term care hospital facility and
patient criteria shall be used to screen patients in
determining the medical necessity and appropriateness of a
Medicare beneficiary's admission to, continued stay at, and
discharge from, long-term care hospitals under the Medicare
program and shall take into account the medical judgment of
the patient's physician, as provided for under sections
1814(a)(3) and 1835(a)(2)(B) of the Social Security Act (42
U.S.C. 1395f(a)(3), 1395n(a)(2)(B)).
(3) Expanded review of medical necessity.--
(A) In general.--The Secretary of Health and Human Services
shall provide, under contracts with one or more appropriate
fiscal intermediaries or medicare administrative contractors
under section 1874A(a)(4)(G) of the Social Security Act (42
U.S.C. 1395kk(a)(4)(G)), for reviews of the medical necessity
of admissions to long-term care hospitals (described in
section 1886(d)(1)(B)(iv) of such Act) and continued stay at
such hospitals, of individuals entitled to, or enrolled for,
benefits under part A of title XVIII of such Act on a
hospital-specific basis consistent with this paragraph. Such
reviews shall be made for discharges occurring on or after
October 1, 2007.
(B) Review methodology.--The medical necessity reviews
under paragraph (A) shall be conducted for each such long-
term care hospital on an annual basis in accordance with
rules (including a sample methodology) specified by the
Secretary. Such sample methodology shall--
(i) provide for a statistically valid and representative
sample of admissions of such individuals sufficient to
provide results at a 95 percent confidence interval; and
(ii) guarantee that at least 75 percent of overpayments
received by long-term care hospitals for medically
unnecessary admissions and continued stays of individuals in
long-term care hospitals will be identified and recovered and
that related days of care will not be counted toward the
length of stay requirement contained in section
1886(d)(1)(B)(iv) of the Social Security Act (42 U.S.C.
1395ww(d)(1)(B)(iv)).
(C) Continuation of reviews.--Under contracts under this
paragraph, the Secretary shall establish a denial rate with
respect to such reviews that, if exceeded, could require
further review of the medical necessity of admissions and
continued stay in the hospital involved.
(D) Termination of required reviews.--
(i) In general.--Subject to clause (iii), the previous
provisions of this subsection shall cease to apply as of the
date specified in clause (ii).
(ii) Date specified.--The date specified in this clause is
the later of January 1, 2013, or the date of implementation
of national long-term care hospital facility and patient
criteria under section paragraph (2)(B).
(iii) Continuation.--As of the date specified in clause
(ii), the Secretary shall determine whether to continue to
guarantee, through continued medical review and sampling
under this paragraph, recovery of at least 75 percent of
overpayments received by long-term care hospitals due to
medically unnecessary admissions and continued stays.
(E) Funding.--The costs to fiscal intermediaries or
medicare administrative contractors conducting the medical
necessity reviews under subparagraph (A) shall be funded from
the aggregate overpayments recouped by the Secretary of
Health and Human Services from long-term care hospitals due
to medically unnecessary admissions and continued stays. The
Secretary may use an amount not in excess of 40 percent of
the overpayments recouped under this paragraph to compensate
the fiscal intermediaries or Medicare administrative
contractors for the costs of services performed.
(4) Limited, qualified moratorium of long-term care
hospitals.--
(A) In general.--Subject to subparagraph (B), the Secretary
shall impose a temporary moratorium on the certification of
new long-term care hospitals (and satellite facilities), and
new long-term care hospital and satellite facility beds, for
purposes of the Medicare program under title XVIII of the
Social Security Act. The moratorium shall terminate at the
end of the 4-year period beginning on the date of the
enactment of this Act.
(B) Exceptions.--
(i) In general.--The moratorium under subparagraph (A)
shall not apply as follows:
(I) To a long-term care hospital, satellite facility, or
additional beds under development as of the date of the
enactment of this Act.
(II) To an existing long-term care hospital that requests
to increase its number of long-term care hospital beds, if
the Secretary determines there is a need at the long-term
care hospital for additional beds to accommodate--
(aa) infectious disease issues for isolation of patients;
(bb) bedside dialysis services;
(cc) single-sex accommodation issues;
(dd) behavioral issues; or
(ee) any requirements of State or local law.
(III) To an existing long-term care hospital that requests
an increase in beds because of the closure of a long-term
care hospital or significant decrease in the number of long-
term care hospital beds, in a State where there is only one
other long-term care hospital.
There shall be no administrative or judicial review from a
decision of the Secretary under this subparagraph.
[[Page H9378]]
(ii) ``Under development'' defined.--For purposes of clause
(i)(I), a long-term care hospital or satellite facility is
considered to be ``under development'' as of a date if any of
the following have occurred on or before such date:
(I) The hospital or a related party has a binding written
agreement with an outside, unrelated party for the
construction, reconstruction, lease, rental, or financing of
the long-term care hospital and the hospital has expended,
before the date of the enactment of this Act, at least 10
percent of the estimated cost of the project (or, if less,
$2,500,000).
(II) Actual construction, renovation or demolition for the
long-term care hospital has begun and the hospital has
expended, before the date of the enactment of this Act, at
least 10 percent of the estimated cost of the project (or, if
less, $2,500,000).
(III) A certificate of need has been approved in a State
where one is required or other necessary approvals from
appropriate State agencies have been received for the
operation of the hospital.
(IV) The hospital documents that, within 3 months after the
date of the enactment of this Act, it is within a 6-month
long-term care hospital demonstration period required by
section 412.23(e)(1)-(3) of title 42, Code of Federal
Regulations, to demonstrate that it has a greater than 25 day
average length of stay.
(5) No application of 25 percent patient threshold payment
adjustment to freestanding and grandfathered ltchs.--The
Secretary shall not apply, during the 5-year period beginning
on the date of the enactment of this Act, section 412.536 of
title 42, Code of Federal Regulations, or any similar
provision, to freestanding long-term care hospitals and the
Secretary shall not apply such section or section 412.534 of
title 42, Code of Federal Regulations, or any similar
provisions, to a long-term care hospital identified by
section 4417(a) of the Balanced Budget Act of 1997 (Public
Law 105-33). A long-term care hospital identified by such
section 4417(a) shall be deemed to be a freestanding long-
term care hospital for the purpose of this section. Section
412.536 of title 42, Code of Federal Regulations, shall be
void and of no effect.
(6) Payment for hospitals-within-hospitals.--
(A) In general.--Payments to an applicable long-term care
hospital or satellite facility which is located in a rural
area or which is co-located with an urban single or MSA
dominant hospital under paragraphs (d)(1), (e)(1), and (e)(4)
of section 412.534 of title 42, Code of Federal Regulations,
shall not be subject to any payment adjustment under such
section if no more than 75 percent of the hospital's Medicare
discharges (other than discharges described in paragraphs
(d)(2) or (e)(3) of such section) are admitted from a co-
located hospital.
(B) Co-located long-term care hospitals and satellite
facilities.--
(i) In general.--Payment to an applicable long-term care
hospital or satellite facility which is co-located with
another hospital shall not be subject to any payment
adjustment under section 412.534 of title 42, Code of Federal
Regulations, if no more than 50 percent of the hospital's
Medicare discharges (other than discharges described in
section 412.534(c)(3) of such title) are admitted from a co-
located hospital.
(ii) Applicable long-term care hospital or satellite
facility defined.--In this paragraph, the term ``applicable
long-term care hospital or satellite facility'' means a
hospital or satellite facility that is subject to the
transition rules under section 412.534(g) of title 42, Code
of Federal Regulations.
(C) Effective date.--Subparagraphs (A) and (B) shall apply
to discharges occurring on or after October 1, 2007, and
before October 1, 2012.
(7) No application of very short-stay outlier policy.--The
Secretary shall not apply, during the 5-year period beginning
on the date of the enactment of this Act, the amendments
finalized on May 11, 2007 (72 Federal Register 26904) made to
the short-stay outlier payment provision for long-term care
hospitals contained in section 412.529(c)(3)(i) of title 42,
Code of Federal Regulations, or any similar provision.
(8) No application of one time adjustment to standard
amount.--The Secretary shall not, during the 5-year period
beginning on the date of the enactment of this Act, make the
one-time prospective adjustment to long-term care hospital
prospective payment rates provided for in section
412.523(d)(3) of title 42, Code of Federal Regulations, or
any similar provision.
(c) Separate Classification for Certain Long-Stay Cancer
Hospitals.--
(1) In general.--Subsection (d)(1)(B) of section 1886 of
the Social Security Act (42 U.S.C. 1395ww) is amended--
(A) in clause (iv)--
(i) in subclause (I), by striking ``(iv)(I)'' and inserting
``(iv)'' and by striking ``or'' at the end; and
(ii) in subclause (II)--
(I) by striking ``, or'' at the end and inserting a
semicolon; and
(II) by redesignating such subclause as clause (vi) and by
moving it to immediately follow clause (v); and
(B) in clause (v), by striking the semicolon at the end and
inserting ``, or''.
(2) Conforming payment references.--Subsection (b) of such
section is amended--
(A) in paragraph (2)(E)(ii), by adding at the end the
following new subclause:
``(III) Hospitals described in clause (vi) of such
subsection.'';
(B) in paragraph (3)(F)(iii), by adding at the end the
following new subclause:
``(VI) Hospitals described in clause (vi) of such
subsection.'';
(C) in paragraphs (3)(G)(ii), (3)(H)(i), and (3)(H)(ii)(I),
by inserting ``or (vi)'' after ``clause (iv)'' each place it
appears;
(D) in paragraph (3)(H)(iv), by adding at the end the
following new subclause:
``(IV) Hospitals described in clause (vi) of such
subsection.'';
(E) in paragraph (3)(J), by striking ``subsection
(d)(1)(B)(iv)'' and inserting ``clause (iv) or (vi) of
subsection (d)(1)(B)''; and
(F) in paragraph (7)(B), by adding at the end the following
new clause:
``(iv) Hospitals described in clause (vi) of such
subsection.''.
(3) Additional conforming amendments.--The second sentence
of subsection (d)(1)(B) of such section is amended--
(A) by inserting ``(as in effect as of such date)'' after
``clause (iv)''; and
(B) by inserting ``(or, in the case of a hospital
classified under clause (iv)(II), as so in effect, shall be
classified under clause (vi) on and after the effective date
of such clause)'' after ``so classified''.
(4) In General.--In the case of a hospital that is
classified under clause (iv)(II) of section 1886(d)(1)(B) of
the Social Security Act immediately before the date of the
enactment of this Act and which is classified under clause
(vi) of such section after such date of enactment, payments
under section 1886 of such Act for cost reporting periods
beginning after the date of the enactment of this Act shall
be based upon payment rates in effect for the cost reporting
period for such hospital beginning during fiscal year 2001,
increased for each succeeding cost reporting period
(beginning before the date of the enactment of this Act) by
the applicable percentage increase under section
1886(b)(3)(B)(ii) of such Act.
(5) Clarification of treatment of satellite facilities and
remote locations.--A long-stay cancer hospital described in
section 1886(d)(1)(B)(vi) of the Social Security Act, as
designated under paragraph (1), shall include satellites or
remote site locations for such hospital established before or
after the date of the enactment ``without regard to section
412.22(h)(2)(i) of title 42, Code of Federal Regulations,''
if the provider-based requirements under section 413.65 of
such title, applicable certification requirements under title
XVIII of the Social Security, and such other applicable State
licensure and certificate of need requirements are met with
respect to such satellites or remote site locations.
SEC. 504. INCREASING THE DSH ADJUSTMENT CAP.
(a) In General.--Section 1886(d)(5)(F)(xiv) of the Social
Security Act (42 U.S.C. 1395ww(d)(5)(F)(xiv)) is amended--
(b) Special Rule in Computing Disproportionate Patient
Percentage.--
(1) In general.--Section 1886(d)(5)(F)(vi) of such Act (42
U.S.C. 1395ww(d)(5)(F)(vi)) is amended by adding at the end
the following: ``In applying this clause in the case of
hospitals located in Puerto Rico, the Secretary shall
substitute for the fraction described in subclause (I) one-
half of the national average of such fraction for all
subsection (d) hospitals, as estimated by the Secretary.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to discharges in cost reporting periods of
hospitals beginning on or after January 1, 2008.
(1) in subclause (II), by striking ``12 percent'' and
inserting ``the percent specified in subclause (III)''; and
(2) by adding at the end the following new subclause:
``(III) The percent specified in this subclause is, in the
case of discharges occurring--
``(a) before October 1, 2007, 12 percent;
``(b) during fiscal year 2008, 16 percent;
``(c) during fiscal year 2009, 18 percent; and
``(d) on or after October 1, 2009, 12 percent.''.
SEC. 505. PPS-EXEMPT CANCER HOSPITALS.
(a) Authorizing Rebasing for PPS-Exempt Cancer Hospitals.--
Section 1886(b)(3)(F) of the Social Security Act (42 U.S.C.
1395ww(b)(3)(F)) is amended by adding at the end the
following new clause:
``(iv) In the case of a hospital (or unit described in the
matter following clause (v) of subsection (d)(1)(B)) that
received payment under this subsection for inpatient hospital
services furnished during cost reporting periods beginning
before October 1, 1999, that is within a class of hospital
described in clause (iii) (other than subclause (IV),
relating to long-term care hospitals, and that requests the
Secretary (in a form and manner specified by the Secretary)
to effect a rebasing under this clause for the hospital, the
Secretary may compute the target amount for the hospital's
12-month cost reporting period beginning during fiscal year
2008 as an amount equal to the average described in clause
(ii) but determined as if any reference in such clause to
`the date of the enactment of this subparagraph' were a
reference to `the date of the enactment of this clause'.''.
(b) Additional Cancer Hospital Provisions.--
(1) In general.--Section 1886(d)(1) of the Social Security
Act (42 U.S.C. 1395ww(d)(1)) is amended--
(A) in subparagraph (B)(v)--
(i) by striking ``or'' at the end of subclause (II); and
(ii) by adding at the end the following:
``(IV) a hospital that is a nonprofit corporation, the sole
member of which is affiliated with a university that has been
the recipient of a cancer center support grant from the
National Cancer Institute of the National Institutes of
Health, and which sole member (or its predecessors or such
university) was recognized as a comprehensive cancer center
by the National Cancer Institute of the National Institutes
of Health as of April 20, 1983, if the hospital's articles of
incorporation specify that at least 50 percent of its total
discharges have a principal finding of neoplastic disease (as
defined in subparagraph (E)) and if, of December 31, 2005,
the
[[Page H9379]]
hospital was licensed for less than 150 acute care beds, or
``(V) a hospital (aa) that the Secretary has determined to
be, at any time on or before December 31, 2011, a hospital
involved extensively in treatment for, or research on,
cancer, (bb) that is (as of the date of such determination) a
free-standing facility, (cc) for which the hospital's
predecessor provider entity was University Hospitals of
Cleveland with medicare provider number 36-0137;''; and
(B) in subparagraph (B), by inserting after clause (vi), as
redesignated by section 503(c)(1)(A)(ii)(II), the following
new clause:
``(vii) a hospital that--
``(I) is located in a State that as of December 31, 2006,
had only one center under section 414 of the Public Health
Service Act that has been designated by the National Cancer
Institute as a comprehensive center currently serving all 21
counties in the most densely populated State in the nation
(U.S. Census estimate for 2005: 8,717,925 persons; 1,134.5
persons per square mile), serving more than 70,000 patient
visits annually;
``(II) as of December 31, 2006, served as the teaching and
clinical care, research and training hospital for the Center
described in subclause (II), providing significant financial
and operational support to such Center;
``(III) as of December 31, 2006, served as a core and
essential element in such Center which conducts more than 130
clinical trial activities, national cooperative group
studies, investigator-initiated and peer review studies and
has received as of 2005 at least $93,000,000 in research
grant awards;
``(IV) as of December 31, 2006, includes dedicated patient
care units organized primarily for the treatment of and
research on cancer with approximately 125 beds, 75 percent of
which are dedicated to cancer patients, and contains a
radiation oncology department as well as specialized
emergency services for oncology patients; and
``(V) as of December 31, 2004, is identified as the focus
of the Center's inpatient activities in the Center's
application as a NCI-designated comprehensive cancer center
and shares the NCI comprehensive cancer designation with the
Center; and
(D) in subparagraph (E)--
(i) by striking ``subclauses (II) and (III)'' and inserting
``subclauses (II), (III), and (IV)''; and
(ii) by inserting ``and subparagraph (B)(vi)'' after
``subparagraph (B)(v)''.
(2) Effective dates; payments.--
(A) Application to cost reporting periods.--
(i) Any classification by reason of section
1886(d)(1)(B)(vi) of the Social Security Act (42 U.S.C.
1395ww(d)(1)(B)(vi)), as inserted by paragraph (1), shall
apply to cost reporting periods beginning on or after January
1, 2006.
(ii) The provisions of section 1886(d)(1)(B)(v)(IV) of the
Social Security Act, as added by paragraph (1), shall take
effect on January 1, 2008.
(B) Base target amount.--Notwithstanding subsection
(b)(3)(E) of section 1886 of the Social Security Act (42
U.S.C. 1395ww), in the case of a hospital described in
subsection (d)(1)(B)(vi) of such section, as inserted by
paragraph (1)--
(i) the hospital shall be permitted to resubmit the 2006
Medicare 2552 cost report incorporating a cancer hospital
sub-provider number and to apply the Medicare ratio-of-cost-
to-charge settlement methodology for outpatient cancer
services; and
(ii) the hospital's target amount under subsection
(b)(3)(E)(i) of such section for the first cost reporting
period beginning on or after January 1, 2006, shall be the
allowable operating costs of inpatient hospital services
(referred to in subclause (I) of such subsection) for such
first cost reporting period.
(C) Deadline for payments.--Any payments owed to a hospital
as a result of this subsection for periods occurring before
the date of the enactment of this Act shall be made
expeditiously, but in no event later than 1 year after such
date of enactment.
(3) Application to certain hospitals.--
(A) Inapplicability of certain requirements.--The
provisions of section 412.22(e) of title 42, Code of Federal
Regulations, shall not apply to a hospital described in
section 1886(d)(1)(B)(v)(V) of the Social Security Act, as
added by paragraph (1).
(B) Application to cost reporting periods.--If the
Secretary makes a determination that a hospital is described
in section 1886(d)(1)(B)(v)(V) of the Social Security Act, as
added by paragraph (1), such determination shall apply as of
the first cost reporting period beginning on or after the
date of such determination.
(C) Base period.--Notwithstanding the provisions of section
1886(b)(3)(E) of the Social Security Act (42 U.S.C.
1395ww(b)(3)(E)) or any other provision of law, the base cost
reporting period for purposes of determining the target
amount for any hospital for which a determination described
in subparagraph (B) has been made shall be the first full 12-
month cost reporting period beginning on or after the date of
such determination.
(D) Rule.--A hospital described in subclause (V) of section
1886(b)(1)(B)(v) of the Social Security Act, as added by
paragraph (1), shall not qualify as a hospital described in
such subclause for any cost reporting period in which less
than 50 percent of its total discharges have a principal
finding of neoplastic disease. With respect to the first cost
reporting period for which a determination described in
subparagraph (B) has been made, the Secretary shall accept a
self-certification by the hospital, which shall be applicable
to such first cost reporting period, that the hospital
intends to have total discharges during such first cost
reporting period of which 50 percent or more have a principal
finding of neoplastic disease.
(c) MedPAC Report on PPS-Exempt Cancer Hospitals.--Not
later than March 1, 2009, the Medicare Payment Advisory
Commission (established under section 1805 of the Social
Security Act (42 U.S.C. 1395b-6)) shall submit to the
Secretary and Congress a report evaluating the following:
(1) Measures of payment adequacy and Medicare margins for
PPS-exempt cancer hospitals, as established under section
1886(d)(1)(B)(v) of the Social Security Act (42 U.S.C.
1395ww(d)(1)(B)(v)).
(2) To the extent a PPS-exempt cancer hospital was
previously affiliated with another hospital, the margins of
the PPS-exempt hospital and the other hospital as separate
entities and the margins of such hospitals that existed when
the hospitals were previously affiliated.
(3) Payment adequacy for cancer discharges under the
Medicare inpatient hospital prospective payment system.
SEC. 506. SKILLED NURSING FACILITY PAYMENT UPDATE.
(a) In General.--Section 1888(e)(4)(E)(ii) of the Social
Security Act (42 U.S.C. 1395yy(e)(4)(E)(ii)) is amended--
(1) in subclause (III), by striking ``and'' at the end;
(2) by redesignating subclause (IV) as subclause (VI); and
(3) by inserting after subclause (III) the following new
subclauses:
``(IV) for each of fiscal years 2004, 2005, 2006, and 2007,
the rate computed for the previous fiscal year increased by
the skilled nursing facility market basket percentage change
for the fiscal year involved;
``(V) for fiscal year 2008, the rate computed for the
previous fiscal year; and''.
(b) Delayed Effective Date.--Section 1888(e)(4)(E)(ii)(V)
of the Social Security Act, as inserted by subsection (a)(3),
shall not apply to payment for days before January 1, 2008.
SEC. 507. REVOCATION OF UNIQUE DEEMING AUTHORITY OF THE JOINT
COMMISSION FOR THE ACCREDITATION OF HEALTHCARE
ORGANIZATIONS.
(a) Revocation.--Section 1865 of the Social Security Act
(42 U.S.C. 1395bb) is amended--
(1) by striking subsection (a); and
(2) by redesignating subsections (b), (c), (d), and (e) as
subsections (a), (b), (c), and (d), respectively.
(b) Conforming Amendments.--(1) Such section is further
amended--
(A) in subsection (a)(1), as so redesignated, by striking
``In addition, if'' and inserting ``If'';
(B) in subsection (b), as so redesignated--
(i) by striking ``released to him by the Joint Commission
on Accreditation of Hospitals,'' and inserting ``released to
the Secretary by''; and
(ii) by striking the comma after ``Association'';
(C) in subsection (c), as so redesignated, by striking
``pursuant to subsection (a) or (b)(1)'' and inserting
``pursuant to subsection (a)(1)''; and
(D) in subsection (d), as so redesignated, by striking
``pursuant to subsection (a) or (b)(1)'' and inserting
``pursuant to subsection (a)(1)''.
(2) Section 1861(e) of such Act (42 U.S.C. 1395x(e)) is
amended in the fourth sentence by striking ``and (ii) is
accredited by the Joint Commission on Accreditation of
Hospitals, or is accredited by or approved by a program of
the country in which such institution is located if the
Secretary finds the accreditation or comparable approval
standards of such program to be essentially equivalent to
those of the Joint Commission on Accreditation of
Hospitals.'' and inserting ``and (ii) is accredited by a
national accreditation body recognized by the Secretary under
section 1865(a), or is accredited by or approved by a program
of the country in which such institution is located if the
Secretary finds the accreditation or comparable approval
standards of such program to be essentially equivalent to
those of such a national accreditation body.''.
(3) Section 1864(c) of such Act (42 U.S.C. 1395aa(c)) is
amended by striking ``pursuant to subsection (a) or (b)(1) of
section 1865'' and inserting ``pursuant to section
1865(a)(1)''.
(4) Section 1875(b) of such Act (42 U.S.C. 1395ll(b)) is
amended by striking ``the Joint Commission on Accreditation
of Hospitals,'' and inserting ``national accreditation bodies
under section 1865(a)''.
(5) Section 1834(a)(20)(B) of such Act (42 U.S.C.
1395m(a)(20)(B)) is amended by striking ``section 1865(b)''
and inserting ``section 1865(a)''.
(6) Section 1852(e)(4)(C) of such Act (42 U.S.C. 1395w-
22(e)(4)(C)) is amended by striking ``section 1865(b)(2)''
and inserting ``section 1865(a)(2)''.
(c) Authority to Recognize JCAHO as a National
Accreditation Body.--The Secretary of Health and Human
Services may recognize the Joint Commission on Accreditation
of Healthcare Organizations as a national accreditation body
under section 1865 of the Social Security Act (42 U.S.C.
1395bb), as amended by this section, upon such terms and
conditions, and upon submission of such information, as the
Secretary may require.
(d) Effective Date; Transition Rule.--(1) Subject to
paragraph (2), the amendments made by this section shall
apply with respect to accreditations of hospitals granted on
or after the date that is 18 months after the date of the
enactment of this Act.
(2) For purposes of title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.), the amendments made by this section
shall not effect the accreditation of a hospital by the Joint
Commission on Accreditation of Healthcare Organizations, or
under accreditation or comparable approval standards found to
be essentially equivalent to accreditation or approval
standards of the Joint Commission on Accreditation of
Healthcare Organizations, for the period of time applicable
under such accreditation.
[[Page H9380]]
SEC. 508. TREATMENT OF MEDICARE HOSPITAL RECLASSIFICATIONS.
(a) Extending Certain Medicare Hospital Wage Index
Reclassifications Through Fiscal Year 2009.--
(1) In general.--Section 106(a) of the Medicare
Improvements and Extension Act of 2006 (division B of Public
Law 109-432) is amended by striking ``September 30, 2007''
and inserting ``September 30, 2009''.
(2) Special exception reclassifications.--The Secretary of
Health and Human Services shall extend for discharges
occurring through September 30, 2009, the special exception
reclassification made under the authority of section
1886(d)(5)(I)(i) of the Social Security Act (42 U.S.C.
1395ww(d)(5)(I)(i)) and contained in the final rule
promulgated by the Secretary in the Federal Register on
August 11, 2004 (69 Fed. Reg. 49105, 49107).
(b) Disregarding Section 508 Hospital Reclassifications for
Purposes of Group Reclassifications.--Section 508 of the
Medicare Prescription Drug, Improvement, and Modernization
Act of 2003 (Public Law 108-173, 42 U.S.C. 1395ww note) is
amended by adding at the end the following new subsection:
``(g) Disregarding Hospital Reclassifications for Purposes
of Group Reclassifications.--For purposes of the
reclassification of a group of hospitals in a geographic area
under section 1886(d), a hospital reclassified under this
section (including any such reclassification which is
extended under section 106(a) of the Medicare Improvements
and Extension Act of 2006) shall not be taken into account
and shall not prevent the other hospitals in such area from
establishing such a group for such purpose.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to payments for discharges occurring on or after
October 1, 2008.
(c) Other Hospital Reclassification Provisions.--
Notwithstanding any other provision of law--
(1) In the case of a subsection (d) hospital (as defined
for purposes of section 1886 of the Social Security Act (42
U.S.C. 1395ww)) located in Putnam County, Tennessee with
respect to which a reclassification of its wage index for
purposes of such section would (but for this subsection)
expire on September 30, 2007, such reclassification of such
hospital shall be extended through September 30, 2008.
(2) For purposes of making payments under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)), the
Secretary of Health and Human Services shall classify any
hospital located in Orange County, New York that was
reclassified under the authority of section 508 of the the
Medicare Prescription Drug, Improvement and Modernization Act
of 2003 (Public Law 108-173) as being located in the New
York-White Plains-Wayne, NY-NJ Core Based Statistical Area.
Any reclassification under this subsection shall be treated
as a reclassification under section 1886(d)(8) of such Act.
(3) For purposes of making payments under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)), the large
urban area of New York, New York is deemed to include
hospitals, required by State law enacted prior to June 30,
2007, to join under a single unified governance structure
if--
(A) such hospitals are located in a city with a population
of no less than 20,000 and no greater than 30,000; and
(B) such hospitals are less than 3/4 miles apart.
(4) For purposes of making payments under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)) the large
urban area of Buffalo-Niagara Falls, New York is deemed to
include Chautauqua County, New York. In no case shall there
be a reduction in the hospital wage index for Erie County,
New York, or any adjoining county, as a result of the
application of this paragraph, (other than as a result of a
general reduction required to carry out paragraph (8)(D) of
that section).
(5) For purposes of making payments under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)) a hospital
shall be reclassified into the New York-White Plains-Wayne,
New York-New Jersey core based statistical area (CBSA code
35644) if the hospital is a subsection (d) hospital (as
defined in section 1886(d)(1)(B) of the Social Security Act
(42 U.S.C. 1395ww(d)(1)(B)) that--
(A) is licensed by the State in which it is located as a
specialty hospital;
(B) specializes in the treatment of cardiac, vascular, and
pulmonary diseases;
(C) provides at least 100 beds; and
(D) is located in Burlington County, New Jersey.
(6)(A) Any hospital described in subparagraph (B) shall be
treated as located in the core based statistical area
described in subparagraph (C) for purposes of making payments
under section 1886(d) of the Social Security Act (42 U.S.C.
1395ww(d)).
(B) A hospital described in this subparagraph is any
hospital that--
(i) is located in a core based statistical area (CBSA)
that--
(I) had a population (as reported in the decennial census
for the year 2000) of at least 500,000, but not more than
750,000;
(II) had a population (as reported in such census) that was
at least 10,000 below the population for the area as reported
in the previous decennial census; and
(III) has as of January 1, 2006, at least 5, and no more
than 7, subsection (d) hospitals; and
(ii) demonstrates that its average hourly wage amount (as
determined consistent with section 1886(d)(10)(D)(vi) of the
Social Security Act is not less than 96 percent of such
average hourly wage amount rate for all subsection (d)
hospitals located in same core base statistical area of the
hospital.
(C) The area described in this subparagraph, with respect
to a hospital described in subparagraph (B), is the core
based statistical area that--
(i) is within the same State as, and is adjacent to, the
core based statistical area in which the hospital is located;
and
(ii) has an average hourly wage amount (described in
subparagraph (B)(ii)) that is closest to (but does not
exceed) such average hourly wage amount of the hospital.
(7) For purposes of making payments under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)), the large
urban area of Hartford, Connecticut is deemed to include
Albany, Schenectady, and Rensselaer Counties, New York.
(8) For purposes of making payment under section 1886(d) of
the Social Security Act (42 U.S.C. 1395ww(d)), the Nashville-
Davidson-Murfreesboro core based statistical area is deemed
to include Cumberland County, Tennessee.
(9) For purposes of making payment under section 1886(d) of
the Social Security Act (42 U.S.C. 1395ww(d)), any hospital
that is co-located in Marinette, Wisconsin and the Menominee,
Michigan is deemed to be located in Chicago, Illinois.
(10) In the case of a hospital located in Massachusetts or
Clinton County, New York, that is reclassified based on wages
under paragraph (8) or (10) of section 1886(d) of the Social
Security Act into an area the area wage index for which is
increased under section 4410(a) of the Balanced Budget Act of
1997 (Public Law 105-33), such increased area wage index
shall also apply to such hospital under such section 1886(d).
(11) For purposes of applying the area wage index under
section 1886(d) of the Social Security Act (42 U.S.C.
1395ww(d)), hospital provider numbers 360112 and 23005 shall
be treated as located in the same urban area as Ann Arbor,
Michigan.
(12) For purposes of making payment under section 1886(d)
of the Social Security Act (42 U.S.C. 1395ww(d)), any
hospital that is located in Columbia County, New York, with
less 250 beds is deemed to be located in the New York-White
Plains-Wayne, NY-NJ core based statistical area.
(13) For purposes of the previous provisions of this
subsection (other than paragraph (1))--
(A) any reclassification effected under such provisions
shall be treated as a decision of the Medicare Geographic
Classification Review Board under section 1886(d) of the
Social Security Act and subject to budget neutrality under
paragraph (8)(D) of such section.; and
(B) such provisions shall only apply to discharges
occurring on or after October 1, 2008, during the 3-year
reclassification period beginning on such date.
SEC. 509. MEDICARE CRITICAL ACCESS HOSPITAL DESIGNATIONS.
(a) In General.--
(1) Section 405(h) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173; 117 Stat. 2269) is amended by adding at the end the
following new paragraph:
``(3) Exception.--
``(A) In general.--The amendment made by paragraph (1)
shall not apply to the certification by the State of
Minnesota on or after January 1, 2006, under section
1820(c)(2)(B)(i)(II) of the Social Security Act (42 U.S.C.
1395i-4(c)(2)(B)(i)(II)) of one hospital that meets the
criteria described in subparagraph (B) and is located in Cass
County, Minnesota, as a necessary provider of health care
services to residents in the area of the hospital.
``(B) Criteria described.--A hospital meets the criteria
described in this subparagraph if the hospital
``(i) has been granted an exception by the State to an
otherwise applicable statutory restriction on hospital
construction or licensing prior to the date of enactment of
this subparagraph; and
``(ii) is located on property which the State has approved
for conveyance to a county within the State prior to such
date of enactment.''.
(2) Section 1820(c)(2)(B)(i)(I) of the Social Security Act
(42 U.S.C. 1395i-4(c)(2)(B)(i)(I)) is amended by striking
``or,'' and inserting ``or, in the case of a hospital that is
located in the county seat of Butler, Alabama, a 32-mile
drive, or,''.
(b) Effective Date.--The amendment made by subsection
(a)(2) shall apply to cost reporting periods beginning on or
after the date of the enactment of this Act.
TITLE VI--OTHER PROVISIONS RELATING TO MEDICARE PART B
Subtitle A--Payment and Coverage Improvements
SEC. 601. PAYMENT FOR THERAPY SERVICES.
(a) Extension of Exceptions Process for Medicare Therapy
Caps.--Section 1833(g)(5) of the Social Security Act (42
U.S.C. 1395l(g)(5)), as amended by section 201 of the
Medicare Improvements and Extension Act of 2006 (division B
of Public Law 109-432), is amended by striking ``2007'' and
inserting ``2009''.
(b) Study and Report.--
(1) Study.--The Secretary of Health and Human Services, in
consultation with appropriate stakeholders, shall conduct a
study on refined and alternative payment systems to the
Medicare payment cap under section 1833(g) of the Social
Security Act (42 U.S.C. 1395l(g)) for physical therapy
services and speech-language pathology services, described in
paragraph (1) of such section and occupational therapy
services described in paragraph (3) of such section. Such
study shall consider, with respect to payment amounts under
Medicare, the following:
(A) The creation of multiple payment caps for such services
to better reflect costs associated with specific health
conditions.
[[Page H9381]]
(B) The development of a prospective payment system,
including an episode-based system of payments, for such
services.
(C) The data needed for the development of a system of
multiple payment caps (or an alternative payment methodology)
for such services and the availability of such data.
(2) Report.--Not later than January 1, 2009, the Secretary
shall submit to Congress a report on the study conducted
under paragraph (1).
SEC. 602. MEDICARE SEPARATE DEFINITION OF OUTPATIENT SPEECH-
LANGUAGE PATHOLOGY SERVICES.
(a) In General.--Section 1861(ll) of the Social Security
Act (42 U.S.C. 1395x(ll)) is amended--
(1) by redesignating paragraphs (2) and (3) as paragraphs
(3) and (4), respectively; and
(2) by inserting after paragraph (1) the following new
paragraph:
``(2) The term `outpatient speech-language pathology
services' has the meaning given the term `outpatient physical
therapy services' in subsection (p), except that in applying
such subsection--
``(A) `speech-language pathology' shall be substituted for
`physical therapy' each place it appears; and
``(B) `speech-language pathologist' shall be substituted
for `physical therapist' each place it appears.''.
(b) Conforming Amendments.--
(1) Section 1832(a)(2)(C) of the Social Security Act (42
U.S.C. 1395k(a)(2)(C)) is amended--
(A) by striking ``and outpatient'' and inserting ``,
outpatient''; and
(B) by inserting before the semicolon at the end the
following: ``, and outpatient speech-language pathology
services (other than services to which the second sentence of
section 1861(p) applies through the application of section
1861(ll)(2))''.
(2) Subparagraphs (A) and (B) of section 1833(a)(8) of such
Act (42 U.S.C. 1395l(a)(8)) are each amended by striking
``(which includes outpatient speech-language pathology
services)'' and inserting ``, outpatient speech-language
pathology services,''.
(3) Section 1833(g)(1) of such Act (42 U.S.C. 1395l(g)(1))
is amended--
(A) by inserting ``and speech-language pathology services
of the type described in such section through the application
of section 1861(ll)(2)'' after ``1861(p)''; and
(B) by inserting ``and speech-language pathology services''
after ``and physical therapy services''.
(4) The second sentence of section 1835(a) of such Act (42
U.S.C. 1395n(a)) is amended--
(A) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861'' each place it
appears; and
(B) by inserting ``or outpatient speech-language pathology
services, respectively'' after ``occupational therapy
services''.
(5) Section 1861(p) of such Act (42 U.S.C. 1395x(p)) is
amended by striking the fourth sentence.
(6) Section 1861(s)(2)(D) of such Act (42 U.S.C.
1395x(s)(2)(D)) is amended by inserting ``, outpatient
speech-language pathology services,'' after ``physical
therapy services''.
(7) Section 1862(a)(20) of such Act (42 U.S.C.
1395y(a)(20)) is amended--
(A) by striking ``outpatient occupational therapy services
or outpatient physical therapy services'' and inserting
``outpatient physical therapy services, outpatient speech-
language pathology services, or outpatient occupational
therapy services''; and
(B) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861''.
(8) Section 1866(e)(1) of such Act (42 U.S.C. 1395cc(e)(1))
is amended--
(A) by striking ``section 1861(g)'' and inserting
``subsection (g) or (ll)(2) of section 1861'' the first two
places it appears;
(B) by striking ``defined) or'' and inserting
``defined),''; and
(C) by inserting before the semicolon at the end the
following: ``, or (through the operation of section
1861(ll)(2)) with respect to the furnishing of outpatient
speech-language pathology''.
(c) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2008.
(d) Construction.--Nothing in this section shall be
construed to affect existing regulations and policies of the
Centers for Medicare & Medicaid Services that require
physician oversight of care as a condition of payment for
speech-language pathology services under part B of the
medicare program.
SEC. 603. INCREASED REIMBURSEMENT RATE FOR CERTIFIED NURSE-
MIDWIVES.
(a) In General.--Section 1833(a)(1)(K) of the Social
Security Act (42 U.S.C.1395l(a)(1)(K)) is amended by striking
``(but in no event'' and all that follows through ``performed
by a physician)''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to services furnished on or after April 1, 2008.
SEC. 604. ADJUSTMENT IN OUTPATIENT HOSPITAL FEE SCHEDULE
INCREASE FACTOR.
