SUBCHAPTER XVIII—HEALTH INSURANCE FOR AGED AND DISABLED
Subchapter Referred to in Other Sections
This subchapter is referred to in
§1395. Prohibition against any Federal interference
Nothing in this subchapter shall be construed to authorize any Federal officer or employee to exercise any supervision or control over the practice of medicine or the manner in which medical services are provided, or over the selection, tenure, or compensation of any officer or employee of any institution, agency, or person providing health services; or to exercise any supervision or control over the administration or operation of any such institution, agency, or person.
(Aug. 14, 1935, ch. 531, title XVIII, §1801, as added July 30, 1965,
Short Title
For short title of title I of
§1395a. Free choice by patient guaranteed
Any individual entitled to insurance benefits under this subchapter may obtain health services from any institution, agency, or person qualified to participate under this subchapter if such institution, agency, or person undertakes to provide him such services.
(Aug. 14, 1935, ch. 531, title XVIII, §1802, as added July 30, 1965,
§1395b. Option to individuals to obtain other health insurance protection
Nothing contained in this subchapter shall be construed to preclude any State from providing, or any individual from purchasing or otherwise securing, protection against the cost of any health services.
(Aug. 14, 1935, ch. 531, title XVIII, §1803, as added July 30, 1965,
Exclusion From Wages and Compensation of Refunds Required From Employers To Compensate for Duplication of Medicare Benefits by Health Care Benefits Provided by Employers
"(a)
"(b)
"(c)
"(1)
"(2)
"(3)
"(d)
"(e)
United States Bipartisan Commission on Comprehensive Health Care
"SEC. 401. ESTABLISHMENT.
"There is established a commission to be known as the United States Bipartisan Commission on Comprehensive Health Care (in this title [probably should be 'this subtitle' which enacted this note] referred to as the 'Commission') and also to be known as the 'Claude Pepper Commission' or the 'Pepper Commission'.
"SEC. 402. DUTIES.
"(a)
"(1) examine shortcomings in the current health care delivery and financing mechanisms that limit or prevent access of all individuals in the United States to comprehensive health care, and
"(2) make specific recommendations to the Congress respecting Federal programs, policies, and financing needed to assure the availability of—
"(A) comprehensive long-term care services for the elderly and disabled,
"(B) comprehensive health care services for the elderly and disabled, and
"(C) comprehensive health care services for all individuals in the United States.
"(b)
"(1) the amount and sources (consistent with principles of social insurance) of Federal funds to finance the needed services, including reallocations of existing Federal program funds, and
"(2) the most efficient and effective manner of administering such programs.
"(c)
"(1) The term 'comprehensive health care services' includes—
"(A) inpatient hospital services (including mental health services);
"(B) skilled nursing facility services, intermediate care facility services, home health services, and other long-term health care services;
"(C) physician services and other outpatient health care services (including mental health services);
"(D) periodic general physical examinations, eye examinations, hearing examinations, dental examinations, foot examinations, and other preventive health care services; and
"(E) prescription drugs, eyeglasses, hearing aids, orthopedic equipment, and dentures (both complete and partial).
"(2) The term 'comprehensive long-term care services' includes custodial and noncustodial services in facilities, as well as home and community-based services.
"SEC. 403. MEMBERSHIP.
"(a)
"(1) The President shall appoint 3 members.
"(2) The President pro tempore of the Senate shall appoint, after consultation with the minority leader of the Senate, 6 members of the Senate, of whom not more than 4 may be of the same political party.
"(3) The Speaker of the House of Representatives shall appoint, after consultation with the minority leader of the House of Representatives, 6 members of the House, of whom not more than 4 may be of the same political party.
"(b)
"(c)
"(d)
"(e)
"(f)
"SEC. 404. STAFF AND CONSULTANTS.
"(a)
"(b)
"SEC. 405. POWERS.
"(a)
"(b)
"(c)
"(1) Upon the request of the Commission, the Director of the Congressional Budget Office shall provide to the Commission such cost estimates as the Commission determines to be necessary to carry out its duties.
"(2) The Commission shall reimburse the Director of the Congressional Budget Office for expenses relating to the employment in the office of the Director of such additional staff as may be necessary for the Director to comply with requests by the Commission under paragraph (1).
"(d)
"(e)
"(f)
"(g)
"(h)
"(i)
"(j)
"SEC. 406. REPORT.
"(a)
"(b)
"(c)
"SEC. 407. TERMINATION.
"The Commission shall terminate 30 days after the date of submission of the report required in section 406(b).
"SEC. 408. AUTHORIZATION OF APPROPRIATIONS.
"There are authorized to be appropriated $1,500,000 to carry out this title [probably should be 'this subtitle' which enacted this note]."
Maintenance of Effort Regarding Duplicative Benefits
Task Force on Long-Term Health Care Policies
"(a)
"(b)
"(1) two members representing the National Association of Insurance Commissioners,
"(2) three members representing Federal and State agencies with responsibilities relating to health or the elderly,
"(3) three members representing private insurers,
"(4) three members from organizations representing consumers or the elderly, and
"(5) three members from organizations representing providers of long-term health care services.
The Secretary shall designate a member of the Task Force as chair.
"(c)
"(1) to limit marketing and agent abuse for those policies,
"(2) to assure the dissemination of such information to consumers as is necessary to permit informed choice in purchasing the policies and to reduce the purchase of unnecessary or duplicative coverage,
"(3) to assure that benefits provided under the policies are reasonable in relationship to premiums charged, and
"(4) to promote the development and availability of long-term health care policies which meet these recommendations.
"(d)
"(1) the recommendations developed under subsection (c), including an explanation of the reasons for their selection, and
"(2) such recommendations for additional activities respecting long-term health care policies as the Task Force finds appropriate.
The Secretary, in cooperation with the National Association of Insurance Commissioners, shall provide for the dissemination of the report to each of the States.
"(e)
"(f)
"(1) actions taken by the States to implement the recommendations developed under this section and to recommend additional action; and
"(2) recommendations for legislative and administrative action, if any, needed to respond to issues raised by the Task Force or to improve consumer protection with respect to long-term health care policies.
The first report shall be transmitted 18 months after the date the report is made under subsection (d), and the second report shall be transmitted 18 months later.
"(g)
"(h)
§1395b–1. Incentives for economy while maintaining or improving quality in provision of health services
(a) Grants and contracts to develop and engage in experiments and demonstration projects
(1) The Secretary of Health and Human Services is authorized, either directly or through grants to public or private agencies, institutions, and organizations or contracts with public or private agencies, institutions, and organizations, to develop and engage in experiments and demonstration projects for the following purposes:
(A) to determine whether, and if so which, changes in methods of payment or reimbursement (other than those dealt with in section 222(a) of the Social Security Amendments of 1972) for health care and services under health programs established by this chapter, including a change to methods based on negotiated rates, would have the effect of increasing the efficiency and economy of health services under such programs through the creation of additional incentives to these ends without adversely affecting the quality of such services;
(B) to determine whether payments for services other than those for which payment may be made under such programs (and which are incidental to services for which payment may be made under such programs) would, in the judgment of the Secretary, result in more economical provision and more effective utilization of services for which payment may be made under such program, where such services are furnished by organizations and institutions which have the capability of providing—
(i) comprehensive health care services,
(ii) mental health care services (as defined by section 2691(c) 1 of this title),
(iii) ambulatory health care services (including surgical services provided on an outpatient basis), or
(iv) institutional services which may substitute, at lower cost, for hospital care;
(C) to determine whether the rates of payment or reimbursement for health care services, approved by a State for purposes of the administration of one or more of its laws, when utilized to determine the amount to be paid for services furnished in such State under the health programs established by this chapter, would have the effect of reducing the costs of such programs without adversely affecting the quality of such services;
(D) to determine whether payments under such programs based on a single combined rate of reimbursement or charge for the teaching activities and patient care which residents, interns, and supervising physicians render in connection with a graduate medical education program in a patient facility would result in more equitable and economical patient care arrangements without adversely affecting the quality of such care;
(E) to determine whether coverage of intermediate care facility services and homemaker services would provide suitable alternatives to posthospital benefits presently provided under this subchapter; such experiment and demonstration projects may include:
(i) counting each day of care in an intermediate care facility as one day of care in a skilled nursing facility, if such care was for a condition for which the individual was hospitalized,
(ii) covering the services of homemakers for a maximum of 21 days, if institutional services are not medically appropriate,
(iii) determining whether such coverage would reduce long-range costs by reducing the lengths of stay in hospitals and skilled nursing facilities, and
(iv) establishing alternative eligibility requirements and determining the probable cost of applying each alternative, if the project suggests that such extension of coverage would be desirable;
(F) to determine whether, and if so which type of, fixed price or performance incentive contract would have the effect of inducing to the greatest degree effective, efficient, and economical performance of agencies and organizations making payment under agreements or contracts with the Secretary for health care and services under health programs established by this chapter;
(G) to determine under what circumstances payment for services would be appropriate and the most appropriate, equitable, and noninflationary methods and amounts of reimbursement under health care programs established by this chapter for services, which are performed independently by an assistant to a physician, including a nurse practitioner (whether or not performed in the office of or at a place at which such physician is physically present), and—
(i) which such assistant is legally authorized to perform by the State or political subdivision wherein such services are performed, and
(ii) for which such physician assumes full legal and ethical responsibility as to the necessity, propriety, and quality thereof;
(H) to establish an experimental program to provide day-care services, which consist of such personal care, supervision, and services as the Secretary shall by regulation prescribe, for individuals eligible to enroll in the supplemental medical insurance program established under part B of this subchapter and subchapter XIX of this chapter, in day-care centers which meet such standards as the Secretary shall by regulation establish;
(I) to determine whether the services of clinical psychologists may be made more generally available to persons eligible for services under this subchapter and subchapter XIX of this chapter in a manner consistent with quality of care and equitable and efficient administration;
(J) to develop or demonstrate improved methods for the investigation and prosecution of fraud in the provision of care or services under the health programs established by this chapter; and
(K) to determine whether the use of competitive bidding in the awarding of contracts, or the use of other methods of reimbursement, under part B of subchapter XI of this chapter would be efficient and effective methods of furthering the purposes of that part.
For purposes of this subsection, "health programs established by this chapter" means the program established by this subchapter and a program established by a plan of a State approved under subchapter XIX of this chapter.
(2) Grants, payments under contracts, and other expenditures made for experiments and demonstration projects under paragraph (1) shall be made in appropriate part from the Federal Hospital Insurance Trust Fund (established by
(b) Waiver of certain payment or reimbursement requirements; advice and recommendations of specialists preceding experiments and demonstration projects
In the case of any experiment or demonstration project under subsection (a) of this section, the Secretary may waive compliance with the requirements of this subchapter and subchapter XIX of this chapter insofar as such requirements relate to reimbursement or payment on the basis of reasonable cost, or (in the case of physicians) on the basis of reasonable charge, or to reimbursement or payment only for such services or items as may be specified in the experiment; and costs incurred in such experiment or demonstration project in excess of the costs which would otherwise be reimbursed or paid under such subchapters may be reimbursed or paid to the extent that such waiver applies to them (with such excess being borne by the Secretary). No experiment or demonstration project shall be engaged in or developed under subsection (a) of this section until the Secretary obtains the advice and recommendations of specialists who are competent to evaluate the proposed experiment or demonstration project as to the soundness of its objectives, the possibilities of securing productive results, the adequacy of resources to conduct the proposed experiment or demonstration project, and its relationship to other similar experiments and projects already completed or in process.
