[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 987 Introduced in Senate (IS)]
108th CONGRESS
1st Session
S. 987
To amend title XVIII of the Social Security Act to provide for national
standardized payment amounts for inpatient hospital services furnished
under the medicare program and to make other rural health care
improvements.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 5, 2003
Mr. Dorgan (for himself and Mr. Burns) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to provide for national
standardized payment amounts for inpatient hospital services furnished
under the medicare program and to make other rural health care
improvements.
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 ``Rural Health Care
Fairness and Medicare Equity Act of 2003''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Equalizing urban and rural standardized payment amounts under
the medicare inpatient hospital prospective
payment system.
Sec. 3. Adjustment to wage index.
Sec. 4. Floor on area wage adjustment factors used under medicare PPS
for inpatient and outpatient hospital
services.
Sec. 5. Establishment of alternative guidelines for geographic
reclassification of certain hospitals
located in sparsely populated States.
Sec. 6. Establishment of floor on work geographic adjustment.
SEC. 2. EQUALIZING URBAN AND RURAL STANDARDIZED PAYMENT AMOUNTS UNDER
THE MEDICARE INPATIENT HOSPITAL PROSPECTIVE PAYMENT
SYSTEM.
(a) In General.--Section 1886(d)(3)(A)(iv) of the Social Security
Act (42 U.S.C. 1395ww(d)(3)(A)(iv)) is amended--
(1) by striking ``(iv) For discharges'' and inserting
``(iv)(I) Subject to subclause (II), for discharges''; and
(2) by adding at the end the following new subclause:
``(II) For discharges occurring in a fiscal year beginning
with fiscal year 2004, the Secretary shall compute a
standardized amount for hospitals located in any area within
the United States and within each region equal to the
standardized amount computed for the previous fiscal year under
this subparagraph for hospitals located in a large urban area
(or, beginning with fiscal year 2005, for hospitals located in
any area) increased by the applicable percentage increase under
subsection (b)(3)(B)(i) for the fiscal year involved.''.
(b) Conforming Amendments.--
(1) Computing drg-specific rates.--Section 1886(d)(3)(D) of
the Social Security Act (42 U.S.C. 1395ww(d)(3)(D)) is
amended--
(A) in the heading, by striking ``in different
areas'';
(B) in the matter preceding clause (i), by striking
``each of which is'';
(C) in clause (i)--
(i) in the matter preceding subclause (I),
by inserting ``for fiscal years before fiscal
year 2004,'' before ``for hospitals''; and
(ii) in subclause (II), by striking ``and''
after the semicolon at the end;
(D) in clause (ii)--
(i) in the matter preceding subclause (I),
by inserting ``for fiscal years before fiscal
year 2004,'' before ``for hospitals''; and
(ii) in subclause (II), by striking the
period at the end and inserting ``; and''; and
(E) by adding at the end the following new clause:
``(iii) for a fiscal year beginning after fiscal
year 2003, for hospitals located in all areas, to the
product of--
``(I) the applicable operating standardized
amount (computed under subparagraph (A)),
reduced under subparagraph (B), and adjusted or
reduced under subparagraph (C) for the fiscal
year; and
``(II) the weighting factor (determined
under paragraph (4)(B)) for that diagnosis-
related group.''.
(2) Technical conforming sunset.--Section 1886(d)(3) of the
Social Security Act (42 U.S.C. 1395ww(d)(3)) is amended--
(A) in the matter preceding subparagraph (A), by
inserting ``, for fiscal years before fiscal year
1997,'' before ``a regional adjusted DRG prospective
payment rate''; and
(B) in subparagraph (D), in the matter preceding
clause (i), by inserting ``, for fiscal years before
fiscal year 1997,'' before ``a regional DRG prospective
payment rate for each region,''.
SEC. 3. ADJUSTMENT TO WAGE INDEX.
(a) In General.--Section 1886(d)(3)(E) of the Social Security Act
(42 U.S.C. 1395ww(d)(3)(E)) is amended--
(1) by striking ``wage levels.--The Secretary'' and
inserting ``wage levels.--
``(i) In general.--Except as provided in clause (ii), the
Secretary''; and
(2) by adding at the end the following new clause:
``(ii) Alternative proportion to be adjusted beginning in
fiscal year 2004.--
``(I) In general.--Except as provided in subclause
(II), for discharges occurring on or after October 1,
2003, the Secretary shall substitute `62 percent' for
the proportion described in the first sentence of
clause (i).
``(II) Hold harmless for certain hospitals.--If the
application of subclause (I) would result in lower
payments to a hospital than would otherwise be made,
then this subparagraph shall be applied as if this
clause had not been enacted.