The first sentence of section 1833(t)(3)(C)(iv) of the
Social Security Act (42 U.S.C. 1395l(t)(3)(C)(iv)) is amended
by inserting before the period at the end the following:
``and reduced by 0.25 percentage point for such factor for
such services furnished in 2008''.
SEC. 605. EXCEPTION TO 60-DAY LIMIT ON MEDICARE SUBSTITUTE
BILLING ARRANGEMENTS IN CASE OF PHYSICIANS
ORDERED TO ACTIVE DUTY IN THE ARMED FORCES.
(a) In General.--Section 1842(b)(6)(D)(iii) of the Social
Security Act (42 U.S.C. 1395u(b)(6)(D)(iii)) is amended by
inserting after ``of more than 60 days'' the following: ``or
are provided over a longer continuous period during all of
which the first physician has been called or ordered to
active duty as a member of a reserve component of the Armed
Forces''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to services furnished on or after the date of the
enactment of this section.
SEC. 606. EXCLUDING CLINICAL SOCIAL WORKER SERVICES FROM
COVERAGE UNDER THE MEDICARE SKILLED NURSING
FACILITY PROSPECTIVE PAYMENT SYSTEM AND
CONSOLIDATED PAYMENT.
(a) In General.--Section 1888(e)(2)(A)(ii) of the Social
Security Act (42 U.S.C. 1395yy(e)(2)(A)(ii)) is amended by
inserting ``clinical social worker services,'' after
``qualified psychologist services,''.
(b) Conforming Amendment.--Section 1861(hh)(2) of the
Social Security Act (42 U.S.C. 1395x(hh)(2)) is amended by
striking ``and other than services furnished to an inpatient
of a skilled nursing facility which the facility is required
to provide as a requirement for participation''.
(c) Effective Date.--The amendments made by this section
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 607. COVERAGE OF MARRIAGE AND FAMILY THERAPIST SERVICES
AND MENTAL HEALTH COUNSELOR SERVICES.
(a) Coverage of Marriage and Family Therapist Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)), as amended by section
201(a)(1), is amended--
(A) in subparagraph (AA), by striking ``and'' at the end;
(B) in subparagraph (BB), by adding ``and'' at the end; and
(C) by adding at the end the following new subparagraph:
``(CC) marriage and family therapist services (as defined
in subsection (eee));''.
(2) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x), as amended by sections 201(a)(2) and
503(b)(1), is amended by adding at the end the following new
subsection:
``Marriage and Family Therapist Services
``(eee)(1) The term `marriage and family therapist
services' means services performed by a marriage and family
therapist (as defined in paragraph (2)) for the diagnosis and
treatment of mental illnesses, which the marriage and family
therapist is legally authorized to perform under State law
(or the State regulatory mechanism provided by State law) of
the State in which such services are performed, provided such
services are covered under this title, as would otherwise be
covered if furnished by a physician or as incident to a
physician's professional service, but only if no facility or
other provider charges or is paid any amounts with respect to
the furnishing of such services.
``(2) The term `marriage and family therapist' means an
individual who--
``(A) possesses a master's or doctoral degree which
qualifies for licensure or certification as a marriage and
family therapist pursuant to State law;
``(B) after obtaining such degree has performed at least 2
years of clinical supervised experience in marriage and
family therapy; and
``(C) is licensed or certified as a marriage and family
therapist in the State in which marriage and family therapist
services are performed.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)) is amended by adding at the end the following
new clause:
``(v) marriage and family therapist services;''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)), as amended by section 201(b)(1),
is amended--
(i) by striking ``and'' before ``(W)''; and
(ii) by inserting before the semicolon at the end the
following: ``, and (X) with respect to marriage and family
therapist services under section 1861(s)(2)(CC), the amounts
paid shall be 80 percent of the lesser of (i) the actual
charge for the services or (ii) 75 percent of the amount
determined for payment of a psychologist under subparagraph
(L)''.
(B) Development of criteria with respect to consultation
with a physician.--The Secretary of Health and Human Services
shall, taking into consideration concerns for patient
confidentiality, develop criteria with respect to payment for
marriage and family therapist services for which payment may
be made directly to the marriage and family therapist under
part B of title XVIII of the Social Security Act (42 U.S.C.
1395j et seq.) under which such a therapist must agree to
consult with a patient's attending or primary care physician
in accordance with such criteria.
(5) Exclusion of marriage and family therapist services
from skilled nursing facility prospective payment system.--
Section 1888(e)(2)(A)(ii) of the Social Security Act (42
U.S.C. 1395yy(e)(2)(A)(ii)), is amended by inserting
``marriage and family therapist services (as defined in
subsection (eee)(1)),'' after ``qualified psychologist
services,''.
(6) Coverage of marriage and family therapist services
provided in rural health clinics and federally qualified
health centers.--Section 1861(aa)(1)(B) of the Social
Security Act (42 U.S.C. 1395x(aa)(1)(B)) is amended by
striking ``or by a clinical social worker (as defined in
subsection (hh)(1)),'' and inserting ``, by a clinical social
worker (as defined in subsection (hh)(1)), or by a marriage
and family therapist (as defined in subsection (eee)(2)),''.
(7) Inclusion of marriage and family therapists as
practitioners for assignment of claims.--Section
1842(b)(18)(C) of the Social Security Act (42 U.S.C.
1395u(b)(18)(C)) is amended by adding at the end the
following new clause:
[[Page H9382]]
``(vii) A marriage and family therapist (as defined in
section 1861(eee)(2)).''.
(b) Coverage of Mental Health Counselor Services.--
(1) Coverage of services.--Section 1861(s)(2) of the Social
Security Act (42 U.S.C. 1395x(s)(2)), as amended by
subsection (a)(1), is further amended--
(A) in subparagraph (BB), by striking ``and'' at the end;
(B) in subparagraph (CC), by inserting ``and'' at the end;
and
(C) by adding at the end the following new subparagraph:
``(DD) mental health counselor services (as defined in
subsection (fff)(2));''.
(2) Definition.--Section 1861 of the Social Security Act
(42 U.S.C. 1395x), as amended by sections 201(a)(2) and
503(b)(1) and subsection (a)(2), is amended by adding at the
end the following new subsection:
``Mental Health Counselor; Mental Health Counselor Services
``(fff)(1) The term `mental health counselor' means an
individual who--
``(A) possesses a master's or doctor's degree which
qualifies the individual for licensure or certification for
the practice of mental health counseling in the State in
which the services are performed;
``(B) after obtaining such a degree has performed at least
2 years of supervised mental health counselor practice; and
``(C) is licensed or certified as a mental health counselor
or professional counselor by the State in which the services
are performed.
``(2) The term `mental health counselor services' means
services performed by a mental health counselor (as defined
in paragraph (1)) for the diagnosis and treatment of mental
illnesses which the mental health counselor is legally
authorized to perform under State law (or the State
regulatory mechanism provided by the State law) of the State
in which such services are performed, provided such services
are covered under this title, as would otherwise be covered
if furnished by a physician or as incident to a physician's
professional service, but only if no facility or other
provider charges or is paid any amounts with respect to the
furnishing of such services.''.
(3) Provision for payment under part b.--Section
1832(a)(2)(B) of the Social Security Act (42 U.S.C.
1395k(a)(2)(B)), as amended by subsection (a)(3), is further
amended by adding at the end the following new clause:
``(vi) mental health counselor services;''.
(4) Amount of payment.--
(A) In general.--Section 1833(a)(1) of the Social Security
Act (42 U.S.C. 1395l(a)(1)), as amended by subsection (a)(4),
is further amended--
(i) by striking ``and'' before ``(X)''; and
(ii) by inserting before the semicolon at the end the
following: ``, and (Y) with respect to mental health
counselor services under section 1861(s)(2)(DD), the amounts
paid shall be 80 percent of the lesser of (i) the actual
charge for the services or (ii) 75 percent of the amount
determined for payment of a psychologist under subparagraph
(L)''.
(B) Development of criteria with respect to consultation
with a physician.--The Secretary of Health and Human Services
shall, taking into consideration concerns for patient
confidentiality, develop criteria with respect to payment for
mental health counselor services for which payment may be
made directly to the mental health counselor under part B of
title XVIII of the Social Security Act (42 U.S.C. 1395j et
seq.) under which such a counselor must agree to consult with
a patient's attending or primary care physician in accordance
with such criteria.
(5) Exclusion of mental health counselor services from
skilled nursing facility prospective payment system.--Section
1888(e)(2)(A)(ii) of the Social Security Act (42 U.S.C.
1395yy(e)(2)(A)(ii)), as amended by subsection (a)(5), is
amended by inserting ``mental health counselor services (as
defined in section 1861(ddd)(2)),'' after ``marriage and
family therapist services (as defined in subsection
(eee)(1)),''.
(6) Coverage of mental health counselor services provided
in rural health clinics and federally qualified health
centers.--Section 1861(aa)(1)(B) of the Social Security Act
(42 U.S.C. 1395x(aa)(1)(B)), as amended by subsection (a)(6),
is amended by striking ``or by a marriage and family
therapist (as defined in subsection (eee)(2)),'' and
inserting ``by a marriage and family therapist (as defined in
subsection (eee)(2)), or a mental health counselor (as
defined in subsection (fff)(1)),''.
(7) Inclusion of mental health counselors as practitioners
for assignment of claims.--Section 1842(b)(18)(C) of the
Social Security Act (42 U.S.C. 1395u(b)(18)(C)), as amended
by subsection (a)(7), is amended by adding at the end the
following new clause:
``(viii) A mental health counselor (as defined in section
1861(fff)(1)).''.
(c) Effective Date.--The amendments made by this section
shall apply to items and services furnished on or after
January 1, 2008.
SEC. 608. RENTAL AND PURCHASE OF POWER-DRIVEN WHEELCHAIRS.
(a) In General.--Section 1834(a)(7) of the Social Security
Act (42 U.S.C. 1395m(a)(7)) is amended--
(1) in subparagraph (A)--
(A) in clause (i)(I), by striking ``Except as provided in
clause (iii), payment'' and inserting ``Payment'';
(B) by striking clause (iii); and
(C) in clause (iv)--
(i) by redesignating such clause as clause (iii); and
(ii) by striking ``or in the case of a power-driven
wheelchair for which a purchase agreement has been entered
into under clause (iii)''; and
(2) in subparagraph (C)(ii)(II), by striking ``or
(A)(iii)''.
(b) Effective Date.--
(1) In general.--Subject to paragraph (1), the amendments
made by subsection (a) shall take effect on January 1, 2008,
and shall apply to power-driven wheelchairs furnished on or
after such date.
(2) Application to competitive acquisition.--The amendments
made by subsection (a) shall not apply to contracts entered
into under section 1847 of the Social Security Act (42 U.S.C.
1395w-3) pursuant to a bid submitted under such section
before October 1, 2007.
SEC. 609. RENTAL AND PURCHASE OF OXYGEN EQUIPMENT.
(a) In General.--Section 1834(a)(5)(F) of the Social
Security Act (42 U.S.C. 1395m(a)(5)(F)) is amended--
(1) in clause (i)--
(A) by striking ``Payment'' and inserting ``Subject to
clause (iii), payment''; and
(B) by striking ``36 months'' and inserting ``18 months'';
(2) in clause (ii)(I), by striking ``36th continuous
month'' and inserting ``18th continuous month''; and
(3) by adding at the end the following new clause:
``(iii) Special rule for oxygen generating portable
equipment.--In the case of oxygen generating portable
equipment referred to in the final rule published in the
Federal Register on November 9, 2006 (71 Fed. Reg. 65897-
65899), in applying clauses (i) and (ii)(I) each reference to
`18 months' is deemed a reference to `36 months'.''.
(b) Effective Date.--
(1) In general.--Subject to paragraph (3), the amendments
made by subsection (a) shall apply to oxygen equipment
furnished on or after January 1, 2008.
(2) Transition.--In the case of an individual receiving
oxygen equipment on December 31, 2007, for which payment is
made under section 1834(a) of the Social Security Act (42
U.S.C. 1395m(a)), the 18-month period described in paragraph
(5)(F)(i) of such section, as amended by subsection (a),
shall begin on January 1, 2008, but in no case shall the
rental period for such equipment exceed 36 months.
(3) Application to competitive acquisition.--The amendments
made by subsection (a) shall not apply to contracts entered
into under section 1847 of the Social Security Act (42 U.S.C.
1395w-3) pursuant to a bid submitted under such section
before October 1, 2007.
(c) Study and Report.--
(1) Study.--The Secretary of Health and Human Services
shall conduct a study to examine the service component and
the equipment component of the provision of oxygen to
Medicare beneficiaries. The study shall assess--
(A) the type of services provided and variation across
suppliers in providing such services;
(B) whether the services are medically necessary or affect
patient outcomes;
(C) whether the Medicare program pays appropriately for
equipment in connection with the provision of oxygen;
(D) whether such program pays appropriately for necessary
services;
(E) whether such payment in connection with the provision
of oxygen should be divided between equipment and services,
and if so, how; and
(F) how such payment rate compares to a competitively bid
rate.
(2) Report.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of Health and Human
Services shall submit to Congress a report on the study
conducted under paragraph (1).
SEC. 610. ADJUSTMENT FOR MEDICARE MENTAL HEALTH SERVICES.
(a) In General.--For purposes of payment for services
furnished under the physician fee schedule under section 1848
of the Social Security Act (42 U.S.C. 1395w-4) during the
applicable period, the Secretary of Health and Human Services
shall increase the amount otherwise payable for applicable
services by 5 percent.
(b) Definitions.--For purposes of subsection (a):
(1) Applicable period.--The term ``applicable period''
means the period beginning on January 1, 2008, and ending on
December 31 of the year before the effective date of the
first review after January 1, 2008, of work relative value
units conducted under section 1848(c)(2)(B)(i) of the Social
Security Act.
(2) Applicable services.--The term ``applicable services''
means procedure codes for services--
(A) in the categories of psychiatric therapeutic procedures
furnished in office or other outpatient facility settings, or
inpatient hospital, partial hospital or residential care
facility settings; and
(B) which cover insight oriented, behavior modifying, or
supportive psychotherapy and interactive psychotherapy
services in the Healthcare Common Procedure Coding System
established by the Secretary of Health and Human Services
under section 1848(c)(5) of such Act.
(c) Implementation.--Notwithstanding any other provision of
law, the Secretary of Health and Human Services may implement
this section by program instruction or otherwise.
SEC. 611. EXTENSION OF BRACHYTHERAPY SPECIAL RULE.
Section 1833(t)(16)(C) of the Social Security Act (42
U.S.C. 1395l(t)(16)(C)) is amended by striking ``2008'' and
inserting ``2009''.
SEC. 612. PAYMENT FOR PART B DRUGS.
(a) Application of Consistent Volume Weighting in
Computation of ASP.--In order to assure that payments for
drugs and
[[Page H9383]]
biologicals under section 1847A of the Social Security Act
(42 U.S.C. 1395w-3a) are correct and consistent with law, the
Secretary of Health and Human Services shall, for payment for
drugs and biologicals furnished on or after July 1, 2008,
compute the volume-weighted average sales price using
equation #2 (specified in appendix A of the report of the
Inspector General of the Department of Health and Human
Services on ``Calculation of Volume-Weighted Average Sales
Price for Medicare Part B Prescription Drugs'' (February
2006; OEI-03-05-00310)) used by the Office of Inspector
General to calculate a volume-weighted ASP.
(b) Improvements in the Competitive Acquisition Program
(CAP).--
(1) Continuous open enrollment; automatic reenrollment
without need for reapplication.--Subsection (a)(1)(A) of
section 1847B of the Social Security Act (42 U.S.C. 1395w-3b)
is amended--
(A) in clause (ii), by striking ``annually'' and inserting
``on an ongoing basis'';
(B) in clause (iii), by striking ``an annual selection''
and inserting ``a selection (which may be changed on an
annual basis)'' ; and
(C) by adding at the end the following: ``An election and
selection described in clauses (ii) and (iii) shall continue
to be effective without the need for any periodic reelection
or reapplication or selection.''.
(2) Permitting appropriate delivery and transport of
drugs.--Subsection (b)(4)(E) of such section is amended--
(A) by striking ``or'' at the end of clause (i);
(B) by striking the period at the end of clause (ii) and
inserting a semicolon; and
(C) by adding at the end the following new clauses:
``(iii) prevent a contractor from delivering drugs to a
satellite office designated by the prescribing physician; or
``(iv) prevent a contractor from allowing a selecting
physician to transport drugs or biologicals to the site of
administration consistent with State law and other applicable
laws and regulations.''.
(3) Physician outreach and education.--Subsection (a)(1) of
such section is amended by adding at the end the following
new subparagraph:
``(E) Physician outreach and education.--The Secretary
shall conduct a program of outreach to education physicians
concerning the program and the ongoing opportunity of
physicians to elect to obtain drugs and biologicals under the
program.''.
(4) Rebidding of contracts.--The Secretary of Health and
Human Services shall provide for the rebidding of contracts
under section 1847B(c) of the Social Security Act (42 U.S.C.
1395w-3b(c)) only for periods on or after the expiration of
the contract in effect under such section as of the date of
the enactment of this Act, except in the case of a contractor
terminated as a result of the application of section
1847B(b)(2)(B) of such Act.''
(c) Treatment of Certain Drugs.--Section 1847A(b) of the
Social Security Act (42 U.S.C. 1395w-3a(b)) is amended--
(1) in paragraph (1), by inserting ``paragraph (6) and''
after ``Subject to''; and
(2) by adding at the end the following new paragraph:
``(6) Special rule.--Beginning with January 1, 2008, the
payment amount for--
``(A) each single source drug or biological described in
section 1842(o)(1)(G) (including a single source drug or
biological that is treated as a multiple source drug because
of the application of subsection (c)(6)(C)(ii)) is the lower
of--
``(i) the payment amount that would be determined for such
drug or biological applying such subsection; or
``(ii) the payment amount that would have been determined
for such drug or biological if such subsection were not
applied; and
``(B) a multiple source drug (excluding a drug or
biological that is treated as a multiple source drug because
of the application of such subsection) is the lower of--
``(i) the payment amount that would be determined for such
drug or biological taking into account the application of
such subsection; or
``(ii) the payment amount that would have been determined
for such drug or biological if such subsection were not
applied.''.
(d) Effective Date.--Except as otherwise provided, the
amendments made by this section shall apply to drugs
furnished on or after January 1, 2008.
Subtitle B--Extension of Medicare Rural Access Protections
SEC. 621. 2-YEAR EXTENSION OF FLOOR ON MEDICARE WORK
GEOGRAPHIC ADJUSTMENT.
Section 1848(e)(1)(E) of such Act (42 U.S.C. 1395w-
4(e)(1)(E)) is amended by striking ``2008'' and inserting
``2010''.
SEC. 622. 2-YEAR EXTENSION OF SPECIAL TREATMENT OF CERTAIN
PHYSICIAN PATHOLOGY SERVICES UNDER MEDICARE.
Section 542(c) of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000, as amended
by section 732 of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003, and section 104
of the Medicare Improvements and Extension Act of 2006
(division B of Public Law 109-432), is amended by striking
``and 2007'' and inserting ``2007, 2008, and 2009''.
SEC. 623. 2-YEAR EXTENSION OF MEDICARE REASONABLE COSTS
PAYMENTS FOR CERTAIN CLINICAL DIAGNOSTIC
LABORATORY TESTS FURNISHED TO HOSPITAL PATIENTS
IN CERTAIN RURAL AREAS.
Section 416(b) of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173; 117 Stat. 2282; 42 U.S.C. 1395l-4(b)), as amended by
section 105 of the Medicare Improvement and Extension Act of
2006 (division B of Public Law 109-432), is amended by
striking ``3-year'' and inserting ``5-year''.
SEC. 624. 2-YEAR EXTENSION OF MEDICARE INCENTIVE PAYMENT
PROGRAM FOR PHYSICIAN SCARCITY AREAS .
(a) In General.--Section 1833(u)(1) of the Social Security
Act (42 U.S.C. 1395l(u)(1)) is amended by striking ``2008''
and inserting ``2010''.
(b) Transition.--With respect to physicians' services
furnished during 2008 and 2009, for purposes of subsection
(a), the Secretary of Health and Human Services shall use the
primary care scarcity areas and the specialty care scarcity
areas (as identified in section 1833(u)(4)) that the
Secretary was using under such subsection with respect to
physicians' services furnished on December 31, 2007.
SEC. 625. 2-YEAR EXTENSION OF MEDICARE INCREASE PAYMENTS FOR
GROUND AMBULANCE SERVICES IN RURAL AREAS.
Section 1834(l)(13) of the Social Security Act (42 U.S.C.
1395m(l)(13)) is amended--
(1) in subparagraph (A)--
(A) in the matter before clause (i), by striking
``furnished on or after July 1, 2004, and before January 1,
2007,'';
(B) in clause (i), by inserting ``for services furnished on
or after July 1, 2004, and before January 1, 2007, and on or
after January 1, 2008, and before January 1, 2010,'' after
``in such paragraph,''; and
(C) in clause (ii), by inserting ``for services furnished
on or after July 1, 2004, and before January 1, 2007,'' after
``in clause (i),''; and
(2) in subparagraph (B)--
(A) in the heading, by striking ``after 2006'' and
inserting ``for subsequent periods'';
(B) by inserting ``clauses (i) and (ii) of'' before
``subparagraph (A)''; and
(C) by striking ``in such subparagraph'' and inserting ``in
the respective clause''.
SEC. 626. EXTENDING HOLD HARMLESS FOR SMALL RURAL HOSPITALS
UNDER THE HOPD PROSPECTIVE PAYMENT SYSTEM.
Section 1833(t)(7)(D)(i)(II) of the Social Security Act (42
U.S.C. 1395l(t)(7)(D)(I)(II)) is amended--
(1) by striking ``January 1, 2009'' and inserting ``January
1, 2010'';
(2) by striking ``2007, or 2008,''; and
(3) by striking ``90 percent, and 85 percent,
respectively.'' and inserting ``and with respect to such
services furnished after 2006 the applicable percentage shall
be 90 percent.''.
Subtitle C--End Stage Renal Disease Program
SEC. 631. CHRONIC KIDNEY DISEASE DEMONSTRATION PROJECTS.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary''), acting
through the Director of the National Institutes of Health,
shall establish demonstration projects to--
(1) increase public and medical community awareness
(particularly of those who treat patients with diabetes and
hypertension) about the factors that lead to chronic kidney
disease, how to prevent it, how to diagnose it, and how to
treat it;
(2) increase screening and use of prevention techniques for
chronic kidney disease for Medicare beneficiaries and the
general public (particularly among patients with diabetes and
hypertension, where prevention techniques are well
established and early detection makes prevention possible);
and
(3) enhance surveillance systems and expand research to
better assess the prevalence and incidence of chronic kidney
disease, (building on work done by Centers for Disease
Control and Prevention).
(b) Scope and Duration.--
(1) Scope.--The Secretary shall select at least 3 States in
which to conduct demonstration projects under this section.
In selecting the States under this paragraph, the Secretary
shall take into account the size of the population of
individuals with end-stage renal disease who are enrolled in
part B of title XVIII of the Social Security Act and ensure
the participation of individuals who reside in rural and
urban areas.
(2) Duration.--The demonstration projects under this
section shall be conducted for a period that is not longer
than 5 years and shall begin on January 1, 2009.
(c) Evaluation and Report.--
(1) Evaluation.--The Secretary shall conduct an evaluation
of the demonstration projects conducted under this section.
(2) Report.--Not later than 12 months after the date on
which the demonstration projects under this section are
completed, the Secretary shall submit to Congress a report on
the evaluation conducted under paragraph (1) together with
recommendations for such legislation and administrative
action as the Secretary determines appropriate.
SEC. 632. MEDICARE COVERAGE OF KIDNEY DISEASE PATIENT
EDUCATION SERVICES.
(a) Coverage of Kidney Disease Education Services.--
(1) Coverage.--Section 1861(s)(2) of the Social Security
Act (42 U.S.C. 1395x(s)(2)), as amended by sections
201(a)(1), 607(a)(1), and 607(b)(1), is amended--
(A) in subparagraph (CC), by striking ``and'' after the
semicolon at the end;
(B) in subparagraph (DD), by adding ``and'' after the
semicolon at the end; and
(C) by adding at the end the following new subparagraph:
``(EE) kidney disease education services (as defined in
subsection (ggg));''.
(2) Services described.--Section 1861 of the Social
Security Act (42 U.S.C. 1395x), as amended by sections
201(a)(2), 503(b)(1), 607(a)(2), and 607(b)(2), is amended by
adding at the end the following new subsection:
[[Page H9384]]
``Kidney Disease Education Services
``(ggg)(1) The term `kidney disease education services'
means educational services that are--
``(A) furnished to an individual with stage IV chronic
kidney disease who, according to accepted clinical guidelines
identified by the Secretary, will require dialysis or a
kidney transplant;
``(B) furnished, upon the referral of the physician
managing the individual's kidney condition, by a qualified
person (as defined in paragraph (2)); and
``(C) designed--
``(i) to provide comprehensive information (consistent with
the standards developed under paragraph (3)) regarding--
``(I) the management of comorbidities, including for
purposes of delaying the need for dialysis;
``(II) the prevention of uremic complications; and
``(III) each option for renal replacement therapy
(including hemodialysis and peritoneal dialysis at home and
in-center as well as vascular access options and
transplantation);
``(ii) to ensure that the individual has the opportunity to
actively participate in the choice of therapy; and
``(iii) to be tailored to meet the needs of the individual
involved.
``(2) The term `qualified person' means a physician,
physician assistant, nurse practitioner, or clinical nurse
specialist who furnishes services for which payment may be
made under the fee schedule established under section 1848.
Such term does not include a renal dialysis facility.
``(3) The Secretary shall set standards for the content of
such information to be provided under paragraph (1)(C)(i)
after consulting with physicians, other health professionals,
health educators, professional organizations, accrediting
organizations, kidney patient organizations, dialysis
facilities, transplant centers, network organizations
described in section 1881(c)(2), and other knowledgeable
persons. To the extent possible the Secretary shall consult
with a person or entity described in the previous sentence,
other than a dialysis facility, that has not received
industry funding from a drug or biological manufacturer or
dialysis facility.
``(4) In promulgating regulations to carry out this
subsection, the Secretary shall ensure that each individual
who is eligible for benefits for kidney disease education
services under this title receives such services in a timely
manner to maximize the benefit of those services.
``(5) The Secretary shall monitor the implementation of
this subsection to ensure that individuals who are eligible
for benefits for kidney disease education services receive
such services in the manner described in paragraph (4).
``(6) No individual shall be eligible to be provided more
than 6 sessions of kidney disease education services under
this title.''.
(3) Payment under the physician fee schedule.--Section
1848(j)(3) of the Social Security Act (42 U.S.C. 1395w-
4(j)(3)) is amended by inserting ``(2)(DD),'' after
``(2)(AA),''.
(4) Limitation on number of sessions.--Section 1862(a)(1)
of the Social Security Act (42 U.S.C. 1395y(a)(1)) is
amended--
(A) in subparagraph (M), by striking ``and'' at the end;
(B) in subparagraph (N), by striking the semicolon at the
end and inserting ``, and''; and
(C) by adding at the end the following new subparagraph:
``(O) in the case of kidney disease education services (as
defined in section 1861(ggg)), which are furnished in excess
of the number of sessions covered under such section;''.
(5) GAO report.--Not later than September 1, 2010, the
Comptroller General of the United States shall submit to
Congress a report on the following:
(A) The number of Medicare beneficiaries who are eligible
to receive benefits for kidney disease education services (as
defined in section 1861(ggg) of the Social Security Act, as
added by paragraph (2)) under title XVIII of such Act and who
receive such services.
(B) The extent to which there is a sufficient amount of
physicians, physician assistants, nurse practitioners, and
clinical nurse specialists to furnish kidney disease
education services (as so defined) under such title and
whether or not renal dialysis facilities (and appropriate
employees of such facilities) should be included as an entity
eligible under such section to furnish such services.
(C) Recommendations, if appropriate, for renal dialysis
facilities (and appropriate employees of such facilities) to
structure kidney disease education services (as so defined)
in a manner that is objective and unbiased and that provides
a range of options and alternative locations for renal
replacement therapy and management of co-morbidities that may
delay the need for dialysis.
(b) Effective Date.--The amendments made by this section
shall apply to services furnished on or after January 1,
2009.
SEC. 633. REQUIRED TRAINING FOR PATIENT CARE DIALYSIS
TECHNICIANS.
Section 1881 of the Social Security Act (42 U.S.C. 1395rr)
is amended by adding the following new subsection:
``(h)(1) Except as provided in paragraph (2), a provider of
services or a renal dialysis facility may not use, for more
than 12 months during 2009, or for any period beginning on
January 1, 2010, any individual as a patient care dialysis
technician unless the individual--
``(A) has completed a training program in the care and
treatment of an individual with chronic kidney failure who is
undergoing dialysis treatment; and
``(B) has been certified by a nationally recognized
certification entity for dialysis technicians.
``(2)(A) A provider of services or a renal dialysis
facility may permit an individual enrolled in a training
program described in paragraph (1)(A) to serve as a patient
care dialysis technician while they are so enrolled.
``(B) The requirements described in subparagraphs (A), (B),
and (C) of paragraph (1) do not apply to an individual who
has performed dialysis-related services for at least 5 years.
``(3) For purposes of paragraph (1), if, since the most
recent completion by an individual of a training program
described in paragraph (1)(A), there has been a period of 24
consecutive months during which the individual has not
furnished dialysis-related services for monetary
compensation, such individual shall be required to complete a
new training program or become recertified as described in
paragraph (1)(B).
``(4) A provider of services or a renal dialysis facility
shall provide such regular performance review and regular in-
service education as assures that individuals serving as
patient care dialysis technicians for the provider or
facility are competent to perform dialysis-related
services.''.
SEC. 634. MEDPAC REPORT ON TREATMENT MODALITIES FOR PATIENTS
WITH KIDNEY FAILURE.
(a) Evaluation.--
(1) In general.--Not later than March 1, 2009, the Medicare
Payment Advisory Commission (established under section 1805
of the Social Security Act) shall submit to the Secretary and
Congress a report evaluating the barriers that exist to
increasing the number of individuals with end-stage renal
disease who elect to receive home dialysis services under the
Medicare program under title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.).
(2) Report details.--The report shall include the
following:
(A) A review of Medicare home dialysis demonstration
projects initiated before the date of the enactment of this
Act, and the results of such demonstration projects and
recommendations for future Medicare home dialysis
demonstration projects or Medicare program changes that will
test models that can improve Medicare beneficiary access to
home dialysis.
(B) A comparison of current Medicare home dialysis costs
and payments with current in-center and hospital dialysis
costs and payments.
(C) An analysis of the adequacy of Medicare reimbursement
for patient training for home dialysis (including
hemodialysis and peritoneal dialysis) and recommendations for
ensuring appropriate payment for such home dialysis training.
(D) A catalogue and evaluation of the incentives and
disincentives in the current reimbursement system that
influence whether patients receive home dialysis services or
other treatment modalities.
(E) An evaluation of patient education services and how
such services impact the treatment choices made by patients.
(F) Recommendations for implementing incentives to
encourage patients to elect to receive home dialysis services
or other treatment modalities under the Medicare program
(3) Scope of review.--In preparing the report under
paragraph (1), the Medicare Payment Advisory Commission shall
consider a variety of perspectives, including the
perspectives of physicians, other health care professionals,
hospitals, dialysis facilities, health plans, purchasers, and
patients.
SEC. 635. ADJUSTMENT FOR ERYTHROPOIETIN STIMULATING AGENTS
(ESAS).
(a) In General.--Subsection (b)(13) of section 1881 of the
Social Security Act (42 U.S.C. 1395rr) is amended--
(1) in subparagraph (A)(iii), by striking ``For such
drugs'' and inserting ``Subject to subparagraph (C), for such
drugs''; and
(2) by adding at the end the following new subparagraph:
``(C)(i) The payment amounts under this title for
erythropoietin furnished during 2008 or 2009 to an individual
with end stage renal disease by a large dialysis facility (as
defined in subparagraph (D)) (whether to individuals in the
facility or at home), in an amount equal to $8.75 per
thousand units (rounded to the nearest 100 units) or, if
less, 102 percent of the average sales price (as determined
under section 1847A) for such drug or biological.
``(ii) The payment amounts under this title for darbepoetin
alfa furnished during 2008 or 2009 to an individual with end
stage renal disease by a large dialysis facility (as defined
in clause (iii)) (whether to individuals in the facility or
at home), in an amount equal to $2.92 per microgram or, if
less, 102 percent of the average sales price (as determined
under section 1847A) for such drug or biological.
``(iii) For purposes of this subparagraph, the term `large
dialysis facility' means a provider of services or renal
dialysis facility that is owned or managed by a corporate
entity that, as of July 24, 2007, owns or manages 300 or more
such providers or facilities, and includes a successor to
such a corporate entity.''.
(b) No Impact on Drug Add-on Payment.--Nothing in the
amendments made by subsection (a) shall be construed to
affect the amount of any payment adjustment made under
section 1881(b)(12)(B)(ii) of the Social Security Act (42
U.S.C. 1395rr(b)(12)(B)(ii)).
SEC. 636. SITE NEUTRAL COMPOSITE RATE.
Subsection (b)(12)(A) of section 1881 of the Social
Security Act (42 U.S.C. 1395rr) is amended by adding at the
end the following new sentence: ``Under such system the
payment rate for dialysis services furnished on or after
January 1, 2008, by providers of such services for hospital-
based facilities shall be the same as the payment rate
(computed without regard to this
[[Page H9385]]
sentence) for such services furnished by renal dialysis
facilities that are not hospital-based, except that in
applying the geographic index under subparagraph (D) to
hospital-based facilities, the labor share shall be based on
the labor share otherwise applied for such facilities.''.
SEC. 637. DEVELOPMENT OF ESRD BUNDLING SYSTEM AND QUALITY
INCENTIVE PAYMENTS.
(a) Development of ESRD Bundling System.--Subsection (b) of
section 1881 of the Social Security Act (42 U.S.C. 1395rr) is
further amended--
(1) in paragraph (12)(A), by striking ``In lieu of
payment'' and inserting ``Subject to paragraph (14), in lieu
of payment'';
(2) in the second sentence of paragraph (12)(F)--
(A) by inserting ``or paragraph (14)'' after ``this
paragraph''; and
(B) by inserting ``or under the system under paragraph
(14)'' after ``subparagraph (B)'';
(3) in paragraph (12)(H)--
(A) by inserting ``or paragraph (14)'' after ``under this
paragraph'' the first place it appears; and
(B) by inserting before the period at the end the
following: ``or, under paragraph (14), the identification of
renal dialysis services included in the bundled payment, the
adjustment for outliers, the identification of facilities to
which the phase-in may apply, and the determination of
payment amounts under subparagraph (A) under such paragraph,
and the application of paragraph (13)(C)(iii)'';
(4) in paragraph (13)--
(A) in subparagraph (A), by striking ``The payment
amounts'' and inserting ``subject to paragraph (14), the
payment amounts''; and
(B) in subparagraph (B)--
(i) in clause (i), by striking ``(i)'' after ``(B)'' and by
inserting ``, subject to paragraph (14)'' before the period
at the end; and
(ii) by striking clause (ii); and
(5) by adding at the end the following new paragraph:
``(14)(A) Subject to subparagraph (E), for services
furnished on or after January 1, 2010, the Secretary shall
implement a payment system under which a single payment is
made under this title for renal dialysis services (as defined
in subparagraph (B)) in lieu of any other payment (including
a payment adjustment under paragraph (12)(B)(ii)) for such
services and items furnished pursuant to paragraph (4). In
implementing the system the Secretary shall ensure that the
estimated total amount of payments under this title for 2010
for renal dialysis services shall equal 96 percent of the
estimated amount of payments for such services, including
payments under paragraph (12)(B)(ii), that would have been
made if such system had not been implemented.
``(B) For purposes of this paragraph, the term `renal
dialysis services' includes--
``(i) items and services included in the composite rate for
renal dialysis services as of December 31, 2009;
``(ii) erythropoietin stimulating agents furnished to
individuals with end stage renal disease;
``(iii) other drugs and biologicals and diagnostic
laboratory tests, that the Secretary identifies as commonly
used in the treatment of such patients and for which payment
was (before the application of this paragraph) made
separately under this title, and any oral equivalent form of
such drugs and biologicals or of drugs and biologicals
described in clause (ii); and
``(iv) home dialysis training for which payment was (before
the application of this paragraph) made separately under this
section.
Such term does not include vaccines.
``(C) The system under this paragraph may provide for
payment on the basis of services furnished during a week or
month or such other appropriate unit of payment as the
Secretary specifies.
``(D) Such system--
``(i) shall include a payment adjustment based on case mix
that may take into account patient weight, body mass index,
comorbidities, length of time on dialysis, age, race,
ethnicity, and other appropriate factors;
``(ii) shall include a payment adjustment for high cost
outliers due to unusual variations in the type or amount of
medically necessary care, including variations in the amount
of erythropoietin stimulating agents necessary for anemia
management; and
``(iii) may include such other payment adjustments as the
Secretary determines appropriate, such as a payment
adjustment--
``(I) by a geographic index, such as the index referred to
in paragraph (12)(D), as the Secretary determines to be
appropriate;
``(II) for pediatric providers of services and renal
dialysis facilities;
``(III) for low volume providers of services and renal
dialysis facilities;
``(IV) for providers of services or renal dialysis
facilities located in rural areas; and
``(V) for providers of services or renal dialysis
facilities that are not large dialysis facilities.
``(E) The Secretary may provide for a phase-in of the
payment system described in subparagraph (A) for services
furnished by a provider of services or renal dialysis
facility described in any of subclauses (II) through (V) of
subparagraph (D)(iii), but such payment system shall be fully
implemented for services furnished in the case of any such
provider or facility on or after January 1, 2013.
``(F) The Secretary shall apply the annual increase that
would otherwise apply under subparagraph (F) of paragraph
(12) to payment amounts established under such paragraph (if
this paragraph did not apply) in an appropriate manner under
this paragraph.''.