(
References in Text
Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (a)(1)(A), is section 222(a) of
Part B of this subchapter, referred to in subsec. (a)(1)(H), is classified to
Part B of subchapter XI of this chapter, referred to in subsec. (a)(1)(K), is classified to
Codification
Section is comprised of subsecs. (a) and (b) of section 402 of
Section was enacted as a part of the Social Security Amendments of 1967, and not as a part of the Social Security Act which comprises this chapter.
Amendments
1984—Subsec. (a)(1).
1982—Subsec. (a)(1)(K).
1981—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (b).
1977—Subsec. (a)(1)(J).
1972—Subsec. (a).
Subsec. (b).
Change of Name
"Secretary of Health and Human Services" substituted for "Secretary of Health, Education, and Welfare" in subsec. (a)(1) pursuant to section 509(b)
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1981 Amendment, Savings, and Transitional Provisions
For effective date, savings, and transitional provisions relating to amendment by
Clarification of Secretarial Waiver Authority for Rural Hospital Demonstrations
Volunteer Senior Aides Demonstration Projects for Basic Medical Assistance and Support to Families With Disabled or Ill Children
"(a)
"(b)
"(1)
"(2)
"(3)
"(c)
"(d)
"(1) $1,000,000 for each of the fiscal years 1990 and 1991; and
"(2) $2,000,000 for each of the fiscal years 1992, 1993, and 1994.
"(e)
Treatment of Certain Nursing Education Programs
"(a)
"(1) The Secretary of Health and Human Services shall provide for demonstration programs under this subsection in each of 5 hospitals for cost reporting periods beginning on or after July 1, 1989, and before July 1, 1994.
"(2) Under each demonstration project, subject to paragraph (4), the reasonable costs incurred by a hospital pursuant to a written agreement with an educational institution for the activities described in paragraph (3) conducted as part of an approved educational program that—
"(A) involves a substantial clinical component (as determined by the Secretary), and
"(B) leads to a master's or doctoral degree in nursing,
shall be allowable as reasonable costs under title XVIII of the Social Security Act [this subchapter] and reimbursed under such title on the same basis as if they were allowable direct costs of a hospital-operated approved educational program (other than an approved graduate medical education program).
"(3) The activities described in this paragraph are the activities for which the reasonable costs of conducting such activities are allowable under title XVIII of the Social Security Act if conducted under a hospital-operated approved educational program (other than an approved graduate medical education program), but only to the extent such activities are directly related to the operation of the educational program conducted pursuant to the written agreement between the hospital and the educational institution.
"(4) The amount paid under a demonstration program under this subsection to a hospital for a cost reporting period may not exceed $200,000.
"(5) The Secretary shall report to Congress, by not later than January 1, 1995, on the demonstration programs conducted under this subsection and on the supply and characteristics of nurses trained under such programs.
"(b)
Research on Long-Term Care Services for Medicare Beneficiaries
Adjustment of Contracts With Prepaid Health Plans
For requirement that Secretary of Health and Human Services modify contracts with health maintenance organizations under subsec. (a) of this section and section 222(a) of
Case Management Demonstration Projects
"(1)
"(2)
"(A) the project proposed to be conducted by Providence Hospital for case management of the elderly at risk for acute hospitalization as described in Project No. 18–P–99379/5–01;
"(B) the project proposed to be conducted by the Iowa Foundation for Medical Care to study patients with chronic congestive conditions to reduce repeated hospitalizations of such patients as described in Project No. P–99399/4–01; and
"(C) the project proposed to be conducted by Key Care Health Resources, Inc., to examine the effects of case management on 2,500 high cost medicare beneficiaries as described in Project No. 18–P–99396/5.
"(3)
"(4)
Demonstration Projects With Respect to Chronic Ventilator-Dependent Units in Hospitals
"(a)
"(b)
[
Research and Demonstration Projects on Rural and Inner-City Health Issues
"(a)
"(2) Not less than ten percent of the total amounts annually appropriated to, and expended by, the Health Care Financing Administration for the conduct of research and demonstration projects in fiscal years 1988, 1989, and 1990 shall be expended for research and demonstration projects relating exclusively or substantially to issues of providing health care in inner-city areas, including (but not limited to) the impact of the payment methodology under section 1886(d) of the Social Security Act on the financial viability of inner-city hospitals and the impact of medicare policies on access to (and the quality of) health care in inner-city areas.
"(b)
Alzheimer's Disease Demonstration Projects
"(a)
"(b)
"(1) case management services,
"(2) home and community-based services,
"(3) mental health services,
"(4) outpatient drug therapy,
"(5) respite care and other supportive services and counseling for family,
"(6) adult day care services, and
"(7) other in-home services.
"(c)
"(1) each be conducted over a period of 5 years;
"(2) provide each medicare beneficiary with a comprehensive medical and mental status evaluation upon entering the project and at discharge;
"(3) be conducted by an entity which either directly or by contract is able to provide such comprehensive evaluations and the additional services (described in subsection (b)) covered by the project;
"(4) be conducted in sites which are chosen so as to be geographically diverse and located in States with a high proportion of medicare beneficiaries and in areas readily accessible to a significant number of medicare beneficiaries; and
"(5) involve community outreach efforts at each site to enroll the maximum number of medicare beneficiaries in each project.
"(d)
"(1) a preliminary report during the fourth year of the projects, which report shall include a description of the sites at which the projects are being conducted and the services being provided at the different sites, and
"(2) a final report upon completion of the projects, which report shall include recommendations for appropriate legislative changes.
"(f)
"(g)
Special Treatment of States Formerly Under Waiver
For treatment of hospitals in States which have had a waiver approved under this section, upon termination of waiver, see section 9202(j) of
Extension of Certain Medicare Municipal Health Services Demonstration Projects
Demonstration Program for Reduction of Disability and Dependency Through Provision of Preventive Health Services Under Medicare
"(a)
"(b)
"(1) health screenings,
"(2) health risk appraisals,
"(3) immunizations, and
"(4) counseling on and instruction in—
"(A) diet and nutrition,
"(B) reduction of stress,
"(C) exercise and exercise programs,
"(D) sleep regulation,
"(E) injury prevention,
"(F) prevention of alcohol and drug abuse,
"(G) prevention of mental health disorders,
"(H) self-care, including use of medication, and
"(I) reduction or cessation of smoking.
"(c)
"(1) be conducted under the direction of accredited public or private nonprofit schools of public health or preventive medicine departments accredited by the Council on Education for Public Health;
"(2) be conducted in no fewer than five sites (at least one of which shall serve a rural area), which sites shall be chosen so as to be geographically diverse and shall be readily accessible to a significant number of medicare beneficiaries;
"(3) involve community outreach efforts at each site to enroll the maximum number of medicare beneficiaries in the program; and
"(4) be designed—
"(A) to test alternative methods of payment for preventive health services, including payment on a prepayment basis as well as payment on a fee-for-service basis,
"(B) to permit a variety of appropriate health care providers to furnish preventive health services, including physicians, health educators, nurses, allied health personnel, dieticians, and clinical psychologists, and
"(C) to facilitate evaluation under subsection (d).
"(d)
"(1) the short-term and long-term costs and benefits of providing preventive health services for medicare beneficiaries, including any reduction in inpatient services resulting from providing the services, and
"(2) what practical mechanisms exist to finance preventive health services under title XVIII of the Social Security Act [this subchapter].
"(e)
"(2) Not later than April 1, 1993, the Secretary shall submit an interim report to those Committees on the demonstration program and shall include in the report—
"(A) the evaluation described in subsection (d), and
"(B) recommendations for appropriate legislative changes to incorporate payment for cost-effective preventive health services into the medicare program.
"(3) Not later than April 1, 1995, the Secretary shall submit a final report to those Committees on the demonstration program and shall include in the report a comprehensive evaluation of the long-term effects of the program.
"(f)
"(g)
[Section 9344(d) of
Payment for Costs of Hospital-Based Mobile Intensive Care Units
Section 2320 of
"(a)(1) In the case of a project described in subsection (b), the Secretary of Health and Human Services shall provide, except as provided in paragraph (2), that the amount of payments to hospitals covered under the project during the period described in paragraph (3) shall include payments for their operation of hospital-based mobile intensive care units (as defined by State statute) if the State provides satisfactory assurances that the total amount of payments to such hospitals under titles XVIII and XIX of the Social Security Act [this subchapter and subchapter XIX of this chapter] under the demonstration project (including any such additional amount of payment) would not exceed the total amount of payments which would have been paid under such titles if the demonstration project were not in effect.
"(2) Paragraph (1) shall not apply if the State in which the project is located notifies the Secretary, within 30 days after the date of the enactment of this section [July 18, 1984], that the State does not want paragraph (1) to apply to that project.
"(3) The period referred to in paragraph (1) begins on the date of the enactment of this section and continues so long as the Secretary continues the Statewide waiver referred to in subsection (b), but in no case ends earlier than 90 days after the date final regulations to implement section 1886(c) of the Social Security Act [
"(b) The project referred to in subsection (a) is the statewide demonstration project established in the State of New Jersey under section 402 of the Social Security Amendments of 1967, as amended by section 222(b) of the Social Security Amendments of 1972 (
"(c) Payment for services described in this section shall be considered to be payments for services under part A of title XVIII of the Social Security Act [part A of this subchapter]."
Continuation of Secretary's Authority Regarding Experiments and Demonstration Projects
"(1) Except as provided in paragraph (2), the amendments made by this title [amending
"(2) The Secretary shall provide that, upon the request of a State which has a demonstration project, for payment of hospitals under title XVIII of the Social Security Act [this subchapter] approved under section 402(a) of the Social Security Amendments of 1967 [subsec. (a) of this section] or section 222(a) of the Social Security Amendments of 1972 [set out as a note below], which (A) is in effect as of March 1, 1983, and (B) was entered into after August 1982 (or upon the request of another party to demonstration project agreement), the terms of the demonstration agreement shall be modified so that the demonstration project is not required to maintain the rate of increase in medicare hospital costs in that State below the national rate of increase in medicare hospital costs."
Alternative Care Demonstration Projects in Hospitals Short of Skilled Nursing Facilities
Continuation of Hospice Demonstration Projects; Report to Congress
Section 122(i), formerly §122(h), of
"(1) Notwithstanding any provision of law which has the effect of restricting the time period of a hospice demonstration project in effect on July 15, 1982, pursuant to section 402(a) of the Social Security Amendments of 1967 [subsec. (a) of this section], the Secretary of Health and Human Services, upon request of the hospice involved, shall permit continuation of the project until November 1, 1983, or, if later, the date on which payments can first be made to any hospice program under the amendments made by this section.
"(2) Prior to September 30, 1983, the Secretary shall submit to Congress a report on the effectiveness of demonstration projects referred to in paragraph (1), including an evaluation of the cost-effectiveness of hospice care, the reasonableness of the 40-percent cap amount for hospice care as provided in section 1814(i) of the Social Security Act [
"(3)(A) Notwithstanding the provisions of paragraph (1), the Secretary of Health and Human Services, upon request of the hospice involved, shall permit continuation of a hospice demonstration project described in paragraph (1) until September 30, 1986, if the hospice involved in such demonstration project does not provide hospice care directly but acts as a channeling agency for the provision of hospice care.