(b) Waiving Budget Neutrality.--Section 1886(d)(3)(E) of the Social
Security Act (42 U.S.C. 1395ww(d)(3)(E)), as amended by subsection (a),
is amended by adding at the end of clause (i) the following new
sentence: ``The Secretary shall apply the previous sentence for any
period as if the amendments made by section 3(a) of the Rural Health
Care Fairness and Medicare Equity Act of 2003 had not been enacted.''.
SEC. 4. FLOOR ON AREA WAGE ADJUSTMENT FACTORS USED UNDER MEDICARE PPS
FOR INPATIENT AND OUTPATIENT HOSPITAL SERVICES.
(a) Inpatient PPS.--Section 1886(d)(3)(E) of the Social Security
Act (42 U.S.C. 1395ww(d)(3)(E)), as amended by section 3(a), is
amended--
(1) in clause (i), by striking ``clause (ii)'' and
inserting ``clauses (ii) and (iii)''; and
(2) by adding at the end the following new clause:
``(iii) Floor on area wage adjustment factor.--
``(I) In general.--Notwithstanding clause
(i), in determining payments under this
subsection for discharges occurring on or after
October 1, 2003, the Secretary shall substitute
a factor of 0.85 for any factor that would
otherwise apply under such clause that is less
than 0.85.
``(II) Applicability.--Nothing in this
clause shall be construed as authorizing the
application of subclause (I) to adjustments for
area wage levels made under other payment
systems established under this title (other
than the payment system under section 1833(t))
to which the factors established under clause
(i) apply.''.
(b) Outpatient PPS.--Section 1833(t)(2) of the Social Security Act
(42 U.S.C. 1395l(t)(2)) is amended by adding at the end the following
new sentence: ``For purposes of subparagraph (D) for items and services
furnished on or after October 1, 2003, if the factors established under
clause (i) of section 1886(d)(3)(E) are used to adjust for relative
differences in labor and labor-related costs under the payment system
established under this subsection, the provisions of clause (iii) of
such section (relating to a floor on area wage adjustment factor) shall
apply to such factors, as used in this subsection, in the same manner
and to the same extent (including waiving the applicability of the
requirement for such floor to be applied in a budget neutral manner) as
they apply to factors under section 1886.''.
(c) Waiving Budget Neutrality.--The last sentence of section
1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)),
as added by section 3(b), is amended by striking ``section 3(a)'' and
inserting ``sections 3(a) and 4(a)''.
SEC. 5. ESTABLISHMENT OF ALTERNATIVE GUIDELINES FOR GEOGRAPHIC
RECLASSIFICATION OF CERTAIN HOSPITALS LOCATED IN SPARSELY
POPULATED STATES.
(a) Alternative Guidelines for Reclassification.--Notwithstanding
the guidelines published under section 1886(d)(10)(D)(i)(I) of the
Social Security Act (42 U.S.C. 1395ww(d)(10)(D)(i)(I)), the Secretary
of Health and Human Services shall publish and use alternative
guidelines under which--
(1) a hospital or a group of hospitals described in
subsection (b) qualifies for geographic reclassification under
such section for a fiscal year beginning with fiscal year 2005
for the purposes of using the other area's standardized amount
for inpatient operating costs, wage index value, or both, or,
in the case of a group of hospitals, for the purposes of using
both the other area's standardized amount for inpatient
operating costs and wage index value; and
(2) a hospital or group of hospitals seeking to be
reclassified is required to demonstrate that the hospital meets
the criteria to be reclassified to the area to which such
hospital seeks to be reclassified, except that, in the case of
an individual hospital, the hospital does not meet the
proximity criteria applicable with respect to such area, or, in
the case of a group of hospitals, the group does not meet the
adjacency criteria applicable with respect to such area.
(b) Hospitals Covered.--A hospital or a group of hospitals
described in this subsection is a hospital or group of hospitals that--
(1) is located in a State with less than 20 people per
square mile (as determined by the Secretary); and
(2) seeks to be reclassified to an area within the State in
which such hospital or group is located.
SEC. 6. ESTABLISHMENT OF FLOOR ON WORK GEOGRAPHIC ADJUSTMENT.
Section 1848(e)(1) of the Social Security Act (42 U.S.C. 1395w-
4(e)(1)) is amended by adding at the end the following new
subparagraph:
``(E) Floor at 1.0 on work geographic indices.--
After calculating the work geographic indices in
subparagraph (A)(iii), for purposes of payment for
services furnished on or after January 1, 2004, the
Secretary shall increase the work geographic index to
1.00 for any locality for which such geographic index
is less than 1.00.''.
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