(b) Prohibition of Unbundling.--Section 1862(a) of such Act
(42 U.S.C. 1395y(a)) is amended--
(1) by striking ``or'' at the end of paragraph (21);
(2) by striking the period at the end of paragraph (22) and
inserting ``; or''; and
(3) by inserting after paragraph (22) the following new
paragraph:
``(23) where such expenses are for renal dialysis services
(as defined in subparagraph (B) of section 1881(b)(14)) for
which payment is made under such section (other than under
subparagraph (E) of such section) unless such payment is made
under such section to a provider of services or a renal
dialysis facility for such services.''.
(c) Quality Incentive Payments.--Section 1881 of such Act
is amended by adding at the end the following new subsection:
``(i) Quality Incentive Payments in the End-Stage Renal
Disease Program.--
``(1) Quality incentive payments for services furnished in
2008, 2009, and 2010.--
``(A) In general.--With respect to renal dialysis services
furnished during a performance period (as defined in
subparagraph (B)) by a provider of services or renal dialysis
facility that the Secretary determines meets the applicable
performance standard for the period under subparagraph (C)
and reports on measures for 2009 and 2010 under subparagraph
(D) for such services, in addition to the amount otherwise
paid under this section, subject to subparagraph (G), there
also shall be paid to the provider or facility an amount
equal to the applicable percentage (specified in subparagraph
(E) for the period) of the Secretary's estimate (based on
claims submitted not later than two months after the end of
the performance period) of the amount specified in
subparagraph (F) for such period.
``(B) Performance period.--In this paragraph, the term
`performance period' means each of the following:
``(i) The period beginning on July 1, 2008, and ending on
December 31, 2008.
``(ii) 2009.
``(iii) 2010.
``(C) Performance standard.--
``(i) 2008.--For the performance period occurring in 2008,
the applicable performance standards for a provider or
facility under this subparagraph are--
``(I) 92 percent or more of individuals with end stage
renal disease receiving erythopoetin stimulating agents who
have an average hematocrit of 33.0 percent or more; and
``(II) less than a percentage, specified by the Secretary,
of individuals with end stage renal disease receiving
erythopoetin stimulating agents who have an average
hematocrit of 39.0 percent or more.
``(ii) 2009 and 2010.--For the 2009 and 2010 performance
periods, the applicable performance standard for a provider
or facility under this subparagraph is successful performance
(relative to national average) on--
``(I) such measures of anemia management as the Secretary
shall specify, including measures of hemoglobin levels or
hematocrit levels for erythropoietin stimulating agents that
are consistent with the labeling for dosage of erythropoietin
stimulating agents approved by the Food and Drug
Administration for treatment of anemia in patients with end
stage renal disease, taking into account variations in
hemoglobin ranges or hematocrit levels of patients; and
``(II) such other measures, relating to subjects described
in subparagraph (D)(i), as the Secretary may specify.
``(D) Reporting performance measures.--The performance
measures under this subparagraph to be reported shall
include--
``(i) such measures as the Secretary specifies, before the
beginning of the performance period involved and taking into
account measures endorsed by the National Quality Forum,
including, to the extent feasible measures on--
``(I) iron management;
``(II) dialysis adequacy; and
``(III) vascular access, including for maximizing the
placement of arterial venous fistula; and
``(ii) to the extent feasible, such measure (or measures)
of patient satisfaction as the Secretary shall specify.
The provider or facility submitting information on such
measures shall attest to the completeness and accuracy of
such information.
``(E) Applicable percentage.--The applicable percentage
specified in this subparagraph for--
``(i) the performance period occurring in 2008, is 1.0
percent;
``(ii) the 2009 performance period, is 2.0 percent; and
``(iii) the 2010 performance period, is 3.0 percent.
In the case of any performance period which is less than an
entire year, the applicable percentage specified in this
subparagraph shall be multiplied by the ratio of the number
of months in the year to the number of months in such
performance period. In the case of 2010, the applicable
percentage specified in this subparagraph shall be multiplied
by the Secretary's estimate of the ratio of the aggregate
payment amount described in subparagraph (F)(i) that would
apply in 2010 if paragraph (14) did not apply, to the
aggregate payment base under subparagraph (F)(ii) for 2010.
``(F) Payment base.--The payment base described in this
subparagraph for a provider or facility is--
``(i) for performance periods before 2010, the payment
amount determined under paragraph (12) for services furnished
by the provider or facility during the performance period,
including the drug payment adjustment described in
subparagraph (B)(ii) of such paragraph; and
``(ii) for the 2010 performance period is the amount
determined under paragraph (14) for services furnished by the
provider or facility during the period.
[[Page H9386]]
``(G) Limitation on funding.--
``(i) In general.--If the Secretary determines that the
total payments under this paragraph for a performance period
is projected to exceed the dollar amount specified in clause
(ii) for such period, the Secretary shall reduce, in a pro
rata manner, the amount of such payments for each provider or
facility for such period to eliminate any such projected
excess for the period.
``(ii) Dollar amount.--The dollar amount specified in this
clause--
``(I) for the performance period occurring in 2008, is
$50,000,000;
``(II) for the 2009 performance period is $100,000,000; and
``(III) for the 2010 performance period is $150,000,000.
``(H) Form of payment.--The payment under this paragraph
shall be in the form of a single consolidated payment.
``(2) Quality incentive payments for facilities and
providers for 2011.--
``(A) Increased payment.--For 2011, in the case of a
provider or facility that, for the performance period (as
defined in subparagraph (B))--
``(i) meets (or exceeds) the performance standard for
anemia management specified in paragraph (1)(C)(ii)(I);
``(ii) has substantially improved performance or exceeds a
performance standard (as determined under subparagraph (E));
and
``(iii) reports measures specified in paragraph (1)(D),
with respect to renal dialysis services furnished by the
provider or facility during the quality bonus payment period
(as specified in subparagraph (C)) the payment amount
otherwise made to such provider or facility under subsection
(b)(14) shall be increased, subject to subparagraph (F), by
the applicable percentage specified in subparagraph (D).
Payment amounts under paragraph (1) shall not be counted for
purposes of applying the previous sentence.
``(B) Performance period.--In this paragraph, the term
`performance period' means a multi-month period specified by
the Secretary .
``(C) Quality bonus payment period.--In this paragraph, the
term `quality bonus payment period' means, with respect to a
performance period, a multi-month period beginning on January
1, 2011, specified by the Secretary that begins at least 3
months (but not more than 9 months) after the end of the
performance period.
``(D) Applicable percentage.--The applicable percentage
specified in this subparagraph is a percentage, not to exceed
the 4.0 percent, specified by the Secretary consistent with
subparagraph (F). Such percentage may vary based on the level
of performance and improvement. The applicable percentage
specified in this subparagraph shall be multiplied by the
ratio applied under the third sentence of paragraph (1)(E)
for 2010.
``(E) Performance standard.--Based on performance of a
provider of services or a renal dialysis facility on
performance measures described in paragraph (1)(D) for a
performance period, the Secretary shall determine a composite
score for such period.
``(F) Limitation on funding.--If the Secretary determines
that the total amount to be paid under this paragraph for a
quality bonus payment period is projected to exceed
$200,000,000, the Secretary shall reduce, in a uniform
manner, the applicable percentage otherwise applied under
subparagraph (D) for services furnished during the period to
eliminate any such projected excess.
``(3) Application.--
``(A) Implementation.--Notwithstanding any other provision
of law, the Secretary may implement by program instruction or
otherwise this subsection.
``(B) Limitations on review.--
``(i) In general.--There shall be no administrative or
judicial review under section 1869 or 1878 or otherwise of--
``(I) the determination of performance measures and
standards under this subsection;
``(II) the determination of successful reporting, including
a determination of composite scores; and
``(III) the determination of the quality incentive payments
made under this subsection.
``(ii) Treatment of determinations.--A determination under
this subparagraph shall not be treated as a determination for
purposes of section 1869.
``(4) Technical assistance.--The Secretary shall identify
or establish an appropriately skilled group or organization,
such as the ESRD Networks, to provide technical assistance to
consistently low-performing facilities or providers that are
in the bottom quintile.
``(5) Public reporting.--
``(A) Annual notice.--The Secretary shall provide an annual
written notification to each individual who is receiving
renal dialysis services from a provider of services or renal
dialysis facility that--
``(i) informs such individual of the composite scores
described in subparagraph (A) and other relevant quality
measures with respect to providers of services or renal
dialysis facilities in the local area;
``(ii) compares such scores and measures to the average
local and national scores and measures; and
``(iii) provides information on how to access additional
information on quality of such services furnished and options
for alternative providers and facilities.
``(B) Certificates.--The Secretary shall provide
certificates to facilities and providers who provide services
to individuals with end-stage renal disease under this title
to display in patient areas. The certificate shall indicate
the composite score obtained by the facility or provider
under the quality initiative.
``(C) Web-based quality list.--The Secretary shall
establish a web-based list of facilities and providers who
furnish renal dialysis services under this section that
indicates their composite score of each provider and
facility.
``(6) Recommendations for reporting and quality incentive
intitiative for physicians.--The Secretary shall develop
recommendations for applying quality incentive payments under
this subsection to physicians who receive the monthly
capitated payment under this title. Such recommendations
shall include the following:
``(A) Recommendations to include pediatric specific
measures for physicians with at least 50 percent of their
patients with end stage renal disease being individuals under
18 years of age.
``(B) Recommendations on how to structure quality incentive
payments for physicians who demonstrate improvements in
quality or who attain quality standards, as specified by the
Secretary.
``(7) Reports.--
``(A) Initial report.--Not later than January 1, 2013, the
Secretary shall submit to Congress a report on the
implementation of the bundled payment system under subsection
(b)(14) and the quality initiative under this subsection.
Such report shall include the following information:
``(i) A comparison of the aggregate payments under
subsection (b)(14) for items and services to the cost of such
items and services.
``(ii) The changes in utilization rates for erythropoietin
stimulating agents.
``(iii) The mode of administering such agents, including
information on the proportion of such individuals receiving
such agents intravenously as compared to subcutaneously.
``(iv) The frequency of dialysis.
``(v) Other differences in practice patterns, such as the
adoption of new technology, different modes of practice, and
variations in use of drugs other than drugs described in
clause (iii).
``(vi) The performance of facilities and providers under
paragraph (2).
``(vii) Other recommendations for legislative and
administrative actions determined appropriate by the
Secretary.
``(B) Subsequent report.--Not later than January 1, 2015,
the Secretary shall submit to Congress a report that contains
the information described in each of clauses (ii) through
(vii) of subparagraph (A) and a comparison of the results of
the payment system under subsection (b)(14) for renal
dialysis services furnished during the 2-year period
beginning on January 1, 2013, and the results of such payment
system for such services furnished during the previous two-
year period.''.
SEC. 638. MEDPAC REPORT ON ESRD BUNDLING SYSTEM.
Not later than March 1, 2012, the Medicare Payment Advisory
Commission (established under section 1805 of the Social
Security Act) shall submit to Congress a report on the
implementation of the payment system under section
1881(b)(14) of the Social Security Act (as added by section
7) for renal dialysis services and related services (defined
in subparagraph (B) of such section). Such report shall
include, with respect to such payment system for such
services, an analysis of each of the following:
(1) An analysis of the overall adequacy of payment under
such system for all such services.
(2) An analysis that compares the adequacy of payment under
such system for services furnished by--
(A) a provider of services or renal dialysis facility that
is described in section 1881(b)(13)(C)(iv) of the Social
Security Act;
(B) a provider of services or renal dialysis facility not
described in such section;
(C) a hospital-based facility;
(D) a freestanding renal dialysis facility;
(E) a renal dialysis facility located in an urban area; and
(F) a renal dialysis facility located in a rural area.
(3) An analysis of the financial status of providers of
such services and renal dialysis facilities, including access
to capital, return on equity, and return on capital.
(4) An analysis of the adequacy of payment under such
method and the adequacy of the quality improvement payments
under section 1881(i) of the Social Security Act in ensuring
that payments for such services under the Medicare program
are consistent with costs for such services.
(5) Recommendations, if appropriate, for modifications to
such payment system.
SEC. 639. OIG STUDY AND REPORT ON ERYTHROPOIETIN.
(a) Study.--The Inspector General of the Department of
Health and Human Services shall conduct a study on the
following:
(1) The dosing guidelines, standards, protocols, and
alogorithms for erythropoietin stimulating agents recommended
or used by providers of services and renal dialysis
facilities that are described in section 1881(b)(13)(C)(iv)
of the Social Security Act and providers and facilities that
are not described in such section.
(2) The extent to which such guidelines, standards,
protocols, and algorithms are consistent with the labeling of
the Food and Drug Administration for such agents.
(3) The extent to which physicians sign standing orders for
such agents that are consistent with such guidelines,
standards, protocols, and algorithms recommended or used by
the provider or facility involved.
(4) The extent to which the prescribing decisions of
physicians, with respect to such agents, are independent of--
(A) such relevant guidelines, standards, protocols, and
algorithms; or
(B) recommendations of an anemia management nurse or other
appropriate employee of the provider or facility involved.
(5) The role of medical directors of providers of services
and renal dialysis facilities and the
[[Page H9387]]
financial relationships between such providers and facilities
and the physicians hired as medical directors of such
providers and facilities, respectively.
(b) Report.--Not later than January 1, 2009, the Inspector
General of the Department of Health and Human Services shall
submit to Congress a report on the study conducted under
subsection (a), together with such recommendations as the
Inspector General determines appropriate.
Subtitle D--Miscellaneous
SEC. 651. LIMITATION ON EXCEPTION TO THE PROHIBITION ON
CERTAIN PHYSICIAN REFERRALS FOR HOSPITALS.
(a) In General.--Section 1877 of the Social Security Act
(42 U.S.C. 1395) is amended--
(1) in subsection (d)(2)--
(A) in subparagraph (A), by striking ``and'' at the end;
(B) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subparagraph:
``(C) if the entity is a hospital, the hospital meets the
requirements of paragraph (3)(D).'';
(2) in subsection (d)(3)--
(A) in subparagraph (B), by striking ``and'' at the end;
(B) in subparagraph (C), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subparagraph:
``(D) the hospital meets the requirements described in
subsection (i)(1) not later than 18 months after the date of
the enactment of this subparagraph.''; and
(3) by adding at the end the following new subsection:
``(i) Requirements for Hospitals to Qualify for Hospital
Exception to Ownership or Investment Prohibition.--
``(1) Requirements described.--For purposes of paragraphs
subsection (d)(3)(D), the requirements described in this
paragraph for a hospital are as follows:
``(A) Provider agreement.--The hospital had a provider
agreement under section 1866 in effect on July 24, 2007.
``(B) Prohibition of expansion of facility capacity.--The
number of operating rooms and beds of the hospital at any
time on or after the date of the enactment of this subsection
are no greater than the number of operating rooms and beds as
of such date.
``(C) Preventing conflicts of interest.--
``(i) The hospital submits to the Secretary an annual
report containing a detailed description of--
``(I) the identity of each physician owner and any other
owners of the hospital; and
``(II) the nature and extent of all ownership interests in
the hospital.
``(ii) The hospital has procedures in place to require that
any referring physician owner discloses to the patient being
referred, by a time that permits the patient to make a
meaningful decision regarding the receipt of care, as
determined by the Secretary--
``(I) the ownership interest of such referring physician in
the hospital; and
``(II) if applicable, any such ownership interest of the
treating physician.
``(iii) The hospital does not condition any physician
ownership interests either directly or indirectly on the
physician owner making or influencing referrals to the
hospital or otherwise generating business for the hospital.
``(D) Ensuring bona fide investment.--
``(i) Physician owners in the aggregate do not own more
than 40 percent of the total value of the investment
interests held in the hospital or in an entity whose assets
include the hospital.
``(ii) The investment interest of any individual physician
owner does not exceed 2 percent of the total value of the
investment interests held in the hospital or in an entity
whose assets include the hospital.
``(iii) Any ownership or investment interests that the
hospital offers to a physician owner are not offered on more
favorable terms than the terms offered to a person who is not
a physician owner.
``(iv) The hospital does not directly or indirectly provide
loans or financing for any physician owner investments in the
hospital.
``(v) The hospital does not directly or indirectly
guarantee a loan, make a payment toward a loan, or otherwise
subsidize a loan, for any individual physician owner or group
of physician owners that is related to acquiring any
ownership interest in the hospital.
``(vi) Investment returns are distributed to investors in
the hospital in an amount that is directly proportional to
the investment of capital by the physician owner in the
hospital.
``(vii) Physician owners do not receive, directly or
indirectly, any guaranteed receipt of or right to purchase
other business interests related to the hospital, including
the purchase or lease of any property under the control of
other investors in the hospital or located near the premises
of the hospital.
``(viii) The hospital does not offer a physician owner the
opportunity to purchase or lease any property under the
control of the hospital or any other investor in the hospital
on more favorable terms than the terms offered to an
individual who is not a physician owner.
``(E) Patient safety.--
``(i) Insofar as the hospital admits a patient and does not
have any physician available on the premises to provide
services during all hours in which the hospital is providing
services to such patient, before admitting the patient--
``(I) the hospital discloses such fact to a patient; and
``(II) following such disclosure, the hospital receives
from the patient a signed acknowledgment that the patient
understands such fact.
``(ii) The hospital has the capacity to--
``(I) provide assessment and initial treatment for
patients; and
``(II) refer and transfer patients to hospitals with the
capability to treat the needs of the patient involved.
``(2) Publication of information reported.--The Secretary
shall publish, and update on an annual basis, the information
submitted by hospitals under paragraph (1)(C)(i) on the
public Internet website of the Centers for Medicare &
Medicaid Services.
``(3) Collection of ownership and investment information.--
For purposes of clauses (i) and (ii) of paragraph (1)(D), the
Secretary shall collect physician ownership and investment
information for each hospital as it existed on the date of
the enactment of this subsection.
``(4) Physician owner defined.--For purposes of this
subsection, the term `physician owner' means a physician (or
an immediate family member of such physician) with a direct
or an indirect ownership interest in the hospital.''.
(b) Enforcement.--
(1) Ensuring compliance.--The Secretary of Health and Human
Services shall establish policies and procedures to ensure
compliance with the requirements described in such section
1877(i)(1) of the Social Security Act, as added by subsection
(a)(3), beginning on the date such requirements first apply.
Such policies and procedures may include unannounced site
reviews of hospitals.
(2) Audits.--Beginning not later than 18 months after the
date of the enactment of this Act, the Secretary of Health
and Human Services shall conduct audits to determine if
hospitals violate the requirements referred to in paragraph
(1).
TITLE VII--PROVISIONS RELATING TO MEDICARE PARTS A AND B
SEC. 701. HOME HEALTH PAYMENT UPDATE FOR 2008.
Section 1895(b)(3)(B)(ii) of the Social Security Act (42
U.S.C. 1395fff(b)(3)(B)(ii)) is amended--
(1) in subclause (IV) at the end, by striking ``and'';
(2) by redesignating subclause (V) as subclause (VII); and
(3) by inserting after subclause (IV) the following new
subclauses:
``(V) 2007, subject to clause (v), the home health market
basket percentage increase;
``(VI) 2008, subject to clause (v), 0 percent; and''.
SEC. 702. 2-YEAR EXTENSION OF TEMPORARY MEDICARE PAYMENT
INCREASE FOR HOME HEALTH SERVICES FURNISHED IN
A RURAL AREA.
Section 421 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (Public Law 108-173; 117 Stat.
2283; 42 U.S.C. 1395fff note), as amended by section 5201(b)
of the Deficit Reduction Act of 2005, is amended--
(1) in the heading, by striking ``ONE-YEAR'' and inserting
``TEMPORARY''; and
(2) in subsection (a), by striking ``and episodes and
visits beginning on or after January 1, 2006, and before
January 1, 2007'' and inserting ``episodes and visits
beginning on or after January 1, 2006, and before January 1,
2007, and episodes and visits beginning on or after January
1, 2008, and before January 1, 2010''.
SEC. 703. EXTENSION OF MEDICARE SECONDARY PAYER FOR
BENEFICIARIES WITH END STAGE RENAL DISEASE FOR
LARGE GROUP PLANS.
(a) In General.--Section 1862(b)(1)(C) of the Social
Security Act (42 U.S.C. 1395y(b)(1)(C)) is amended--
(1) by redesignating clauses (i) and (ii) as subclauses (I)
and (II), respectively, and indenting accordingly;
(2) by amending the text preceding subclause (I), as so
redesignated, to read as follows:
``(C) Individuals with end stage renal disease.--
``(i) In general.--A group health plan (as defined in
subparagraph (A)(v))--'';
(3) in the matter following subclause (II), as so
redesignated--
(A) by striking ``clause (i)'' and inserting ``subclause
(I)'';
(B) by striking ``clause (ii)'' and inserting ``subclause
(II)''; and
(C) by striking ``clauses (i) and (ii)'' and inserting
``subclauses (I) and (II)''; and
(D) in the last sentence, by striking ``Effective for
items'' and inserting ``Subject to clause (ii), effective for
items''; and
(4) by adding at the end the following new clause:
``(ii) Special Rule for Large Group Plans.--In applying
clause (i) to a large group health plan (as defined in
subparagraph (B)(iii)). effective for items and services
furnished on or after January 1, 2008, (with respect to
periods beginning on or after the date that is 30 months
prior to January 1, 2008), subclauses (I) and (II) of such
clause shall be applied by substituting `42-month' for `12-
month' each place it appears.''.
SEC. 704. PLAN FOR MEDICARE PAYMENT ADJUSTMENTS FOR NEVER
EVENTS.
(a) In General.--The Secretary of Health and Human Services
(in this section referred to as the ``Secretary'') shall
develop a plan (in this section referred to as the ``never
events plan'') to implement, beginning in fiscal year 2010, a
policy to reduce or eliminate payments under title XVIII of
the Social Security Act for never events.
(b) Never Event Defined.--For purposes of this section, the
term ``never event'' means an event involving the delivery of
(or failure to deliver) physicians' services, inpatient or
outpatient hospital services, or facility services furnished
in an ambulatory surgical facility in which there is an error
in medical care that is clearly identifiable, usually
preventable, and serious in consequences to patients, and
that indicates a deficiency in the safety and process
controls of the services furnished with respect to the
[[Page H9388]]
physician, hospital, or ambulatory surgical center involved.
(c) Plan Details.--
(1) Defining never events.--With respect to criteria for
identifying never events under the never events plan, the
Secretary should consider whether the event meets the
following characteristics:
(A) Clearly identifiable.--The event is clearly
identifiable and measurable and feasible to include in a
reporting system for never events.
(B) Usually preventable.--The event is usually preventable
taking into consideration that, because of the complexity of
medical care, certain medical events are not always
avoidable.
(C) Serious.--The event is serious and could result in
death or loss of a body part, disability, or more than
transient loss of a body function.
(D) Deficiency in safety and process controls.--The event
is indicative of a problem in safety systems and process
controls used by the physician, hospital, or ambulatory
surgical center involved and is indicative of the reliability
of the quality of services provided by the physician,
hospital, or ambulatory surgical center, respectively.
(2) Identification and payment issues.--With respect to
policies under the never events plan for identifying and
reducing (or eliminating) payment for never events, the
Secretary shall consider--
(A) mechanisms used by hospitals and physicians in
reporting and coding of services that would reliably identify
never events; and
(B) modifications in billing and payment mechanisms that
would enable the Secretary to efficiently and accurately
reduce or eliminate payments for never events.
(3) Priorities.--Under the never events plan the Secretary
shall identify priorities regarding the services to focus on
and, among those, the never events for which payments should
be reduced or eliminated.
(4) Consultation.--In developing the never events plan, the
Secretary shall consult with affected parties that are
relevant to payment reductions in response to never events.
(d) Congressional Report.--By not later than June 1, 2008,
the Secretary shall submit a report to Congress on the never
events plan developed under this subsection and shall include
in the report recommendations on specific methods for
implementation of the plan on a timely basis.
SEC. 705. REINSTATEMENT OF RESIDENCY SLOTS.
(a) In General.--Section 1886(h) of the Social Security Act
(42 U.S.C. 1395ww(h)) is amended--
(1) in paragraph (4)(H), by adding at the end the following
new clauses:
``(v) Increase in resident limit due to closure of other
hospitals.--If one or more hospitals with approved medical
residency training programs, which are located within the
same metropolitan statistical area as of January 1, 2001,
closed, the Secretary shall increase by not more than 10
(subject to the limitation set forth in the last sentence of
this clause) the otherwise applicable resident limit under
subparagraph (F) for each hospital within the same
metropolitan statistical area that meets all the following
criteria:
``(I) The hospital is described in subsection (d)(5)(F)(i).
``(II) The hospital instituted a medical residency training
program in internal medicine that was accredited by the
American Osteopathic Association on or after January 1, 2004.
``(III) The hospital had a provider number and a resident
limit as of January 1, 2000, and remained open as of October
1, 2007.
``(IV) The hospital did not receive an increase in its
resident limit under paragraph (7)(B).
``(V) The hospital maintains no more than 400 beds.
In no event may the resident limit for any hospital be
increased above 50 through application of this clause and in
no event may the total of the residency positions added by
this clause for all hospitals exceed 10.
``(vi) Increase in residency slots.--In the case of a
hospital located in Peoria County, Illinois, that has more
than 500 beds, the Secretary shall increase by two the
otherwise applicable resident limit under subparagraph (F)
for such hospital.''.
(2) in paragraph (7)--
(A) by redesignating subparagraph (D) as subparagraph (E);
and
(B) by inserting after subparagraph (C) the following new
subparagraph:
``(D) Adjustment based on settled cost report.--In the case
of a hospital with a dual accredited osteopathic and
allopathic family practice program for which--
``(i) the otherwise applicable resident limit was reduced
under subparagraph (A)(i)(I); and
``(ii) such reduction was based on a reference resident
level that was determined using a cost report and where a
revised or corrected notice of program reimbursement was
issued between September 1, 2006 and September 15, 2006,
whether as a result of an appeal or otherwise, and the
reference resident level under such settled cost report is
higher than the level used for the reduction under
subparagraph (A)(i)(I);
the Secretary shall apply subparagraph (A)(i)(I) using the
higher resident reference level and make any necessary
adjustments to such reduction. Any such necessary adjustments
shall be effective for portions of cost reporting periods
occurring on or after July 1, 2005.''.
(b) Effective Dates.--The amendment made by paragraph (1)
shall be effective for cost reporting periods beginning on or
after October 1, 2007, and the amendments made by paragraph
(2) shall take effect as if included in the enactment of
section 422 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (Public Law 108-173).
SEC. 706. STUDIES RELATING TO HOME HEALTH.
(a) In General.--The Medicare Payment Advisory Commission
shall conduct a study of Medicare beneficiaries utilizing
home health care services to determine--
(1) the impact that remote monitoring equipment and related
services have on improving health care outcomes in the home
health care setting for beneficiaries with chronic
conditions;
(2) the differences in the percentage of inpatient hospital
admissions and emergency room visits for beneficiaries with a
similar health care risk profile who utilize remote
monitoring equipment and services compared to those who do
not use such equipment and services;
(3) the percentage of Medicare beneficiaries currently
utilizing remote monitoring equipment and related services;
(4) the estimated reduction in aggregate expenditures under
parts A and B of title XVIII of the Social Security Act
expenditures if home health agencies increased their
utilization of remote monitoring equipment and related
services for patients with chronic disease conditions; and
(5) the variation of utilization of remote monitoring
equipment and related services within geographic regions and
by size of home health agency.
(b) Data Collection.--As a condition of a home health
agency's participation in the program under title XVIII of
the Social Security Act, beginning no later than January 1,
2008, the Secretary of Health and Human Services shall
require such agencies to collect, in a form and manner
determined by the Secretary, the following data:
(1) The extent of home health agency's usage of remote
monitoring equipment and related services for beneficiaries
with chronic conditions.
(2) Whether such equipment and services are used to monitor
patients' with chronic conditions vital signs on a daily
basis.
(3) Whether standing physician orders accompany the use of
remote monitoring equipment and services.
(4) The costs of remote monitoring equipment and related
services.
(c) Report to Congress.--Not later than June 1, 2010, the
Commission shall report to Congress on its findings on the
study conducted under subsection (a). Such report shall
include recommendations regarding how Congress may enact
reimbursement policies that increase the appropriate
utilization of remote monitoring equipment and services under
the home health program for Medicare beneficiaries with
chronic conditions in a manner that facilitates health care
outcomes and leads to the long-term reduction of aggregate
expenditures under the Medicare program.
SEC. 707. RURAL HOME HEALTH QUALITY DEMONSTRATION PROJECTS.
(a) In General.--Not later than 180 days after the date of
the enactment of this Act, the Secretary of Health and Human
Services (in this section referred to as the ``Secretary'')
shall make grants to eligible entities for demonstration
projects to assist home health agencies to better serve their
Medicare populations while aiming to reduce costs to the
Medicare program through utilization of technologies,
including telemonitoring and other telehealth technologies,
health information technologies, and telecommunications
technologies that--
(1) implement procedures and standards that reduce the need
for inpatient hospital services and health center visits; and
(2) address the aims of safety, effectiveness, patient- or
community-centeredness, timeliness, efficiency, and equity
identified by the Institute of Medicine of the National
Academies in its report entitled ``Crossing the Quality
Chasm: A New Health System for the 21st Century'' released on
March 1, 2001, when determining when and what care is needed.
(b) Eligible Entities.--In this section, the term
``eligible entity'' means a State that includes--
(1) a rural academic medical center;
(2) no urban regional medical center; and
(3) a Medicare population whose enrollees in the Medicare
Part C program is less than 3 percent.
(c) Consultation.--In developing the program for awarding
grants under this section, the Secretary shall consult with
the Administrator of the Centers for Medicare & Medicaid
Services, home health agencies, rural health care
researchers, and private and non-profit groups (including
national associations) which are undertaking similar efforts.
(d) Duration.--Each demonstration project under this
section shall be for a period of 2 years.
(e) Report.--Not later than one year after the conclusion
of all of the demonstration projects funded under this
section, the Secretary shall submit a report to the Congress
on the results of such projects. The report shall include--
(1) an evaluation of technologies utilized and effects on
patient access to home health care, patient outcomes, and an
analysis of the cost effectiveness of each such project; and
(2) recommendations on Federal legislation, regulations, or
administrative policies to enhance rural home health quality
and outcomes.
(f) Funding.-- Out of any funds in the Treasury not
otherwise appropriated, there are appropriated to the
Secretary for fiscal year 2008, $3,000,000 to carry out this
section. Funds appropriated under this subsection shall
remain available until expended.
TITLE VIII--MEDICAID
Subtitle A--Protecting Existing Coverage
SEC. 801. MODERNIZING TRANSITIONAL MEDICAID.
(a) Four-Year Extension.--
(1) In general.--Sections 1902(e)(1)(B) and 1925(f) of the
Social Security Act (42 U.S.C.
[[Page H9389]]
1396a(e)(1)(B), 1396r-6(f)) are each amended by striking
``September 30, 2003'' and inserting ``September 30, 2011''.
(2) Effective date.--The amendments made by this subsection
shall take effect on October 1, 2007.
(b) State Option of Initial 12-Month Eligibility.--Section
1925 of the Social Security Act (42 U.S.C. 1396r-6) is
amended--
(1) in subsection (a)(1), by inserting ``but subject to
paragraph (5)'' after ``Notwithstanding any other provision
of this title'';
(2) by adding at the end of subsection (a) the following:
``(5) Option of 12-month initial eligibility period.--A
State may elect to treat any reference in this subsection to
a 6-month period (or 6 months) as a reference to a 12-month
period (or 12 months). In the case of such an election,
subsection (b) shall not apply.''; and
(3) in subsection (b)(1), by inserting ``but subject to
subsection (a)(5)'' after ``Notwithstanding any other
provision of this title''.
(c) Removal of Requirement for Previous Receipt of Medical
Assistance.--Section 1925(a)(1) of such Act (42 U.S.C. 1396r-
6(a)(1)), as amended by subsection (b)(1), is further
amended--
(1) by inserting ``subparagraph (B) and'' before
``paragraph (5)'';
(2) by redesignating the matter after ``Requirement.--'' as
a subparagraph (A) with the heading ``In general.--'' and
with the same indentation as subparagraph (B) (as added by
paragraph (3)); and
(3) by adding at the end the following:
``(B) State option to waive requirement for 3 months before
receipt of medical assistance.--A State may, at its option,
elect also to apply subparagraph (A) in the case of a family
that was receiving such aid for fewer than three months or
that had applied for and was eligible for such aid for fewer
than 3 months during the 6 immediately preceding months
described in such subparagraph.''.
(d) CMS Report on Enrollment and Participation Rates Under
TMA.--Section 1925 of such Act (42 U.S.C. 1396r-6), as
amended by this section, is further amended by adding at the
end the following new subsection:
``(g) Collection and Reporting of Participation
Information.--
``(1) Collection of information from states.--Each State
shall collect and submit to the Secretary (and make publicly
available), in a format specified by the Secretary,
information on average monthly enrollment and average monthly
participation rates for adults and children under this
section and of the number and percentage of children who
become ineligible for medical assistance under this section
whose medical assistance is continued under another
eligibility category or who are enrolled under the State's
child health plan under title XXI. Such information shall be
submitted at the same time and frequency in which other
enrollment information under this title is submitted to the
Secretary.
``(2) Annual reports to congress.--Using the information
submitted under paragraph (1), the Secretary shall submit to
Congress annual reports concerning enrollment and
participation rates described in such paragraph.''.
(e) Effective Date.--The amendments made by subsections (b)
through (d) shall take effect on the date of the enactment of
this Act.
SEC. 802. FAMILY PLANNING SERVICES.
(a) Coverage as Optional Categorically Needy Group.--
(1) In general.--Section 1902(a)(10)(A)(ii) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)) is amended--
(A) in subclause (XVIII), by striking ``or'' at the end;
(B) in subclause (XIX), by adding ``or'' at the end; and
(C) by adding at the end the following new subclause:
``(XX) who are described in subsection (ee) (relating to
individuals who meet certain income standards);''.
(2) Group described.--Section 1902 of the Social Security
Act (42 U.S.C. 1396a), as amended by section 112(c), is
amended by adding at the end the following new subsection:
``(ee)(1) Individuals described in this subsection are
individuals--
``(A) whose income does not exceed an income eligibility
level established by the State that does not exceed the
highest income eligibility level established under the State
plan under this title (or under its State child health plan
under title XXI) for pregnant women; and
``(B) who are not pregnant.
``(2) At the option of a State, individuals described in
this subsection may include individuals who are determined to
meet the eligibility requirements referred to in paragraph
(1) under the terms, conditions, and procedures applicable to
making eligibility determinations for medical assistance
under this title under a waiver to provide the benefits
described in clause (XV) of the matter following subparagraph
(G) of section 1902(a)(10) granted to the State under section
1115 as of January 1, 2007.''.
(3) Limitation on benefits.--Section 1902(a)(10) of the
Social Security Act (42 U.S.C. 1396a(a)(10)) is amended in
the matter following subparagraph (G)--
(A) by striking ``and (XIV)'' and inserting ``(XIV)''; and
(B) by inserting ``, and (XV) the medical assistance made
available to an individual described in subsection (ee) shall
be limited to family planning services and supplies described
in section 1905(a)(4)(C) including medical diagnosis or
treatment services that are provided pursuant to a family
planning service in a family planning setting provided during
the period in which such an individual is eligible'' after
``cervical cancer''.
(4) Conforming amendments.--Section 1905(a) of the Social
Security Act (42 U.S.C. 1396d(a)) is amended in the matter
preceding paragraph (1)--
(A) in clause (xii), by striking ``or'' at the end;
(B) in clause (xiii), by adding ``or'' at the end; and
(C) by inserting after clause (xiii) the following:
``(xiv) individuals described in section 1902(ee),''.
(b) Presumptive Eligibility.--
(1) In general.--Title XIX of the Social Security Act (42
U.S.C. 1396 et seq.) is amended by inserting after section
1920B the following:
``PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING SERVICES
``Sec. 1920C. (a) State Option.--State plan approved under
section 1902 may provide for making medical assistance
available to an individual described in section 1902(ee)
(relating to individuals who meet certain income eligibility
standard) during a presumptive eligibility period. In the
case of an individual described in section 1902(ee), such
medical assistance shall be limited to family planning
services and supplies described in 1905(a)(4)(C) and, at the
State's option, medical diagnosis or treatment services that
are provided in conjunction with a family planning service in
a family planning setting provided during the period in which
such an individual is eligible.
``(b) Definitions.--For purposes of this section:
``(1) Presumptive eligibility period.--The term
`presumptive eligibility period' means, with respect to an
individual described in subsection (a), the period that--
``(A) begins with the date on which a qualified entity
determines, on the basis of preliminary information, that the
individual is described in section 1902(ee); and
``(B) ends with (and includes) the earlier of--
``(i) the day on which a determination is made with respect
to the eligibility of such individual for services under the
State plan; or
``(ii) in the case of such an individual who does not file
an application by the last day of the month following the
month during which the entity makes the determination
referred to in subparagraph (A), such last day.
``(2) Qualified entity.--
``(A) In general.--Subject to subparagraph (B), the term
`qualified entity' means any entity that--
``(i) is eligible for payments under a State plan approved
under this title; and
``(ii) is determined by the State agency to be capable of
making determinations of the type described in paragraph
(1)(A).
``(B) Rule of construction.--Nothing in this paragraph
shall be construed as preventing a State from limiting the
classes of entities that may become qualified entities in
order to prevent fraud and abuse.
``(c) Administration.--
``(1) In general.--The State agency shall provide qualified
entities with--
``(A) such forms as are necessary for an application to be
made by an individual described in subsection (a) for medical
assistance under the State plan; and
``(B) information on how to assist such individuals in
completing and filing such forms.
``(2) Notification requirements.--A qualified entity that
determines under subsection (b)(1)(A) that an individual
described in subsection (a) is presumptively eligible for
medical assistance under a State plan shall--
``(A) notify the State agency of the determination within 5
working days after the date on which determination is made;
and
``(B) inform such individual at the time the determination
is made that an application for medical assistance is
required to be made by not later than the last day of the
month following the month during which the determination is
made.