"(B) During the period after the date on which a hospice demonstration project described in subparagraph (A) would otherwise have terminated under the provisions of paragraph (1), and prior to September 30, 1986, any such hospice demonstration project shall be subject to the same requirements as are imposed under the hospice program provided for under the amendments made by this section [amending
State Medicare Hospital Reimbursement Demonstration Project Limitation
Study of Need for Dual Participation of Skilled Nursing Facilities
Demonstration Projects for Physician-Directed Clinics in Urban Medically Underserved Areas; Report Submitted No Later Than January 1, 1981
Scope of Grants for Experiments and Demonstration Projects To Determine Methods for Prospective Payments to Hospitals, Skilled Nursing Facilities, and Other Providers of Services
"(1) the applicant for such grant is a State or an agency thereof,
"(2) such participant is an individual practice association which has been in existence for at least 3 years prior to the date of enactment of this section [Dec. 31, 1975] and which has in effect a contract with such State (or an agency thereof), entered into prior to the date on which the grant is approved by the Secretary, under which such association will, for a period which begins before and ends after the date such grant is so approved, provide health care services for individuals entitled to care and services under the State plan of such State which is approved under title XIX of the Social Security Act [subchapter XIX of this chapter].
"(3) the purpose of the inclusion of the project of such association is to test the utility of a particular rate-setting methodology, designed to be employed in prepaid health plans, in an individual practice association operation, and
"(4) the applicant for such grant affirms that the use of moneys from such grant to make such payments to such individual practice association is necessary or useful in assuring that such association will be able to continue in operation and carry out the project described in clause (3)."
Experiments and Demonstration Projects To Determine Methods for Prospective Payments to Hospitals, Skilled Nursing Facilities, and Other Providers of Services for Care and Services Furnished; Scope; Waiver of Payment Requirements; Source and Manner of Payments for Grants, etc.; Reports to Congress
Section 222(a) of
"(1) The Secretary of Health, Education, and Welfare [now Health and Human Services], directly or through contracts with, or grants to, public or private agencies or organizations, shall develop and carry out experiments and demonstration projects designed to determine the relative advantages and disadvantages of various alternative methods of making payment on a prospective basis to hospitals, skilled nursing facilities, and other providers of services for care and services provided by them under title XVIII of the Social Security Act [this subchapter] and under State plans approved under title XIX of such Act [subchapter XIX of this chapter], including alternative methods for classifying providers, for establishing prospective rates of payment, and for implementing on a gradual, selective, or other basis the establishment of a prospective payment system, in order to stimulate such providers through positive (or negative) financial incentives to use their facilities and personnel more efficiently and thereby to reduce the total costs of the health programs involved without adversely affecting the quality of services by containing or lowering the rate of increase in provider costs that has been and is being experienced under the existing system of retroactive cost reimbursement.
"(2) The experiments and demonstration projects developed under paragraph (1) shall be of sufficient scope and shall be carried out on a wide enough scale to permit a thorough evaluation of the alternative methods of prospective payment under consideration while giving assurance that the results derived from the experiments and projects will obtain generally in the operation of the programs involved (without committing such programs to the adoption of any prospective payment system either locally or nationally).
"(3) In the case of any experiment or demonstration project under paragraph (1), the Secretary may waive compliance with the requirements of titles XVIII and XIX of the Social Security Act [this subchapter and subchapter XIX of this chapter] insofar as such requirements relate to methods of payment for services provided; and costs incurred in such experiment or project in excess of those which would otherwise be reimbursed or paid under such titles [subchapters] may be reimbursed or paid to the extent that such waiver applies to them (with such excess being borne by the Secretary). No experiment or demonstration project shall be developed or carried out under paragraph (1) until the Secretary obtains the advice and recommendations of specialists who are competent to evaluate the proposed experiment or project as to the soundness of its objectives, the possibilities of securing productive results, the adequacy of resources to conduct it, and its relationship to other similar experiments or projects already completed or in process; and no such experiment or project shall be actually placed in operation unless at least 30 days prior thereto a written report, prepared for purposes of notification and information only, containing a full and complete description thereof has been transmitted to the Committee on Ways and Means of the House of Representatives and to the Committee on Finance of the Senate.
"(4) Grants, payments under contracts, and other expenditures made for experiments and demonstration projects under this subsection shall be made in appropriate part from the Federal Hospital Insurance Trust Fund (established by section 1817 of the Social Security Act [
"(5) The Secretary shall submit to the Congress no later than July 1, 1974, a full report on the experiments and demonstration projects carried out under this subsection and on the experience of other programs with respect to prospective reimbursement together with any related data and materials which he may consider appropriate. Such report shall include detailed recommendations with respect to the specific methods which could be used in the full implementation of a system of prospective payment to providers of services under the programs involved."
Section Referred to in Other Sections
This section is referred to in
1 See References in Text note below.
§1395b–2. Notice of medicare benefits; medicare and medigap information
(a) The Secretary shall prepare (in consultation with groups representing the elderly and with health insurers) and provide for distribution of a notice containing—
(1) a clear, simple explanation of the benefits available under this subchapter and the major categories of health care for which benefits are not available under this subchapter,
(2) the limitations on payment (including deductibles and coinsurance amounts) that are imposed under this subchapter, and
(3) a description of the limited benefits for long-term care services available under this subchapter and generally available under State plans approved under subchapter XIX of this chapter.
Such notice shall be mailed annually to individuals entitled to benefits under part A or part B of this subchapter and when an individual applies for benefits under part A of this subchapter or enrolls under part B of this subchapter.
(b) The Secretary shall provide information via a toll-free telephone number on the programs under this subchapter.
(Aug. 14, 1935, ch. 531, title XVIII, §1804, as added July 1, 1988,
References in Text
Parts A and B of this subchapter, referred to in subsec. (a), are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Amendments
1994—
Effective Date of 1994 Amendment
Amendment by
Effective Date
Section 223(d)(1) of
State Regulatory Programs
For provisions relating to changes required to conform State regulatory programs to amendments by section 171 of
Demonstration Projects
Section 4361(b) of
Notice of Changes Under Repeal of Medicare Catastrophic Coverage
Benefits Counseling and Assistance Demonstration Project for Certain Medicare and Medicaid Beneficiaries
Section 424 of
§1395b–3. Health insurance advisory service for medicare beneficiaries
(a) In general
The Secretary of Health and Human Services shall establish a health insurance advisory service program (in this section referred to as the "beneficiary assistance program") to assist medicare-eligible individuals with the receipt of services under the medicare and medicaid programs and other health insurance programs.
(b) Outreach elements
The beneficiary assistance program shall provide assistance—
(1) through operation using local Federal offices that provide information on the medicare program,
(2) using community outreach programs, and
(3) using a toll-free telephone information service.
(c) Assistance provided
The beneficiary assistance program shall provide for information, counseling, and assistance for medicare-eligible individuals with respect to at least the following:
(1) With respect to the medicare program—
(A) eligibility,
(B) benefits (both covered and not covered),
(C) the process of payment for services,
(D) rights and process for appeals of determinations,
(E) other medicare-related entities (such as peer review organizations, fiscal intermediaries, and carriers), and
(F) recent legislative and administrative changes in the medicare program.
(2) With respect to the medicaid program—
(A) eligibility, benefits, and the application process,
(B) linkages between the medicaid and medicare programs, and
(C) referral to appropriate State and local agencies involved in the medicaid program.
(3) With respect to medicare supplemental policies—
(A) the program under
(B) how to make informed decisions on whether to purchase such policies and on what criteria to use in evaluating different policies,
(C) appropriate Federal, State, and private agencies that provide information and assistance in obtaining benefits under such policies, and
(D) other issues deemed appropriate by the Secretary.
The beneficiary assistance program also shall provide such other services as the Secretary deems appropriate to increase beneficiary understanding of, and confidence in, the medicare program and to improve the relationship between beneficiaries and the program.
(d) Educational material
The Secretary, through the Administrator of the Health Care Financing Administration, shall develop appropriate educational materials and other appropriate techniques to assist employees in carrying out this section.
(e) Notice to beneficiaries
The Secretary shall take such steps as are necessary to assure that medicare-eligible beneficiaries and the general public are made aware of the beneficiary assistance program.
(f) Report
The Secretary shall include, in an annual report transmitted to the Congress, a report on the beneficiary assistance program and on other health insurance informational and counseling services made available to medicare-eligible individuals. The Secretary shall include in the report recommendations for such changes as may be desirable to improve the relationship between the medicare program and medicare-eligible individuals.
(
Codification
Section was enacted as part of the Omnibus Budget Reconciliation Act of 1990, and not as part of the Social Security Act which comprises this chapter.
Qualified Medicare Beneficiary Outreach
§1395b–4. Health insurance information, counseling, and assistance grants
(a) Grants
The Secretary of Health and Human Services (in this section referred to as the "Secretary") shall make grants to States, with approved State regulatory programs under
(b) Grant applications
(1) In submitting an application under this section, a State may consolidate and coordinate an application that consists of parts prepared by more than one agency or department of such State.
(2) As part of an application for a grant under this section, a State shall submit a plan for a State-wide health insurance information, counseling, and assistance program. Such program shall—
(A) establish or improve upon a health insurance information, counseling, and assistance program that provides counseling and assistance to eligible individuals in need of health insurance information, including—
(i) information that may assist individuals in obtaining benefits and filing claims under this subchapter and subchapter XIX of this chapter;
(ii) policy comparison information for medicare supplemental policies (as described in
(iii) information regarding long-term care insurance; and
(iv) information regarding other types of health insurance benefits that the Secretary determines to be appropriate;
(B) in conjunction with the health insurance information, counseling, and assistance program described in subparagraph (A), establish a system of referral to appropriate Federal or State departments or agencies for assistance with problems related to health insurance coverage (including legal problems), as determined by the Secretary;
(C) provide for a sufficient number of staff positions (including volunteer positions) necessary to provide the services of the health insurance information, counseling, and assistance program;
(D) provide assurances that staff members (including volunteer staff members) of the health insurance information, counseling, and assistance program have no conflict of interest in providing the counseling described in subparagraph (A);
(E) provide for the collection and dissemination of timely and accurate health care information to staff members;
(F) provide for training programs for staff members (including volunteer staff members);
(G) provide for the coordination of the exchange of health insurance information between the staff of departments and agencies of the State government and the staff of the health insurance information, counseling, and assistance program;
(H) make recommendations concerning consumer issues and complaints related to the provision of health care to agencies and departments of the State government and the Federal Government responsible for providing or regulating health insurance;
(I) establish an outreach program to provide the health insurance information and counseling described in subparagraph (A) and the referrals described in subparagraph (B) to eligible individuals; and
(J) demonstrate, to the satisfaction of the Secretary, an ability to provide the counseling and assistance required under this section.
(c) Special grants
(1) A State that is conducting a health insurance information, counseling, and assistance program that is substantially similar to a program described in subsection (b)(2) of this section shall, as a requirement for eligibility for a grant under this section, demonstrate, to the satisfaction of the Secretary, that such State shall maintain the activities of such program at least at the level that such activities were conducted immediately preceding the date of the issuance of any grant during the period of time covered by such grant under this section.
(2) If the Secretary determines that the existing health insurance information, counseling, and assistance program is substantially similar to a program described in subsection (b)(2) of this section, the Secretary may waive some or all of the requirements described in such subsection and issue a grant to the State for the purpose of increasing the number of services offered by the health insurance information, counseling, and assistance program, experimenting with new methods of outreach in conducting such program, or expanding such program to geographic areas of the State not previously served by the program.
(d) Criteria for issuing grants
In issuing a grant under this section, the Secretary shall consider—
(1) the commitment of the State to carrying out the health insurance information, counseling, and assistance program described in subsection (b)(2) of this section, including the level of cooperation demonstrated—
(A) by the office of the chief insurance regulator of the State, or the equivalent State entity;
(B) other officials of the State responsible for overseeing insurance plans issued by nonprofit hospital and medical service associations; and
(C) departments and agencies of such State responsible for—
(i) administering funds under subchapter XIX of this chapter, and
(ii) administering funds appropriated under the Older Americans Act [
(2) the population of eligible individuals in such State as a percentage of the population of such State; and
(3) in order to ensure the needs of rural areas in such State, the relative costs and special problems associated with addressing the special problems of providing health care information, counseling, and assistance eligible 1 individuals residing in rural areas of such State.
(e) Annual State report
A State that receives a grant under this section shall, not later than 180 days after receiving such grant, and annually thereafter during the period of the grant, issue a report to the Secretary that includes information concerning—
(1) the number of individuals served by the health insurance information, counseling and assistance program of such State;
(2) an estimate of the amount of funds saved by the State, and by eligible individuals in the State, in the implementation of such program; and
(3) the problems that eligible individuals in such State encounter in procuring adequate and appropriate health care coverage.
(f) Report to Congress
Not later than 180 days after November 5, 1990, and annually thereafter, the Secretary shall issue a report to the Committee on Finance of the Senate, the Special Committee on Aging of the Senate, the Committee on Ways and Means of the House of Representatives, and the Committee on Energy and Commerce of the House of Representatives that—
(1) summarizes the allocation of funds authorized for grants under this section and the expenditure of such funds;
(2) outlines the problems that eligible individuals encounter in procuring adequate and appropriate health care coverage;
(3) makes recommendations that the Secretary determines to be appropriate to address the problems described in paragraph (3); 2 and
(4) in the case of the report issued 2 years after November 5, 1990, evaluates the effectiveness of counseling programs established under this program, and makes recommendations regarding continued authorization of funds for these purposes.
(g) Authorization of appropriations for grants
There are authorized to be appropriated, in equal parts from the Federal Hospital Insurance Trust Fund and from the Federal Supplementary Medical Insurance Trust Fund, $10,000,000 for each of fiscal years 1991, 1992, 1993, 1994, 1995, and 1996, to fund the grant programs described in this section.
(
References in Text
The Older Americans Act, referred to in subsec. (d)(1)(C)(ii), probably means the Older Americans Act of 1965, which is
Codification
Section was enacted as part of the Omnibus Budget Reconciliation Act of 1990, and not as part of the Social Security Act which comprises this chapter.
Amendments
1994—Subsec. (b)(2)(A)(ii).
Subsec. (b)(2)(D).
Subsec. (b)(2)(I).
Subsec. (c)(1).
Subsec. (d)(3).
Subsec. (e).
Subsec. (e)(1).
Subsec. (f).
Subsec. (f)(2) to (5).
Subsec. (g).
Change of Name
Committee on Energy and Commerce of House of Representatives changed to Committee on Commerce of House of Representatives by House Resolution No. 6, One Hundred Fourth Congress, Jan. 4, 1995.
Effective Date of 1994 Amendment
Amendment by
State Regulatory Programs
For provisions relating to changes required to conform State regulatory programs to amendments by section 171 of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be preceded by "to".
2 So in original. Probably should be paragraph "(2)".
Part A—Hospital Insurance Benefits for Aged and Disabled
Part Referred to in Other Sections
This part is referred to in
§1395c. Description of program
The insurance program for which entitlement is established by
(Aug. 14, 1935, ch. 531, title XVIII, §1811, as added July 30, 1965,
Amendments
1989—
1988—
1986—
1982—
1980—
1978—
1972—
Effective Date of 1989 Amendment
Section 101(d) of
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1986 Amendment
Amendment by
Effective Date of 1982 Amendment
Section 122(h)(1) of
Amendment by section 278(b)(3) of
Effective Date of 1980 Amendments
Amendment by
Amendment by
Amendment by
Effective Date of 1978 Amendment
Amendment by
Advisory Council To Study Coverage of Disabled Under This Subchapter
Reimbursement of Charges Under Part A for Services to Patients Admitted Prior to 1968 to Certain Hospitals
"(a) Notwithstanding any provision of title XVIII of the Social Security Act [this subchapter] an individual who is entitled to hospital insurance benefits under section 226 of such Act [
"(1) the hospital did not have an agreement in effect under section 1866 of such Act [
"(2) the hospital (A) meets the requirements of paragraphs (5) and (7) of section 1861(e) of such Act [
"(3) the hospital did not meet the requirements that must be met to permit payment to the hospital under part A of title XVIII of such Act [this part]; and
"(4) an application is filed (submitted in such form and manner and by such person, and containing and supported by such information, as the Secretary shall by regulations prescribe) for reimbursement before January 1, 1969.
"(b) Payments under this section may not be made for inpatient hospital services (as described in subsection (a)) furnished to an individual—
"(1) prior to July 1, 1966,
"(2) after December 31, 1967, unless furnished with respect to an admission to the hospital prior to January 1, 1968, and
"(3) for more than—
"(A) 90 days in any spell of illness, but only if (i) prior to January 1, 1969, the hospital furnishing such services entered into an agreement under section 1866 of the Social Security Act [
"(B) 20 days in any spell of illness, if the hospital did not meet the conditions of clauses (i) and (ii) of subparagraph (A).
"(c)(1) The amounts payable in accordance with subsection (a) with respect to inpatient hospital services shall, subject to paragraph (2) of this subsection, be paid from the Federal Hospital Insurance Trust Fund in amounts equal to 60 percent of the hospital's reasonable charges for routine services furnished in the accommodations occupied by the individual or in semi-private accommodations (as defined in section 1861(v)(4) of the Social Security Act [
"(2) Before applying paragraph (1), payments made under this section shall be reduced to the extent provided for under section 1813 of the Social Security Act [
"(d) For the purposes of this section—
"(1) the 90-day period, referred to in subsection (b)(3)(A), shall be reduced by the number of days of inpatient hospital services furnished to such individual during the spell of illness, referred to therein, and with respect to which he was entitled to have payment made under part A of title XVIII of the Social Security Act [this part];
"(2) the 20-day period, referred to in subsection (b)(3)(B) shall be reduced by the number of days in excess of 70 days of inpatient hospital services furnished during the spell of illness, referred to therein, and with respect to which such individual was entitled to have payment made under such part A [this part];
"(3) the term 'spell of illness' shall have the meaning assigned to it by subsection (a) of section 1861 of such Act [
Section Referred to in Other Sections
This section is referred to in title 38 section 1729.
§1395d. Scope of benefits
(a) Entitlement to payment for inpatient hospital services, post-hospital extended care services, home health services, and hospice care
The benefits provided to an individual by the insurance program under this part shall consist of entitlement to have payment made on his behalf or, in the case of payments referred to in
(1) inpatient hospital services or inpatient rural primary care hospital services for up to 150 days during any spell of illness minus 1 day for each day of such services in excess of 90 received during any preceding spell of illness (if such individual was entitled to have payment for such services made under this part unless he specifies in accordance with regulations of the Secretary that he does not desire to have such payment made);
(2)(A) post-hospital extended care services for up to 100 days during any spell of illness, and (B) to the extent provided in subsection (f) of this section, extended care services that are not post-hospital extended care services;
(3) home health services; and
(4) in lieu of certain other benefits, hospice care with respect to the individual during up to two periods of 90 days each, a subsequent period of 30 days, and a subsequent extension period with respect to which the individual makes an election under subsection (d)(1) of this section.
(b) Services not covered
Payment under this part for services furnished an individual during a spell of illness may not (subject to subsection (c) of this section) be made for—
(1) inpatient hospital services furnished to him during such spell after such services have been furnished to him for 150 days during such spell minus 1 day for each day of inpatient hospital services in excess of 90 received during any preceding spell of illness (if such individual was entitled to have payment for such services made under this part unless he specifies in accordance with regulations of the Secretary that he does not desire to have such payment made);
(2) post-hospital extended care services furnished to him during such spell after such services have been furnished to him for 100 days during such spell; or
(3) inpatient psychiatric hospital services furnished to him after such services have been furnished to him for a total of 190 days during his lifetime.
(c) Inpatients of psychiatric hospitals
If an individual is an inpatient of a psychiatric hospital on the first day of the first month for which he is entitled to benefits under this part, the days on which he was an inpatient of such a hospital in the 150-day period immediately before such first day shall be included in determining the number of days limit under subsection (b)(1) of this section insofar as such limit applies to (1) inpatient psychiatric hospital services, or (2) inpatient hospital services for an individual who is an inpatient primarily for the diagnosis or treatment of mental illness (but shall not be included in determining such number of days limit insofar as it applies to other inpatient hospital services or in determining the 190-day limit under subsection (b)(3) of this section).
(d) Hospice care; election; waiver of rights; revocation; change of election
(1) Payment under this part may be made for hospice care provided with respect to an individual only during two periods of 90 days each, a subsequent period of 30 days, and a subsequent extension period during the individual's lifetime and only, with respect to each such period, if the individual makes an election under this paragraph to receive hospice care under this part provided by, or under arrangements made by, a particular hospice program instead of certain other benefits under this subchapter.
(2)(A) Except as provided in subparagraphs (B) and (C) and except in such exceptional and unusual circumstances as the Secretary may provide, if an individual makes such an election for a period with respect to a particular hospice program, the individual shall be deemed to have waived all rights to have payment made under this subchapter with respect to—
(i) hospice care provided by another hospice program (other than under arrangements made by the particular hospice program) during the period, and
(ii) services furnished during the period that are determined (in accordance with guidelines of the Secretary) to be—
(I) related to the treatment of the individual's condition with respect to which a diagnosis of terminal illness has been made or
(II) equivalent to (or duplicative of) hospice care;
except that clause (ii) shall not apply to physicians' services furnished by the individual's attending physician (if not an employee of the hospice program) or to services provided by (or under arrangements made by) the hospice program.
(B) After an individual makes such an election with respect to a 90- or 30-day period or a subsequent extension period, the individual may revoke the election during the period, in which case—
(i) the revocation shall act as a waiver of the right to have payment made under this part for any hospice care benefits for the remaining time in such period and (for purposes of subsection (a)(4) of this section and subparagraph (A)) the individual shall be deemed to have been provided such benefits during such entire period, and
(ii) the individual may at any time after the revocation execute a new election for a subsequent period, if the individual otherwise is entitled to hospice care benefits with respect to such a period.
(C) An individual may, once in each such period, change the hospice program with respect to which the election is made and such change shall not be considered a revocation of an election under subparagraph (B).