``(3) Application for medical assistance.--In the case of
an individual described in subsection (a) who is determined
by a qualified entity to be presumptively eligible for
medical assistance under a State plan, the individual shall
apply for medical assistance by not later than the last day
of the month following the month during which the
determination is made.
``(d) Payment.--Notwithstanding any other provision of this
title, medical assistance that--
``(1) is furnished to an individual described in subsection
(a)--
``(A) during a presumptive eligibility period;
``(B) by a entity that is eligible for payments under the
State plan; and
``(2) is included in the care and services covered by the
State plan, shall be treated as medical assistance provided
by such plan for purposes of clause (4) of the first sentence
of section 1905(b).''.
(2) Conforming amendments.--
(A) Section 1902(a)(47) of the Social Security Act (42
U.S.C. 1396a(a)(47)) is amended by inserting before the
semicolon at the end the following: ``and provide for making
medical assistance available to individuals described in
subsection (a) of section 1920C during a presumptive
eligibility period in accordance with such section''.
(B) Section 1903(u)(1)(D)(v) of such Act (42 U.S.C.
1396b(u)(1)(D)(v)) is amended--
(i) by striking ``or for'' and inserting ``for''; and
(ii) by inserting before the period the following: ``, or
for medical assistance provided to an individual described in
subsection (a) of section 1920C during a presumptive
eligibility period under such section''.
(e) Clarification of Coverage of Family Planning Services
and Supplies.--Section 1937(b) of the Social Security Act (42
U.S.C. 1396u-7(b)) is amended by adding at the end the
following:
``(5) Coverage of family planning services and supplies.--
Notwithstanding the previous provisions of this section, a
State may not provide for medical assistance through
enrollment
[[Page H9390]]
of an individual with benchmark coverage or benchmark-
equivalent coverage under this section unless such coverage
includes for any individual described in section
1905(a)(4)(C), medical assistance for family planning
services and supplies in accordance with such section.''.
(f) Effective Date.--The amendments made by this section
take effect on October 1, 2007.
SEC. 803. AUTHORITY TO CONTINUE PROVIDING ADULT DAY HEALTH
SERVICES APPROVED UNDER A STATE MEDICAID PLAN.
(a) In General.--During the period described in subsection
(b), the Secretary of Health and Human Services shall not--
(1) withhold, suspend, disallow, or otherwise deny Federal
financial participation under section 1903(a) of the Social
Security Act (42 U.S.C. 1396b(a)) for the provision of adult
day health care services, day activity and health services,
or adult medical day care services, as defined under a State
Medicaid plan approved during or before 1994, during such
period if such services are provided consistent with such
definition and the requirements of such plan; or
(2) withdraw Federal approval of any such State plan or
part thereof regarding the provision of such services (by
regulation or otherwise).
(b) Period Described.--The period described in this
subsection is the period that begins on November 3, 2005, and
ends on March 1, 2009.
SEC. 804. STATE OPTION TO PROTECT COMMUNITY SPOUSES OF
INDIVIDUALS WITH DISABILITIES.
Section 1924(h)(1)(A) of the Social Security Act (42
U.S.C. 1396r-5(h)(1)(A)) is amended by striking ``is
described in section 1902(a)(10)(A)(ii)(VI)'' and inserting
``is being provided medical assistance for home and
community-based services under subsection (c), (d), (e), (i),
or (j) of section 1915 or pursuant to section 1115''.
SEC. 805. COUNTY MEDICAID HEALTH INSURING ORGANIZATIONS .
(a) In General.--Section 9517(c)(3) of the Consolidated
Omnibus Budget Reconciliation Act of 1985 (42 U.S.C. 1396b
note), as added by section 4734 of the Omnibus Budget
Reconciliation Act of 1990 and as amended by section 704 of
the Medicare, Medicaid, and SCHIP Benefits Improvement and
Protection Act of 2000, is amended--
(1) in subparagraph (A), by inserting ``, in the case of
any health insuring organization described in such
subparagraph that is operated by a public entity established
by Ventura County, and in the case of any health insuring
organization described in such subparagraph that is operated
by a public entity established by Merced County'' after
``described in subparagraph (B)''; and
(2) in subparagraph (C), by striking ``14 percent'' and
inserting ``16 percent''.
(b) Effective Date.--The amendments made by subsection (a)
shall take effect on the date of the enactment of this Act.
Subtitle B--Payments
SEC. 811. PAYMENTS FOR PUERTO RICO AND TERRITORIES.
(a) Payment Ceiling.--Section 1108(g) of the Social
Security Act (42 U.S.C. 1308(g)) is amended--
(1) in paragraph (2), by striking ``paragraph (3)'' and
inserting ``paragraphs (3) and (4)''; and
(2) by adding at the end the following new paragraph:
``(4) Fiscal years 2009 through 2012 for certain insular
areas.--The amounts otherwise determined under this
subsection for Puerto Rico, the Virgin Islands, Guam, the
Northern Mariana Islands, and American Samoa for fiscal years
2009 through 2012 shall be increased by the following
amounts:
``(A) Puerto rico.--For Puerto Rico, $250,000,000 for
fiscal year 2009, $350,000,000 for fiscal year 2010,
$500,000,000 for fiscal year 2011, and $600,000,000 for
fiscal year 2012.
``(B) Virgin islands.--For the Virgin Islands, $5,000,000
for each of fiscal years 2009 through 2012.
``(C) Guam.--For Guam, $5,000,000 for each of fiscal years
2009 through 2012.
``(D) Northern mariana islands.--For the Northern Mariana
Islands, $4,000,000 for each of fiscal years 2009 through
2012.
``(E) American samoa.--For American Samoa, $4,000,000 for
each of fiscal years 2009 through 2012.
Such amounts shall not be taken into account in applying
paragraph (2) for fiscal years 2009 through 2012 but shall be
taken into account in applying such paragraph for fiscal year
2013 and subsequent fiscal years.''.
(b) Removal of Federal Matching Payments for Improving Data
Reporting Systems From the Overall Limit on Payments to
Territories Under Title XIX.--Such section is further amended
by adding at the end the following new paragraph:
``(5) Exclusion of certain expenditures from payment
limits.--With respect to fiscal year 2008 and each fiscal
year thereafter, if Puerto Rico, the Virgin Islands, Guam,
the Northern Mariana Islands, or American Samoa qualify for a
payment under subparagraph (A)(i) or (B) of section
1903(a)(3) for a calendar quarter of such fiscal year with
respect to expenditures for improvements in data reporting
systems described in such subparagraph, the limitation on
expenditures under title XIX for such commonwealth or
territory otherwise determined under subsection (f) and this
subsection for such fiscal year shall be determined without
regard to payment for such expenditures.''.
SEC. 812. MEDICAID DRUG REBATE.
Paragraph (1)(B)(i) of section 1927(c) of the Social
Security Act (42 U.S.C. 1396r-8(c)) is amended--
(1) by striking ``and'' at the end of subclause (IV);
(2) in subclause (V)--
(A) by inserting ``and before January 1, 2008,'' after
``December 31, 1995,''; and
(B) by striking the period at the end and inserting ``;
and''; and
(3) by adding at the end the following new subclause:
``(VI) after December 31, 2007, is 22.1 percent.''.
(1) In general.--Section 1927(c)(1)(C)(ii)(I) of the Social
Security Act (42 U.S.C. 1396r-8(c)(1)(C)(ii)(I)) is amended--
(A) by striking ``and'' before ``rebates''; and
(B) by inserting before the semicolon at the end the
following: ``, and rebates, discounts, and other price
concessions to pharmaceutical benefit managers (PBMs)''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply to calendar quarters beginning on or after
January 1, 2008.
SEC. 813. ADJUSTMENT IN COMPUTATION OF MEDICAID FMAP TO
DISREGARD AN EXTRAORDINARY EMPLOYER PENSION
CONTRIBUTION.
(a) In General.--Only for purposes of computing the Federal
medical assistance percentage under section 1905(b) of the
Social Security Act (42 U.S.C. 1396d(b)) for a State for a
fiscal year (beginning with fiscal year 2006), any
significantly disproportionate employer pension contribution
described in subsection (b) shall be disregarded in computing
the per capita income of such State, but shall not be
disregarded in computing the per capita income for the
continental United States (and Alaska) and Hawaii.
(b) Significantly Disproportionate Employer Pension
Contribution.--For purposes of subsection (a), a
significantly disproportionate employer pension contribution
described in this subsection with respect to a State for a
fiscal year is an employer contribution towards pensions that
is allocated to such State for a period if the aggregate
amount so allocated exceeds 25 percent of the total increase
in personal income in that State for the period involved.
SEC. 814. MORATORIUM ON CERTAIN PAYMENT RESTRICTIONS.
Notwithstanding any other provision of law, the Secretary
of Health and Human Services shall not, prior to the date
that is 1 year after the date of enactment of this Act, take
any action (through promulgation of regulation, issuance of
regulatory guidance, use of federal payment audit procedures,
or other administrative action, policy, or practice,
including a Medical Assistance Manual transmittal or letter
to State Medicaid directors) to restrict coverage or payment
under title XIX of the Social Security Act for rehabilitation
services, or school-based administration, transportation, or
medical services if such restrictions are more restrictive in
any aspect than those applied to such coverage or payment as
of July 1, 2007.
SEC. 815. TENNESSEE DSH.
The DSH allotments for Tennessee for each fiscal year
beginning with fiscal year 2008 under subsection (f)(3) of
section 1923 of the Social Security Act (42 U.S.C. 13961396r-
4) are deemed to be $30,000,000. The Secretary of Health and
Human Services may impose a limitation on the total amount of
payments made to hospitals under the TennCare Section 1115
waiver only to the extent that such limitation is necessary
to ensure that a hospital does not receive payment in excess
of the amounts described in subsection (f) of such section or
as necessary to ensure that the waiver remains budget
neutral.
SEC. 816. CLARIFICATION TREATMENT OF REGIONAL MEDICAL CENTER.
(a) In General.--Nothing in section 1903(w) of the Social
Security Act (42 U.S.C. 1396b(w)) shall be construed by the
Secretary of Health and Human Services as prohibiting a
State's use of funds as the non-Federal share of expenditures
under title XIX of such Act where such funds are transferred
from or certified by a publicly-owned regional medical center
located in another State and described in subsection (b), so
long as the Secretary determines that such use of funds is
proper and in the interest of the program under title XIX.
(b) Center Described.--A center described in this
subsection is a publicly-owned regional medical center that--
(1) provides level 1 trauma and burn care services;
(2) provides level 3 neonatal care services;
(3) is obligated to serve all patients, regardless of
ability to pay;
(4) is located within a Standard Metropolitan Statistical
Area (SMSA) that includes at least 3 States;
(5) provides services as a tertiary care provider for
patients residing within a 125-mile radius; and
(6) meets the criteria for a disproportionate share
hospital under section 1923 of such Act (42 U.S.C. 1396r-4)
in at least one Stat<divide>e other than the State in which
the center is located.
SEC. 817. EXTENSION OF SSI WEB-BASED ASSET DEMONSTRATION
PROJECT TO THE MEDICAID PROGRAM.
(a) In General.--The Secretary of Health and Human Services
shall provide for the application to asset eligibility
determinations under the Medicaid program under title XIX of
the Social Security Act of the automated, secure, web-based
asset verification request and response process being applied
for determining eligibility for benefits under the
Supplemental Security Income (SSI) program under title XVI of
such Act under a demonstration project conducted under the
authority of section 1631(e)(1)(B)(ii) of such Act (42 U.S.C.
1383(e)(1)(B)(ii)).
(b) Limitation.--Such application shall only extend to
those States in which such demonstration project is operating
and only for the period in which such project is otherwise
provided.
(c) Rules of Application.--For purposes of carrying out
subsection (a), notwithstanding
[[Page H9391]]
any other provision of law, information obtained from a
financial institution that is used for purposes of
eligibility determinations under such demonstration project
with respect to the Secretary of Health and Human Services
under the SSI program may also be shared and used by States
for purposes of eligibility determinations under the Medicaid
program. In applying section 1631(e)(1)(B)(ii) of the Social
Security Act under this subsection, references to the
Commissioner of Social Security and benefits under title XVI
of such Act shall be treated as including a reference to a
State described in subsection (b) and medical assistance
under title XIX of such Act provided by such a State.
Subtitle C--Miscellaneous
SEC. 821. DEMONSTRATION PROJECT FOR EMPLOYER BUY-IN.
Title XXI of the Social Security Act, as amended by section
133(a)(1), is further amended by adding at the end the
following new section:
``SEC. 2112. DEMONSTRATION PROJECT FOR EMPLOYER BUY-IN.
``(a) Authority.--
``(1) In general.--The Secretary shall establish a
demonstration project under which up to 10 States (each
referred to in this section as a `participating State') that
meets the conditions of paragraph (2) may provide, under its
State child health plan (notwithstanding section
2102(b)(3)(C)) for a period of 5 years, for child health
assistance in relation to family coverage described in
subsection (d) for children who would be targeted low-income
children but for coverage as beneficiaries under a group
health plan as the children of participants by virtue of a
qualifying employer's contribution under subsection (b)(2). :
``(2) Conditions.--The conditions described in this
paragraph for a State are as follows:
``(A) No waiting lists.--The State does not impose any
waiting list, enrollment cap, or similar limitation on
enrollment of targeted low-income children under the State
child health plan.
``(B) Eligibility of all children under 200 percent of
poverty line.--The State is applying an income eligibility
level under section 2110(b)(1)(B)(ii)(I) that is at least 200
percent of the poverty line.
``(3) Qualifying employer defined.--In this section, the
term `qualifying employer' means an employer that has a
majority of its workforce composed of full-time workers with
family incomes reasonably estimated by the employer (based on
wage information available to the employer) at or below 200
percent of the poverty line. In applying the previous
sentence, two part-time workers shall be treated as a single
full-time worker.
``(b) Funding.--A demonstration project under this section
in a participating State shall be funded, with respect to
assistance provided to children described in subsection
(a)(1), consistent with the following:
``(1) Limited family contribution.--The family involved
shall be responsible for providing payment towards the
premium for such assistance of such amount as the State may
specify, except that the limitations on cost-sharing
(including premiums) under paragraphs (2) and (3) of section
2103(e) shall apply to all cost-sharing of such family under
this section.
``(2) Minimum employer contribution.--The qualifying
employer involved shall be responsible for providing payment
to the State child health plan in the State of at least 50
percent of the portion of the cost (as determined by the
State) of the family coverage in which the employer is
enrolling the family that exceeds the amount of the family
contribution under paragraph (1) applied towards such
coverage.
``(3) Limitation on federal financial participation.--In no
case shall the Federal financial participation under section
2105 with respect to a demonstration project under this
section be made for any portion of the costs of family
coverage described in subsection (d) (including the costs of
administration of such coverage) that are not attributable to
children described in subsection (a)(1).
``(c) Uniform Eligibility Rules.--In providing assistance
under a demonstration project under this section--
``(1) a State shall establish uniform rules of eligibility
for families to participate; and
``(2) a State shall not permit a qualifying employer to
select, within those families that meet such eligibility
rules, which families may participate.
``(d) Terms and Conditions.--The family coverage offered to
families of qualifying employers under a demonstration
project under this section in a State shall be the same as
the coverage and benefits provided under the State child
health plan in the State for targeted low-income children
with the highest family income level permitted.''.
SEC. 822. DIABETES GRANTS.
Section 2104 of the Social Security Act (42 U.C.C 1397dd),
as amended by section 101, is further amended--
(1) in subsection (a)(11), by inserting before the period
at the end the following: ``plus for fiscal year 2009 the
total of the amount specified in subsection (j)''; and
(2) by adding at the end the following new subsection:
``(j) Funding for Diabetes Grants.--From the amounts
appropriated under subsection (a)(11), for fiscal year 2009
from the amounts--
``(1) $150,000,000 is hereby transferred and made available
in such fiscal year for grants under section 330B of the
Public Health Service Act; and
``(2) $150,000,000 is hereby transferred and made available
in such fiscal year for grants under section 330C of such
Act.''.
SEC. 823. TECHNICAL CORRECTION.
(a) Correction of Reference to Children in Foster Care
Receiving Child Welfare Services.--Section
1937(a)(2)(B)(viii) of the Social Security Act (42 U.S.C.
1396u-7(a)(2)(B) is amended by striking ``aid or assistance
is made available under part B of title IV to children in
foster care'' and inserting ``child welfare services are made
available under part B of title IV on the basis of being a
child in foster care''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect as if included in the amendment made by
section 6044(a) of the Deficit Reduction Act of 2005.
TITLE IX--MISCELLANEOUS
SEC. 901. MEDICARE PAYMENT ADVISORY COMMISSION STATUS.
Section 1805(a) of the Social Security Act (42 U.S.C.
1395b-6(a)) is amended by inserting ``as an agency of
Congress'' after ``established''.
SEC. 902. REPEAL OF TRIGGER PROVISION.
Subtitle A of title VIII of the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (Public Law 108-
173) is repealed and the provisions of law amended by such
subtitle are restored as if such subtitle had never been
enacted.
SEC. 903. REPEAL OF COMPARATIVE COST ADJUSTMENT (CCA)
PROGRAM.
Section 1860C-1 of the Social Security Act (42 U.S.C.
1395w-29), as added by section 241(a) of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003
(Public Law 108-173), is repealed.
SEC. 904. COMPARATIVE EFFECTIVENESS RESEARCH.
(a) In General.--Part A of title XVIII of the Social
Security Act is amended by adding at the end the following
new section:
``COMPARATIVE EFFECTIVENESS RESEARCH
``Sec. 1822. (a) Center for Comparative Effectiveness
Research Established.--
``(1) In general.--The Secretary shall establish within the
Agency of Healthcare Research and Quality a Center for
Comparative Effectiveness Research (in this section referred
to as the `Center') to conduct, support, and synthesize
research (including research conducted or supported under
section 1013 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003) with respect to the outcomes,
effectiveness, and appropriateness of health care services
and procedures in order to identify the manner in which
diseases, disorders, and other health conditions can most
effectively and appropriately be prevented, diagnosed,
treated, and managed clinically.
``(2) Duties.--The Center shall--
``(A) conduct, support, and synthesize research relevant to
the comparative clinical effectiveness of the full spectrum
of health care treatments, including pharmaceuticals, medical
devices, medical and surgical procedures, and other medical
interventions;
``(B) conduct and support systematic reviews of clinical
research, including original research conducted subsequent to
the date of the enactment of this section;
``(C) use methodologies such as randomized controlled
clinical trials as well as other various types of clinical
research, such as observational studies;
``(D) submit to the Comparative Effectiveness Research
Commission, the Secretary, and Congress appropriate relevant
reports described in subsection (d)(2);
``(E) encourage, as appropriate, the development and use of
clinical registries and the development of clinical
effectiveness research data networks from electronic health
records, post marketing drug and medical device surveillance
efforts, and other forms of electronic health data; and
``(F) not later than 180 days after the date of the
enactment of this section, develop methodological standards
to be used when conducting studies of comparative clinical
effectiveness and value (and procedures for use of such
standards) in order to help ensure accurate and effective
comparisons and update such standards at least biennially.
``(b) Oversight by Comparative Effectiveness Research
Commission.--
``(1) In general.--The Secretary shall establish an
independent Comparative Effectiveness Research Commission (in
this section referred to as the `Commission') to oversee and
evaluate the activities carried out by the Center under
subsection (a) to ensure such activities result in highly
credible research and information resulting from such
research.
``(2) Duties.--The Commission shall--
``(A) determine national priorities for research described
in subsection (a) and in making such determinations consult
with patients and health care providers and payers;
``(B) monitor the appropriateness of use of the CERTF
described in subsection (f) with respect to the timely
production of comparative effectiveness research determined
to be a national priority under subparagraph (A);
``(C) identify highly credible research methods and
standards of evidence for such research to be considered by
the Center;
``(D) review and approve the methodological standards (and
updates to such standards) developed by the Center under
subsection (a)(2)(F);
``(E) enter into an arrangement under which the Institute
of Medicine of the National Academy of Sciences shall conduct
an evaluation and report on standards of evidence for such
research;
``(F) support forums to increase stakeholder awareness and
permit stakeholder feedback on the efforts of the Agency of
Healthcare Research and Quality to advance methods and
standards that promote highly credible research;
``(G) make recommendations for public data access policies
of the Center that would allow for access of such data by the
public while ensuring the information produced from research
involved is timely and credible;
[[Page H9392]]
``(H) appoint a clinical perspective advisory panel for
each research priority determined under subparagraph (A),
which shall frame the specific research inquiry to be
examined with respect to such priority to ensure that the
information produced from such research is clinically
relevant to decisions made by clinicians and patients at the
point of care;
``(I) make recommendations for the priority for periodic
reviews of previous comparative effectiveness research and
studies conducted by the Center under subsection (a);
``(J) routinely review processes of the Center with respect
to such research to confirm that the information produced by
such research is objective, credible, consistent with
standards of evidence established under this section, and
developed through a transparent process that includes
consultations with appropriate stakeholders;
``(K) at least annually, provide guidance or
recommendations to health care providers and consumers for
the use of information on the comparative effectiveness of
health care services by consumers, providers (as defined for
purposes of regulations promulgated under section 264(c) of
the Health Insurance Portability and Accountability Act of
1996) and public and private purchasers;
``(L) make recommendations for a strategy to disseminate
the findings of research conducted and supported under this
section that enables clinicians to improve performance,
consumers to make more informed health care decisions, and
payers to set medical policies that improve quality and
value;
``(M) provide for the public disclosure of relevant reports
described in subsection (d)(2); and
``(N) submit to Congress an annual report on the progress
of the Center in achieving national priorities determined
under subparagraph (A) for the provision of credible
comparative effectiveness information produced from such
research to all interested parties.
``(3) Composition of commission.--
``(A) In general.--The members of the Commission shall
consist of--
``(i) the Director of the Agency for Healthcare Research
and Quality;
``(ii) the Chief Medical Officer of the Centers for
Medicare & Medicaid Services; and
``(iii) 15 additional members who shall represent broad
constituencies of stakeholders including clinicians,
patients, researchers, third-party payers, consumers of
Federal and State beneficiary programs.
``(B) Qualifications.--
``(i) Diverse representation of perspectives.--The members
of the Commission shall represent a broad range of
perspectives and shall collectively have experience in the
following areas:
``(I) Epidemiology.
``(II) Health services research.
``(III) Bioethics.
``(IV) Decision sciences.
``(V) Economics.
``(ii) Diverse representation of health care community.--At
least one member shall represent each of the following health
care communities:
``(I) Consumers.
``(II) Practicing physicians, including surgeons.
``(III) Employers.
``(IV) Public payers.
``(V) Insurance plans.
``(VI) Clinical researchers who conduct research on behalf
of pharmaceutical or device manufacturers.
``(4) Appointment.--The Comptroller General of the United
States, in consultation with the chairs of the committees of
jurisdiction of the House of Representatives and the Senate,
shall appoint the members of the Commission.
``(5) Chairman; vice chairman.--The Comptroller General of
the United States shall designate a member of the Commission,
at the time of appointment of the member, as Chairman and a
member as Vice Chairman for that term of appointment, except
that in the case of vacancy of the Chairmanship or Vice
Chairmanship, the Comptroller General may designate another
member for the remainder of that member's term.
``(6) Terms.--
``(A) In general.--Except as provided in subparagraph (B),
each member of the Commission shall be appointed for a term
of 4 years.
``(B) Terms of initial appointees.--Of the members first
appointed--
``(i) 8 shall be appointed for a term of 4 years; and
``(ii) 7 shall be appointed for a term of 3 years.
``(7) Coordination.--To enhance effectiveness and
coordination, the Comptroller General is encouraged, to the
greatest extent possible, to seek coordination between the
Commission and the National Advisory Council of the Agency
for Healthcare Research and Quality.
``(8) Conflicts of interest.--In appointing the members of
the Commission or a clinical perspective advisory panel
described in paragraph (2)(H), the Comptroller General of the
United States or the Commission, respectively, shall take
into consideration any financial conflicts of interest.
``(9) Compensation.--While serving on the business of the
Commission (including traveltime), a member of the Commission
shall be entitled to compensation at the per diem equivalent
of the rate provided for level IV of the Executive Schedule
under section 5315 of title 5, United States Code; and while
so serving away from home and the member's regular place of
business, a member may be allowed travel expenses, as
authorized by the Director of the Commission.
``(10) Availability of reports.--The Commission shall
transmit to the Secretary a copy of each report submitted
under this subsection and shall make such reports available
to the public.
``(11) Director and staff; experts and consultants.--
Subject to such review as the Secretary, in consultation with
the Comptroller General deems necessary to assure the
efficient administration of the Commission, the Commission
may--
``(A) employ and fix the compensation of an Executive
Director (subject to the approval of the Secretary, in
consultation with the Comptroller General) and such other
personnel as may be necessary to carry out its duties
(without regard to the provisions of title 5, United States
Code, governing appointments in the competitive service);
``(B) seek such assistance and support as may be required
in the performance of its duties from appropriate Federal
departments and agencies;
``(C) enter into contracts or make other arrangements, as
may be necessary for the conduct of the work of the
Commission (without regard to section 3709 of the Revised
Statutes (41 U.S.C. 5));
``(D) make advance, progress, and other payments which
relate to the work of the Commission;
``(E) provide transportation and subsistence for persons
serving without compensation; and
``(F) prescribe such rules and regulations as it deems
necessary with respect to the internal organization and
operation of the Commission.
``(12) Powers.--
``(A) Obtaining official data.--The Commission may secure
directly from any department or agency of the United States
information necessary to enable it to carry out this section.
Upon request of the Executive Director, the head of that
department or agency shall furnish that information to the
Commission on an agreed upon schedule.
``(B) Data collection.--In order to carry out its
functions, the Commission shall--
``(i) utilize existing information, both published and
unpublished, where possible, collected and assessed either by
its own staff or under other arrangements made in accordance
with this section,
``(ii) carry out, or award grants or contracts for,
original research and experimentation, where existing
information is inadequate, and
``(iii) adopt procedures allowing any interested party to
submit information for the Commission's use in making reports
and recommendations.
``(C) Access of gao to information.--The Comptroller
General shall have unrestricted access to all deliberations,
records, and nonproprietary data of the Commission,
immediately upon request.
``(D) Periodic audit.--The Commission shall be subject to
periodic audit by the Comptroller General.
``(c) Research Requirements.--Any research conducted,
supported, or synthesized under this section shall meet the
following requirements:
``(1) Ensuring transparency, credibility, and access.--
``(A) The establishment of the agenda and conduct of the
research shall be insulated from inappropriate political or
stakeholder influence.
``(B) Methods of conducting such research shall be
scientifically based.
``(C) All aspects of the prioritization of research,
conduct of the research, and development of conclusions based
on the research shall be transparent to all stakeholders.
``(D) The process and methods for conducting such research
shall be publicly documented and available to all
stakeholders.
``(E) Throughout the process of such research, the Center
shall provide opportunities for all stakeholders involved to
review and provide comment on the methods and findings of
such research.
``(2) Use of clinical perspective advisory panels.--The
research shall meet a national research priority determined
under subsection (b)(2)(A) and shall examine the specific
research inquiry framed by the clinical perspective advisory
panel for the national research priority.
``(3) Stakeholder input.--The priorities of the research,
the research, and the dissemination of the research shall
involve the consultation of patients, health care providers,
and health care consumer representatives through transparent
mechanisms recommended by the Commission.
``(d) Public Access to Comparative Effectiveness
Information.--
``(1) In general.--Not later than 90 days after receipt by
the Center or Commission, as applicable, of a relevant report
described in paragraph (2) made by the Center, Commission, or
clinical perspective advisory panel under this section,
appropriate information contained in such report shall be
posted on the official public Internet site of the Center and
of the Commission, as applicable.
``(2) Relevant reports described.--For purposes of this
section, a relevant report is each of the following submitted
by a grantee or contractor of the Center:
``(A) An interim progress report.
``(B) A draft final comparative effectiveness review.
``(C) A final progress report on new research submitted for
publication by a peer review journal.
``(D) Stakeholder comments.
``(E) A final report.
``(3) Access by congress and the commission to the center's
information.--Congress and the Commission shall each have
unrestricted access to all deliberations, records, and
nonproprietary data of the Center, immediately upon request.
``(e) Dissemination and Incorporation of Comparative
Effectiveness Information.--
``(1) Dissemination.--The Center shall provide for the
dissemination of appropriate findings produced by research
supported, conducted, or synthesized under this section to
health care providers, patients, vendors of health
information technology focused on clinical decision support,
appropriate professional
[[Page H9393]]
associations, and Federal and private health plans.
``(2) Incorporation.--The Center shall assist users of
health information technology focused on clinical decision
support to promote the timely incorporation of the findings
described in paragraph (1) into clinical practices and to
promote the ease of use of such incorporation.
``(f) Reports to Congress.--
``(1) Annual reports.--Beginning not later than one year
after the date of the enactment of this section, the Director
of the Agency of Healthcare Research and Quality and the
Commission shall submit to Congress an annual report on the
activities of the Center and the Commission, as well as the
research, conducted under this section.
``(2) Recommendation for fair share per capita amount for
all-payer financing.--Beginning not later than December 31,
2009, the Secretary shall submit to Congress an annual
recommendation for a fair share per capita amount described
in subsection (c)(1) of section 9511 of the Internal Revenue
Code of 1986 for purposes of funding the CERTF under such
section.
``(3) Analysis and review.--Not later than December 31,
2011, the Secretary, in consultation with the Commission,
shall submit to Congress a report on all activities conducted
or supported under this section as of such date. Such report
shall include an evaluation of the return on investment
resulting from such activities, the overall costs of such
activities, and an analysis of the backlog of any research
proposals approved by the Commission but not funded. Such
report shall also address whether Congress should expand the
responsibilities of the Center and of the Commission to
include studies of the effectiveness of various aspects of
the health care delivery system, including health plans and
delivery models, such as health plan features, benefit
designs and performance, and the ways in which health
services are organized, managed, and delivered.
``(g) Coordinating Council for Health Services Research.--
``(1) Establishment.--The Secretary shall establish a
permanent council (in this section referred to as the
`Council') for the purpose of--
``(A) assisting the offices and agencies of the Department
of Health and Human Services, the Department of Veterans
Affairs, the Department of Defense, and any other Federal
department or agency to coordinate the conduct or support of
health services research; and
``(B) advising the President and Congress on--
``(i) the national health services research agenda;
``(ii) strategies with respect to infrastructure needs of
health services research; and
``(iii) appropriate organizational expenditures in health
services research by relevant Federal departments and
agencies.
``(2) Membership.--
``(A) Number and appointment.--The Council shall be
composed of 20 members. One member shall be the Director of
the Agency for Healthcare Research and Quality. The Director
shall appoint the other members not later than 30 days after
the enactment of this Act.
``(B) Terms.--
``(i) In general.--Except as provided in clause (ii), each
member of the Council shall be appointed for a term of 4
years.
``(ii) Terms of initial appointees.--Of the members first
appointed--
``(I) 10 shall be appointed for a term of 4 years; and
``(II) 9 shall be appointed for a term of 3 years.
``(iii) Vacancies.--Any vacancies shall not affect the
power and duties of the Council and shall be filled in the
same manner as the original appointment.
``(C) Qualifications.--
``(i) In general.--The members of the Council shall include
one senior official from each of the following agencies:
``(I) The Veterans Health Administration.
``(II) The Department of Defense Military Health Care
System.
``(III) The Centers for Disease Control and Prevention.
``(IV) The National Center for Health Statistics.
``(V) The National Institutes of Health.
``(VI) The Center for Medicare & Medicaid Services.
``(VII) The Federal Employees Health Benefits Program.
``(ii) National, philanthropic foundations.--The members of
the Council shall include 4 senior leaders from major
national, philanthropic foundations that fund and use health
services research.
``(iii) Stakeholders.--The remaining members of the Council
shall be representatives of other stakeholders in health
services research, including private purchasers, health
plans, hospitals and other health facilities, and health
consumer groups.
``(3) Annual report.--The Council shall submit to Congress
an annual report on the progress of the implementation of the
national health services research agenda.
``(h) Funding of Comparative Effectiveness Research.--For
fiscal year 2008 and each subsequent fiscal year, amounts in
the Comparative Effectiveness Research Trust Fund (referred
to in this section as the `CERTF') under section 9511 of the
Internal Revenue Code of 1986 shall be available to the
Secretary to carry out this section.''.
(b) Comparative Effectiveness Research Trust Fund;
Financing for Trust Fund.--
(1) Establishment of trust fund.--
(A) In general.--Subchapter A of chapter 98 of the Internal
Revenue Code of 1986 (relating to trust fund code) is amended
by adding at the end the following new section:
``SEC. 9511. HEALTH CARE COMPARATIVE EFFECTIVENESS RESEARCH
TRUST FUND.
``(a) Creation of Trust Fund.--There is established in the
Treasury of the United States a trust fund to be known as the
`Health Care Comparative Effectiveness Research Trust Fund'
(hereinafter in this section referred to as the `CERTF'),
consisting of such amounts as may be appropriated or credited
to such Trust Fund as provided in this section and section
9602(b).
``(b) Transfers to Fund.--There are hereby appropriated to
the Trust Fund the following:
``(1) For fiscal year 2008, $90,000,000.
``(2) For fiscal year 2009, $100,000,000.
``(3) For fiscal year 2010, $110,000,000.
``(4) For each fiscal year beginning with fiscal year
2011--
``(A) an amount equivalent to the net revenues received in
the Treasury from the fees imposed under subchapter B of
chapter 34 (relating to fees on health insurance and self-
insured plans) for such fiscal year; and
``(B) subject to subsection (c)(2), amounts determined by
the Secretary of Health and Human Services to be equivalent
to the fair share per capita amount computed under subsection
(c)(1) for the fiscal year multiplied by the average number
of individuals entitled to benefits under part A, or enrolled
under part B, of title XVIII of the Social Security Act
during such fiscal year.
The amounts appropriated under paragraphs (1), (2), (3), and
(4)(B) shall be transferred from the Federal Hospital
Insurance Trust Fund and from the Federal Supplementary
Medical Insurance Trust Fund (established under section 1841
of such Act), and from the Medicare Prescription Drug Account
within such Trust Fund, in proportion (as estimated by the
Secretary) to the total expenditures during such fiscal year
that are made under title XVIII of such Act from the
respective trust fund or account.
``(c) Fair Share Per Capita Amount.--
``(1) Computation.--
``(A) In general.--Subject to subparagraph (B), the fair
share per capita amount under this paragraph for a fiscal
year (beginning with fiscal year 2011) is an amount computed
by the Secretary of Health and Human Services for such fiscal
year that, when applied under this section and subchapter B
of chapter 34 of the Internal Revenue Code of 1986, will
result in revenues to the CERTF of $375,000,000 for the
fiscal year.
``(B) Alternative computation.--
``(i) In general.--If the Secretary is unable to compute
the fair share per capita amount under subparagraph (A) for a
fiscal year, the fair share per capita amount under this
paragraph for the fiscal year shall be the default amount
determined under clause (ii) for the fiscal year.
``(ii) Default amount.--The default amount under this
clause for--
``(I) fiscal year 2011 is equal to $2; or
``(II) a subsequent year is equal to the default amount
under this clause for the preceeding fiscal year increased by
the annual percentage increase in the medical care component
of the consumer price index (United States city average) for
the 12-month period ending with April of the preceding fiscal
year.
Any amount determined under subclause (II) shall be rounded
to the nearest penny.
``(2) Limitation on medicare funding.--In no case shall the
amount transferred under subsection (b)(4)(B) for any fiscal
year exceed $90,000,000.
``(d) Expenditures From Fund.--
``(1) In general.--Subject to paragraph (2), amounts in the
CERTF are available to the Secretary of Health and Human
Services for carrying out section 1822 of the Social Security
Act.
``(2) Allocation for commission.--Not less than the
following amounts in the CERTF for a fiscal year shall be
available to carry out the activities of the Comparative
Effectiveness Research Commission established under section
1822(b) of the Social Security Act for such fiscal year:
``(A) For fiscal year 2008, $7,000,000.
``(B) For fiscal year 2009, $9,000,000.
``(C) For each fiscal year beginning with 2010,
$10,000,000.
Nothing in this paragraph shall be construed as preventing
additional amounts in the CERTF from being made available to
the Comparative Effectiveness Research Commission for such
activities.
``(e) Net Revenues.--For purposes of this section, the term
`net revenues' means the amount estimated by the Secretary
based on the excess of--
``(1) the fees received in the Treasury under subchapter B
of chapter 34, over
``(2) the decrease in the tax imposed by chapter 1
resulting from the fees imposed by such subchapter.''.
(B) Clerical amendment.--The table of sections for such
subchapter A is amended by adding at the end thereof the
following new item:
``Sec. 9511. Health Care Comparative Effectiveness Research Trust
Fund.''.
(2) Financing for fund from fees on insured and self-
insured health plans.--
(A) General rule.--Chapter 34 of the Internal Revenue Code
of 1986 is amended by adding at the end the following new
subchapter:
``Subchapter B--Insured and Self-Insured Health Plans
``Sec. 4375. Health insurance.
``Sec. 4376. Self-insured health plans
``Sec. 4377. Definitions and special rules
``SEC. 4375. HEALTH INSURANCE.
``(a) Imposition of Fee.--There is hereby imposed on each
specified health insurance policy for each policy year a fee
equal to the fair share per capita amount determined under
section 9511(c)(1) multiplied by the average number of lives
covered under the policy.
``(b) Liability for Fee.--The fee imposed by subsection (a)
shall be paid by the issuer of the policy.
[[Page H9394]]
``(c) Specified Health Insurance Policy.--For purposes of
this section--
``(1) In general.--Except as otherwise provided in this
section, the term `specified health insurance policy' means
any accident or health insurance policy issued with respect
to individuals residing in the United States.
``(2) Exemption of certain policies.--The term `specified
health insurance policy' does not include any insurance
policy if substantially all of its coverage is of excepted
benefits described in section 9832(c).
``(A) liabilities incurred under workers' compensation
laws,
``(B) tort liabilities,
``(C) liabilities relating to ownership or use of property,
``(D) credit insurance,
``(E) medicare supplemental coverage, or
``(F) such other similar liabilities as the Secretary may
specify by regulations.
``(3) Treatment of prepaid health coverage arrangements.--
``(A) In general.--In the case of any arrangement described
in subparagraph (B)--
``(i) such arrangement shall be treated as a specified
health insurance policy, and
``(ii) the person referred to in such subparagraph shall be
treated as the issuer.
``(B) Description of arrangements.--An arrangement is
described in this subparagraph if under such arrangement
fixed payments or premiums are received as consideration for
any person's agreement to provide or arrange for the
provision of accident or health coverage to residents of the
United States, regardless of how such coverage is provided or
arranged to be provided.
``SEC. 4376. SELF-INSURED HEALTH PLANS.
``(a) Imposition of Fee.--In the case of any applicable
self-insured health plan for each plan year, there is hereby
imposed a fee equal to the fair share per capita amount
determined under section 9511(c)(1) multiplied by the average
number of lives covered under the plan.
``(b) Liability for Fee.--
``(1) In general.--The fee imposed by subsection (a) shall
be paid by the plan sponsor.
``(2) Plan sponsor.--For purposes of paragraph (1) the term
`plan sponsor' means--
``(A) the employer in the case of a plan established or
maintained by a single employer,
``(B) the employee organization in the case of a plan
established or maintained by an employee organization,
``(C) in the case of--
``(i) a plan established or maintained by 2 or more
employers or jointly by 1 or more employers and 1 or more
employee organizations,
``(ii) a multiple employer welfare arrangement, or
``(iii) a voluntary employees' beneficiary association
described in section 501(c)(9),
the association, committee, joint board of trustees, or other
similar group of representatives of the parties who establish
or maintain the plan, or
``(D) the cooperative or association described in
subsection (c)(2)(F) in the case of a plan established or
maintained by such a cooperative or association.
``(c) Applicable Self-Insured Health Plan.--For purposes of
this section, the term `applicable self-insured health plan'
means any plan for providing accident or health coverage if--
``(1) any portion of such coverage is provided other than
through an insurance policy, and
``(2) such plan is established or maintained--
``(A) by one or more employers for the benefit of their
employees or former employees,
``(B) by one or more employee organizations for the benefit
of their members or former members,
``(C) jointly by 1 or more employers and 1 or more employee
organizations for the benefit of employees or former
employees,
``(D) by a voluntary employees' beneficiary association
described in section 501(c)(9),
``(E) by any organization described in section 501(c)(6),
or
``(F) in the case of a plan not described in the preceding
subparagraphs, by a multiple employer welfare arrangement (as
defined in section 3(40) of Employee Retirement Income
Security Act of 1974), a rural electric cooperative (as
defined in section 3(40)(B)(iv) of such Act), or a rural
telephone cooperative association (as defined in section
3(40)(B)(v) of such Act).
``SEC. 4377. DEFINITIONS AND SPECIAL RULES.
``(a) Definitions.--For purposes of this subchapter--
``(1) Accident and health coverage.--The term `accident and
health coverage' means any coverage which, if provided by an
insurance policy, would cause such policy to be a specified
health insurance policy (as defined in section 4375(c)).
``(2) Insurance policy.--The term `insurance policy' means
any policy or other instrument whereby a contract of
insurance is issued, renewed, or extended.
``(3) United states.--The term `United States' includes any
possession of the United States.
``(b) Treatment of Governmental Entities.--
``(1) In general.--For purposes of this subchapter--
``(A) the term `person' includes any governmental entity,
and
``(B) notwithstanding any other law or rule of law,
governmental entities shall not be exempt from the fees
imposed by this subchapter except as provided in paragraph
(2).
``(2) Treatment of exempt governmental programs.--In the
case of an exempt governmental program, no fee shall be
imposed under section 4375 or section 4376 on any covered
life under such program.
``(3) Exempt governmental program defined.--For purposes of
this subchapter, the term `exempt governmental program'
means--
``(A) any insurance program established under title XVIII
of the Social Security Act,
``(B) the medical assistance program established by title
XIX or XXI of the Social Security Act,
``(C) any program established by Federal law for providing
medical care (other than through insurance policies) to
individuals (or the spouses and dependents thereof) by reason
of such individuals being--
``(i) members of the Armed Forces of the United States, or
``(ii) veterans, and
``(D) any program established by Federal law for providing
medical care (other than through insurance policies) to
members of Indian tribes (as defined in section 4(d) of the
Indian Health Care Improvement Act).
``(c) Treatment as Tax.--For purposes of subtitle F, the
fees imposed by this subchapter shall be treated as if they
were taxes.
``(d) No Cover Over to Possessions.--Notwithstanding any
other provision of law, no amount collected under this
subchapter shall be covered over to any possession of the
United States.''
(B) Clerical amendments.--
(i) Chapter 34 of such Code is amended by striking the
chapter heading and inserting the following:
``CHAPTER 34--TAXES ON CERTAIN INSURANCE POLICIES
``subchapter a. policies issued by foreign insurers
``subchapter b. insured and self-insured health plans
``Subchapter A--Policies Issued By Foreign Insurers''.
(ii) The table of chapters for subtitle D of such Code is
amended by striking the item relating to chapter 34 and
inserting the following new item:
``Chapter 34--Taxes on Certain Insurance Policies''.
(C) Effective date.--The amendments made by this subsection
shall apply with respect to policies and plans for portions
of policy or plan years beginning on or after October 1,
2010.
SEC. 905. IMPLEMENTATION OF HEALTH INFORMATION TECHNOLOGY
(IT) UNDER MEDICARE.
(a) In General.--Not later than January 1, 2010, the
Secretary of Health and Human Services shall submit to
Congress a report that includes--
(1) a plan to develop and implement a health information
technology (health IT) system for all health care providers
under the Medicare program that meets the specifications
described in subsection (b); and
(2) an analysis of the impact, feasibility, and costs
associated with the use of health information technology in
medically underserved communities.
(b) Plan Specification.--The specifications described in
this subsection, with respect to a health information
technology system described in subsection (a), are the
following:
(1) The system protects the privacy and security of
individually identifiable health information.
(2) The system maintains and provides permitted access to
health information in an electronic format (such as through
computerized patient records or a clinical data repository).
(3) The system utilizes interface software that allows for
interoperability.
(4) The system includes clinical decision support.
(5) The system incorporates e-prescribing and computerized
physician order entry.
(6) The system incorporates patient tracking and reminders.
(7) The system utilizes technology that is open source (if
available) or technology that has been developed by the
government.
The report shall include an analysis of the financial and
administrative resources necessary to develop such system and
recommendations regarding the level of subsidies needed for
all such health care providers to adopt the system.
SEC. 906. DEVELOPMENT, REPORTING, AND USE OF HEALTH CARE
MEASURES.
(a) In General.--Part E of title XVIII of the Social
Security Act (42 U.S.C. 1395x et seq.) is amended by
inserting after section 1889 the following:
``DEVELOPMENT, REPORTING, AND USE OF HEALTH CARE MEASURES
``Sec. 1890. (a) Fostering Development of Health Care
Measures.--The Secretary shall designate, and have in effect
an arrangement with, a single organization (such as the
National Quality Forum) that meets the requirements described
in subsection (c), under which such organization provides the
Secretary with advice on, and recommendations with respect
to, the key elements and priorities of a national system for
establishing health care measures. The arrangement shall be
effective beginning no sooner than January 1, 2008, and no
later than September 30, 2008.
``(b) Duties.--The duties of the organization designated
under subsection (a) (in this title referred to as the
`designated organization') shall, in accordance with
subsection (d), include--
``(1) establishing and managing an integrated national
strategy and process for setting priorities and goals in
establishing health care measures;
``(2) coordinating the development and specifications of
such measures;
``(3) establishing standards for the development and
testing of such measures;
``(4) endorsing national consensus health care measures;
and
``(5) advancing the use of electronic health records for
automating the collection, aggregation, and transmission of
measurement information.
[[Page H9395]]
``(c) Requirements Described.--For purposes of subsection
(a), the requirements described in this subsection, with
respect to an organization, are the following:
``(1) Private nonprofit.--The organization is a private
nonprofit entity governed by a board and an individual
designated as president and chief executive officer.
``(2) Board membership.--The members of the board of the
organization include representatives of--
``(A) health care providers or groups representing such
providers;
``(B) health plans or groups representing health plans;
``(C) groups representing health care consumers;
``(D) health care purchasers and employers or groups
representing such purchasers or employers; and
``(E) health care practitioners or groups representing
practitioners.
``(3) Other membership requirements.--The membership of the
organization is representative of individuals with experience
with--
``(A) urban health care issues;
``(B) safety net health care issues;
``(C) rural and frontier health care issues; and
``(D) health care quality and safety issues.
``(4) Open and transparent.--With respect to matters
related to the arrangement described in subsection (a), the
organization conducts its business in an open and transparent
manner and provides the opportunity for public comment.
``(5) Voluntary consensus standards setting organization.--
The organization operates as a voluntary consensus standards
setting organization as defined for purposes of section 12(d)
of the National Technology Transfer and Advancement Act of
1995 (Public Law 104-113) and Office of Management and Budget
Revised Circular A-119 (published in the Federal Register on
February 10, 1998).
``(6) Experience.--The organization has at least 7 years
experience in establishing national consensus standards.
``(d) Requirements for Health Care Measures.--In carrying
out its duties under subsection (b), the designated
organization shall ensure the following:
``(1) Measures.--The designated organization shall ensure
that the measures established or endorsed under subsection
(b) are evidence-based, reliable, and valid; and include--
``(A) measures of clinical processes and outcomes, patient
experience, efficiency, and equity;
``(B) measures to assess effectiveness, timeliness, patient
self-management, patient centeredness, and safety; and
``(C) measures of under use and over use.
``(2) Priorities.--
``(A) In general.--The designated organization shall ensure
that priority is given to establishing and endorsing--
``(i) measures with the greatest potential impact for
improving the effectiveness and efficiency of health care;
``(ii) measures that may be rapidly implemented by group
health plans, health insurance issuers, physicians,
hospitals, nursing homes, long-term care providers, and other
providers;
``(iii) measures which may inform health care decisions
made by consumers and patients; and
``(iv) measures that apply to multiple services furnished
by different providers during an episode of care.
``(B) Annual report on priorities; secretarial publication
and comment.--
``(i) Annual report.--The designated organization shall
issue and submit to the Secretary a report by March 31 of
each year (beginning with 2009) on the organization's
recommendations for priorities and goals in establishing and
endorsing health care measures under this section over the
next five years.
``(ii) Secretarial review and comment.--After receipt of
the report under clause (i) for a year, the Secretary shall
publish the report in the Federal Register, including any
comments of the Secretary on the priorities and goals set
forth in the report.
``(3) Risk adjustment.--The designated organization, in
consultation with health care measure developers and other
stakeholders, shall establish procedures to assure that
health care measures established and endorsed under this
section account for differences in patient health status,
patient characteristics, and geographic location, as
appropriate.
``(4) Maintenance.--The designated organization, in
consultation with owners and developers of health care
measures, shall require the owners or developers of such
measures to update and enhance such measures, including the
development of more accurate and precise specifications, and
retire existing outdated measures. Such updating shall occur
not more often than once during each 12-month period, except
in the case of emergent circumstances requiring a more
immediate update to a measure.
``(e) Use of Health Care Measures; Reporting.--
``(1) Use of measures.--For purposes of activities
authorized or required under this title, the Secretary shall
select from health care measures--
``(A) recommended by multi-stakeholder groups; and
``(B) endorsed by the designated organization under
subsection (b)(4).
``(2) Reporting.--The Secretary shall implement procedures,
consistent with generally accepted standards, to enable the
Department of Health and Human Services to accept the
electronic submission of data for purposes of--
``(A) effectiveness measurement using the health care
measures developed pursuant to this section; and
``(B) reporting to the Secretary measures used to make
value-based payments under this title.
``(f) Contracts.--The Secretary, acting through the Agency
for Healthcare Research and Quality, may contract with
organizations to support the development and testing of
health care measures meeting the standards established by the
designated organization.
``(g) Dissemination of Information.--In order to make
information on health care measures available to health care
consumers, health professionals, public health officials,
oversight organizations, researchers, and other appropriate
individuals and entities, the Secretary shall work with
multi-stakeholder groups to provide for the dissemination of
information developed pursuant to this title.
``(h) Funding.--For purposes of carrying out subsections
(a), (b), (c), and (d), including for expenses incurred for
the arrangement under subsection (a) with the designated
organization, there is payable from the Federal Hospital
Insurance Trust Fund (established under section 1817) and the
Federal Supplementary Medical Insurance Trust Fund
(established under section 1841)--
``(1) for fiscal year 2008, $15,000,000, multiplied by the
ratio of the total number of months in the year to the number
of months (and portions of months) of such year during which
the arrangement under subsection (a) is effective; and
``(2) for each of the fiscal years, 2009 through 2012,
$15,000,000.''.
SEC. 907. IMPROVEMENTS TO THE MEDIGAP PROGRAM.
(a) Implementation of NAIC Recommendations.--The Secretary
of Health and Human Services shall provide, under subsections
(p)(1)(E) of section 1882 of the Social Security Act (42
U.S.C. 1395s), for implementation of the changes in the NAIC
model law and regulations recommended by the National
Association of Insurance Commissioners in its Model #651
(``Model Regulation to Implement the NAIC Medicare Supplement
Insurance Minimum Standards Model Act'') on March 11, 2007,
as modified to reflect the changes made under this Act. In
carrying out the previous sentence, the benefit packages
classified as ``K'' and ``L'' shall be eliminated and such
NAIC recommendations shall be treated as having been adopted
by such Association as of January 1, 2008.
(b) Required Offering of a Range of Policies.--
(1) In general.--Subsection (o) of such section is amended
by adding at the end the following new paragraph:
``(4) In addition to the requirement of paragraph (2), the
issuer of the policy must make available to the individual at
least medicare supplemental policies with benefit packages
classified as `C' or `F'.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to medicare supplemental policies issued on or
after January 1, 2008.
(c) Removal of New Benefit Packages.--Such section is
further amended--
(1) in subsection (o)(1), by striking ``(p), (v), and (w)''
and inserting ``(p) and (v)'';
(2) in subsection (v)(3)(A)(i), by striking ``or a benefit
package described in subparagraph (A) or (B) of subsection
(w)(2)''; and
(3) in subsection (w)--
(A) by striking ``Policies'' and all that follows through
``The Secretary'' and inserting ``Policies.--The Secretary'';
(B) by striking the second sentence; and
(C) by striking paragraph (2) .
SEC. 908. IMPLEMENTATION FUNDING.
For purposes of implementing the provisions of this Act
(other than title X), the Secretary of Health and Human
Services shall provide for the transfer, from the Federal
Supplementary Medical Insurance Trust Fund established under
section 1841 of the Social Security Act (42 U.S.C. 1395t), of
$40,000,000 to the Centers for Medicare & Medicaid Services
Program Management Account for fiscal year 2008.
SEC. 909. ACCESS TO DATA ON PRESCRIPTION DRUG PLANS AND
MEDICARE ADVANTAGE PLANS.
(a) In General.--Section 1875 of the Social Security Act
(42 U.S.C. 1395ll) is amended--
(1) in the heading, by inserting ``to congress; providing
information to congressional support agencies'' after ``and
recommendations''; and
(2) by adding at the end the following new subsection:
``(c) Providing Information to Congressional Support
Agencies.--
``(1) In general.--Notwithstanding any provision under part
D that limits the use of prescription drug data collected
under such part, upon the request of a Congressional support
agency, the Secretary shall provide such agency with
information submitted to, or compiled by, the Secretary under
part D (subject to the restriction on disclosure under
paragraph (2)), including--
``(A) only with respect to Congressional support agencies
that make official baseline spending projections, conduct
oversight studies mandated by Congress, or make official
recommendations on the program under this title to Congress--
``(i) aggregate negotiated prices for drugs covered under
prescription drug plans and MA-PD plans;
``(ii) negotiated rebates, discounts, and other price
concessions by drug and by contract or plan (as reported
under section 1860D-2(d)(2));
``(iii) bid information (described in section 1860D-
11(b)(2)(C)) submitted by such plans;
``(iv) data or a representative sample of data regarding
drug claims and other data submitted under section 1860D-
15(c)(1)(C) (as determined necessary and appropriate by the
Congressional support agency to carry out the legislatively
mandated duties of the agency);
``(v) the amount of reinsurance payments paid under section
1860D-15(a)(2), provided at the plan level; and
[[Page H9396]]
``(vi) the amount of any adjustments of payments made under
subparagraph (B) or (C) of section 1860D-15(e)(2), provided
at the plan level aggregate negotiated prices for drugs
covered under prescription drug plans and MA-PD plans; and
``(B) access to drug event data submitted by such plans
under section 1860D-15(d)(2)(A), except, with respect to data
that reveals prices negotiated with drug manufacturers, such
data shall only be available to Congressional support
agencies that make official baseline spending projections,
conduct oversight studies mandated by Congress, or make
official recommendations on the program under this title to
Congress.
``(2) Restriction on data disclosure.--
``(A) In general.--Data provided to a Congressional support
agency under this subsection shall not be disclosed,
reported, or released in identifiable form.
``(B) Identifiable form.--For purposes of subparagraph (A),
the term `identifiable form' means any representation of
information that permits identification of a specific
prescription drug plan, MA-PD plan, pharmacy benefit manager,
drug manufacturer, drug wholesaler, or individual enrolled in
a prescription drug plan or an MA-PD plan under part D.
``(3) Timing.--The Secretary shall release data under this
subsection in a timeframe that enables Congressional support
agencies to complete congressional requests.
``(4) Use of the data provided.--Data provided to a
Congressional support agency under this subsection shall only
be used by such agency for carrying out the functions and
activities of the agency mandated by Congress.
``(5) Confidentiality.--The Secretary shall establish
safeguards to protect the confidentiality of data released
under this subsection. Such safeguards shall not provide for
greater disclosure than is permitted under any of the
following:
``(A) The Federal regulations (concerning the privacy of
individually identifiable health information) promulgated
under section 264(c) of the Health Insurance Portability and
Accountability Act of 1996.
``(B) Sections 552 or 552a of title 5, United States Code,
with regard to the privacy of individually identifiable
beneficiary health information.
``(6) Definitions.--In this subsection:
``(A) Congressional support agency.--The term
`Congressional support agency' means--
``(i) the Medicare Payment Advisory Commission;
``(ii) the Government Accountability Office; and
``(iii) the Congressional Budget Office.
``(B) Ma-pd plan.--The term `MA-PD plan' has the meaning
given such term in section 1860D-1(a)(3)(C).
``(C) Prescription drug plan.--The term `prescription drug
plan' has the meaning given such term in section 1860D-
41(a)(14).''.
(b) Conforming Amendment.--Section 1805(b)(2) of the Social
Security Act (42 U.S.C. 1395b-6(b)(2)) is amended by adding
at the end the following new subparagraph:
``(D) Part d.--Specifically, the Commission shall review
payment policies with respect to the Voluntary Prescription
Drug Benefit Program under part D, including--
``(i) the factors affecting expenditures;
``(ii) payment methodologies; and
``(iii) their relationship to access and quality of care
for Medicare beneficiaries.''.
SEC. 910. ABSTINENCE EDUCATION.
Section 510 of the Social Security Act (42 U.S.C. 710) is
amended to read as follows:
``SEC. 510. SEPARATE PROGRAM FOR ABSTINENCE EDUCATION.
``(a) In General.--For the purpose described in subsection
(b), the Secretary shall, for fiscal year 2008 and fiscal
year 2009, allot to each State which has transmitted an
application for the fiscal year under section 505(a) an
amount equal to the product of--
``(1) the amount appropriated in subsection (d) for the
fiscal year; and
``(2) the percentage determined for the State under section
502(c)(1)(B)(ii).
``(b) Purpose of Allotment.--
``(1) Purpose.--The purpose of an allotment under
subsection (a) to a State is to enable the State to provide
abstinence education, and where appropriate, mentoring,
counseling, and adult supervision to promote abstinence from
sexual activity, with a focus on those groups which are most
likely to bear children out-of-wedlock.
``(2) Definition; state option.--For purposes of this
section, the term `abstinence education' has, at the option
of each State receiving an allotment under subsection (a),
the meaning given such term in subparagraph (A), or the
meaning given such term in subparagraph (B), as follows:
``(A) Such term means a medically and scientifically
accurate educational or motivational program which--
``(i) has as its exclusive purpose, teaching the social,
psychological, and health gains to be realized by abstaining
from sexual activity;
``(ii) teaches abstinence from sexual activity outside
marriage as the expected standard for all school age
children;
``(iii) teaches that abstinence from sexual activity is the
only certain way to avoid out-of-wedlock pregnancy, sexually
transmitted diseases, and other associated health problems;
``(iv) teaches that a mutually faithful monogamous
relationship in context of marriage is the expected standard
of human sexual activity;
``(v) teaches that sexual activity outside of the context
of marriage is likely to have harmful psychological and
physical effects;
``(vi) teaches that bearing children out-of-wedlock is
likely to have harmful consequences for the child, the
child's parents, and society;
``(vii) teaches young people how to reject sexual advances
and how alcohol and drug use increases vulnerability to
sexual advances; and
``(viii) teaches the importance of attaining self-
sufficiency before engaging in sexual activity.
``(B) Such term means a medically and scientifically
accurate educational or motivational program which promotes
abstinence and educates those who are currently sexually
active or at risk of sexual activity about additional methods
to prevent unintended pregnancy or reduce other health risks.
``(3) Certain requirements.--
``(A) Limitation regarding inaccurate information.--None of
the funds made available under this section may be used to
provide abstinence education that includes information that
is medically and scientifically inaccurate. For purposes of
this section, the term `medically and scientifically
inaccurate' means information that is unsupported or
contradicted by a preponderance of peer-reviewed research by
leading medical, psychological, psychiatric, and public
health publications, organizations and agencies.
``(B) Effectiveness regarding certain matters.--None of the
funds made available under this section may be used for a
program unless the program is based on a model that has been
demonstrated to be effective in preventing unintended
pregnancy, or in reducing the transmission of a sexually
transmitted disease, including the human immunodeficiency
virus. The preceding sentence does not apply to any program
that was approved and funded under this section on or before
September 30, 2007.
``(c) Applicability of Certain Sections.--
``(1) Requirements.--Sections 503, 507, and 508 apply to
allotments under subsection (a) to the same extent and in the
same manner as such sections apply to allotments under
section 502(c).
``(2) Discretion of secretary.--Sections 505 and 506 apply
to allotments under subsection (a) to the extent determined
by the Secretary to be appropriate.
``(d) Authorization of Appropriations.--For the purpose of
allotments under subsection (a), there is authorized to be
appropriated $50,000,000 for each of fiscal years 2008 and
2009.''.
TITLE X--REVENUES
SEC. 1001. INCREASE IN RATE OF EXCISE TAXES ON TOBACCO
PRODUCTS AND CIGARETTE PAPERS AND TUBES.
(a) Small Cigarettes.--Paragraph (1) of section 5701(b) of
the Internal Revenue Code of 1986 is amended by striking
``$19.50 per thousand ($17 per thousand on cigarettes removed
during 2000 or 2001)'' and inserting ``$42 per thousand''.
(b) Large Cigarettes.--Paragraph (2) of section 5701(b) of
such Code is amended by striking ``$40.95 per thousand
($35.70 per thousand on cigarettes removed during 2000 or
2001)'' and inserting ``$88.20 per thousand''.
(c) Small Cigars.--Paragraph (1) of section 5701(a) of such
Code is amended by striking ``$1.828 cents per thousand
($1.594 cents per thousand on cigars removed during 2000 or
2001)'' and inserting ``$42 per thousand''.
(d) Large Cigars.--Paragraph (2) of section 5701(a) of such
Code is amended--
(1) by striking ``20.719 percent (18.063 percent on cigars
removed during 2000 or 2001)'' and inserting 40 percent (33
percent on cigars removed after December 31, 2007, and before
October 1, 2013).
(2) by striking ``$48.75 per thousand ($42.50 per thousand
on cigars removed during 2000 or 2001)'' and inserting ``$1
per cigar''.
(e) Cigarette Papers.--Subsection (c) of section 5701 of
such Code is amended by striking ``1.22 cents (1.06 cents on
cigarette papers removed during 2000 or 2001)'' and inserting
``2.63 cents''.
(f) Cigarette Tubes.--Subsection (d) of section 5701 of
such Code is amended by striking ``2.44 cents (2.13 cents on
cigarette tubes removed during 2000 or 2001)'' and inserting
``5.26 cents''.
(g) Snuff.--Paragraph (1) of section 5701(e) of such Code
is amended by striking ``58.5 cents (51 cents on snuff
removed during 2000 or 2001)'' and inserting ``$1.26''.
(h) Chewing Tobacco.--Paragraph (2) of section 5701(e) of
such Code is amended by striking ``19.5 cents (17 cents on
chewing tobacco removed during 2000 or 2001)'' and inserting
``42 cents''.
(i) Pipe Tobacco.--Subsection (f) of section 5701 of such
Code is amended by striking ``$1.0969 cents (95.67 cents on
pipe tobacco removed during 2000 or 2001)'' and inserting
``$2.36''.
(j) Roll-Your-Own Tobacco.--
(1) In general.--Subsection (g) of section 5701 of such
Code is amended by striking ``$1.0969 cents (95.67 cents on
roll-your-own tobacco removed during 2000 or 2001)'' and
inserting ``$7.4667''.
(2) Inclusion of cigar tobacco.--Subsection (o) of section
5702 of such Code is amended by inserting ``or cigars, or for
use as wrappers for making cigars'' before the period at the
end.
(k) Effective Date.--The amendments made by this section
shall apply to articles removed after December 31, 2007.
(l) Floor Stocks Taxes.--
(1) Imposition of tax.--On cigarettes manufactured in or
imported into the United States which are removed before
January 1, 2008, and held on such date for sale by any
person, there is hereby imposed a tax in an amount equal to
the excess of--
(A) the tax which would be imposed under section 5701 of
the Internal Revenue Code of 1986 on the article if the
article had been removed on such date, over
(B) the prior tax (if any) imposed under section 5701 of
such Code on such article.
[[Page H9397]]
(2) Authority to exempt cigarettes held in vending
machines.--To the extent provided in regulations prescribed
by the Secretary, no tax shall be imposed by paragraph (1) on
cigarettes held for retail sale on January 1, 2008, by any
person in any vending machine. If the Secretary provides such
a benefit with respect to any person, the Secretary may
reduce the $500 amount in paragraph (3) with respect to such
person.
(3) Credit against tax.--Each person shall be allowed as a
credit against the taxes imposed by paragraph (1) an amount
equal to $500. Such credit shall not exceed the amount of
taxes imposed by paragraph (1) for which such person is
liable.
(4) Liability for tax and method of payment.--
(A) Liability for tax.--A person holding cigarettes on
January 1, 2008, to which any tax imposed by paragraph (1)
applies shall be liable for such tax.
(B) Method of payment.--The tax imposed by paragraph (1)
shall be paid in such manner as the Secretary shall prescribe
by regulations.
(C) Time for payment.--The tax imposed by paragraph (1)
shall be paid on or before April 14, 2008.
(5) Articles in foreign trade zones.--- Notwithstanding the
Act of June 18, 1934 (48 Stat. 998, 19 U.S.C. 81a) and any
other provision of law, any article which is located in a
foreign trade zone on January 1, 2008, shall be subject to
the tax imposed by paragraph (1) if--
(A) internal revenue taxes have been determined, or customs
duties liquidated, with respect to such article before such
date pursuant to a request made under the 1st proviso of
section 3(a) of such Act, or
(B) such article is held on such date under the supervision
of a customs officer pursuant to the 2d proviso of such
section 3(a).
(6) Definitions.--For purposes of this subsection--
(A) In general.--Terms used in this subsection which are
also used in section 5702 of the Internal Revenue Code of
1986 shall have the respective meanings such terms have in
such section.
(B) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury or the Secretary's delegate.
(7) Controlled groups.--Rules similar to the rules of
section 5061(e)(3) of such Code shall apply for purposes of
this subsection.
(8) Other laws applicable.--All provisions of law,
including penalties, applicable with respect to the taxes
imposed by section 5701 of such Code shall, insofar as
applicable and not inconsistent with the provisions of this
subsection, apply to the floor stocks taxes imposed by
paragraph (1), to the same extent as if such taxes were
imposed by such section 5701. The Secretary may treat any
person who bore the ultimate burden of the tax imposed by
paragraph (1) as the person to whom a credit or refund under
such provisions may be allowed or made.
SEC. 1002. EXEMPTION FOR EMERGENCY MEDICAL SERVICES
TRANSPORTATION.
(a) In General.--Subsection (l) of section 4041 of the
Internal Revenue Code of 1986 is amended to read as follows:
``(l) Exemption for Certain Uses.--
``(1) Certain aircraft.--No tax shall be imposed under this
section on any liquid sold for use in, or used in, a
helicopter or a fixed-wing aircraft for purposes of providing
transportation with respect to which the requirements of
subsection (f) or (g) of section 4261 are met.
``(2) Emergency medical services.--No tax shall be imposed
under this section on any liquid sold for use in, or used in,
any ambulance for purposes of providing transportation for
emergency medical services. The preceding sentence shall not
apply to any liquid used after December 31, 2012.''.
(b) Fuels Not Used for Taxable Purposes.--Section 6427 of
such Code is amended by inserting after subsection (e) the
following new subsection:
``(f) Use to Provide Emergency Medical Services.--Except as
provided in subsection (k), if any fuel on which tax was
imposed by section 4081 or 4041 is used in an ambulance for a
purpose described in section 4041(l)(2), the Secretary shall
pay (without interest) to the ultimate purchaser of such fuel
an amount equal to the aggregate amount of the tax imposed on
such fuel. The preceding sentence shall not apply to any
liquid used after December 31, 2012.''.
(c) Time for Filing Claims; Period Covered.--Paragraphs (1)
and (2)(A) of section 6427(i) of such Code are each amended
by inserting ``(f),'' after ``(d),''.
(d) Conforming Amendment.--Section 6427(d) of such Code is
amended by striking ``4041(l)'' and inserting ``4041(l)(1)''.
(e) Effective Date.--The amendments made by this section
shall apply to fuel used in transportation provided in
quarters beginning after the date of the enactment of this
Act.
The SPEAKER pro tempore. Debate shall not exceed 2 hours, with 1 hour
equally divided and controlled by the chairman and ranking minority
member of the Committee on Ways and Means and 1 hour equally divided
and controlled by the chairman and ranking minority member of the
Committee on Energy and Commerce.
The gentleman from New York (Mr. Rangel), the gentleman from
Louisiana (Mr. McCrery), the gentleman from Michigan (Mr. Dingell) and
the gentleman from Texas (Mr. Barton) each will control 30 minutes.
The Chair recognizes the gentleman from New York.
Mr. RANGEL. Mr. Speaker, I rise in support of this great piece of
legislation that this august body has the privilege of supporting.
There may be some concerns in the House, some with merit, about
procedure, but we on the Ways and Means Committee are so proud of the
work that has been done by the subcommittee, led by Mr. Stark, working
with Mr. Camp, that we had 15 hearings on what was involved in this
bill and a half a dozen sessions where we just talked with the
professionals to make certain that not only did we support the great
work that had been done by the Dean of our House in terms of education,
in terms of Energy and Commerce and the SCHIP bill, but so at the same
time we could preserve the benefits that are provided to our senior
citizens through medical programs.
Mr. Stark did one great job at making certain that we worked with the
administration, tried to find out where the abuses were and, where we
could, we were able to raise $15 billion so that the poorest of our
seniors would have the ability to receive health care enhanced.
{time} 1415
Of course, those who live in rural areas and who for years have not
be able to receive the type of access to health care, we found $5
billion to do it.
I am not thoroughly convinced as to what PAYGO is going to mean in
the future, but it is the rules of our party. It seems now that it
makes some sense. But when you say that you have to enlarge this
program so that an additional 6 million people, kids, that are already
on the program, adding 5 million people to it, nobody, Republican or
Democrat, liberal or conservative, does not believe that these children
should be entitled to health care.
It is not just the right and moral thing to do. But in terms of being
fiscally responsible, everyone would tell you that having a kid in the
family exposed to preventive care actually costs less money than just
ignoring the care of our children. I could go even further in saying
that, even kids that go to school, if they are not well, they can't
learn. And God knows we have millions of people in the street that had
health impediments, that they thought they were educational
impediments, and they are out there. I personally believe that a
stronger country is a healthier country and a well-educated country.
Now, it is true when you have these PAYGO rules and you don't want to
raise taxes that you have to find the money. And so it is a great deal
of empathy that I have for our poor cigarette smokers, because I used
to be one; and, two, I just don't like the idea of regressive taxes
where the poor are penalized. But I am learning to live with it in such
a sense that these cigarette smokers, these addicts, they hate
themselves for smoking. And I have stretched it to the point that when
I talk with them and tell them what we are about to do, after they
finish coughing and spitting, they said, ``I have got to stop this
smoking.'' Then, when you look at the little kids, this is the one
thing that an increase in prices sharply reduces, it is kids going to
smoke.
So, I am trying to get myself to think that maybe I am doing it for
the tobacco companies, because they advertise they don't want kids to
smoke, and we are going to help them by increasing the price of
cigarettes, which one thing is abundantly clear, it will stop a lot of
children from smoking.
Mr. Speaker, I am going to yield the rest of my time to the gentleman
from California, Pete Stark, who has done such a fantastic job in
finding out where the problems were and bringing to this floor not only
a great child insurance bill, but also improving Medicare, increasing
the benefits of our seniors who are poor and help into rural areas.
While we may have a lot of procedural differences, and I understand
that, I just hope that whether you are Republican or Democrat that you
feel comfortable being able to say that there may be some pain for
cigarette smokers who really are costing us a lot of money with these
lung transplants and whatnot. But that is painful enough.
So you may have some problem with your smokers. But just think about
11 million children and their families that love them so much and a
country that wants them healthy, and I am certain that at the end of
the day that the kids
[[Page H9398]]
are going to win, we will have a better health care delivery system,
and you will feel very, very comfortable in talking about the
procedural differences that you differed with. But, in your heart, you
would know that every major advocate for children and health and
hospitals and doctors have signed up saying, ``do the right thing.'' I
personally believe that that is what you are going to do today.
Mr. Speaker, I yield the balance of my time to the gentleman from
California, Pete Stark, the chairman of the Subcommittee on Health, and
I thank him publicly, and the staff, for the fantastic job that they
have done in having hearings and letting all Members have a better
understanding of the problem, but, better than that, in being able to
bring a solution to this floor today.
The SPEAKER pro tempore. Without objection, the gentleman from
California will manage the remainder of the time for the Ways and Means
Committee majority.
There was no objection.
Mr. BARTON of Texas. Mr. Speaker, I ask unanimous consent that there
be one 1 hour of additional debate, equally divided between the
majority and the minority, and within each of those subsegments,
equally divided between the Ways and Means Committee and the Energy and
Commerce Committee.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
Mr. STARK. Mr. Speaker, I object.
The SPEAKER pro tempore. Objection is heard. The time will remain the
same.
Mr. DINGELL. Mr. Speaker, I hope that my good friend from California
will not object.
Mr. BARTON of Texas. Mr. Speaker, I would repeat that unanimous
consent request.
Mr. DINGELL. Mr. Speaker, I would hope my good friend would not
object.
Mr. STARK. Mr. Speaker, I reserve the right to object. I may discuss
it at a later point, but at this time, I must object.
The SPEAKER pro tempore. The gentleman from California reserves the
right to object.
Mr. BARTON of Texas. Mr. Speaker, does that mean we discuss the
reservation now?
Mr. DINGELL. Mr. Speaker, reserving the right to object.
Mr. STARK. Mr. Speaker, I object.
The SPEAKER pro tempore. The gentleman from California has reserved
the right to object.
Mr. STARK. Mr. Speaker, I object.
The SPEAKER pro tempore. Now he objects. The gentleman from
California objects.
Does the gentleman from California rise to object?
Mr. STARK. Yes, Mr. Speaker, I object.
The SPEAKER pro tempore. Objection is heard.
Mr. RANGEL. Mr. Speaker, may I be recognized to respond?
The SPEAKER pro tempore. For what purpose does the gentleman from New
York rise?
Mr. RANGEL. Mr. Speaker, it appears as though the decision for extra
time should be one that our leadership should have decided on. It just
seems to me that since our leader has not been conferred with, that if
you just reserve the opportunity, that in a very short while we will be
able to discuss this.
Mr. BARTON of Texas. Mr. Speaker, if the gentleman will yield, we
have, just from the Energy and Commerce Committee on the minority side,
a request for 25 speakers, plus several of our leadership. So if this
unanimous consent request were to be agreed to, it would give each
committee on both sides of the aisle an additional 15 minutes. I am
sure there are many Members on the majority side, as on the minority,
that wish to speak. I will offer it later on if you want to check on
it.
Mr. RANGEL. Well, Mr. Speaker, the minority somehow manages to find
time to speak on this and many other subjects. But I am saying that
under normal conditions, you would think that your leadership would
have discussed this issue with ours so that at some times the Members
would know exactly what to expect.
Now, I don't see any reason why this should not be agreed upon, but I
just don't think Members can come to the floor by unanimous consent and
ask for an hour or 2 hours or 3 hours. We don't even know whether or
not the minority intends to follow any other procedures that could kind
of take away floor time in terms of debates and exchanges. Just based
on some of the things that I've seen from your committee, it appears to
me that we have to find out what you want to do with that hour.
Mr. BARTON of Texas. Mr. Speaker, if the gentleman will yield, the
gentleman has every right to be suspicious of the ranking member of the
Energy and Commerce Committee. I am a devious fellow and I reserve all
my options. But on this one, we were shooting straight and dealing off
the top of the deck.
The SPEAKER pro tempore. The gentleman from California has objected.
Does the gentleman stand to object, or does he withdraw his objection?
Mr. STARK. I object.
The SPEAKER pro tempore. Objection is heard.
Mr. DINGELL. Mr. Speaker, I am going to make the same unanimous
consent request, and then I will withdraw it. But first I want to make
an observation here for the benefit of all of my colleagues and
friends.