(D) For purposes of this subchapter, an individual's election with respect to a hospice program shall no longer be considered to be in effect with respect to that hospice program after the date the individual's revocation or change of election with respect to that election takes effect.
(e) Services taken into account
For purposes of subsections (b) and (c) of this section, inpatient hospital services, inpatient psychiatric hospital services, and post-hospital extended care services shall be taken into account only if payment is or would be, except for this section or the failure to comply with the request and certification requirements of or under
(f) Coverage of extended care services without regard to three-day prior hospitalization requirement
(1) The Secretary shall provide for coverage, under clause (B) of subsection (a)(2) of this section, of extended care services which are not post-hospital extended care services at such time and for so long as the Secretary determines, and under such terms and conditions (described in paragraph (2)) as the Secretary finds appropriate, that the inclusion of such services will not result in any increase in the total of payments made under this subchapter and will not alter the acute care nature of the benefit described in subsection (a)(2) of this section.
(2) The Secretary may provide—
(A) for such limitations on the scope and extent of services described in subsection (a)(2)(B) of this section and on the categories of individuals who may be eligible to receive such services, and
(B) notwithstanding
as may be necessary to carry out paragraph (1).
(g) "Spell of illness" defined
For definitions of "spell of illness", and for definitions of other terms used in this part, see
(Aug. 14, 1935, ch. 531, title XVIII, §1812, as added July 30, 1965,
Amendments
1994—Subsec. (a)(1).
1990—Subsec. (a)(4).
Subsec. (d)(1).
Subsec. (d)(2)(B).
1989—Subsec. (a).
Subsec. (a)(1).
Subsecs. (b) to (d)(1), (2)(B), (e) to (g).
1988—Subsec. (a).
"(1) inpatient hospital services;
"(2) extended care services for up to 150 days during any calendar year;
"(3) home health services; and
"(4) in lieu of certain other benefits, hospice care with respect to the individual during up to two periods of 90 days each, a subsequent period of 30 days, and a subsequent extension period with respect to which the individual makes an election under subsection (d)(1) of this section."
Subsec. (b).
Subsec. (c).
Subsec. (d)(1).
Subsec. (d)(2)(B).
Subsec. (e).
Subsec. (f).
Subsec. (g).
1983—Subsec. (d)(2)(A).
1982—Subsec. (a)(2).
Subsec. (a)(4).
Subsec. (d).
Subsecs. (f), (g).
1981—Subsec. (a).
1980—Subsec. (a)(3).
Subsec. (a)(4).
Subsec. (d).
Subsec. (e).
1968—Subsec. (a).
Subsec. (a)(1).
Subsec. (a)(4).
Subsec. (b)(1).
Subsec. (c).
Effective Date of 1994 Amendment
Section 102(i) of
Effective Date of 1990 Amendment
Section 4006(c) of
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Section 104(a) of
"(1)
"(A) to the inpatient hospital deductible for 1989 and succeeding years,
"(B) to care and services furnished on or after January 1, 1989,
"(C) to premiums for January 1989 and succeeding months, and
"(D) to blood or blood cells furnished on or after January 1, 1989.
"(2)
Effective Date of 1983 Amendment
Amendment by
Effective Date of 1982 Amendment
Amendment by section 122(b) of
Effective Date of 1981 Amendment
Section 2121(i) of
Effective Date of 1980 Amendment
Amendment by section 930(b)–(d) of
Section 931(e) of
Effective Date of 1968 Amendment
Section 129(d) of
Section 137(c) of
Section 138(b) of
Section 143(d) of
Section 146(b) of
Repeal of 1988 Expansion of Medicare Part A Benefits
For provisions repealing amendment by section 101 of
Section Referred to in Other Sections
This section is referred to in
§1395e. Deductibles and coinsurance
(a) Inpatient hospital services; outpatient hospital diagnostic services; blood; post-hospital extended care services
(1) The amount payable for inpatient hospital services or inpatient rural primary care hospital services furnished an individual during any spell of illness shall be reduced by a deduction equal to the inpatient hospital deductible or, if less, the charges imposed with respect to such individual for such services, except that, if the customary charges for such services are greater than the charges so imposed, such customary charges shall be considered to be the charges so imposed. Such amount shall be further reduced by a coinsurance amount equal to—
(A) one-fourth of the inpatient hospital deductible for each day (before the 91st day) on which such individual is furnished such services during such spell of illness after such services have been furnished to him for 60 days during such spell; and
(B) one-half of the inpatient hospital deductible for each day (before the day following the last day for which such individual is entitled under
except that the reduction under this sentence for any day shall not exceed the charges imposed for that day with respect to such individual for such services (and for this purpose, if the customary charges for such services are greater than the charges so imposed, such customary charges shall be considered to be the charges so imposed).
(2)(A) The amount payable to any provider of services under this part for services furnished an individual shall be further reduced by a deduction equal to the expenses incurred for the first three pints of whole blood (or equivalent quantities of packed red blood cells, as defined under regulations) furnished to the individual during each calendar year, except that such deductible for such blood shall in accordance with regulations be appropriately reduced to the extent that there has been a replacement of such blood (or equivalent quantities of packed red blood cells, as so defined); and for such purposes blood (or equivalent quantities of packed red blood cells, as so defined) furnished such individual shall be deemed replaced when the institution or other person furnishing such blood (or such equivalent quantities of packed red blood cells, as so defined) is given one pint of blood for each pint of blood (or equivalent quantities of packed red blood cells, as so defined) furnished such individual with respect to which a deduction is made under this sentence.
(B) The deductible under subparagraph (A) for blood or blood cells furnished an individual in a year shall be reduced to the extent that a deductible has been imposed under
(3) The amount payable for post-hospital extended care services furnished an individual during any spell of illness shall be reduced by a coinsurance amount equal to one-eighth of the inpatient hospital deductible for each day (before the 101st day) on which he is furnished such services after such services have been furnished to him for 20 days during such spell.
(4)(A) The amount payable for hospice care shall be reduced—
(i) in the case of drugs and biologicals provided on an outpatient basis by (or under arrangements made by) the hospice program, by a coinsurance amount equal to an amount (not to exceed $5 per prescription) determined in accordance with a drug copayment schedule (established by the hospice program) which is related to, and approximates 5 percent of, the cost of the drug or biological to the program, and
(ii) in the case of respite care provided by (or under arrangements made by) the hospice program, by a coinsurance amount equal to 5 percent of the amount estimated by the hospice program (in accordance with regulations of the Secretary) to be equal to the amount of payment under
except that the total of the coinsurance required under clause (ii) for an individual may not exceed for a hospice coinsurance period the inpatient hospital deductible applicable for the year in which the period began. For purposes of this subparagraph, the term "hospice coinsurance period" means, for an individual, a period of consecutive days beginning with the first day for which an election under
(B) During the period of an election by an individual under
(b) Inpatient hospital deductible; application
(1) The inpatient hospital deductible for 1987 shall be $520. The inpatient hospital deductible for any succeeding year shall be an amount equal to the inpatient hospital deductible for the preceding calendar year, changed by the Secretary's best estimate of the payment-weighted average of the applicable percentage increases (as defined in
(2) The Secretary shall promulgate the inpatient hospital deductible and all coinsurance amounts under this section between September 1 and September 15 of the year preceding the year to which they will apply.
(3) The inpatient hospital deductible for a year shall apply to—
(A) the deduction under the first sentence of subsection (a)(1) of this section for the year in which the first day of inpatient hospital services or inpatient rural primary care hospital services occurs in a spell of illness, and
(B) to the coinsurance amounts under subsection (a) of this section for inpatient hospital services, inpatient rural primary care hospital services and post-hospital extended care services furnished in that year.
(Aug. 14, 1935, ch. 531, title XVIII, §1813, as added July 30, 1965,
Amendments
1994—Subsec. (a)(1).
Subsec. (b)(3)(A).
Subsec. (b)(3)(B).
1989—Subsecs. (a)(1) to (3), (b)(3).
1988—Subsec. (a)(1) to (3).
Subsec. (b)(1).
Subsec. (b)(3).
1987—Subsec. (b)(1).
1986—Subsec. (b).
"(1) The inpatient hospital deductible which shall be applicable for the purposes of subsection (a) of this section shall be $40 in the case of any spell of illness beginning before 1969.
"(2) The Secretary shall, between July 1 and September 15 of 1968, and of each year thereafter, determine and promulgate the inpatient hospital deductible which shall be applicable for the purposes of subsection (a) of this section in the case of any inpatient hospital services or post-hospital extended care services furnished during the succeeding calendar year. Such inpatient hospital deductible shall be equal to $45 multiplied by the ratio of (A) the current average per diem rate for inpatient hospital services for the calendar year preceding the promulgation, to (B) the current average per diem rate for such services for 1966. Any amount determined under the preceding sentence which is not a multiple of $4 shall be rounded to the nearest multiple of $4 (or, if it is midway between two multiplies of $4, to the next higher multiple of $4). The current average per diem rate for any year shall be determined by the Secretary on the basis of the best information available to him (at the time the determination is made) as to the amounts paid under this part on account of inpatient hospital services furnished during such year, by hospitals which have agreements in effect under
Subsec. (b)(2).
1982—Subsec. (a)(4).
1981—Subsec. (b)(2).
1968—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (a)(2) to (4).
Subsec. (b)(1), (2).
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by section 102 of
Section 411(b)(1)(H)(iii) of
Effective Date of 1986 Amendments
Section 9301(b) of
Section 9125(b) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1981 Amendment
Section 2131(b) of
Section 2132(b) of
Effective Date of 1968 Amendment
Amendment by section 129(c)(3), (4) of
Section 135(d) of
Amendment by section 137(b) of
Repeal of 1988 Expansion of Medicare Part A Benefits
Section 101(a)–(b)(2) of
"(a)
"(1)
"(2)
"(b)
"(1)
"(A) no day before January 1, 1990, shall be counted in determining the beginning (or period) of a spell of illness;
"(B) with respect to the limitation (other than the limitation under section 1812(c) of such Act [
"(C) the limitation of coverage of extended care services to post-hospital extended care services shall not apply to an individual receiving such services from a skilled nursing facility during a continuous period beginning before (and including) January 1, 1990, until the end of the period of 30 consecutive days in which the individual is not provided inpatient hospital services or extended care services; and
"(D) the inpatient hospital deductible under section 1813(a)(1) of such Act [subsec. (a)(1) of this section] shall not apply—
"(i) in the case of an individual who is receiving inpatient hospital services during a continuous period beginning before (and including) January 1, 1990, with respect to the spell of illness beginning on such date, if such a deductible was imposed on the individual for a period of hospitalization during 1989;
"(ii) for a spell of illness beginning during January 1990, if such a deductible was imposed on the individual for a period of hospitalization that began in December 1989; and
"(iii) in the case of a spell of illness of an individual that began before January 1, 1990.
"(2)
[Section 4008(m)(1) of
Hold Harmless Provisions; Application of Subsection (a)(1) and (2)
Section 104(b) of
"(1)(A) section 1813(a)(1) of such Act [subsec. (a)(1) of this section] (as amended by this subtitle [subtitle A (§§101–104) of title I of
"(B) if that individual begins a period of hospitalization (as defined in such section) during 1989 after the end of that spell of illness, the first period of hospitalization during 1989 that begins after that spell of illness shall be considered to be (for purposes of such section) the first period of hospitalization that begins during that year; and
"(2) the amount of any deductible under section 1813(a)(2) of such Act (as amended by this subtitle) shall be reduced during that spell of illness during 1989 to the extent the deductible under such section was applied during the spell of illness."
Promulgation of New Deductible
Section 9301(c) of
Section Referred to in Other Sections
This section is referred to in
§1395f. Conditions of and limitations on payment for services
(a) Requirement of requests and certifications
Except as provided in subsections (d) and (g) of this section and in
(1) written request, signed by such individual, except in cases in which the Secretary finds it impracticable for the individual to do so, is filed for such payment in such form, in such manner, and by such person or persons as the Secretary may by regulation prescribe, no later than the close of the period of 3 calendar years following the year in which such services are furnished (deeming any services furnished in the last 3 calendar months of any calendar year to have been furnished in the succeeding calendar year) except that where the Secretary deems that efficient administration so requires, such period may be reduced to not less than 1 calendar year;
(2) a physician, or, in the case of services described in subparagraph (B), a physician, or a nurse practitioner or clinical nurse specialist who does not have a direct or indirect employment relationship with the facility but is working in collaboration with a physician, certifies (and recertifies, where such services are furnished over a period of time, in such cases, with such frequency, and accompanied by such supporting material, appropriate to the case involved, as may be provided by regulations, except that the first of such recertifications shall be required in each case of inpatient hospital services not later than the 20th day of such period) that—
(A) in the case of inpatient psychiatric hospital services, such services are or were required to be given on an inpatient basis, by or under the supervision of a physician, for the psychiatric treatment of an individual; and (i) such treatment can or could reasonably be expected to improve the condition for which such treatment is or was necessary or (ii) inpatient diagnostic study is or was medically required and such services are or were necessary for such purposes;
(B) in the case of post-hospital extended care services, such services are or were required to be given because the individual needs or needed on a daily basis skilled nursing care (provided directly by or requiring the supervision of skilled nursing personnel) or other skilled rehabilitation services, which as a practical matter can only be provided in a skilled nursing facility on an inpatient basis, for any of the conditions with respect to which he was receiving inpatient hospital services (or services which would constitute inpatient hospital services if the institution met the requirements of paragraphs (6) and (9) of
(C) in the case of home health services, such services are or were required because the individual is or was confined to his home (except when receiving items and services referred to in
(D) in the case of inpatient hospital services in connection with the care, treatment, filling, removal, or replacement of teeth or structures directly supporting teeth, the individual, because of his underlying medical condition and clinical status or because of the severity of the dental procedure, requires hospitalization in connection with the provision of such services;
(3) with respect to inpatient hospital services (other than inpatient psychiatric hospital services) which are furnished over a period of time, a physician certifies that such services are required to be given on an inpatient basis for such individual's medical treatment, or that inpatient diagnostic study is medically required and such services are necessary for such purpose, except that (A) such certification shall be furnished only in such cases, with such frequency, and accompanied by such supporting material, appropriate to the cases involved, as may be provided by regulations, and (B) the first such certification required in accordance with clause (A) shall be furnished no later than the 20th day of such period;
(4) in the case of inpatient psychiatric hospital services, the services are those which the records of the hospital indicate were furnished to the individual during periods when he was receiving (A) intensive treatment services, (B) admission and related services necessary for a diagnostic study, or (C) equivalent services;
(5) with respect to inpatient hospital services furnished such individual after the 20th day of a continuous period of such services, there was not in effect, at the time of admission of such individual to the hospital, a decision under
(6) with respect to inpatient hospital services or post-hospital extended care services furnished such individual during a continuous period, a finding has not been made (by the physician members of the committee or group, as described in
(7) in the case of hospice care provided an individual—
(A)(i) in the first 90-day period—
(I) the individual's attending physician (as defined in
(II) the medical director (or physician member of the interdisciplinary group described in
each certify in writing, not later than 2 days after hospice care is initiated (or, if each certify verbally not later than 2 days after hospice care is initiated, not later than 8 days after such care is initiated), that the individual is terminally ill (as defined in
(ii) in a subsequent 90- or 30-day period, the medical director or physician described in clause (i)(II) recertifies at the beginning of the period that the individual is terminally ill, and
(iii) in a subsequent extension period, the medical director or physician described in clause (i)(II) recertifies at the beginning of the period that the individual is terminally ill;
(B) a written plan for providing hospice care with respect to such individual has been established (before such care is provided by, or under arrangements made by, that hospice program) and is periodically reviewed by the individual's attending physician and by the medical director (and the interdisciplinary group described in
(C) such care is being or was provided pursuant to such plan of care; and
(8) in the case of inpatient rural primary care hospital services, a physician certifies that the individual may reasonably be expected to be discharged or transferred to a hospital within 72 hours after admission to the rural primary care hospital.
To the extent provided by regulations, the certification and recertification requirements of paragraph (2) shall be deemed satisfied where, at a later date, a physician, nurse practitioner, or clinical nurse specialist (as the case may be) makes certification of the kind provided in subparagraph (A), (B), (C), or (D) of paragraph (2) (whichever would have applied), but only where such certification is accompanied by such medical and other evidence as may be required by such regulations. With respect to the physician certification required by paragraph (2) for home health services furnished to any individual by a home health agency (other than an agency which is a governmental entity) and with respect to the establishment and review of a plan for such services, the Secretary shall prescribe regulations which shall become effective no later than July 1, 1981, and which prohibit a physician who has a significant ownership interest in, or a significant financial or contractual relationship with, such home health agency from performing such certification and from establishing or reviewing such plan, except that such prohibition shall not apply with respect to a home health agency which is a sole community home health agency (as determined by the Secretary). For purposes of the preceding sentence, service by a physician as an uncompensated officer or director of a home health agency shall not constitute having a significant ownership interest in, or a significant financial or contractual relationship with, such agency. For purposes of paragraph (2)(C), an individual shall be considered to be "confined to his home" if the individual has a condition, due to an illness or injury, that restricts the ability of the individual to leave his or her home except with the assistance of another individual or the aid of a supportive device (such as crutches, a cane, a wheelchair, or a walker), or if the individual has a condition such that leaving his or her home is medically contraindicated. While an individual does not have to be bedridden to be considered "confined to his home", the condition of the individual should be such that there exists a normal inability to leave home, that leaving home requires a considerable and taxing effort by the individual, and that absences of the individual from home are infrequent or of relatively short duration, or are attributable to the need to receive medical treatment.
(b) Amount paid to provider of services
The amount paid to any provider of services (other than a hospice program providing hospice care, other than a rural primary care hospital providing inpatient rural primary care hospital services, and other than a home health agency with respect to durable medical equipment) with respect to services for which payment may be made under this part shall, subject to the provisions of
(1) except as provided in paragraph (3), the lesser of (A) the reasonable cost of such services, as determined under
(2) if such services are furnished by a public provider of services, or by another provider which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low-income (and requests that payment be made under this paragraph), free of charge or at nominal charges to the public, the amount determined on the basis of those items (specified in regulations prescribed by the Secretary) included in the determination of such reasonable cost which the Secretary finds will provide fair compensation to such provider for such services; or
(3) if some or all of the hospitals in a State have been reimbursed for services (for which payment may be made under this part) pursuant to a reimbursement system approved as a demonstration project under section 402 of the Social Security Amendments of 1967 or section 222 of the Social Security Amendments of 1972, if the rate of increase in such hospitals in their costs per hospital inpatient admission of individuals entitled to benefits under this part over the duration of such project was equal to or less than such rate of increase for admissions of such individuals with respect to all hospitals in the United States during such period, and if either the State has legislative authority to operate such system and the State elects to have reimbursement to such hospitals made in accordance with this paragraph or the system is operated through a voluntary agreement of hospitals and such hospitals elect to have reimbursement to those hospitals made in accordance with this paragraph, then the Secretary may provide for continuation of reimbursement to such hospitals under such system until the Secretary determines that—
(A) a third-party payor reimburses such a hospital on a basis other than under such system, or
(B) the aggregate rate of increase from January 1, 1981, to the most recent date for which annual data are available in such hospitals in costs per hospital inpatient admission of individuals entitled to benefits under this part is greater than such rate of increase for admissions of such individuals with respect to all hospitals in the United States for such period.
In the case of any State which has had such a demonstration project reimbursement system in continuous operation since July 1, 1977, the Secretary shall provide under paragraph (3) for continuation of reimbursement to hospitals in the State under such system until the first day of the 37th month beginning after the date the Secretary determines and notifies the Governor of the State that either of the conditions described in subparagraph (A) or (B) of such paragraph has occurred. If, by the end of such 36-month period, the Secretary determines, based on evidence submitted by the Governor of the State, that neither of the conditions described in subparagraph (A) or (B) of paragraph (3) continues to apply, the Secretary shall continue without interruption payment to hospitals in the State under the State's system. If, by the end of such 36-month period, the Secretary determines, based on such evidence, that either of the conditions described in subparagraph (A) or (B) of such paragraph continues to apply, the Secretary shall (i) collect any net excess reimbursement to hospitals in the State during such 36-month period (basing such net excess reimbursement on the net difference, if any, in the rate of increase in costs per hospital inpatient admission under the State system compared to the rate of increase in such costs with respect to all hospitals in the United States over the 36-month period, as measured by including the cumulative savings under the State system based on the difference in the rate of increase in costs per hospital inpatient admission under the State system as compared to the rate of increase in such costs with respect to all hospitals in the United States between January 1, 1981, and the date of the Secretary's initial notice), and (ii) provide a reasonable period, not to exceed 2 years, for transition from the State system to the national payment system.
(c) No payments to Federal providers of services
Subject to
(d) Payments for emergency hospital services
(1) Payments shall also be made to any hospital for inpatient hospital services furnished in a calendar year, by the hospital or under arrangements (as defined in
(2) Payment may be made on the basis of an itemized bill to an individual entitled to hospital insurance benefits under
(3) The amounts payable under the preceding paragraph with respect to services described therein shall, subject to the provisions of
(e) Payment for inpatient hospital services prior to notification of noneligibility
Notwithstanding that an individual is not entitled to have payment made under this part for inpatient hospital services furnished by any hospital, payment shall be made to such hospital (unless it elects not to receive such payment or, if payment has already been made by or on behalf of such individual, fails to refund such payment within the time specified by the Secretary) for such services which are furnished to the individual prior to notification to such hospital from the Secretary of his lack of entitlement, if such payments are precluded only by reason of
(f) Payment for certain inpatient hospital services furnished outside United States
(1) Payment shall be made for inpatient hospital services furnished to an individual entitled to hospital insurance benefits under
(A) such individual is a resident of the United States, and
(B) such hospital was closer to, or substantially more accessible from, the residence of such individual than the nearest hospital within the United States which was adequately equipped to deal with, and was available for the treatment of, such individual's illness or injury.
(2) Payment may also be made for emergency inpatient hospital services furnished to an individual entitled to hospital insurance benefits under
(A) such individual was physically present—
(i) in a place within the United States; or
(ii) at a place within Canada while traveling without unreasonable delay by the most direct route (as determined by the Secretary) between Alaska and another State;
at the time the emergency which necessitated such inpatient hospital services occurred, and
(B) such hospital was closer to, or substantially more accessible from, such place than the nearest hospital within the United States which was adequately equipped to deal with, and was available for the treatment of, such individual's illness or injury.