This is a very important piece of legislation. I am not going to
defend the behavior of any Member here, and I am not going to criticize
the behavior of any Member, but I am going to make an observation that
I think is important.
This is a very important piece of legislation. Twelve million of our
kids are going to have their health insurance increased or not
depending on how we conduct ourselves today. I want to have a broad
exposition. If you look at the time that we have to give to Members who
wish to be heard on this, we are talking about a minute or 30 seconds,
hardly enough time for any Member to adequately make a position on
something which is important to him and to the kids.
I think that we have a chance to do a great deal of good for our
young people. I don't think that it is excessive to say we are going to
give enough time so that this matter can be properly discussed, nor do
I think there is any benefit in denying our Members the time to do this
and denying the Members a chance to be heard.
Now, I am going to withdraw this.
The SPEAKER pro tempore. The gentleman withdraws his request. Members
may engage in debate by using their time.
Mr. DINGELL. Mr. Speaker, I have asked unanimous consent and I
reserved the right to object.
The SPEAKER pro tempore. The gentleman cannot reserve the right to
object on his own request. The gentleman reiterates a unanimous consent
request.
Is there objection?
Mr. WAXMAN. Mr. Speaker, I reserve the right to object.
The SPEAKER pro tempore. The gentleman from California.
Mr. WAXMAN. Mr. Speaker and my colleagues, for goodwill, I would see
it a wise course of action to give additional time, since the minority
requests it, but I wouldn't be prepared to give them that time now.
The reason we are starting so late today on this bill is because we
have been interrupted with procedural votes to delay us from debating
this issue. In our own committee, the Energy and Commerce Committee,
the gentleman from Texas said he had a lot of people from our committee
who wanted to speak on the issue. They wouldn't let us debate any
single issue of merit. They made us read the bill, to frustrate the
committee from meeting at all.
Let's renew this request for additional time later as a reward for
good behavior, if we can see some good behavior. But right now, to this
point, I haven't seen a lot of good behavior from the other side.
The SPEAKER pro tempore. Does the gentleman object or does he
withdraw his reservation of the right to object?
Mr. WAXMAN. I object.
The SPEAKER pro tempore. Objection is heard.
Mr. BARTON of Texas. Mr. Speaker, I proudly stand for the First
Amendment rights of even the Members of the minority, and I also stand
for honoring the rules and the procedures developed over 200 years in
the most Democratic body the free world has ever known, the House of
Representatives.
With that, I yield 1 minute to the distinguished minority leader from
the great State of Ohio (Mr. Boehner).
[[Page H9399]]
Mr. BOEHNER. Mr. Speaker, let me thank my colleague for yielding.
Mr. Speaker and my colleagues, the State Children's Health Insurance
Program was created 10 years ago by a Republican Congress, along with
our Democrat colleagues and a Democrat President. It clearly was a very
bipartisan process from the beginning, and as we reauthorize this
important program that Republicans, Democrats, the White House,
everyone supports, I am saddened that we are here today with a very
partisan bill done in a very partisan way.
I thought in this reauthorization process, I know on our side, Mr.
Barton, Mr. McCrery, their respective committees, wanted to work with
our Democrat colleagues to develop a bill that we could all vote for.
But that process never even got started. While there may have been some
hearings in the Ways and Means Committee on this bill, there were no
hearings in the Energy and Commerce Committee. We were presented with a
488-page bill the night before the markup. Now we have brought this to
the floor without a markup in committee, no amendments allowed to be
offered by the minority and a limited time for debate. This saddens me
and disappoints me. It did not have to be this way.
The result of this flawed process is a bill that expands government-
run health care beyond anything that any one of us could have imagined
over the last 10 years. I really do believe that Republicans and
Democrats can work together to reauthorize this program in a way that
will receive bipartisan support.
Last November, the American people sent us a message here in
Congress, but I don't think that message was, ``I want you to cut my
Medicare and I want you to raise taxes. I did not want you to raise my
taxes.''
When you look at the bill that we have before us, we have $193
billion worth of cuts to Medicare, a program to provide health
insurance for our seniors. We are going to cut this $193 billion over
10 years, and we are going to raise tobacco taxes, which affects the
poorest of America's citizens, and lay more of this tax burden on their
backs.
{time} 1430
In my district alone, some 14,267 seniors are going to have their
Medicare costs increased, and about 73 percent of that number are
likely to lose their Medicare Advantage Program altogether.
That is not what the voters sent us here to do; and, believe me, the
seniors in my district who take advantage of this very valuable program
don't want to lose their benefits which will result from the passage of
this bill.
And so I say to my colleagues, we have a flawed bill on the floor
today; and the flawed bill is the result of a flawed process. As I said
last night to all of my colleagues, we represent nearly half of the
American people. We have a right to be heard. We have a right to
participate. And through the process over the last couple of weeks we
have been denied the right to be involved in the process, denied the
right today to be involved in trying to amend the bill to a point where
we can have a bipartisan product to send to the other body. I am
disappointed by that.
Later today, Republicans will offer a motion to recommit this bill,
the only option that we have. And that motion to recommit will do this:
It will reauthorize the SCHIP program for 1 year. There will be no
Medicare cuts involved in this program, no benefits will go to illegal
immigrants, and we will see to that in the motion to recommit.
Fourthly, it will have a sense of the Congress that this bill should
go back to the committee and, over the course of the next year, have
the Republicans and Democrats on the respective committees work
together to produce a bipartisan product that the President can sign
into law. I think that is a responsible course of action, given what we
have dealt with here over the last couple of weeks.
I would ask my colleagues to reject the underlying bill and vote for
the motion to recommit.
Mr. DINGELL. Mr. Speaker, I yield myself 3 minutes.
(Mr. DINGELL asked and was given permission to revise and extend his
remarks.)
Mr. DINGELL. Mr. Speaker, the Children's Health and Medicare
Protection Act, the CHAMP Act, is a good piece of legislation. It
expands and improves a most successful program, bipartisan in
character, created in 1997. That program has cut the rate of uninsured
children by a full third. Some States have been able to ensure as many
as 60 percent of the children who previously had no health insurance.
This bill is about taking care of our kids. It is about taking care
of the future of the country. Today, 6 million of our youngsters get
their health care through the program. With this legislation, an
additional 5 million previously uninsured children will be able to see
doctors, receive immunizations, and get dental and mental health
coverage.
The bill requires that children receive priority in coverage. It
allows States to cover pregnant women, recognizing that healthy moms
make for healthy babies. I am certain my Republican colleagues on
Energy and Commerce understood this point, because our clerk read this
bill to them. As I am sure all of us there will recall, all some 486
pages were to be read.
The CHAMP Act does not allow one thin dime to be spent on illegal
aliens. You will find this prohibition in section 135 of the bill. Nor
does it create a government-run health insurance system. Coverage under
CHIP and Medicaid are provided primarily through private health
insurance. All but two States use some form of managed care for their
programs. Nothing here will change that, and the newly covered children
will be exactly the same kind of child in the same situation that every
one of the children now covered happens to be.
The CHAMP Act also covers and secures Medicare for the future. This
past Monday marked the 42nd anniversary of President Johnson signing
that wonderful piece of legislation into law. I was there.
The CHAMP Act shores up the Medicare trust fund, improves benefits
for seniors, protects their ability to choose their own doctors, and
these reforms effectively provide low-income seniors on Medicare with
an additional $1,200 in benefits.
The CHAMP Act is an act of fiscal responsibility. Seniors in
traditional Medicare will pay approximately three-quarters of a billion
dollars in excess premiums to cover the overpayments now being made to
HMOs, a great injustice. The things that my Republican colleagues are
complaining about are that we stop that evil practice. The CHAMP Act
also adds 3 years to the life of the trust fund by stopping these
overpayments which are accelerating the insolvency of the Medicare
trust fund.
I know that President Bush has pledged to veto counterpart
legislation in the Senate that is much more modest in its ambitions.
I include the rest of my speech for the Record and urge my Republican
colleagues to read it. It is an excellent speech.
The legislation before us accomplishes two critical goals. It will
provide health care to as many as 12 million children. And it will
allow our elderly to continue seeing their own doctors.
The CHAMP Act--the Children's Health and Medicare Protection Act--
improves a most successful program created with bipartisan support in
1997. That program has cut the rate of low-income uninsured children by
one-third. Some States have been able to insure as many as 60 percent
of their children who previously had no health insurance.
Today, six million children get their health care through this
program. With this legislation, five million previously uninsured
children will be able to see doctors, receive immunizations, get dental
care, and other coverage.
This legislation requires that children receive priority in coverage.
It allows States to cover pregnant women, recognizing that healthy moms
make for healthy babies.
While I am certain that my Republican colleagues on the Committee on
Energy and Commerce understand this point--because our wonderful clerk
read the bill to them--I will restate it for others listening:
The CHAMP Act does not allow one Federal dime to be spent on illegal
aliens. You will find this prohibition in section 135 of the bill.
Nor does the bill create a ``government run'' health care system.
Coverage under CHIP and Medicaid are provided primarily through private
insurance--all but two States use some form of managed care for their
programs. Nothing here would change that. And the newly covered
children are exactly the same as those now covered.
[[Page H9400]]
The CHAMP Act also secures Medicare for the future. This past Monday
marked the 42nd anniversary of President Johnson signing Medicare into
law. The CHAMP Act shores up the Medicare trust fund, improves benefits
for seniors, and protects their ability to choose their own doctors.
These reforms will effectively provide low-income seniors on Medicare
with an additional $1,200 in their pockets.
The CHAMP Act is an act of fiscal responsibility. This year, seniors
in traditional Medicare will pay nearly three-quarters of a billion
dollars in excess premiums to finance overpayments to HMOs. Those
overpayments will accelerate the insolvency of the Medicare trust fund.
The CHAMP Act adds three years to the life of the Trust Fund.
I am well aware that President Bush has pledged to veto counterpart
legislation in the Senate that is much more modest in its ambitions,
and I have received my own veto letter from the Secretary of the
Department of Health and Human Services. They stand on one side of the
debate.
Let's look at who stands on the other side: 12 million children. The
American Medical Association. The American Academy of Pediatrics. The
National Rural Health Association. The National Council on Aging. The
AARP. The Federation of American Hospitals. The March of Dimes. The
Children's Defense Fund. The NAACP. The National Governors Association,
including the Governors of New York, Michigan, California, Illinois,
and Maryland, and the Catholic Health Association--which notes that
``the most important pro-life thing the Congress can do right now is
ensure that the State Children's Health Insurance Program is
reauthorized.''
A vote against this bill is a vote to deprive six million children of
healthcare. A vote against this bill is a vote to continue the plunder
of the Medicare Trust Fund by bloated private interests. A vote against
this bill is a vote to deny seniors in Medicare additional benefits.
I urge all of my colleagues to stand up for what's right for
children, seniors, people with disabilities, and taxpayers: support the
speedy passage of the CHAMP Act.
Mr. BARTON of Texas. Mr. Speaker, I yield myself 2 minutes.
To follow up on our distinguished minority leader, I want to say what
the Republicans are for in this debate before we talk about some of the
flaws in the pending bill.
We are for authorization of the SCHIP legislation. We are for
covering low-income and near-low-income children so they have health
care benefits.
We are for making sure that the States that are out of funding
receive additional funds beginning October, 2007.
So we want to reauthorize the SCHIP program. We do believe that it
should be maintained as a block grant program and not become an
entitlement program. We believe it should be reauthorized for a
specific period of time, not become an open-ended entitlement.
We believe that SCHIP payments should be restricted to citizens of
the United States and legal residents who have been here at least 5
years. We do not believe SCHIP payments should be allowed for illegal
aliens who have come into this country without the proper
documentation. So we are for reauthorization of SCHIP. We are for
covering our low-income and near-low-income children.
We disagree with our friends on the majority side on the number of
individuals that we are talking about. We believe that children below
200 percent of poverty that do not have health insurance or health
coverage today are in the neighborhood of 700,000, not 7 million.
But we do understand that if you raise the level to 400 percent, if
you allow States to self-certify above that level so there really is no
income test, we do understand if you do that, almost every child in
America, 78 million children, could be eligible for some sort of SCHIP
assistance under the majority Democratic plan. But if you restrict it
to low-income and near-low-income children below 200 percent of
poverty, we believe that the Republican substitute, which was not made
in order by the Rules Committee at 2 a.m. this morning, solves that.
Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
Much has been said by the distinguished chairman of the Energy and
Commerce Committee, by the distinguished chairman of the Ways and Means
Committee on how this bill helps Americans. Five million kids will
receive medical coverage insurance that they don't now have. Seniors
will receive preventative care with no copayments. They will receive
mental health care at parity. Rural benefits will be extended to the
rural communities that need assistance for access to their population.
Low-income seniors will receive assistance in paying for their co-pays
and their premiums.
This bill is fully funded over 10 years, something my Republican
colleagues never did in the past. I want to remind my colleagues that
there are many myths being floated around here today. It is important
to note that 83 of my Republican friends in 1997 voted for an identical
bill. The bill that they voted on has the exact same income eligibility
that was passed in 1997. The minority leader, the ranking member of the
Ways and Means Committee, the ranking member of the Health Subcommittee
on the Ways and Means Committee, all voted for this and included a
cigarette tax to pay for it.
And I might added that the reductions that they put in their Medicare
bill were five times greater than the adjustments we made in the bill
today. It included an increase in the Federal tobacco tax.
Now I don't know what has changed. Maybe they have learned to hate
children in the interim, but nothing has changed in the eligibility. It
is the same bill. If it was good for you, then it is better now. And it
does a fair thing.
The public is sick of radical ranting. They want health care for kids
and seniors, and the way to get that is to support the bill before us
today.
Mr. Speaker, I reserve the balance of my time.
Mr. BARTON of Texas. Mr. Speaker, I yield 2 minutes to the ranking
member of the Health Subcommittee on the Energy and Commerce Committee,
the gentleman from Georgia (Mr. Deal).
Mr. DEAL of Georgia. Mr. Speaker, this is a program that started 10
years ago with a $40 billion Federal authorization of expenditures. The
current bill before us would spend $128.7 billion over the next 10
years. When added with the State money, that is over $255 billion in
taxpayer money over the next 10 years. That is over a quarter of a
trillion dollars. And what do you get for it?
CBO says you will cover 600,000 more eligible children, 600,000
children. You would be better off to give each one of them $80,000 in
cash, and they would probably get better results.
In 1996, we had an immigration bill that provided that if you wanted
to bring somebody and sponsor somebody to come into this country
legally, you would have to say they would not go on the public rolls of
Medicaid and other programs for 5 years. This bill removes that. CBO
says that alone will cost $2.2 billion, and we let sponsors off the
hook and we put them on the public payroll.
If we have a bill like the Senate was considering that would make 20
million illegals legal, that cost alone would be $140 billion a year.
What it does, too, is it says, in the area of immigration, we are going
to spend $400 billion paying for translators, not just to serve people
but to enroll them in the program. That is $400 million.
Now they can say this does not open it up to illegal immigrants just
by saying that. CBO says it will cost $2 billion because they think
that is the cost that it is. What they are saying is just sign an
affidavit that says you are legally in this country. I have speeders
who would just like to sign an affidavit saying they have a driver's
license. I have taxpayers who would like on April 15 to sign an
affidavit saying they didn't have any taxable income; just take my word
for it. And if you believe just signing an affidavit is a deterrent to
people illegally in the country, then you also believe we can just put
a sign at the Mexican border saying, if you don't have permission, just
don't come in.
This is a ridiculous piece of legislation. It will undermine the
purposes of the original bill.
Mr. DINGELL. Mr. Speaker, I yield 2 minutes to the gentleman from
Michigan (Mr. Stupak).
Mr. STUPAK. Mr. Speaker, I want to congratulate Mr. Dingell and Mr.
Pallone on crafting a well-balanced bill and for all of the hard work
you and your staff have spent on the CHAMP Act.
The State Children's Health Initiative Program was enacted with
bipartisan support a decade ago to reduce the number of low-income,
uninsured
[[Page H9401]]
children by expanding eligibility levels and simplifying application
procedures.
In 2006, SCHIP provided insurance to 6.7 million children. In
Michigan, roughly 118,000 children are enrolled in SCHIP. Eighty-six
percent of these SCHIP children are of working parents who are unable
to afford private health insurance for their children.
SCHIP is vitally important to children living in our country's rural
areas. Of the 50 counties with the highest rates of uninsured children,
44 are rural counties.
This legislation commits $50 billion to reauthorize and improve the
SCHIP program to protect and continue coverage for 6 million children.
In addition, this legislation ensures coverage for an additional 5
million children that are eligible but currently uninsured.
I am also very pleased to see the rural investments in the CHAMP Act
which maintains Congress's commitment to rural America by extending a
number of provisions that, if left to expire, would negatively affect
rural beneficiaries' access to Medicare health services.
The CHAMP Act provides health care for children, expands preventive
Medicare medicine for our seniors and helps make health care more
affordable, available and accessible in rural America.
Mr. Speaker, I urge my colleagues to vote in favor of this
legislation.
Mr. BARTON of Texas. Mr. Speaker, I yield 2 minutes to the
distinguished former Speaker of the House and currently the ranking
member of the Energy and Air Quality Subcommittee of the Energy and
Commerce Committee, the gentleman from the great State of Illinois (Mr.
Hastert).
Mr. HASTERT. Mr. Speaker, I stand somewhat chagrined that we bring
this bill to the floor of this great House, the floor that deliberates
on the issues that take care of the needs of people, but this bill
comes under a charade, a charade that we are going to help the poorest
and most disadvantaged children.
{time} 1445
The SCHIP program that we put in place 10 years ago started to do
that, and we can't expand that, but this bill covers people up to four
times of poverty. That is a family of four earning $82,000 a year.
What it does is say if you go out into the private sector and you
continue to buy health care for you and your family, you're going to
pay a tax, and that tax will fund other people, not just children, but
expand the amount of adults covered by SCHIP, which is supposed to be
for children.
In the State of Illinois, my State, 60 percent of the people on SCHIP
are adults, not children; 40 percent are covered by children. If we
want to cover children, let's change it so we cover children. This bill
doesn't do that. This bill expands what we do for adults, adults that
should be able to be paying their own way in American society.
What this bill does is open the doors for all other types of people
to be able to be involved in government-paid health care, and that's
the bottom line. It's government-paid health care. It's Hillary care
all over again.
And what we do is take, at the cost of seniors who get Medicare
Advantage, who get choices of their own health care plans, we take it
away. We wipe it out, and we give it to people who are illegal aliens
and aliens. And don't kid yourself, it's going to happen.
So, if we want to take health care on the backs and take it away from
seniors and give it to people who haven't made their way in this
country, who haven't got their citizenship, then this bill does it.
It's a bad bill for a bad time, and it's coming under the false
pretences of trying to do something for children.
Vote ``no.''
Mr. Speaker, it's unfortunate that today we are considering
legislation which was rushed through the House without proper
consideration in the Energy and Commerce Committee. There were no
legislative hearings held by the Subcommittee or full committee on a
bill that could cost taxpayers over $300 billion. That is simply
unacceptable and the American people have the right to know what this
bill is really about.
This Congress has the opportunity to correct flaws in SCHIP and bring
spending in the program under control. Rather than return the focus
back to our most vulnerable children, the CHAMP Act would greatly
expand coverage.
First, it changes law to now define a child as someone as old as 21.
It also expands coverage to more adults, and families with incomes
upwards of 400 percent of the poverty line. This equates to an annual
salary of over $82,000.
We are sending the message to families across the country--drop your
children from your private insurance--the American taxpayer will foot
the bill.
Furthermore, at a time when Americans look to Congress to secure our
borders and enforce our existing immigration laws, the Democrat
leadership, through the CHAMP Act, is taking leaps in the opposite
direction by opening the door to free health insurance for illegal
aliens.
It does so by removing language from the Deficit Reduction Act
requiring proof of citizenship to receive SCHIP and Medicaid. This will
make it nearly impossible for the Federal Government to prevent illegal
immigrants from accessing these programs.
The American people are getting a clear message today from the new
majority. They want your tax dollars to provide incentives to those who
choose to break our laws and enter this country illegally.
And our Democrat colleagues would pay for this reckless expansion of
SCHIP by cutting Medicare Advantage plans and significantly raising
premiums on seniors.
Millions of seniors depend on Medicare Advantage plans to provide the
benefits they need and services they can't otherwise get with
traditional Medicare. Especially our seniors in rural and underserved
communities. The CHAMP Act will immediately eliminate these enhanced
benefits and choices so many have come to rely on.
Our Democrat friends are once again attempting to empower the
Government to ration healthcare in this country. This will take choices
out of every American's hands when it comes to their well-being and
leaves the decisions to a government-run managed care system.
Instead, we should be encouraging the participation of private plans
regardless if it is for children, families, or seniors. This creates
competition in the marketplace, which we know lowers out-of-pocket
costs while expanding benefits for the insured.
I believe, given the opportunity to properly debate and offer
amendments, we could ensure coverage to our most vulnerable children in
a fiscally responsible way without raising taxes and sacrificing
Medicare services for our seniors. Unfortunately Republicans were
denied that right today. I urge my colleagues to vote ``no'' on the
CHAMP Act.
Mr. STARK. Mr. Speaker, I just remind the former Speaker that he
voted for the same benefits in 1997, and nothing has changed since
then.
I yield 1 minute to the gentleman from Michigan (Mr. Levin), who
remembers what happened in 1997.
(Mr. LEVIN asked and was given permission to revise and extend his
remarks.)
Mr. LEVIN. Mr. Speaker, some issues are complicated. This one is
quite simple. It's kids and more benefits for seniors.
Five million more kids. I just wonder how many on the minority side
are going to stand up and say no to 5 million kids, including kids
where you live. Benefits for seniors are improved. And then we hear
there will be benefits for illegal aliens, illegal immigrants? It's
false. It's a lie.
This does not go to illegal immigrants. I did read the bill, and I
also read the minds of the American people.
I also read the minds of the American people. They want the children
of America covered by health insurance, and the Republicans have failed
to do it in their years here.
We're going to do it today for the 5 million kids in the United
States of America. That's what this is all about.
I rise in strong support of the Children's Health and Medicare
Improvement Act of 2007. This legislation re-authorizes the State
Children's Health Insurance Program and improves Medicare for all
beneficiaries.
Some of the issues we debate in Congress are complicated. This issue
is quite simple. It is about kids getting health care and seniors
getting better Medicare benefits. The American people want the children
of America covered by health msurance.
The current health insurance program covers 6 million children
nationwide, including 55,000 kids in my home State of Michigan. But
when two-thirds of the 9 million uninsured kids in America are
eligible, but not participating, we need to extend the reach of the
program. Extending this program means giving States the resources they
need to reach out and cover these 6 million kids.
This important legislation not only allows more kids to have health
insurance, but it also
[[Page H9402]]
makes long-needed improvements to the Medicare program. Improvements
include ensuring physician access for Medicare beneficiaries, lowering
the cost of mental health care for seniors, eliminating co-pays and
deductibles for preventative services like mammograms and colonoscopy
screenings, and expanding programs that help low-income seniors pay for
their health care and prescriptions.
The Republicans reject this bill because it does not fit their rigid
ideology. This bill is about a program that works and kids that need
health care.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to the
distinguished gentlewoman from Nashville, Tennessee (Mrs. Blackburn), a
member of the committee.
Mrs. BLACKBURN. Mr. Speaker, I support the original intent of SCHIP
to cover our low-income children at 200 percent of the Federal poverty
level; yet the bill before us really strays from that, and we all know
it.
And we're debating this under a lockdown rule because the Rules
Committee refused to allow Republican amendments to this bill, and I
will tell you, I found that 1 a.m. meeting for the Rules Committee
informative and entertaining in an unfortunate sense.
The debate on this, as my colleague said, is pretty simple: Who will
manage and control the health care sector that comprises one-seventh of
our Nation's economy. That's what this is about today. Are individual
Americans going to have the freedom to make those choices or are those
Americans going to be relegated to being a faceless file on a
bureaucrat's desk with that bureaucrat making those life-and-death
decisions? Our future health care system is going to be shaped by the
way we answer those questions on this floor today.
Under this Democrat bill, there will be billions spent to enroll
children into SCHIP.
I encourage my colleagues to oppose this bill.
Mr. DINGELL. Mr. Speaker, my good Republican friends will be
discussing process, and we want to discuss kids and the future of the
country.
For that purpose, I yield 2 minutes to the distinguished chairman of
the subcommittee, my friend, Mr. Pallone of New Jersey.
Mr. PALLONE. Mr. Speaker, there shouldn't be any doubt here today
about what the Republicans are trying to do. They are trying to destroy
the SCHIP program.
We spent 18 hours in our committee where they wouldn't let the bill
come up. The substitute that they had in the committee would put so
many barriers in the program that, in effect, the program would die.
Don't believe them. They don't want to provide the additional funds.
They know that this expires on September 30, and it will if we don't do
something today; that there will be a million kids that will
automatically not have their health insurance.
We're not changing any of the eligibility today. It's they that want
to change the eligibility.
The fact of the matter is CBO tells us, and I have it right here,
that this bill would cover another 5 million children who are currently
uninsured.
Now, my colleagues on the other side know that the States have run
out of money. Georgia ran out of money in March. They came to us and
begged us for more money. States ran out each month of money. We had to
put money in the supplemental appropriations bill because the States
ran out of money.
We need a lot more money to make sure that these 5 million kids are
covered. They want to stop that. They're not proposing to cover any
additional kids. They want to cut that.
There's no illegal aliens covered in this bill. There never were.
There's no language in here that says that.
This is not an entitlement. It's a block grant set up by Newt
Gingrich. Newt Gingrich was the guy who set it up as a block grant,
giving the States flexibility. The States want flexibility. Some of
them want to go a little higher. Well, it's George Bush, the President
of the United States, that granted the waiver so they could have some
adults or kids at higher incomes.
Who are you kidding? This is a Republican program, but you are now
walking away from it. You don't want to fund it. You want to deny
eligibility. You want to kill the program. That's what you're all about
here today.
And don't let anybody kid you. Eighteen hours we had to listen while
the bill was being read. Today, they want to delay. They're kidding no
one saying that they want an SCHIP program. Don't believe what they
say. It's simply not true.
You vote for this bill today to expand this program to provide more
kids, not more eligibility. And if you don't, this will die and those
kids are not going to have health insurance.
We have health insurance for our kids as Members of Congress. That's
okay for our own kids but not for the rest of these poor kids.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. All Members are reminded to direct their
comments to the Chair.
Mr. BARTON of Texas. Mr. Speaker, page 76 and 77, section 143 of the
original committee print repeals the requirement for documentation
presentation for children covered under SCHIP.
With that, I yield 1 minute to the gentleman from Michigan, a member
of the committee, Mr. Rogers.
Mr. ROGERS of Michigan. Mr. Speaker, a letter recently from the NAACP
says: We strongly support maintaining adequate funding for the Medicare
Advantage program that serves as a critical funding for accessing
health care services, particularly for low-income and minority Medicare
beneficiaries.
Talk about what's in the bill. Don't use children as your shield.
This is the single largest cut to Medicare in the program's history.
Absolutely, it is, and let me tell you what you are cutting. Read the
bill.
You're cutting stroke victims from inpatient rehab. You're cutting
doctors. You're cutting oxygen equipment and wheelchair services to
seniors. You're cutting seniors' home health care, cutting hospital
payments, cutting skilled nursing care for the sickest seniors in
nursing homes. You're cutting dialysis services for kidney cancer
patients. You're cutting imaging services for cancer and cardiac
patients.
The list goes on. You're telling seniors once we slash the Medicare
Advantage payments, we're going to push you on to part B, and guess
what, your premiums are going up. We can work this out.
This was a Republican-generated idea when it started, SCHIP, to
include those 200 percent or below of children in poverty, and I will
tell you that there's not one thing that helps those kids under 200
percent of poverty, and you will get more of illegal immigrants at the
expense of seniors. This is a bad bill.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. The time has expired. Would the gentleman
please refrain from talking on.
The gentleman from California.
Mr. STARK. Mr. Speaker, I yield 1 minute to the distinguished
gentleman from Washington (Mr. McDermott), a member of the Ways and
Means Committee. Pending that, I would like to point out that he
understands that in 1997 the Republican bill had five times greater
reduction in Medicare spending than this bill does today, which 83
Members of the Republican party who are still in Congress voted for at
that time.
(Mr. McDERMOTT asked and was given permission to revise and extend
his remarks.)
Mr. McDERMOTT. Mr. Speaker, the debate comes down to this: Do you
favor big tobacco or children? Do you favor big tobacco and insurance
company profits or seniors? We come down on the side of children and
seniors, and that's what this bill is all about.
You've heard over and over and over again there is no change of
eligibility, but you insist on saying the same untruth because you want
to make a point in the press. That is wrong. There are not any illegal
aliens going to get in here. What we took out was what you put in. The
fact is that we took out your requirement that people bring in papers
when their kid is sick and dying, and you're saying to a parent, now
you've got to prove you're a citizen before we'll take care of your
kid.
That's what you're doing. You've taken your clothes off in public.
You don't want to take care of children.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. All Members are reminded to please address
their remarks to the Chair.
[[Page H9403]]
The gentleman from Texas.
Mr. BARTON of Texas. Mr. Speaker, I'd like to point out CBO scores
this as $1.9 billion. So somebody is not telling the truth on the
floor.
I yield 1 minute to a distinguished member of the committee, Mr.
Burgess of Texas.
Mr. BURGESS. Mr. Speaker, I thank the chairman. One minute is
scarcely enough time to discuss what we need to discuss today. So I
would, just like the chairman of the full committee, put my entire
statement into the Record.
Mr. Speaker, I want to confine my comments today to issues that
surround issues for physician reimbursement. I had two amendments last
night in Rules Committee that were not made in order that would have
vastly improved physician reimbursement. Instead, we have language in
the Democratic underlying bill that provides a small uptick for the
next 2 years, then you fall off the cliff, and then you're frozen for
the next 10 years. Hardly measures that will encourage people to go
into the practice of medicine in the future.
I also want to reference section 651, the whole hospital exemption.
Mr. Speaker, I would just point out that in the Rules Committee it was
made in order that several hospitals would actually be grandfathered
out or carved out of that exemption, and most of these hospitals lie in
Democratic districts. I have a letter from 75 constituents, physicians
back in my home State of Texas, who strongly object to the whole
hospital exemption in this bill, and I will submit that for the Record
as well.
The Democratic party is prepared to take its first step toward cradle
to grave government involvement in the lives of all Americans. The 40-
plus page SCHIP bill that was unveiled to this committee in the wee
hours of last Wednesday represents legislative malpractice. We
shouldn't be surprised because we've been here before. A handful of
Democratic staff, working behind closed doors, without any input from
the real world have produced just what we should expect: a bloated and
complicated proposal that grows the size of government, diminishes
state fiscal accountability and an individual's personal
responsibility, and likely erodes the independent practice of medicine.
I doubt anybody in this body, Republican or Democrat, really
understands what is in this proposal. We've not had one legislative
hearing on this bill and haven't even taken this bill through regular
order in the Energy and Commerce Committee. As a member of the Health
Subcommittee of that panel, I'm disappointed in that fact because the
subcommittee has shown an ability to come together and work out
partisan differences. I haven't spoken with Chairman Pallone, but I
imagine he shares that sentiment to some degree.
Just recently, Republicans and Democrats came together to report out
a bill that improves drug safety and FDA review of new drugs and
devices. We worked through our differences and produced superior
legislation. But all that bipartisan comity has been thrown out the
window. Any rationalization of how we can vote on this bill and report
to our constituents that we conducted an in-depth review of this
legislation would be farcical at best, especially when we have learned
that the Rules Committee plans to report out a completely different
measure in the dark and early hours this coming Wednesday.
Kids need a safety net, but the safety net shouldn't apply to those
that can and should help themselves. Taking money from taxpayers to
give it to families that have the resources to purchase health
insurance for their children is irresponsible. And if affordable
options don't exist for these families, well forget it, because this
bill doesn't lift a finger to reform an insurance market burdened by
regulation and lack of choice.
On immigration, this bill all but ensures that states like mine and
other border states will be saddled with more cost as it rewards those
that illegally enter our country. The debate on illegal immigration is
often ruled by emotion but the provisions in this bill relating to
immigrant health care are equally suited--this bill makes little to no
effort to understand this dynamic and only serves to pour gasoline on
an inferno.
On Medicare, this bill misses the mark widely. This bill would make a
bad investment in an attempt to fix Medicare physician payment and in
doing so, members will find themselves in the position of spending
billions more in the future to fix the problem again.
We shouldn't fool ourselves that this is realistic policy making. For
those members about to head home and face their constituents at
coffees, lunches, and town halls they should be wary of what Speaker
Pelosi is force feeding this body.
Baylor Medical Center at Frisco,
Frisco, TX, August 1, 2007.
Hon. Michael C. Burgess, MD,
U.S. Congressman,
Washington, DC.
Dear Congressman Burgess: We are physicians that practice
at Baylor Medical Center at Frisco. Today, we are writing to
express our deep concern about the language in the S-CHIP
bill (CHAMP Act) once again attempting to prohibit physicians
from owning or investing in any hospital. While this
legislation contains many important and generous provisions,
such as the reauthorization of SCHIP and the SGR fix, Section
651 virtually eliminates physician owned hospitals for no
reason other than the enmity of certain competitors.
Much has been written about the negative effect this
ownership has had on our community hospitals where we also
practice. Many of the large hospital systems claim they are
being harmed by physician-owned specialty hospitals in their
communities. Yet none of them has provided any factual data
to support their claim that they are unable to provide
``essential services'' as a result of specialty hospitals. In
fact each of the last 6 years the American Hospital
Association has reported a 6% increase in profits in their
member hospitals. And many of their arguments (e.g.
``specialty hospitals typically do not provide emergency
care'') simply is not accurate.
The benefits of the physician ownership model are so
convincing that a growing number of not-for-profit healthcare
systems, including some of the largest members of the
American Hospital Association, have embraced the concept of
physician ownership.
MedPAC, CMS, and GAO have all studied this issue. Not one
of them has concluded that physician owned hospitals
represent a threat to the community hospitals where they
exist. To the contrary, some have concluded that the overall
increase in quality of care greatly benefits the communities
in which they exist.
We believe that a major part of our success is due to the
fact that individual physicians are partners in the ownership
in the facility. As any business owner, we take pride in our
facility and have worked hard to make sure the quality of
medical care remains high. And frankly, we are much more
aware of the costs and how to better deliver care more cost
effectively. Through disclosure policies our patients are
aware of the physician ownership and our surveys reveal very
high patient satisfaction.
The best way to manage health care costs is to encourage
physicians to become involved in the development of new
models for the delivery of surgical and other health
services. Maintaining the status quo by giving acute care
hospitals protection from market forces will only lead to
higher health care costs for us all.
When voting, please consider carefully the decision you
will be asked to make regarding physician ownership, it will
not only affect your constituents' rights as a patient to
have the most convenient cost effective care, it will affect
the delivery of health care for generations to come.
Sincere regards,
Benton Ellis, MD; James Gill, MD; David Layden, MD; James
Montgomery, MD; Mark Allen, MD; Dawn Bankston, MD; F.
Alan Barber, MD; Richard Bowman, MD; Dale Burleson, MD;
Cameron Carmody, MD; John Schweers, MD; William Cobb,
MD; Stephen Courtney, MD; A. Joe Cribbins, MD; Bruce
Douthit, MD; Dennis Eisenberg, MD; Berry Fleming, MD;
Richard Guyer, MD; Lloyd Haggard, MD; Stephen Hamn, MD;
Andrea Ku, MD; Briant Herzog, MD; Stephen Hochschuler,
MD; James Hudguns, MD; Fawzia Jaffee, MD; Warrett
Kennard, MD; Adam Kouyoumjian, DO; Jimmy Laferney, MD;
Stephen Lieman, MD; Samuel Lifshitz, MD; Earl Lund, MD;
Gary Mashigian, DPM; Mark McQuaid, MD; William
Mitchell, MD; Dr. Keith Matheny; William Montgomery,
MD; John Moore, MD; Mickey Morgan, MD; William Mulchin,
MD; John Peloza, MD; Ralph Rashbaum, MD; Jon Ricks, MD;
Alfred Rodriguez, MD; Vince Rogenes, MD; David Rogers,
MD; Ivan Rovner, MD; Michael Schwartz, MD; James
Smrekar, MD; Robert Taylor, DPM; Ewen Tseng, MD; Gary
Webb, MD; Stanley Whisenant, MD; Michael Wierschem, MD;
Kathryn White, MD; Kathryn Wood, MD; Iddriss Yusufali,
MD; Roger Skiles, MD; Scott Fitzgerald, MD; Leonard
Bays, MD; Donald Mackenzie, MD; Lloyd Haggard, MD;
David Holder, MD; Joe Hughes, MD; David Perkins; Robert
Purnell, MD; Eddie Pybatt, MD; Elaine Allen, MD; Steven
Michelsen, DO.
amendment to h.r. 3162
This amendment would modify Title III of H.R. 3162 that addresses
Medicare physician reimbursement. While H.R. 3162 provides temporary
relief to address scheduled Medicare physician payment cuts, it does
nothing to address the problem in the long-term, and would in fact
exacerbate the problem in the long-term. The amendment does the
following:
1. Reset to 2007 the base year for application of the Sustainable
Growth Rate (SGR), and eliminates the Sustainable Growth Rate in 2010.
The practical effect of this on Medicare physician payment would
provide physicians with over a 1 percentage increase in 2008 and
[[Page H9404]]
2009, and stable and sustainable growth rate in payment from 2010 and
into the future.
2. Makes available incentive payments for increased quality reporting
and implementation of health information technology.
3. Provides annual reports to physicians on billing patterns under
Medicare.
4. Provides an annual report to Medicare beneficiaries on annual
Medicare expenditures.
5. Mandates a study on whether quality reporting requirements on
health care disparities.
Amendment to H.R. 3162, as Reported [By The Committee on Ways and
Means] Offered By Mr. Burgess of Texas
(CHAMP amendment)
Strike sections 301, 302, 303, 304, and 307, and insert the
following sections (and redesignate sections 305 and 306
accordingly):
SEC. 301. RESETTING TO 2007 THE BASE YEAR FOR APPLICATION OF
SUSTAINABLE GROWTH RATE FORMULA; ELIMINATION OF
SUSTAINABLE GROWTH RATE FORMULA IN 2010.