(3) Payment shall be made in the amount provided under subsection (b) of this section to any hospital for the inpatient hospital services described in paragraph (1) or (2) furnished to an individual by the hospital or under arrangements (as defined in
(4) Payment for the inpatient hospital services described in paragraph (1) or (2) furnished to an individual entitled to hospital insurance benefits under
(g) Payments to physicians for services rendered in teaching hospitals
For purposes of services for which the reasonable cost thereof is determined under
(1) such hospital has an agreement with the Secretary under
(2) the Secretary has received written assurances that (A) such payment will be used by such fund solely for the improvement of care of hospital patients or for educational or charitable purposes and (B) the individuals who were furnished such services or any other persons will not be charged for such services (or if charged, provision will be made for return of any moneys incorrectly collected).
(h) Payment for specified hospital services provided in Department of Veterans Affairs hospitals; amount of payment
(1) Payments shall also be made to any hospital operated by the Department of Veterans Affairs for inpatient hospital services furnished in a calendar year by the hospital, or under arrangements (as defined in
(2) Payment for services described in paragraph (1) shall be in an amount equal to the charge imposed by the Secretary of Veterans Affairs for such services, or (if less) the amount that would be payable for such services under subsection (b) of this section and
(i) Payment for hospice care
(1)(A) Subject to the limitation under paragraph (2) and the provisions of
(B) Notwithstanding subparagraph (A), for hospice care furnished on or after April 1, 1986, the daily rate of payment per day for routine home care shall be $63.17 and the daily rate of payment for other services included in hospice care shall be the daily rate of payment recognized under subparagraph (A) as of July 1, 1985, increased by $10.
(C)(i) With respect to routine home care and other services included in hospice care furnished on or after January 1, 1990, and on or before September 30, 1990, the payment rates for such care and services shall be 120 percent of such rates in effect as of September 30, 1989.
(ii) With respect to routine home care and other services included in hospice care furnished during a subsequent fiscal year, the payment rates for such care and services shall be the payment rates in effect under this subparagraph during the previous fiscal year increased by—
(I) for a fiscal year ending on or before September 30, 1993, the market basket percentage increase (as defined in
(II) for fiscal year 1994, the market basket percentage increase for the fiscal year minus 2.0 percentage points;
(III) for fiscal year 1995, the market basket percentage increase for the fiscal year minus 1.5 percentage points;
(IV) for fiscal year 1996, the market basket percentage increase for the fiscal year minus 1.5 percentage points;
(V) for fiscal year 1997, the market basket percentage increase for the fiscal year minus 0.5 percentage point; and
(VI) for a subsequent fiscal year, the market basket percentage increase for the fiscal year.
(2)(A) The amount of payment made under this part for hospice care provided by (or under arrangements made by) a hospice program for an accounting year may not exceed the "cap amount" for the year (computed under subparagraph (B)) multiplied by the number of medicare beneficiaries in the hospice program in that year (determined under subparagraph (C)).
(B) For purposes of subparagraph (A), the "cap amount" for a year is $6,500, increased or decreased, for accounting years that end after October 1, 1984, by the same percentage as the percentage increase or decrease, respectively, in the medical care expenditure category of the Consumer Price Index for All Urban Consumers (United States city average), published by the Bureau of Labor Statistics, from March 1984 to the fifth month of the accounting year.
(C) For purposes of subparagraph (A), the "number of medicare beneficiaries" in a hospice program in an accounting year is equal to the number of individuals who have made an election under subsection (d) of this section with respect to the hospice program and have been provided hospice care by (or under arrangements made by) the hospice program under this part in the accounting year, such number reduced to reflect the proportion of hospice care that each such individual was provided in a previous or subsequent accounting year or under a plan of care established by another hospice program.
(j) Elimination of lesser-of-cost-or-charges provision
(1) The lesser-of-cost-or-charges provisions (described in paragraph (2)) will not apply in the case of services provided by a class of provider of services if the Secretary determines and certifies to Congress that the failure of such provisions to apply to the services provided by that class of providers will not result in any increase in the amount of payments made for those services under this subchapter. Such change will take effect with respect to services furnished, or cost reporting periods of providers, on or after such date as the Secretary shall provide in the certification. Such change for a class of provider shall be discontinued if the Secretary determines and notifies Congress that such change has resulted in an increase in the amount of payments made under this subchapter for services provided by that class of provider.
(2) The lesser-of-cost-or-charges provisions referred to in paragraph (1) are as follows:
(A) Clause (B) of paragraph (1) and paragraph (2) of subsection (b) of this section.
(B)
(C) So much of subparagraph (A) of
(D) Subclause (II) of clause (i) and clause (ii) of
(k) Payments to home health agencies for durable medical equipment
The amount paid to any home health agency with respect to durable medical equipment for which payment may be made under this part shall be the amount described in
(l) Payment for inpatient rural primary care hospital services
(1) The amount of payment under this part for inpatient rural primary care hospital services—
(A) in the case of the first 12-month cost reporting period for which the facility operates as such a hospital, is the reasonable costs of the facility in providing inpatient rural primary care hospital services during such period, as such costs are determined on a per diem basis, and
(B) in the case of a later reporting period, is the per diem payment amount established under this paragraph for the preceding 12-month cost reporting period, increased by the applicable percentage increase under
The payment amounts otherwise determined under this paragraph shall be reduced, to the extent necessary, to avoid duplication of any payment made under
(2) The Secretary shall develop a prospective payment system for determining payment amounts for inpatient rural primary care hospital services under this part furnished on or after January 1, 1996.
(Aug. 14, 1935, ch. 531, title XVIII, §1814, as added July 30, 1965,
References in Text
Section 402 of the Social Security Amendments of 1967, referred to in subsec. (b)(3), means section 402 of
Section 222 of the Social Security Amendments of 1972, referred to in subsec. (b)(3), means section 222 of
Section 4005(e) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (l)(1), is section 4005(e) of
Amendments
1994—Subsec. (a)(5).
Subsec. (a)(8).
Subsec. (i)(1)(C)(i).
Subsec. (l)(2).
1993—Subsec. (i)(1)(C)(ii).
1991—Subsec. (h).
1990—Subsec. (a)(7)(A)(iii).
Subsec. (b)(3).
Subsec. (i)(1)(C)(i).
1989—Subsec. (a).
Subsec. (a)(2).
Subsec. (a)(2)(B), (6).
Subsec. (a)(7)(A)(i).
Subsec. (a)(7)(A)(iii).
Subsec. (a)(8).
Subsec. (b).
Subsec. (d)(3).
Subsec. (i)(1)(A).
Subsec. (i)(1)(C).
Subsec. (l).
1988—Subsec. (a)(2)(B).
Subsec. (a)(6).
Subsec. (a)(7)(A)(iii).
Subsec. (d)(3).
1987—Subsec. (a).
Subsec. (b)(3)(B).
Subsec. (j)(2)(B).
Subsec. (k).
"(1) the lesser of—
"(A) the reasonable cost of such equipment, as determined under
"(B) the customary charges with respect to such equipment,
less the amount the home health agency may charge as described in
"(2) if such equipment is furnished by a public home health agency, or by another home health agency which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low-income (and requests that payment be made under this paragraph), free of charge or at nominal charge to the public, 80 percent of the amount which the Secretary finds will provide fair compensation to the home health agency."
1986—Subsec. (i)(1)(B).
Subsec. (i)(1)(C).
1984—Subsec. (a).
Subsec. (a)(2)(B) to (E).
Subsec. (a)(3).
Subsec. (a)(5) to (8).
Subsec. (b).
Subsec. (b)(2).
Subsec. (b)(3).
Subsec. (i)(1).
Subsec. (j)(2)(B) to (D).
Subsec. (k).
Subsec. (k)(2).
1983—Subsec. (g).
Subsec. (h)(2).
Subsec. (i)(1).
Subsec. (i)(2)(A).
Subsec. (i)(2)(B).
Subsec. (j).
Subsec. (j)(2)(A).
1982—Subsec. (a)(8).
Subsec. (b).
Subsec. (i).
1981—Subsec. (a)(2)(D).
Subsec. (a)(2)(F).
1980—Subsec. (a).
Subsec. (a)(2)(D).
Subsec. (a)(2)(E).
Subsec. (a)(2)(F).
Subsec. (b)(1).
Subsec. (b)(3).
Subsec. (c).
Subsecs. (h) to (j).
1978—Subsec. (b)(1).
1977—Subsec. (c).
Subsec. (j).
1976—Subsec. (c).
1973—Subsec. (a)(2)(E).
Subsec. (a), last sentence.
1972—Subsec. (a).
Subsec. (a)(1).
Subsec. (a)(2)(C).
Subsec. (a)(2)(D).
Subsec. (a)(2)(E).
Subsec. (a)(6).
Subsec. (a)(7).
Subsec. (b).
Subsec. (f).
Subsec. (g).
Subsec. (h).
Subsec. (i).
1968—Subsec. (a).
Subsec. (a)(2)(A) to (E).
Subsec. (a)(2)(F).
Subsec. (a)(3) to (7).
Subsec. (d).
Subsec. (d)(1) to (3).
Effective Date of 1994 Amendment
Amendment by section 106(b)(1)(A) of
Effective Date of 1990 Amendment
Amendment by section 4006(b) of
Effective Date of 1989 Amendments
Section 6005(c) of
Amendment by
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1987 Amendment
Section 4008(b)(2) of
Section 4024(c) of
Section 4062(e) of
[Section 4152(h) of
Effective Date of 1984 Amendments
Section 1(b) of
Section 3(c) of
Section 2321(g) of
Section 2335(g) of
Section 2336(c)(1) of
Amendment by section 2354(b)(1) of
Amendment by section 2354(c)(1)(A) of
Effective Date of 1983 Amendments
Amendment by
Amendment by
Effective Date of 1982 Amendment
Amendment by section 122(c)(1), (2) of
Effective Date of 1981 Amendment
Amendment by section 2121(b) of
Section 2122(b) of
Effective Date of 1980 Amendment
Amendment by section 930(e), (f) of
Amendment by section 931(b) of
Section 936(d) of
Section 941(c) of
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1977 Amendment
Section 23(c) of
Effective Date of 1973 Amendment
Section 18(z–3)(2) of
Effective Date of 1972 Amendment
Section 211(d) of
Amendment by section 226(c)(1) of
Amendment by section 227(b) of
Section 228(b) of
Section 233(f) of
Amendment by section 234(g)(1) of
Section 238(b) of
Section 247(c) of
Section 256(d) of
Amendment by section 281(e) of
Effective Date of 1968 Amendment
Section 126(c) of
Amendment by section 129(c)(5), (6)(A) of
Amendment by section 143(c) of
Study of Methods To Compensate Hospices for High-Cost Care
Section 6016 of
Continuation of Bad Debt Recognition for Hospital Services
Section 4008(c) of
[Section 6023(b) of
[
Providers of Services To Calculate and Report Lesser-of-Cost-or-Charges Determinations Separately With Respect to Payments Under Parts A and B of This Subchapter; Issuance of Regulations
Section 2308(a) of
Determination of Nominal Charges for Applying Nominality Test
Section 2308(b)(1) of
Revision of Regulations Regarding Access to Home Health Services
Section 2336(c)(2) of
Promulgation of Regulations
Section 122(h)(2) of
"(A) a description of the care included in 'hospice care' and the standards for qualification of a 'hospice program', under section 1861(dd) of the Social Security Act [
"(B) the standards for payment for hospice care under part A of title XVIII of such Act [this part], pursuant to section 1814(i) of such Act [subsec. (i) of this section]."