(a) In General.--Section 1848(d)(4) of the Social Security
Act (42 U.S.C. 1395w-4(d)(4)) is amended--
(1) in paragraph (4)--
(A) in subparagraph (B), by striking ``subparagraph (D)''
and inserting ``subparagraphs (D) and (G)''; and
(B) by adding at the end the following new subparagraph:
``(G) Rebasing to 2007 for update adjustments beginning
with 2008.--In determining the update adjustment factor under
subparagraph (B) for 2008 and 2009--
``(i) the allowed expenditures for 2007 shall be equal to
the amount of the actual expenditures for physicians'
services during 2007;
``(ii) subparagraph (B)(ii) shall not apply to 2008; and
``(iii) the reference in subparagraph (B)(ii)(I) to `April
1, 1996' shall be treated, beginning with 2009, as a
reference to `January 1, 2007'.''; and
(2) by adding at the end the following new paragraph:
``(8) Updating beginning with 2010.--The update to the
single conversion factor for each year beginning with 2010
shall be the percentage increase in the MEI (as defined in
section 1842(i)(3)) for that year.''.
(b) Conforming Sunset.--Section 1848(f)(1)(B) of such Act
is amended by inserting ``(ending with 2008)'' after ``each
succeeding year''.
SEC. 302. QUALITY INCENTIVES.
(a) Extension of Current Quality Reporting System and
Transitional Bonus Incentive Payments for 2008 and 2009.--
(1) Extension of quality reporting system through 2009.--
Section 1848(k) of the Social Security Act (42 U.S.C.
1395w(k)) is amended--
(A) in the heading of paragraph (2)(B), by inserting ``and
2009'' after ``2008''; and
(B) in paragraphs (2)(B) and (4), by inserting ``and 2009''
after ``2008'' each place it appears.
(2) Extension of and increase in bonus payments for 2008
and 2009.--Section 101(c) of the Medicare Improvement and
Extension Act of 2006 (division B of Public Law 109-432) is
amended--
(A) in the heading, by inserting ``, 2008, and 2009'' after
``2007'';
(B) in paragraph (1), by inserting ``(or 3 percent in the
case of reporting periods beginning after December 31,
2007)'' after ``1.5 percent'';
(C) in paragraph (4), by striking ``single consolidated
payment.'' and inserting ``single consolidated payment for
each reporting period. Such payment shall be made for a
reporting period within 30 days after the date that required
information has been submitted with respect to claims for
such period.''; and
(D) in paragraph (6)(C), by striking ``the period beginning
on July 1, 2007, and ending on December 31, 2007'' and
inserting ``each of the five consecutive 6-month periods
beginning on July 1, 2007, and ending on December 31, 2009''.
(b) Establishment of New Quality Incentive System Effective
in 2010.--
(1) In general.--Section 1848 of the Social Security Act
(42 U.S.C. 1395w) is amended by striking subsection (k) and
inserting the following:
``(k) Physician Quality Incentive System.--
``(1) In general.--The Secretary shall establish a
reporting system (in this subsection referred to as the
`Physician Quality Incentive System' or `System') for quality
measures relating to physicians' services that focuses on
disease-specific high cost conditions. Not later than January
1, 2010, the Secretary shall--
``(A) identify the 10 health conditions that have the
highest proportion of spending under this part, due in part
to a gap in patient care, and for which reporting measures
are feasible; and
``(B) adopt reporting measures on these conditions, based
on measures developed by the Physician Consortium of the
American Medical Association.
``(2) Add-on payment.--
``(A) In general.--The Secretary shall provide, in a form
and manner specified by the Secretary, for a bonus or other
add-on payment for physicians that submit information
required on the conditions identified under paragraph (1).
``(B) Amount.--Such a bonus or add-on payment shall be
equal to 1.0 percent of the payment amount otherwise computed
under this section.
``(C) Timely payments.--Such a payment shall be made, with
respect to information submitted for a month, by not later
than 30 days after the date the information is submitted for
such month.
``(D) Deductible and coinsurance not applicable.--Such
payment shall not be subject to the deductible or coinsurance
otherwise applicable to physicians' services under this part.
``(E) Use of registry.--In carrying out subparagraph (A),
the Secretary shall allow the submission of the required
information through an appropriate medical registry
identified by the Secretary.
``(3) Monitoring.--The Secretary shall monitor and report
to Congress on an annual basis physician participation in the
Physician Quality Incentive System, administrative burden
encountered by participants, barriers to participation, as
well as savings accrued to the Medicare program due to
quality care improvements based on measures established under
the Physician Quality Incentive System.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to payment for physicians' services for services
furnished in years beginning with 2010.
SEC. 303. HEALTH INFORMATION TECHNOLOGY (HIT) PAYMENT
INCENTIVE.
Section 1848 of the Social Security Act is amended by
adding at the end the following new subsection:
``(m) Health Information Technology Payment Incentives.--
``(1) Standards.--Not later than January 1, 2008, the
Secretary shall create standards for the certification of
health information technology used in the furnishing of
physicians' services.
``(2) Add-on payment.--The Secretary shall provide for a
bonus or other add-on payment for physicians that implement a
health information technology system that is certified under
paragraph (1). Such a bonus shall be equal to 3.0 percent of
the payment amount otherwise computed under this section,
except that--
``(A) in no case may total of such bonus and the bonus
provided under subsection (k)(2) exceed 6 percent of such
payment amount; and
``(B) such payments with respect to a physician shall only
apply to physicians' services furnished during a period of 36
consecutive months beginning with the first day of the first
month after the date of such certification.
The bonus payment under this paragraph shall not be subject
to the deductible or coinsurance otherwise applicable to
physicians' services under this part.''.
SEC. 304. INFORMATION FOR PHYSICIANS ON MEDICARE BILLINGS.
(a) In General.--Section 1848 of the Social Security Act,
as amended by section 201, is further amended by adding at
the end the following new subsection:
``(n) Annual Reporting of Information to Physicians.--
``(1) In general.--The Secretary shall annually report to
each physician information on total billings by the physician
(including laboratory tests and other items and services
ordered by the physician) under this title. Such information
shall be provided in a comparative format by code, weighting
for practice size, number of Medicare patients treated, and
relative number of Medicare beneficiaries in the geographical
area.
``(2) Confidentiality.--Information reported under
paragraph (1) is confidential and shall not be disclosed to
other than the physician to whom the information relates.''.
(b) Effective Date.--The Secretary of Health and Human
Services shall first provide for reporting of information
under the amendment made by subsection (a) for billings
during 2007.
SEC. 305. INFORMATION FOR BENEFICIARIES ON MEDICARE
EXPENDITURES.
(a) In General.--Section 1804 of the Social Security Act is
amended by adding at the end the following new subsection:
``(d) Annual Report on Individual Resource Utilization.--
The Secretary shall provide for the reporting, on an annual
basis, to each individual entitled to benefits under part A
or enrolled under part B, on the amount of payments made to
or on behalf of the individual under this title during the
year involved. Such information shall be provided in a format
that compares such amount with the average per capita
expenditures in the region or area involved.''.
(b) Effective Date.--The Secretary of Health and Human
Services shall first provide for reporting of information
under the amendment made by subsection (a) for payments made
during 2007.
SEC. 306. COLLECTION OF DATA ON MEDICARE SAVINGS FROM
PHYSICIANS' SERVICES DIVERSION.
(a) In General.--The Secretary of Health and Human Services
shall collect data on annual savings in expenditures in the
Medicare program due to physicians' services that resulted in
hospital or in-patient diversion.
(b) Report.--The Secretary shall transmit to Congress
annually a summary of the data collected under subsection
(a).
SEC. 307. STUDY OF REPORTING REQUIREMENTS ON HEALTH CARE
DISPARITIES.
(a) In General.--The Secretary of Health and Human Services
shall provide for a study of health care disparities in high-
risk health
[[Page H9405]]
condition areas and minority communities about the impact
reporting requirements may have on physician penetration in
such communities.
(b) Report.--The Secretary shall provide for the completion
of the study by not later than January 1, 2011, and shall
submit to Congress a report on the study upon its completion.
``(m) Health Information Technology Payment Incentives.--
``(1) Standards.--Not later than January 1, 2008, the
Secretary shall create standards for the certification of
health information technology used in the furnishing of
physicians' services.
``(2) Add-on payment.--The Secretary shall provide for a
bonus or other add-on payment for physicians that implement a
health information technology system that is certified under
paragraph (1). Such a bonus shall be equal to 3.0 percent of
the payment amount otherwise computed under this section,
except that--
``(A) in no case may total of such bonus and the bonus
provided under subsection (k)(2) exceed 6 percent of such
payment amount; and
``(B) such payments with respect to a physician shall only
apply to physicians' services furnished during a period of 36
consecutive months beginning with the first day of the first
month after the date of such certification.
The bonus payment under this paragraph shall not be subject
to the deductible or coinsurance otherwise applicable to
physicians' services under this part.''.
amendment to h.r. 3162
This amendment would modify section 704 of H.R. 3162 that would
require the Secretary of HHS to develop a plan to implement for never
events. Never events, pursuant to H.R. 3162, are defined as an event
involving the delivery of (or failure to deliver) physician services in
which there is an error in medical care that is clearly identifiable,
usually preventable, and serious in consequences to patients and that
indicates a deficiency in the safety and process controls of the
services furnished with respect to the physician, hospital, or
ambulatory surgical center involved. This amendment would ensure that
the identification of a never event is confidential in nature, as it
applies to patient work product under Section 922 of the Public Health
Service Act.
never events
This amendment would ensure that the identification of never events
as required by CHAMP does not lead to frivolous lawsuits against
physicians.
While I may not agree with how ``never events'' are defined by this
bill, I agree that physicians should be able to operate in an
environment that supports improvement of processes and outcomes and not
a punitive legal environment.
Under the bill, ``never events'' are defined as an event involving
the delivery of (or failure to deliver) physician services in which
there is an error in medical care that is clearly identifiable, usually
preventable, and serious in consequences to patients and that indicates
a deficiency in the safety and process controls of the services
furnished with respect to the physician, hospital, or ambulatory
surgical center involved.
This simple amendment ensures that identification of these ``never
events'' would not be used in a legal proceeding and would be
considered patient work product as they are under other areas of
federal law.
Amendment to H.R. 3162, as Reported [by the Committee on Ways and
Means]
Offered by Mr. Burgess of Texas
(CHAMP Amendment)
Amend section 704 (relating to never events plan) by
redesignating subsection (d) as subsection (e) and inserting
after subsection (c) the following:
(d) Liability Protection.--
(1) In general.--Section 922 of the Public Health Service
Act (42 U.S.C. 299b-22) (relating to liability and
confidentiality protections) shall apply to never event
information under this section in the same manner as it
applies to patient work product under such section 922.
(2) Never event information defined.--For purposes of this
subsection the term ``never event information'' means
information required to be provided by a hospital, ambulatory
surgical center, or physician under the never events plan
with respect to a determination to reduce or deny payment
under title XVIII of the Social Security Act for services
furnished by the hospital, ambulatory surgical center, or
physician, respectively, on the basis of the finding of a
never event.
amendment to h.r. 3162
This amendment would prohibit the Secretary of Health and Human
Services from approving future State waivers that would cover adults
other than pregnant adults under the State Children's Health Insurance
Program. This amendment would also terminate existing State waivers
that cover adults other than pregnant adults under a State's Children's
Health Insurance Program. SCHIP is designed to cover uninsured
children, and taxpayer funds used to cover adults cannot achieve that
goal. This amendment would save State and Federal Governments hundreds
of millions of dollars that could be used to cover more uninsured
children.
adults
Since Congress enacted SCHIP in 1997, States have been successful in
making affordable health insurance available to millions of low-income
children.
Prior to the enactment of SCHIP, low-income families that made too
much money to be eligible for Medicaid coverage found it difficult to
find affordable coverage for their children. Several million children
were left without health coverage for important preventative health
services, forcing their families to seek care in emergency departments
and lacking vital continuity of care.
With the Federal and State partnership that is the cornerstone of
SCHIP, needy families were able to obtain health coverage for their
children that was previously just out of reach.
Unfortunately some States have extended coverage to adults under
their SCHIP program, taking limited dollars away from the needs of the
children the program was intended to meet. One dollar a State spends on
an adult is $1 not spent on a needy child. This amendment would
eliminate this inequitable development that needs to be stopped dead in
its tracks.
My bill would prohibit States from spending even a single SCHIP
dollar on anyone but a child or a pregnant woman. Currently, 14 States
extend SCHIP coverage to adults and four of those States cover more
adults than children in their programs.
We can debate coverage of adults and affordable options and States
can take this responsibility upon their shoulders as well. But we
shouldn't spend a dollar dedicated to a child on an adult. It does a
disservice to the very needy children we're trying to provide coverage
to.
Amendment to H.R. 3162, as Reported [by the Committee on Ways and
Means]
Offered by Mr. Burgess of Texas
(CHAMP amendment)
At the end of subtitle D of title I add the following new
section:
SEC. ___. PROHIBITION OF SECTION 1115 WAIVERS FOR COVERAGE OF
NONPREGNANT ADULTS UNDER SCHIP.
(a) In General.--Section 2107(f) of the Social Security Act
(42 U.S.C. 1397gg) is amended, as added by section 6102(a) of
the Deficit Reduction Act of 2005 (Public law 109-171) is
amended--
(1) in the first sentence, by striking ``childless''; and
(2) by striking the second sentence.
(b) Conforming Amendments.--Section 2105(c)(1) of the
Social Security Act (42 U.S.C. 1397ee(c)(1)) is amended--
(1) in the first sentence, by striking ``childless''; and
(2) by striking the second sentence.
(c) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.
(d) Termination of Funding of Coverage Under Current
Waivers.--In the case of any waiver, experimental, pilot, or
demonstration project that would allow funds made available
under title XXI of the Social Security Act (42 U.S.C. 1397aa
et seq.) to be used to provide child health assistance or
other health benefits coverage to an adult (other than
pregnant adult) that is approved as of the date of the
enactment of this Act, on and after such date the Secretary
of Health and Human Services shall not extend or renew such a
waiver or project in a manner that permits funds under the
waiver or project to be used for such purpose and shall
otherwise take such action as is necessary to prevent the use
of funds under the waiver or project to be used for such
purpose on and after January 1, 2008.
amendment to h.r. 3162
This amendment would require a State submitting a SCHIP waiver
request to the Secretary of Health and Human Services to certify that
children in that state have access to an adequate level of
pediatricians, pediatric specialists and pediatric sub-specialists for
targeted low-income children covered under the State's child health
plan.
The State must include a survey conducted by the American Academy of
Pediatrics, a state professional medical society, or other qualified
organization and the Secretary may not approve a waiver application
unless the survey is included in the State's submission.
access
This amendment would ensure that as states seek to expand their CHIP
programs, that an adequate number of pediatricians, pediatric
specialists and sub-specialists are available to meet increased demand
by new patients.
To quote the American Academy of Pediatrics Workforce Committee, ``an
appropriate pediatrician workforce is essential to attain the optimal
physical, mental, and social health and well-being for all infants,
children, adolescents, and young adults. To fully realize such a
workforce requires careful examination of the needs of children and the
consequences of policies that influence the pediatrician workforce.''
This amendment would attempt to achieve this goal, by requiring
adequate access to
[[Page H9406]]
these medical professionals as a condition approval of a waiver
submission.
The amendment would require the American Academy of Pediatrics or
other state medical society to survey and certify that the state's
children have access to a sufficient number of pediatricians and
specialists, should a state request a waiver from federal SCHIP
requirements.
States have a variety of policy options to ensure that an adequate
physician workforce is available in the state and this amendment would
encourage those states to exercise those options.
The growth of the number of pediatricians per child has been positive
over the past decade.
We should ensure that this momentum is sustained and this amendment
will do just that.
I think this is an amendment that should have broad bipartisan
support because its goal is ensuring access to needed medical
professionals for our children.
More broadly, in the coming years this country will face a physician
workforce shortage and this committee and this Congress needs to begin
addressing this now.
I look forward to working with the members of this committee on this
very broad and complicated issue, but this amendment would be a good
first step.
Amendment to H.R. 3162, as Reported [by the Committee on Ways and
Means]
Offered by Mr. Burgess of Texas
(CHAMP amendment)
Add at the end of subtitle E of title I the following new
section:
SEC. ___. LIMITATION ON APPROVAL OF SCHIP WAIVERS.
The Secretary of Health and Human Services shall not
approve any application submitted by a State for a waiver of
any provision of title XXI of the Social Security Act
unless--
(1) the State has certified that there is access to an
adequate level of pediatricians, pediatric specialists and
pediatric sub-specialists for targeted low-income children
covered under the State child health plan under such title;
and
(2) the State includes in such application the results of a
survey, that may be conducted by the American Academy of
Pediatrics, a State professional medical society, or other
qualified organization, that establishes that such an
adequate level exists on a per capita child basis.
Mr. DINGELL. Mr. Speaker, I yield to the distinguished gentleman from
Virginia (Mr. Moran) for purposes of a unanimous consent request.
Mr. MORAN of Virginia. Mr. Speaker, I ask unanimous consent to insert
a statement for the Record refuting the fact that this has anything to
do with undocumented children. The fact is that the current provision
prohibits undocumented children from getting health care, but if we
don't pass it, it will deny tens of thousands of children who are
legally eligible.
Mr. BURGESS. I object.
The SPEAKER pro tempore. Objection is heard.
Parliamentary Inquiry
Mr. BARTON of Texas. Mr. Speaker, parliamentary inquiry, where are
we?
The SPEAKER pro tempore. Objection has been heard. The gentleman
objected. It's for the gentleman from Michigan to yield time.
Mr. BARTON of Texas. So Mr. Dingell controls the time?
The SPEAKER pro tempore. That's correct.
Mr. DINGELL. Mr. Speaker, I yield to the distinguished gentlewoman
from California (Ms. Eshoo) 1 minute.
Ms. ESHOO. Mr. Speaker, I thank the distinguished chairman of the
Energy and Commerce Committee.
Mr. Speaker, today is one of the most exciting days since I've come
to the Congress, having been elected first in 1992. I think today is a
day of history, a day of history for the children of our country,
because the fact is that there are nearly 9 million American children
without guaranteed access to health care in our Nation today. I think
that is a national shame.
Today, we correct that. We build on a successful bipartisan program
of Republican and Democratic Governors, of leaders in the Congress
past, of a program that has worked.
It has not been riddled by fraud, and what we do today very simply is
add 5 million American children in the rolls of health care. It is
private insurance for almost all of the States.
We also strengthen Medicare. I would suggest that my friends on this
side of the aisle are on the wrong side of history.
{time} 1500
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to the
distinguished gentleman of the committee from the great State of
Florida (Mr. Stearns).
(Mr. STEARNS asked and was given permission to revise and extend his
remarks.)
Mr. STEARNS. Mr. Speaker, I would say to the gentlelady from
California who said this is a great day in history, it was a great day
in history when, in 1997, the Republicans, who had the majority,
initiated and started this program. The Democrats are saying this is a
great day, what a great day, when the Republicans started the SCHIP
program.
Now, this bill, you have heard it all before. Obviously, it creates a
new entitlement, crowds out private insurance with government coverage,
offers perverse incentives to States; and, my friends, it contains a
huge tax increase, with more on the way. Lastly, it punishes Medicare
beneficiaries. This is very troubling, particularly in Florida. We have
so many seniors that actually use Medicare Advantage.
The fact that they are going to eliminate this program to pay for
this is really outrageous. It will disproportionately harm racial
minorities and rural senior citizens by taking funds away from Medicare
Advantage, a successful, lower-cost option for health care for seniors
and use it to enroll and federally insure adult men and women who have
the ability to work and receive health care from their employers in the
open market.
Mr. STARK. Mr. Speaker, I yield to the distinguished member of the
Ways and Means Committee, a member of the Health Subcommittee, the
gentleman from Georgia (Mr. Lewis).
Pending that, I would explain that he knows that the NAACP, in a
letter of endorsement, has said that this legislation fills a much-
needed gap that currently exists in health care services for some of
the most vulnerable citizens, low-income children, seniors and the
disabled.
Mr. LEWIS of Georgia. Mr. Speaker, health care is a basic human
right. It is unacceptable to see a young child die because his family
could not afford for him to see a dentist. This should never, ever,
happen in the United States of America. It is wrong. It must not be
tolerated any longer, and today we said ``no more''.
This bill would give 6 million children access to health care. For
our seniors who rely on Medicare, this bill helps our low-income
seniors and makes prevention more affordable.
I applaud the work of Chairman Rangel and Chairman Stark for making
these important improvements. I am proud to have worked on this bill to
help those who suffer from chronic kidney disease and end-stage renal
disease receive the highest quality care and to take the first of many
steps towards preventing these terrible diseases.
Until we can make health care right for every American, we have a
moral mission, a mission and a mandate to start with the most
vulnerable among us, our children and our seniors. We can do no less.
Vote ``yes'' on the CHAMP Act. Do it now. Do it today.
Mr. BARTON of Texas. Mr. Speaker, could I inquire of the time
remaining on each side on this part of the bill?
The SPEAKER pro tempore. The gentleman from Texas has 18 minutes
remaining, and the gentleman from Michigan has 22\1/2\ minutes
remaining.
The gentleman from California has 19 minutes remaining, and the
gentleman from Louisiana has 30 minutes remaining.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to a distinguished
member of the committee from the great State of Illinois (Mr. Shimkus),
the winning pitcher on the congressional baseball team.
(Mr. SHIMKUS asked and was given permission to revise and extend his
remarks.)
Mr. SHIMKUS. Mr. Speaker, under the current Illinois SCHIP program,
it covers up to 200 percent of poverty, $41,300 in annual income for a
family of four; 26,830, or 31 percent of all families with children
under the age of 18, in my district are already eligible for either
Medicaid or SCHIP.
In this bill, Democrats have opposed cutting at least $194 billion in
Medicare spending. Specifically, the Democrats have proposed cutting
Medicare spending for 6,070 seniors in my district who
[[Page H9407]]
are currently enrolled in Medicare Advantage. Payments for hospital
inpatient care will be cut $2.7 billion; inpatient rehabilitation
services, $6.6 billion; skilled nursing facilities, a $6.5 billion cut;
certain drugs, $1.9 billion in cuts; home health care, $7.2 billion;
end-stage renal disease cut by $3.6 billion; motorized wheelchair and
oxygen cuts.
Mr. STARK. Mr. Speaker, I reserve the balance of my time.
Mr. DINGELL. Mr. Speaker, I yield 1 minute to the distinguished
gentleman from Texas (Mr. Gene Green).
(Mr. GENE GREEN of Texas asked and was given permission to revise and
extend his remarks.)
Mr. GENE GREEN of Texas. Mr. Speaker, I rise in strong support of the
Children's Health and Medicare Protection Act.
This is the best piece of legislation since 1997 when the children's
health care was created, but this time we will cover 5 million more
children if we vote ``yes'' today for this bill.
I want to particularly thank the committee, although we didn't get to
have a markup in ours because the Republican minority refused to let us
even have votes on our amendments, so we have to have it on the floor
today. We have to have that discussion. I am just glad they included
that it would cover 12 months of insurability for our children, because
some States have made 6 months the way to cut children off of health
care.
Let me say one other thing. I have heard, particularly last night, I
think it was insulting to say that this bill takes money away from
seniors to give to illegal alien children. You ought to be ashamed of
yourself. That's just outrageous. When you look at the bill and
actually current law that we don't change, it prohibits undocumented
children from getting any assistance.
Now the States are going to be the ones that have to prove that. If
the States can't do it, they have to pay for it. It is just outrageous
that you throw out the ``illegals'' every time you don't have any other
argument.
I am particularly proud of the SCHIP provisions in this legislation,
which would provide much-needed health insurance coverage to low-income
children in need.
Currently, the SCHIP program provides coverage to 6 million low-
income American children.
Unfortunately, an additional 6 million children are eligible for
SCHIP benefits, yet remain uninsured.
This legislation would reach about 5 million of those children by
putting in place a more efficient funding formula based on projected
enrollment and providing states with incentives to find eligible
children and get them enrolled.
I am particularly thankful for the committee's support of our
language to ensure that children in SCHIP get 12 months of continuous
eligibility.
This provision is critical to ensuring that eligible SCHIP children
remain in the program and are not dropped due to cumbersome
bureaucratic requirements imposed on families whose primary focus is on
making ends meet.
A recent Health Affairs article underscores the importance of
continuous eligibility in addressing retention problems in SCHIP.
Of the policy options suggested, the authors state that ``[f]irst and
foremost, the renewal process should be simplified as much as possible,
by reducing the frequency of renewal to once a year.''
This bill does just that.
For many states, this bill reaffirms the compassionate and effective
policies currently in place.
But for a state like mine, this bill will ensure that the State of
Texas does right by Texas children and doesn't use the flexibility
inherent in the program to kick them off the rolls on a budgetary whim.
I encourage my colleagues to stand up for low-income children and
pass this important legislation.
Announcement by the Speaker Pro Tempore
The SPEAKER pro tempore. All Members are reminded to please address
their remarks through the Chair.
Mr. BARTON of Texas. Mr. Speaker, the CBO baseline score shows that
Medicare cuts total $157 billion over the 10-year period.
Mr. Speaker, I yield 1 minute to the gentleman from Staten Island, a
member of the committee, Mr. Fossella.
Mr. FOSSELLA. Mr. Speaker, Mr. Addison Good is an 80 year-old retired
cook from Staten Island. He survives on a very limited income of Social
Security and a small pension. Through every step of his hip operations,
his Medicare Advantage plan paid for the services and drugs that he
needed. He switched to a new plan that provides even better benefits at
lower cost. He says he does not know how he would get the care he needs
without his Medicare Advantage.
Let me say up front, we will consider Mr. Addison Good as we consider
the legislation; and I support the SCHIP program, I support its
reauthorization, I support expanding access to health care for low-
income children.
I do not support this ill-conceived plan that pits parents against
their grandchildren. Make no mistake, the bill cuts Medicare by more
than $190 billion. In my district alone, it will reduce funds for
Medicare Advantage by $58 million for the 38,000 enrollees in just the
first year.
The real-world impact of slashing $58 million in Medicare in Staten
Island, Brooklyn, for seniors enrolled in this program could result in
the following: either denied access to the program altogether, to lose
health care benefits like hearing, vision and dental services or have
to pay more out of pocket. We should not gut Medicare or punish seniors
to achieve a Democratic goal.
Mr. STARK. Mr. Speaker, I reserve the balance of my time.
Mr. DINGELL. Mr. Speaker, we reserve the balance of our time.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to another member
of the committee, Mr. Sullivan of Oklahoma.
Mr. SULLIVAN. Mr. Speaker, it's really astounding that there is
nothing in this bill that stops States from covering illegal
immigrations in this bill. People have come up to me and said, you
know, the Democrats, the people in the Senate wanted to allow illegal
aliens to get free Social Security benefits. Now they want to give free
health care, and that's wrong.
There is nothing in this bill that prevents adults, States from
covering adults, giving them health care. There's nothing in this bill
that prevents States from even covering the children of the Members of
Congress in this bill.
I think this is a bill that should not happen. I rise today in strong
opposition to it.
One of my problems is that it eliminates the 5-year waiting period
for immigrants who deserve to be eligible for Medicare and SCHIP.
Congress wisely created this waiting period, and eliminating this
waiting period will exacerbate our current immigration problems and
further endanger government health care programs. By repealing this
current law, millions of citizens will be eligible for Medicaid and
SCHIP immediately.
Had this bill been brought to the committee, the proper thing, I had
an amendment that would have saved taxpayers $2.2 billion having this
waiting period.
I urge my colleagues to vote ``no.''
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to another
distinguished member of the Energy and Commerce Committee, the
gentleman from California (Mr. Radanovich).
Mr. RADANOVICH. I thought I would use my time to talk about the Ag
approps bill. Just kidding.
Mr. Speaker, we must ensure that all children who qualify for the
SCHIP program are taken care of, but I have grave concerns about the
SCHIP reauthorization bill, which doesn't target low-income kids but
does increase mandatory spending by almost $130 billion over 10 years.
This is not the way to provide coverage for anybody.
I am particularly concerned that the CHAMP bill defines children as
up to the age of 25. I am not aware of any other Federal program that
defines the term ``children'' this broadly, and I certainly don't think
that my constituents could agree that governments should be using
health care funds intended for low-income children to cover a 25-year-
old.
This is not what SCHIP is supposed to be about. I don't believe that
the creation of a new entitlement program costing hundreds of billions
of dollars is in the best interests of our children. Are we going to
encourage people and make it easier for them to take advantage of the
private health care market, or are we going to have the government
grabbing for control of all health care services?
This legislation certainly indicates where our majority is trying to
go. These are not procedural differences but major philosophical
differences.
[[Page H9408]]
Under this bill, Donald Trump's daughter, Ivanka, will be enrolled in
the SCHIP program.
Mr. BARTON of Texas. Mr. Speaker, might I inquire as to the time?
The SPEAKER pro tempore. The gentleman from Texas has 14 minutes
remaining, the gentleman from Michigan has 21\1/2\ minutes remaining,
the gentleman from California has 19 minutes remaining, and the
gentleman from Louisiana has 30 minutes remaining.
Mr. BARTON of Texas. Mr. Speaker, I reserve the balance of my time.
Mr. DINGELL. Mr. Speaker, our problem is a simple one, and I say this
with respect and affection to my colleague. Our Republican colleagues
have chosen to allocate time with two committees on this side and one
committee on that side. The end result is that there is one committee
on the Republican side which is not using its time. In order to balance
out the time use, Mr. Stark and I are reserving our time at this time.
Mr. BARTON of Texas. Mr. Speaker, the gentleman from Texas is in a
quandary. I am not aware we were able to determine anything for the
other side. I don't know why they are allocating their time.
Mr. Speaker, I reserve the balance of my time.
Mr. STARK. Mr. Speaker, it was just my intent to accommodate my
friends in the minority who have been asking for all this extra time,
but I guess if they have lost their speakers, they really don't need
any.
Mr. Speaker, I yield 1 minute to the gentleman from California (Mr.
Thompson), a member of the Health Subcommittee of the Ways and Means
Committee, who recognizes that the American Medical Association has, in
their endorsement, has said that this legislation addresses two of the
AMA's highest priorities, providing health insurance coverage for low-
income coverage and protecting seniors' access to care by preventing
drastic cuts in the Medicare funding for physician services.
Mr. THOMPSON of California. Mr. Speaker, keeping kids healthy today
means that the government will inherit a healthier Medicare population
tomorrow. Investing in our children is both common sense and it's cost-
effective.
It was very difficult to watch the former majority allow the national
debt to grow to record heights. Today, I am proud that the new
Democratic leadership has said no to deficit spending.
The CHAMP Act is emblematic of that shift. It is completely paid for.
The CHAMP Act guarantees that both eligible children and Medicare
seniors can access qualify health care.
Make no mistake. Without this legislation, 5 million new kids won't
be able to get health care, and millions more already in the program
will see their benefits cut.
Without this legislation, physicians will take the biggest rate cut
in the history of the Medicare program.
Without this legislation, Medicare benefits that are critical to
rural communities will expire.
Today, with the passage of the CHAMP Act, Congress has taken an
historic step. So be a champion for kids, be a champion for seniors and
be a champion for common sense.
Vote ``aye'' on the CHAMP Act.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to the
distinguished leader of the Republican Study Committee, Mr. Hensarling
of Texas.
{time} 1515
Mr. HENSARLING. Mr. Speaker, today the Democrat majority in Congress
will no doubt ram through a bill representing the single largest step
in Washington-controlled, bureaucratized, rationed, socialized health
care, and they will do this under the guise of insuring needy children
who are already insured under Medicaid or are already insured under the
SCHIP program, which we could reauthorize. And they do this by turning
SCHIP into a new entitlement, threatening to bankrupt the very children
they claim to be helping. They do this by cutting Medicare, hastening
the bankruptcy of the Medicare trust fund. They do this by cutting
Medicare Advantage plan, threatening the health care choices of
millions of our seniors. They do this by increasing taxes on working
Americans.
This is a threat to our children's fiscal health, it is a threat to
our Nation's and children's physical health. It should be rejected.
Mr. BARTON of Texas. Mr. Speaker, I renew my unanimous consent for 1
additional hour of time equally divided between the majority and the
minority.
Ms. DeGETTE. I object.
The SPEAKER pro tempore. Objection is heard.
Does the gentleman from Texas wish to yield time?
Mr. BARTON of Texas. Who objected, Mr. Speaker?
The gentleman has to be on his feet to object.
The SPEAKER pro tempore. The gentlewoman from Colorado has objected.
She is on her feet.
Mr. BARTON of Texas. I reserve the balance of my time.
Mr. STARK. I reserve the balance of my time.
Mr. DINGELL. I reserve the balance of my time.
Mr. Speaker, it would appear at this time that many of the
difficulties that confront us could be addressed by the appearance of
our good friends on the minority side of the Ways and Means.
Mr. BARTON of Texas. Mr. Speaker, I move that the House do now
adjourn.
The SPEAKER pro tempore. Pursuant to House Resolution 594, the
previous question is ordered to final passage without such an
intervening motion.
A motion to adjourn may not be entertained.
Mr. BARTON of Texas. Parliamentary inquiry. I thought a motion to
adjourn was in order at any time.
The SPEAKER pro tempore. Pursuant to House Resolution 594, the
previous question is ordered to final passage without intervening
motion other than recommittal. As such, a motion to adjourn may not be
entertained.
Mr. BARTON of Texas. Parliamentary inquiry. What is House Resolution
594? Is that the closed rule?
The SPEAKER pro tempore. The rule for consideration of this bill.
Mr. BARTON of Texas. Then I suggest the absence of a quorum, Mr.
Speaker.
The SPEAKER pro tempore. That may not be entertained unless the Chair
is putting the question, in accord with clause 7 of rule XX.
Mr. BARTON of Texas. Then I yield 1 minute to a member of the
committee, Mr. Terry of Nebraska.
Mr. TERRY. Mr. Speaker, first of all, I want to state that I believe
that we should cover our low-income uninsured children, and I do
believe we should make efforts to get them all in. If it was just that,
we would be all in agreement. But that is not before us today. And I do
believe that part of this attacks health insurance as we know it today.
Number one, they defund Medicare Advantage, which is where people can
opt out of Medicare and actually go into a managed program by a health
insurance company. So they defund that, attacking that.
Next is, for the first time, they are going to place a tax on health
insurance policies, driving up the costs, so making it more
unaffordable so more people drop out.
Then probably just as egregious as the other, an amendment that was
denied, a Republican amendment, that says if there is a child that is
eligible by the requirements but already insured can't drop that
insurance or their insurer can't drop them, forcing them to go into the
State-run free health insurance. That was denied.
So what we see here is a step-by-step process of making health
insurance companies less effective and nationalizing health care.
Mr. BARTON of Texas. I reserve the balance of my time.
Mr. STARK. I reserve the balance of my time.
Mr. DINGELL. Mr. Speaker, I yield to the distinguished gentlewoman
from California (Ms. Harman) for purposes of a unanimous consent
request.
(Ms. HARMAN asked and was given permission to revise and extend her
remarks.)
Ms. HARMAN. Mr. Speaker, I rise in strong support of this bill and
commend Chairman Dingell for his enormous work.
Regardless of the business before the House, for the past two weeks,
a drumbeat of dire predictions has been maintained on this floor about
the so-called terrorism gap--the failure of Democrats to fix the
Foreign Intelligence Surveillance Act, or FISA, to permit
[[Page H9409]]
our intelligence agencies to intercept foreign-to-foreign
communications related to international terrorism. The argument is
specious on its face. Democrats are just as committed as our colleagues
on the other side of the aisle to preventing another terrorist attack
on the United States.
As a member of the Gang of Eight from 2002-2006, I am very familiar
with FISA and our Terrorist Surveillance Program. While I agree that
some technical adjustments are appropriate, the core principle of FISA
and the 4th Amendment--that individualized court warrants are required
if the communications of a U.S. person are involved--must be preserved.
But my question is, in the context of the CHAMP Act now before us:
where is the outrage for the 5 million American kids who have no health
insurance and no prospect of getting it unless we pass this bill?
What is the real objective of Members who continue to clutter an
essential debate on improving health outcomes for our neediest children
with alarmist exchanges on the surveillance of potential terrorists?
Perhaps it is to jam Democrats and score partisan points before the
August recess instead of reaching out to the most vulnerable among us.
The CHAMP Act reaches out by providing insurance to 11 million
children, covering mental health and dental benefits, and by allowing
States to cover pregnant women and family planning.
It reauthorizes Title V abstinence education, but requires that it be
medically and scientifically accurate, as well as proven effective. I
expect every Member agrees that no Federal program should use taxpayer
dollars to give inaccurate information to young people.
The CHAMP Act makes improvements to the Medicare program, too,
providing our most vulnerable seniors with better coverage for cost-
saving preventive care and by making it easier to apply for benefits.
Let me bring the issue close to home. The Venice Family Clinic,
located in my congressional district, is the largest free clinic in the
Nation. They know something about reaching out to the most vulnerable
in our communities.
Clinic staff told me today about an 8-year-old boy and his younger
brother. Both of them are on the waiting list for SCHIP because the
program is maxed-out--and their working mother doesn't earn enough to
buy health insurance.
This child suffers epileptic seizures every couple of weeks. He
worries constantly about when the next one will occur, when and if he
will be able to see a doctor or have access to medication that could
help him. These are not things an 8-year-old in a country as rich as
ours should be worrying about.
Expanding SCHIP will cover these children. It will change their
lives, and the lives of 11 million other low income American kids.
FISA can, should and will be fixed--and we can fix health insurance
for kids, too. Every child deserves the health insurance that my four
children and one grandchild have. And I have two more grandchildren on
the way. Hopefully, the CHAMP Act will be law before they are born
early next year.
Mr. DINGELL. Mr. Speaker, I reserve the balance of my time.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to another
distinguished member of the Energy and Commerce Committee, Mr. Pitts of
Pennsylvania.
Mr. PITTS. Mr. Speaker, I would like to focus on one important
failure of this legislation that I think the pro-lifers on the other
side of the aisle would be interested in.
Since 2002, the present administration has granted the States the
option of providing SCHIP coverage to the child before birth, the
unborn child, prenatal care and other health services for the unborn
child and the pregnant mother. Unfortunately, the bill offered today
would override current regulation and extend coverage in the name of
the pregnant woman only. My amendment to codify the words ``unborn
child'' was disallowed, not made in order last night.
Protecting only the pregnant woman could lead to a greater number of
abortions. It would make the woman eligible for all publicly-funded
services, including State-funded elective abortions. In States with
Medicaid expansion programs, this could increase the number of women
eligible for free abortions, thus promoting more abortions of unborn
children in the name of children's health. This bill's language
essentially classifies the pregnant woman herself. It does not make
sense.
Mr. BARTON of Texas. Mr. Speaker, I reserve the balance of my time.
Mr. STARK. Mr. Speaker, I ask unanimous consent that the time
allotted to the minority members of the Ways and Means Committee be
forfeited.
Mr. BARTON of Texas. I object to that.
The SPEAKER pro tempore. Objection is heard.
Mr. STARK. I reserve the balance of my time.
The SPEAKER pro tempore. The gentleman from Michigan? Does anybody
wish to yield time?
Mr. DOGGETT. Mr. Speaker, could you give us a time report? How much
time remains for each?
The SPEAKER pro tempore. The gentleman from Louisiana has 30 minutes;
the gentleman from California has 17\1/2\ minutes; the gentleman from
Texas has 11 minutes; the gentleman from Michigan has 21\1/2\ minutes.
Mr. DOGGETT. How much does the gentleman from Louisiana have?
The SPEAKER pro tempore. 30 minutes.
Mr. DOGGETT. None of it has been used.
Parliamentary Inquiry
Mr. LINDER. Mr. Speaker, I have a parliamentary inquiry.
The SPEAKER pro tempore. The gentleman will state his inquiry.
Mr. LINDER. Would you tell us how much time they have combined, the
two committees and our two committees combined, left?
The SPEAKER pro tempore. The gentleman from Michigan has 21\1/2\
minutes remaining; the gentleman from California has 17\1/2\ minutes
remaining; the gentleman from Louisiana has 30 minutes remaining; and
the gentleman from Texas has 11 minutes remaining.
Mr. BARTON of Texas. Mr. Speaker, I ask unanimous consent to proceed
out of order and engage in a colloquy with Mr. Stark and Mr. Dingell
for purposes of trying to understand what is going on.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
Mr. STARK. I object.
The SPEAKER pro tempore. Objection is heard.
Mr. STARK. Mr. Speaker, I ask unanimous consent to insert in the
Record a letter from the Catholic Health Association of the United
States, which in part states that: We believe the most important pro-
life thing that Congress can do right now is to ensure that the State
Children's Health Insurance Program is reauthorized.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
Mr. BARTON of Texas. Reserving the right to object, Mr. Speaker, I
will not object if the gentleman from California will explain to me why
we are fighting over what was in a pre-agreed-upon time arrangement. We
have got six or seven speakers from the Energy and Commerce Committee.
We are simply trying to do it in a balanced way. The gentleman from
California has 17 minutes; the gentleman from Michigan has, I believe,
21 minutes. We just wish that the time go down in a balanced way. I
don't understand why that should be a problem.
The SPEAKER pro tempore. The gentleman from Texas will suspend.
The Chair will clarify. The gentleman from Michigan has 21\1/2\
minutes remaining; the gentleman from California has 17\1/2\ minutes
remaining; the gentleman from Louisiana has 30 minutes remaining; and
the gentleman from Texas has 11 minutes remaining.
Mr. BARTON of Texas. I yield to my friend from California to explain
to me why they don't want to use some of their time right now.
Mr. STARK. I am happy to respond. You are a couple minutes ahead of
us, and of course I am dying to hear what my colleagues on the
Republican side of the Ways and Means have to say.
Mr. BARTON of Texas. Reclaiming my reservation, my understanding was
that the Energy and Commerce Committee was going to go first, and then
the Ways and Means Committee was going to go in the second hour. That
is why Mr. McCrery is reserving his 30 minutes.
Mr. STARK. If the gentleman would yield.
Mr. BARTON of Texas. I would be happy to yield.
Mr. STARK. I think you have just touched on a misunderstanding. We
had been led to believe that we would be rotating around among the
various committees, and so that now we are kind of out of balance. Our
understanding is that we would rotate back and forth between Energy and
Commerce and Ways and Means for the full time. I apologize to the
gentleman if we misled. Our concern was that we
[[Page H9410]]
would be out of balance in the time between the two committees.
The SPEAKER pro tempore. The Chair will clarify that the gentlemen
from California and from Michigan have a combined total of 39 minutes
remaining; the gentlemen from Louisiana and from Texas have a total of
41 minutes remaining.
Mr. BARTON of Texas. I withdraw my reservation on the gentleman's
unanimous consent request.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from California?
Mr. PRICE of Georgia. Reserving the right to object, Mr. Speaker, it
is apparent that that was the letter that was requested to be inserted
earlier, and the gentleman himself objected to it.
Mr. STARK. Mr. Speaker, I withdraw my unanimous consent request.
The SPEAKER pro tempore. The request is withdrawn.
Does the gentleman from Texas wish to yield time?
Mr. BARTON of Texas. Mr. Speaker, I yield 2 minutes to the gentleman
from Arizona, a distinguished member of the committee, Mr. Shadegg.
Mr. SHADEGG. I thank the gentleman for yielding, and I really wish
this debate was about what my colleagues on the other side want to make
it about. I wish this bill was a debate about the uninsured children of
the near poor or the working poor. I wish it was a debate like we had
10 years ago about insuring children too well off to get Medicaid but
not well enough to buy insurance. But that is not what it is about. It
is about cutting Medicare to provide health care services to middle-
and upper middle-income children and to provide health care services to
adults.
And when you hear SCHIP, children, you don't expect that. When you
think it is to go to the uninsured, you don't expect that.
The median income in America, listen carefully, is $45,000. This bill
will extend SCHIP benefits to families earning $60,000 and up to
$80,000. That means it does not provide money for health insurance to
the poor or the near poor or the working poor. We are all for that.
That is why we initiated the program. We just don't think it ought to
go to upper middle-income Americans.
And let's see what the program has done. Sixty-one percent of the
children who are in the SCHIP program today had private health
insurance before the program was created. They dropped their private
health insurance to take SCHIP. Is that what generous, compassionate
Americans want to do for the poor? I don't think so. They dropped their
private insurance to take SCHIP.
CBO says that the Democrats' billions of dollars larger program will
produce one person dropping private insurance for every one person who
gets SCHIP insurance. Speaker after speaker on the other side has said
this will insure 5 million more children.
{time} 1530
What they don't tell you is that 5 million children, according to
SCHIP, will drop their private insurance. Obviously, what they want is
to take people off of private insurance and put them on SCHIP. That's
not what the American people understand when they understand that that
is supposed to be a bill about the children of the working poor.
I urge my colleagues to oppose this bill. It's a fraud.
Mr. STARK. Mr. Speaker, I yield to the gentleman from Rhode Island
(Mr. Kennedy) for a unanimous consent request.
(Mr. KENNEDY asked and was given permission to revise and extend his
remarks.)
Mr. KENNEDY. Mr. Speaker, I rise in support of this legislation that
raises parity for mental health for Medicare enrollees from 50 percent
to 80 percent and for SCHIP from 75 percent to 100 percent, an
additional $3 billion in this bill for mental health care. That's why
we ought to support it.
Mr. STARK. Mr. Speaker, I reserve the balance of my time.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to another
distinguished member of the committee, the ranking member of the
Veterans Affairs Committee, the gentleman from Indiana (Mr. Buyer).
Mr. BUYER. Mr. Speaker, I don't consider this a high-water mark for
Congress in the 15 years I've been here. I don't consider it a high-
water mark because I'm very disappointed in us, in how we have
conducted ourselves with regard to our process, in how we have treated
ourselves to each other, the lack of intolerance with regard to how we
view each others' opinions. I don't think this is a high-water mark. A
lot of this is taking place at the committee levels, and I have to
reiterate my disappointment.
We can battle it out. The democratic process is never meant to be
pretty and easy. It's a difficult process, but it's exactly what it was
meant to do so we wouldn't have capricious actions, that we wouldn't
have power centralized and imperialistic from the top down. And that's
what kind of happened here, and I'm very bothered by it.
There is no ``time of the essence.'' Yes, this is a program that we
came together in a bipartisan fashion and passed almost 10 years ago to
care for children, poor and impoverished and to take care of them; and
we've done that.
We can extend that existing program and work together in a bipartisan
fashion, if that's what this was really about. But it's not.
Mr. BARTON of Texas. Mr. Speaker, in addition to myself, I only have
one additional speaker that's currently on the floor. I would encourage
my friend from Michigan, if he has any speakers, to use some of his
time at this point in time.
The SPEAKER pro tempore. The gentleman from Michigan has 21\1/2\
minutes remaining. Does he wish to yield any time?
Mr. DINGELL. The gentleman from Michigan will continue to reserve.
Mr. STARK. I continue to reserve, Mr. Speaker.
Mr. BARTON of Texas. I reserve.
The SPEAKER pro tempore. The gentleman from Louisiana has 30 minutes
remaining. The gentleman from Texas has 8 minutes remaining. So 38
minutes total on the minority side, 39 minutes total on the majority
side.
Mr. DINGELL. Mr. Speaker, out of a surcease of good will for my
Republican colleagues, at this time I yield 1 minute to the
distinguished gentlewoman from Colorado (Ms. DeGette).
Ms. DeGETTE. Mr. Speaker, children who receive well-child care begin
their lives healthy and ready to learn in school; and this care is
cheaper and more humane than reliance on the emergency room.
Because of SCHIP, 6 million children of the working poor get the care
they need for a healthy start to their lives. Despite the success, our
work is not complete. Six million uninsured children are still eligible
for SCHIP but not currently enrolled. The CHAMP Act will build on the
strong bipartisan foundation of SCHIP and insure these remaining
children.
Those on the other side of the aisle will put forth a proposal in the
motion to recommit that not only fails to cover these 6 million
remaining children, but it will result in current beneficiaries losing
coverage.
We are halfway to covering the uninsured children in this country,
and the Republicans want to pack up and go home. Thank goodness they
weren't in charge of the mission to the moon. Neil Armstrong would have
gone halfway to the moon and been ordered back to earth. Mission
accomplished.
Mr. Speaker, halfway is not mission accomplished. Vote ``yes'' for
kids, vote ``yes'' on this bill.
Mr. BARTON of Texas. Mr. Speaker, I yield 1 minute to a distinguished
member of the committee, Mr. Walden of the great State of Oregon.
Mr. WALDEN of Oregon. Mr. Speaker, I agree that the SCHIP program is
a good program, as it was created in a bipartisan manner many years
ago. Its extension would be a good thing. But what we have before us
today on the floor is not, because it robs from senior citizens in my
district and elsewhere to provide extraordinary and expanded coverage
of health care to people who may already have it, as well as much
higher income levels. Eighty to one hundred thousand dollars you could
be making, your kids could be eligible for your current health
insurance from your employer, and this program, as proposed by the
Democrats, would actually take those off, or potentially could take
those kids off, as well as take away the Medicare choice that seniors
in my district, some 31,798 seniors in my district run the potential of
losing the choice they have for Medicare.
[[Page H9411]]
I was at a town meeting in the eastern part of my district about 2
weeks ago; and a woman said, please, Congressman, don't let them take
away my Medicare. And that's what's happening today. And it's
unfortunate the process has been so usurped that we didn't have time
other than 1 minute to talk about it.
The SPEAKER pro tempore. The gentleman from Michigan has 20\1/2\
minutes remaining. The gentleman from California has 17\1/2\ minutes
remaining, for a total of 38 minutes. The gentleman from Louisiana has
a total of 30 minutes remaining. The gentleman from Texas has 7 minutes
remaining.
Mr. DINGELL. Mr. Speaker, I would yield 1 minute at this time to the
distinguished gentlewoman from California, my dear friend, Mrs. Capps.
Mrs. CAPPS. Mr. Speaker, this bill is the reason I came to Congress,
to continue my work for children's health. It's a blight on our Nation
that millions of children in hardworking families still have no access
to health care, and today we can undo that wrong. Through this fiscally
responsible bill we ensure that millions more eligible children will be
able to get primary care, manage life-threatening illnesses, improve
their school attendance and grow into healthy, productive adults. And
how fitting that at the same time we will improve Medicare for seniors.
I wish to submit for the Record the piece by Ron Brownstein in
today's L.A. Times where he calls the Bush and Republican arguments
against this bill as not much more than stealing health care from
babies.
We do have a choice today. We can continue to ignore the health of
millions of babies and children, or we can take the high moral ground
and pass this bill which will provide health care to those who need it
most.
I want to commend Chairmen Dingell, Pallone, Rangel, and Stark for
all the hard work they and the committee staff have done. I urge my
colleagues to vote ``yes'' on the CHAMP Act. Do something positive
today for America's children.
[From the Los Angeles Times, Aug. 1, 2007]
Stealing Healthcare From Babies
(By Ronald Brownstein)
Does President Bush really believe what he's saying about
the effort from congressional Democrats and some leading
Senate Republicans to provide health coverage for millions of
uninsured children? He's portraying it as the first step on a
slippery slope toward ``government-run healthcare,'' as if
senior senators in both parties were conspiring with Michael
Moore to import Cuban doctors to inoculate and indoctrinate
American children.
In fact, Congress is moving responsibly to remove a blot on
the nation: the 8 million children without health insurance.
It is doing so by expanding the State Children's Health
Insurance Program, or SCHIP, a state-federal partnership that
the Republican Congress and President Clinton created in 1997
to cover kids in working-poor families. Final votes on the
House and Senate floors could come this week.
Bush, seemingly determined to provoke every possible
confrontation with congressional Democrats, has pledged to
veto the bills. And with the GOP congressional leadership, he
is fighting the proposals with a swarm of misleading and
hypocritical arguments.
Bush complains that expanding the program costs too much.
But cost was no object when Bush and congressional
Republicans sought to court seniors by creating the Medicare
prescription drug benefit in 2003.
Under the bipartisan Senate bill, Washington would spend
about $56 billion over the next five years to cover almost
half of the nation's uninsured children. Over the same
period, the Medicare entitlement that Bush signed (after more
than four-fifths of House and Senate Republicans voted for
it) will cost nearly $330 billion. Is social spending
affordable only when it benefits constituencies Republicans
prize in elections?
Next, Bush complains that the SCHIP expansion would require
``a huge tax increase.'' Actually, both the House and Senate
plans would raise taxes just on tobacco. And the sponsors are
increasing taxes only because they have committed to the
novel notion of paying for their program. When Bush and the
Republican Congress created the expensive Medicare drug
benefit, they did not provide any new revenue to fund it.
They just billed the cost to the next generation through
higher federal deficits. Now Bush is condemning Democrats for
displaying more responsibility.
Bush also disparages the SCHIP expansion as an attempt ``to
encourage people to transfer from the private sector to
government healthcare plans.'' But studies have found that
three-fourths of children covered under the current program
receive their care through private insurance plans that
contract with the states, notes Edwin Park of the liberal
Center on Budget and Policy Priorities. In that way, the
program is no different than Bush's prescription drug plan:
The government pays for services delivered by private
insurance companies.
Bush's argument that the SCHIP changes will unacceptably
``crowd out'' private insurance is misleading in another
respect. It's true, as Bush charges, that if the program is
expanded, some eligible families would shift their children
into it from private coverage, hoping to save money or
improve care. The Congressional Budget Office estimates that
children making such a switch would account for about one-
third of the 6 million kids expected to enroll in the
expanded SCHIP program under the Senate plan, and hence one-
third of the added cost.
But as CBO Director Peter Orszag notes, all efforts to
expand coverage for the uninsured inevitably spill some
benefits on those who already have insurance. And the Senate
SCHIP plan, by limiting that spillover to one-third of its
cost, is actually more efficient than most alternatives for
expanding coverage.
Bush, for instance, wants to reduce the number of uninsured
by providing new tax incentives for buying coverage. But the
Lewin Group, an independent consulting firm, recently
calculated that 80 percent of the benefits from Bush's plan
would flow to people who already have insurance. Such numbers
help explain why Orszag recently said that, dollar for
dollar, expanding SCHIP ``is pretty much as efficient as you
can possibly get'' to insure more kids.
Bush's most outrageous argument is that expanding SCHIP
``empower[s] bureaucrats.'' In reality, covering more
children would empower parents like Sheila Miguel of Sun
Valley, Calif.
Miguel used to spend hours in emergency rooms trying to
obtain asthma medicine for her daughter, Chelsea, but since
enrolling her in a SCHIP-funded program, Miguel can take her
to reliably scheduled clinic visits.
Bush says he wants ``to put more power'' over healthcare
``in the hands of individuals.'' By freeing Miguel's family
from the worry and drudgery of repeated emergency room
visits, that's exactly what SCHIP does.
Few of the lower-income working families that rely on this
program have the time to follow this week's legislative
struggle, much less analyze how it serves the White House's
apparent strategy of embroiling congressional Democrats in
unrelenting conflicts with Bush that alienate swing voters.
In that political skirmishing, these families have been
reduced to collateral damage. They deserve something better
from a president who once called himself a ``compassionate
conservative.''
Mr. BARTON of Texas. I would like to yield 2 minutes to the
distinguished Republican whip and a member of the committee who is on
leave, Mr. Blunt of Missouri.
Mr. BLUNT. Mr. Speaker, I'm thankful to the former chairman and the
ranking member for yielding to me on this bill.
It seems to me that what we have here is a bill that has not
benefited from the process of hearings. Most of our friends in the
majority today, I assume, will vote for this bill. Most of our friends
on our side are going to vote against this bill, and I believe that
during the month of August the voters will have the hearings that we
should have had in advance. I believe what we'll find out is this bill
has needless problems in it in the name of expanding SCHIP.
My good friend, Ms. DeGette, mentioned the moon mission. It does seem
to me that, in this bill now, the moon is the limit. The original bill
said 200 percent of poverty, with some flexibility to the States. We're
in favor of extending these guidelines.
The original proposal, as we understood it from the majority, was 400
percent of poverty. Families who made 80, $85,000 would get free health
insurance for their children. I don't think that limit is there any
more. I believe it's up to the States under this bill. If you made
1,000 times the poverty rate and your State wanted to insure you, they
could do that and your initial payment from the Federal Government
would be 95 cents on every dollar.
We're going to offer a recommital today that extends the current
SCHIP program; that gives us the time to talk about it and ways that
make it better; that reinstates the current law on immigrants, where,
if you come to this country, you have to have a sponsor, and you can't
participate in programs like this for the first 5 years. That's been
one of the workable parts of our immigration policy.
We would propose we don't have self-verification, where people who
are here illegally just can walk up and sign up and say I'm legally
here.
We'll have a doctor fix. We'll do something about the therapy caps.
And, in my district, 21,033 people who would lose their choice of
Medicare don't lose their choice of Medicare. Restricting Medicare
benefits to pay for children's health care is not the right thing.
[[Page H9412]]
Mr. STARK. I reserve the balance of my time.
Mr. BARTON of Texas. I'm going to try one more time here.
Mr. Speaker, I ask unanimous consent that there be 1 hour of
additional time allotted on the pending legislation, equally divided
between the majority and the minority, and, within that, equally
divided between the Ways and Means Committee and the Energy and
Commerce Committee.
Mr. STARK. Reserving the right to object.
The SPEAKER pro tempore. The gentleman reserves the right to object.
Mr. DINGELL. And I make a similar reservation.
Mr. STARK. If I could inquire of the distinguished gentleman from
Texas, it's my understanding that this unanimous consent request has
been negotiated between the majority and minority leadership.
Mr. BARTON of Texas. We share the same understanding.
Mr. STARK. And as part of it that we would proceed expeditiously to
use the debate, move to passage, and without intervening stalling
motions.
Mr. BARTON of Texas. We have the same understanding.
Mr. STARK. Then I withdraw my reservation.
Mr. DINGELL. I have no objection.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. BARTON of Texas. Hallelujah.
Mr. Speaker, at this point in time, I reserve my time.
Mr. STARK. Mr. Speaker, with this new-found wealth of time, I'm happy
to yield 1 minute to the senior member of the Health Ways and Means
Subcommittee, the gentleman from Texas (Mr. Doggett), who understands
that the Lance Armstrong Foundation has urged a vote in favor of 3162,
a legislation scored as a key vote for people affected by cancer; and
Mr. Armstrong is a constituent of Mr. Doggett.
Mr. DOGGETT. Surely if Lance Armstrong can overcome mountains in
France, we can overcome the mountains of obstructionism and of excuses
to provide our children and our seniors the health coverage that they
need.
By including significant portions of two Medicare bills that I filed,
today's legislation supports grandparents as well as grandchildren. All
seniors would get preventive care, and many of the 3.3 million poor
seniors not receiving any help today would get the extra help for which
they qualify.
Today, those seniors most in need are often least aware that help
exists. We must identify and notify those entitled to extra help with
prescription drugs and simplify the application process.
We also ensure that drug coverage is not lost by our seniors who
saved a small nest egg or receive help and groceries from their
children--behavior that we ought to encourage, not punish.
{time} 1545
Importantly, we mandate that patients suffering from cancer, AIDS,
and mental illness receive access to life-saving medications. Without
this protection, vulnerable patients are held hostage by ``cost cutting
decisions'' by private insurance companies.
While Lance inspires us to live strong, we can ``vote strong'' and
improve the lives of children, seniors, and Americans fighting to get
well again. Approve this important legislation.
Mr. BARTON of Texas. Mr. Speaker, could I inquire as to how much time
there is remaining?
The SPEAKER pro tempore. The gentleman from Michigan has 34\1/2\
minutes remaining; the gentleman from California has 31\1/2\ minutes
remaining; the gentleman from Texas has 20 minutes remaining; and the
gentleman from Louisiana has 45 minutes remaining.
Mr. BARTON of Texas. Mr. Speaker, I yield 2\1/2\ minutes to a
distinguished member from the great State of Georgia, Dr. Gingrey.
Mr. GINGREY. Mr. Speaker, I thank the gentleman for yielding.
Mr. Speaker, I want to talk about policy and process.
This is a situation where in the process the voices on both sides of
the aisle have literally been shut down by bringing forward one of the
most important pieces of legislation, I think, that I have had to
discuss in the 4\1/2\ years that I have been a Member of this Congress.
To say to the 11 position Members, almost equally divided between the
Democrats and the Republicans, that we don't want to hear your voice,
we don't want to hear some amendments that you might want to proffer
because you have spent maybe 30 years, in my case maybe 25 years, 250
years in the aggregate of these 11 physicians' practicing medicine, no
one being able to bring meaningful amendments to this issue.
The other side has talked many times about the Republican former
majority running up this massive debt and borrowing money from the
Chinese. I am going to tell you something. This might be a time, Mr.
Speaker, where the new majority should borrow this $75 billion massive
expansion of the SCHIP program from the Chinese rather than getting the
money off the backs of our Medicare recipients under Medicare
Advantage, 8 million of whom choose that option, and many of those are
the lowest income; and also encouraging 22 million people to become
addicted to smoking so they could raise this revenue. The chairman says
it is a modest increase in tax on a pack of cigarettes. Indeed, Mr.
Speaker, it doubles the tax on a pack of cigarettes.
So we have a better idea. I am opposed to this bill in its present
form, and I support the Republican motion to recommit, which is the
Barton-Deal bill, which says, look, we will cover children that are
slipping through the cracks. The CBO estimates, Mr. Speaker, that
600,000 children have fallen through the cracks. They are in that group
100 to 200 percent of the Federal poverty level. Under the Barton-Deal
plan, we can cover them and we will do that. We don't need to increase
the funding by $50 billion and start covering children who already have
health insurance because their families make more than $100,000 a year.
Mr. DINGELL. Mr. Speaker, at this time, I yield 2 minutes to the
distinguished gentleman from Maine (Mr. Allen).
Mr. ALLEN. Mr. Speaker, there are 11 million reasons to vote for this
bill, and each is a child in a working-class family who will grow up
healthier and stronger as a result of its passage.
Every dollar we invest in the SCHIP program saves money over time.
The children we cover are far less likely to require more expensive
health care later on, far more likely to be better achievers in school
and much better prepared to become productive adults.
SCHIP today provides health care to 6 million children. This bill
will cover an additional 5 million children who qualify for SCHIP but
today lack coverage.
Maine has developed one of the best SCHIP programs in the Nation.
This bill offers States the flexibility to tailor outreach efforts to
their specific needs and capacities. Failure to pass this legislation
would mean the loss of health coverage for millions of children. But
every child should have access to quality, affordable health care.
I am proud of the comparative effectiveness research provision in
this bill. It will reduce health care costs and improve quality for all
Americans. It does that by providing doctors and their patients with
valid evidence-based information on how different treatments for
particular medical conditions compare to one another. This data can
help doctors and their patients determine whether or not new or high-
priced drugs, devices, and other medical treatments provide better
clinical outcomes.
This is a critically important piece of legislation. It helps our
kids. It preserves Medicare for our seniors. It makes sure our
physicians and other providers are adequately reimbursed. I urge my
colleagues to support this legislation.
Mr. BARTON of Texas. Mr. Speaker, I yield 1\1/2\ minutes to the
gentleman from Georgia, Dr. Price.
(Mr. PRICE of Georgia asked and was given permission to revise and
extend his remarks.)
Mr. PRICE of Georgia. Mr. Speaker, I appreciate the opportunity.
I have in my hand here a letter from the American Association for
Homecare, Coalition for Pulmonary Fibrosis, the COPD Alert, the Council
for Quality Respiratory Care, and the National Emphysema/COPD
Association asking us not to vote for this bill that would enact cuts
in their programs.
As a physician, I understand the negative consequences of greater
governmental involvement in health care.
[[Page H9413]]
This bill will cut Medicare benefits. It will tax every single American
with private health insurance.
Now, why would they do this? Why would they pass a bill like this?
The answer, Mr. Speaker, is because they can. But their motives are
laid bare. Their motives are laid today.
The true desire of those on the left is to gradually and enticingly
move all Americans to Washington-controlled bureaucratic health care.
Read the bill. Read the bill. It's right there.
It's not what we ought to be doing. It's not what Americans want. I
urge my colleagues to oppose this bill.
Mr. STARK. Mr. Speaker, I would like to yield 1 minute to the
distinguished gentleman from California, a member of the Ways and Means
Committee (Mr. Becerra). Pending that, I would point out that he is
well aware that the National Hispanic Medical Association has endorsed
the bill, and I would like to submit their endorsing letter into the
Record.
NHMA, National Hispanic
Medical Association,
Washington, DC, July 25, 2007.
Hon. John Dingell,
Chairman, House Committee on Energy and Commerce, House of
Representatives, Washington, DC.
Dear Chairman Dingell: On behalf of the National Hispanic
Medical Association (NHMA), a non-profit association
representing 36,000 licensed Hispanic physicians in the
United States, we write to express our strong support for the
Children's Health and Medicare Protection Act, H.R. 3162,
which will allow the State Children's Health Insurance
Program (SCHIP), Medicare, and Medicaid to expand enrollment
of Hispanic children and elderly. Since one in five Hispanic
children are currently uninsured and only 10 percent of
Hispanics eligible for Medicare are enrolled, these programs
are vital to increasing access to health care.
The mission of NHMA is to improve the health of Hispanics
and other underserved populations. We support the SCHIP
section that allows states to cover legal immigrant children
and legal immigrant pregnant women, covers dental care and
mental health care, provides state performance bonuses if
they can demonstrate that they have enrolled new children who
are currently eligible, but not enrolled, and creates the
Children's Access, Payment and Equity Commission, that will
examine issues of health disparities. We support the Medicare
section that calls for reducing health disparities through
demonstrations for language services reimbursement and
targeted outreach, new quality data relating to disparities,
expands the Low Income Subsidy and Medicare Savings Programs,
and mandates a report on Culturally and Linguistically
Appropriate Standards use by providers. We do not support
total elimination of Medicare Advantage with a Hispanic
enrollment of 21 percent receiving comprehensive care
management and with Puerto Rico covering dual eligibles.
Finally, we support the Medicaid section that increases funds
for transition to work, disabilities, family planning, adult
day care and Puerto Rico.
In summary, the National Hispanic Medical Association
supports the Children's Health and Medicare Protection Act,
H.R. 3161, because it will increase access to health
insurance for Hispanics and will, thus, improve the health of
all Americans.
Sincerely,
Elena Rios, M.D., M.S.P.H.,
President and CEO.
Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding.
The CHAMP Act is a victory for children's health, it is a victory for
seniors' health, and it is a victory for American taxpayers who expect
us to be fiscally responsible.
Why shouldn't 11 million American children from working families in
this country have the same access to health care that the children of
every single Member of Congress has? The taxpayers pay our salary and
they make it possible for us to get health care benefits. Why shouldn't
11 million American children who live with parents who are working day
to day have the same access?
Like our victory this year in increasing the minimum wage for
America's workers, expanding health care coverage to 5 million children
is long overdue.
My colleagues on the Republican side of the aisle voted a few years
ago to add a prescription drug benefit under Medicare that costs about
eight times as much as the benefit we would offer to the 11 million
children would cost. Why not do it for our kids?
We are doing this in a way that is fiscally responsible. The CHAMP
Act will not add a single cent to the Federal deficit that the Bush
administration has created.
This is sound policy. Let's vote for the CHAMP Act for our kids and
our seniors.
Mr. BARTON of Texas. Mr. Speaker, I would like to yield 1 minute to
the distinguished gentleman from the great State of Nebraska (Mr.
Fortenberry).
Mr. FORTENBERRY. Mr. Speaker, everyone agrees that children deserve
proper health care. The SCHIP program is an important program that
provides health insurance for over 6.6 million of America's neediest
children. I supported its renewal, but I believe it must be done
responsibly.
This legislation overreaches. It cuts Medicare and also allows some
adults to claim health care coverage meant for children. Good public
policy should not pit the children against their grandparents.
This 465-page bill makes sweeping changes to American health care and
tax policies. It needs thorough, thoughtful, and deliberate analysis,
and time has not been provided for adequate examination. The SCHIP bill
could have clear bipartisan support, I believe, but instead it contains
a labyrinth of provisions, some of which hurts seniors. Mr. Speaker, I
believe this Congress can do better.
Mr. DINGELL. Mr. Speaker, I yield at this time 1 minute to my very
dear friend, the gentleman from New Jersey (Mr. Andrews).
(Mr. ANDREWS asked and was given permission to revise and extend his
remarks.)
Mr. ANDREWS. Mr. Speaker, somewhere in America right now an 8-year-
old girl comes home to her mother and father and says she has a
numbness and ache in her right arm, and they worry about it, wondering
whether it is just a strain from playing on the playground or whether
she has a serious disease of her nervous system. But they can't send
her to the pediatrician because they do not have enough money left in
the family budget this week and they have no health insurance.
The question before the House is whether or not to provide health
insurance for that family and that little girl. Yes or no?
The bill says ``yes.'' It pays for it responsibly by a modest
increase in the cigarette tax and by eliminating subsidies to health
insurance companies. You can say whatever you want, but the question
comes down to that: yes or no? It is time we voted ``yes'' for that
little girl and her family, voted ``yes'' on this bill.
Mr. BARTON of Texas. Mr. Speaker, I want to yield 1 minute to the
Member of Congress with the largest number of Social Security
recipients, the gentlewoman from the great State of Florida (Ms. Ginny
Brown-Waite).
Ms. GINNY BROWN-WAITE of Florida. Mr. Speaker, I rise today on behalf
of the 43,000 senior citizens living in my congressional district who
will lose their Medicare benefits if the bill before us today becomes
law.
Everyone in this Chamber wants to extend SCHIP because it has helped
many children, but not at the expense of their grandparents. Let me
repeat: 43,000 of my constituents, 693,000 Floridians, and 8.3 million
seniors nationwide will be pushed off of Medicare plans in favor of
other priorities.
Today we are seeing the biggest raid on the Medicare trust fund
seniors have ever seen, with no regard to those who rely on Medicare
Advantage for their only access in many rural areas to health care
benefits.
Some of the specific cuts that are in this bill are a 43 percent cut
to patients who rent lifesaving oxygen equipment, a $7.2 billion cut
for home health services, a $6.5 billion cut for skilled nursing
facilities.
Mr. Speaker, cutting the only health care program many of my
constituents use would be unconscionable.
The SPEAKER pro tempore. The gentleman from Michigan has a total of
31\1/2\ minutes remaining, and the gentleman from California has 30
minutes remaining, for an aggregate total of 61\1/2\ minutes. The
gentleman from Texas has 14 minutes, and the gentleman from Louisiana
has 45 minutes, for an aggregate total of 59 minutes.
Mr. DINGELL. Mr. Speaker, I continue to reserve the balance of my
time.
Mr. STARK. Mr. Speaker, I continue to reserve the balance of my time.
Mr. BARTON of Texas. Mr. Speaker, I respectfully reserve the balance
of my time at this time.
{time} 1600
Mr. DINGELL. Mr. Speaker, I note that Mr. McCrery has time remaining.
[[Page H9414]]
He is a very valuable Member of this body, and I'm sure he would make
very good use of the time that's available to him, and I would suggest
that the business of the House could be expedited by having Mr. McCrery
proceed to yield time to members of the Ways and Means Committee on the
minority side.
Mr. BARTON of Texas. Mr. Speaker, I just wish to make an observation
that the tradition of normal procedure is to alternate between majority
and minority. We just had a minority speaker. It should be the
opportunity of the majority to tell their side of the story.
The SPEAKER pro tempore. The Chair notes that it was an alternation
between two committees on one side and two committees on the other side
of the House.
The gentleman from Michigan has 31\1/2\ minutes remaining, the
gentleman from California has 30\1/2\ minutes remaining, for an
aggregate of 61\1/2\ minutes.
The gentleman from Texas has 14 minutes remaining, the gentleman from
Louisiana continues to have his full 45 minutes remaining, for an
aggregate of 59 minutes.
Mr. DINGELL. Mr. Speaker, I would then yield, with the understanding
that the Democrats want to give the choice of the doctor, while our
good Republican friends want to give a choice of HMOs.
With that, I yield 2 minutes to the distinguished gentleman from New
York (Mr. Engel).
Mr. ENGEL. I thank the gentleman.
Mr. Speaker, the reauthorization of State Children's Health Insurance
is unquestionably one of the most important bills we will pass this
year. This bill will protect six million kids currently covered by
SCHIP and provide coverage for an additional five million children.
This bill provides aggressive outreach to enroll children by
simplifying enrollment procedures and awarding States bonuses for
finding more children. This is important since two-thirds of the
uninsured children in our Nation are actually eligible but not enrolled
in Medicaid or SCHIP.
What is the response of our Republican friends? Block the bill from
coming up in our committee; create phony issues because they're against
insuring children. Illegal amnesty? Give me a break. No hearings? We've
had seven hearings on this bill. Eligible for private insurance? 93.5
percent of the children we cover in this bill would have no private
insurance without this bill.
What is the President's response? Under the President's plan, this
program would see its funding cut from last year; and, worse, the
amount allocated for its reauthorization would be less than half of the
amount required to maintain coverage for current beneficiaries.
He says he will veto this bill because it covers too many children.
This is unconscionable. Sixty-one national advocacy groups devoted to
improving children's health request that we fund the SCHIP program at
60 billion additional dollars. The President countered with $4.8
billion. Clearly, there is a disconnect.
We are proud that, despite budgetary constraints, we will be able to
reauthorize our SCHIP program at $50 billion. I am proud that we will
be covering 11 million low-income children under this reauthorization,
and I know our Nation will be better off for it.
This is an amazing feat. Passing bills like this is why we should all
feel honored to be Members of Congress. I'm sorry that my Republican
friends just continue to say no. We say yes, yes to 11 million
children, yes to saying that our children ought to be insured, yes to
saying that America's children need our help. Pass this bill. It is
good for all our children.
Mr. BARTON of Texas. Mr. Speaker, I wish to yield 2 minutes to the
distinguished gentleman from Georgia (Mr. Deal), ranking member of the
Health Subcommittee.
Mr. DEAL of Georgia. I thank the gentleman for yielding.
Mr. Speaker, we've heard a lot of opinions today about the effects of
this bill; and opinions are, of course, of different perspectives on
the bill. But there is an agency that we all rely on, supposedly, to
give us the facts, and that is the Congressional Budget Office.
Now, there has been an argument about whether or not this bill, in
its reforms, will go back to a system that would allow illegal
immigrants to be covered. Now, we can say that it doesn't, but CBO says
that, by changing that provision back to the way it used to be, that
over the next 5 years it will cost $800 million and over the next 10
years it will cost $1.9 billion.
Now, CBO is simply saying that if you make it easier for illegals to
enter the program, that's the price tag. They wouldn't say that if they
didn't have some basis for coming up with those numbers. They didn't
just pull them out of the air.
The other part deals with legal immigrants. We have had a policy in
this country that if someone wants to bring a family member, a friend,
or sponsor somebody to come in and we give that person coming in legal
status, that they are not eligible to participate in our social
programs, such as Medicaid, for the first 5 years. Their sponsor signs
an affidavit that they will be personally responsible for that.
This bill removes that waiting time. So when you bring someone in,
they can immediately sign up for the Medicaid rolls. Now, CBO says that
that will cost $900 million over the next 5 years and $2.2 billion over
the next 10 years. Now, the truth of the matter is that this bill gives
incentives to States to allow this to happen.
I urge a ``no'' vote.
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House amendment offered/reported by : Amendment in the nature of a substitute reported by the House Committee on Rules.(consideration: CR H9349-9397; text: CR H9349-9397)
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Amendment in the nature of a substitute reported by the House Committee on Rules. (consideration: CR H9349-9397; text: CR H9349-9397)
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On agreeing to the Rules amendment (A001) Agreed to without objection.
August 1, 2007 • 2:16 PM