Study and Report Relating to the Reimbursement Method and Benefit Structure for Hospice Care; Supervision of Report by Comptroller General
Section 122(j), formerly §122(i), of
"(1) The Secretary of Health and Human Services shall conduct a study and, prior to January 1, 1986, report to the Congress on whether or not the reimbursement method and benefit structure (including copayments) for hospice care under title XVIII of the Social Security Act [this subchapter] are fair and equitable and promote the most efficient provision of hospice care. Such report shall include the feasibility and advisability of providing for prospective reimbursement for hospice care, an evaluation of the inclusion of payment for outpatient drugs, an evaluation of the need to alter the method of reimbursement for nutritional, dietary, and bereavement counseling as hospice care, and any recommendations for legislative changes in the hospice care reimbursement or benefit structure.
"(2) The Comptroller General shall monitor and evaluate the study and the preparation of the report under paragraph (1)."
Waiver of Limitations To Allow Pre-Existing Hospices To Participate as a Hospice Program
Section 122(k), formerly §122(j), of
Medicare Payment Basis for Services Provided by Agencies and Providers; Effective Date
Section 16 of
Section Referred to in Other Sections
This section is referred to in
§1395g. Payments to providers of services
(a) Determination of amount
The Secretary shall periodically determine the amount which should be paid under this part to each provider of services with respect to the services furnished by it, and the provider of services shall be paid, at such time or times as the Secretary believes appropriate (but not less often than monthly) and prior to audit or settlement by the General Accounting Office, from the Federal Hospital Insurance Trust Fund, the amounts so determined, with necessary adjustments on account of previously made overpayments or underpayments; except that no such payments shall be made to any provider unless it has furnished such information as the Secretary may request in order to determine the amounts due such provider under this part for the period with respect to which the amounts are being paid or any prior period.
(b) Conditions
No payment shall be made to a provider of services which is a hospital for or with respect to services furnished by it for any period with respect to which it is deemed, under
(c) Payments under assignment or power of attorney
No payment which may be made to a provider of services under this subchapter for any service furnished to an individual shall be made to any other person under an assignment or power of attorney; but nothing in this subsection shall be construed (1) to prevent the making of such a payment in accordance with an assignment from the provider if such assignment is made to a governmental agency or entity or is established by or pursuant to the order of a court of competent jurisdiction, or (2) to preclude an agent of the provider of services from receiving any such payment if (but only if) such agent does so pursuant to an agency agreement under which the compensation to be paid to the agent for his services for or in connection with the billing or collection of payments due such provider under this subchapter is unrelated (directly or indirectly) to the amount of such payments or the billings therefor, and is not dependent upon the actual collection of any such payment.
(d) Accrual of interest on balance of excess or deficit not paid
Whenever a final determination is made that the amount of payment made under this part to a provider of services was in excess of or less than the amount of payment that is due, and payment of such excess or deficit is not made (or effected by offset) within 30 days of the date of the determination, interest shall accrue on the balance of such excess or deficit not paid or offset (to the extent that the balance is owed by or owing to the provider) at a rate determined in accordance with the regulations of the Secretary of the Treasury applicable to charges for late payments.
(e) Periodic interim payments
(1) The Secretary shall provide payment under this part for inpatient hospital services furnished by a subsection (d) hospital (as defined in
(A) Upon the request of a hospital which is paid through an agency or organization with an agreement with the Secretary under
(B) In the case of 1 hospital that—
(i) has a disproportionate share adjustment percentage (as established in clause (iv) of such section) of at least 5.1 percent (as computed for purposes of establishing the average standardized amounts for discharges occurring during fiscal year 1987), and
(ii) requests payment on such basis,
but only if the hospital was being paid for inpatient hospital services on such a periodic interim payment basis as of June 30, 1987, and continues to meet the requirements (in effect as of October 1, 1986) applicable to payment on such a basis.
(C) In the case of a hospital that—
(i) is located in a rural area,
(ii) has 100 or fewer beds, and
(iii) requests payment on such basis,
but only if the hospital was being paid for inpatient hospital services on such a periodic interim payment basis as of June 30, 1987, and continues to meet the requirements (in effect as of October 1, 1986) applicable to payment on such a basis.
(2) The Secretary shall provide (or continue to provide) for payment on a periodic interim payment basis (under the standards established under section 405.454(j) of title 42, Code of Federal Regulations, as in effect on October 1, 1986) with respect to—
(A) inpatient hospital services of a hospital that is not a subsection (d) hospital (as defined in
(B) a hospital which is receiving payment under a State hospital reimbursement system under
(C) extended care services;
(D) home health services; and
(E) hospice care;
if the provider of such services elects to receive, and qualifies for, such payments.
(3) In the case of a subsection (d) hospital or a subsection (d) Puerto Rico hospital (as defined for purposes of
(4) A hospital created by the merger or consolidation of 2 or more hospitals or hospital campuses shall be eligible to receive periodic interim payment on the basis described in paragraph (1)(B) if—
(A) at least one of the hospitals or campuses received periodic interim payment on such basis prior to the merger or consolidation; and
(B) the merging or consolidating hospitals or campuses would each meet the requirement of paragraph (1)(B)(i) if such hospitals or campuses were treated as independent hospitals for purposes of this subchapter.
(Aug. 14, 1935, ch. 531, title XVIII, §1815, as added July 30, 1965,
Amendments
1989—Subsec. (e)(4).
1986—Subsec. (e).
1982—Subsec. (b).
Subsec. (d).
1980—Subsec. (c).
1977—Subsec. (c).
1975—
Effective Date of 1989 Amendment
Section 6021(b) of
Effective Date of 1986 Amendment
Section 9311(a)(2) of
Effective Date of 1982 Amendment
Section 117(b) of
Amendment by section 148(b) of
Effective Date of 1977 Amendment
Section 2(a)(4) of
Effective Date of 1975 Amendment
Amendment by
Transition
Section 9311(a)(3) of
"(A) as of June 30, 1987, is receiving payments under part A of title XVIII of such Act [this part] for inpatient hospital services on a periodic interim payment basis,
"(B) requests continuation of payment on such basis, and
"(C) is paid through an agency or organization with an agreement under section 1816 of such Act [
the Secretary of Health and Human Services shall continue payment on such a basis until not earlier than the end of the first period of three consecutive calendar months (beginning no earlier than April 1987) during all of which the agency or organization has met the requirements of section 1816(c)(2) of such Act (relating to prompt payment of claims)."
Delay in Periodic Interim Payments
Section 120 of
"(1) with respect to the last 21 days for which such payments would otherwise be made during fiscal year 1983, such payments shall be deferred until fiscal year 1984; and
"(2) with respect to the last 21 days for which such payments would otherwise be made during fiscal year 1984, such payments shall be deferred until fiscal year 1985."
1 So in original. Probably should be followed by "a".
§1395h. Use of public or private agencies or organizations to facilitate payment to providers of services
(a) Authorization for agreement by Secretary for implementation; scope of agreement
If any group or association of providers of services wishes to have payments under this part to such providers made through a national, State, or other public or private agency or organization and nominates such agency or organization for this purpose, the Secretary is authorized to enter into an agreement with such agency or organization providing for the determination by such agency or organization (subject to the provisions of
(b) Prerequisites for agreement or renewal of agreement by Secretary
The Secretary shall not enter into or renew an agreement with any agency or organization under this section unless—
(1) he finds—
(A) after applying the standards, criteria, and procedures developed under subsection (f) of this section, that to do so is consistent with the effective and efficient administration of this part, and
(B) that such agency or organization is willing and able to assist the providers to which payments are made through it under this part in the application of safeguards against unnecessary utilization of services furnished by them to individuals entitled to hospital insurance benefits under
(2) such agency or organization agrees—
(A) to furnish to the Secretary such of the information acquired by it in carrying out its agreement under this section, and
(B) to provide the Secretary with access to all such data, information, and claims processing operations,
as the Secretary may find necessary in performing his functions under this part.
(c) Terms and conditions of agreements; prompt payment of claims
(1) An agreement with any agency or organization under this section may contain such terms and conditions as the Secretary finds necessary or appropriate, may provide for advances of funds to the agency or organization for the making of payments by it under subsection (a) of this section, and shall provide for payment of so much of the cost of administration of the agency or organization as is determined by the Secretary to be necessary and proper for carrying out the functions covered by the agreement. The Secretary shall provide that in determining the necessary and proper cost of administration, the Secretary shall, with respect to each agreement, take into account the amount that is reasonable and adequate to meet the costs which must be incurred by an efficiently and economically operated agency or organization in carrying out the terms of its agreement. The Secretary shall cause to have published in the Federal Register, by not later than September 1 before each fiscal year, data, standards, and methodology to be used to establish budgets for fiscal intermediaries under this section for that fiscal year, and shall cause to be published in the Federal Register for public comment, at least 90 days before such data, standards, and methodology are published, the data, standards, and methodology proposed to be used. The Secretary may not require, as a condition of entering into or renewing an agreement under this section or under
(2)(A) Each agreement under this section shall provide that payment shall be issued, mailed, or otherwise transmitted with respect to not less than 95 percent of all claims submitted under this subchapter—
(i) which are clean claims, and
(ii) for which payment is not made on a periodic interim payment basis,
within the applicable number of calendar days after the date on which the claim is received.
(B) In this paragraph:
(i) The term "clean claim" means a claim that has no defect or impropriety (including any lack of any required substantiating documentation) or particular circumstance requiring special treatment that prevents timely payment from being made on the claim under this subchapter.
(ii) The term "applicable number of calendar days" means—
(I) with respect to claims received in the 12-month period beginning October 1, 1986, 30 calendar days,
(II) with respect to claims received in the 12-month period beginning October 1, 1987, 26 calendar days,
(III) with respect to claims received in the 12-month period beginning October 1, 1988, 25 calendar days, and 1
(IV) with respect to claims received in the 12-month period beginning October 1, 1989, and claims received in any succeeding 12-month period ending on or before September 30, 1993, 24 calendar days.2
(V) with respect to claims received in the 12-month period beginning October 1, 1993, and claims received in any succeeding 12-month period, 30 calendar days.
(C) If payment is not issued, mailed, or otherwise transmitted within the applicable number of calendar days (as defined in clause (ii) of subparagraph (B)) after a clean claim (as defined in clause (i) of such subparagraph) is received from a hospital, rural primary care hospital, skilled nursing facility, home health agency, hospice program, comprehensive outpatient rehabilitation facility, or rehabilitation agency that is not receiving payments on a periodic interim payment basis with respect to such services, interest shall be paid at the rate used for purposes of
(3)(A) Each agreement under this section shall provide that no payment shall be issued, mailed, or otherwise transmitted with respect to any claim submitted under this subchapter within the applicable number of calendar days after the date on which the claim is received.
(B) In this paragraph, the term "applicable number of calendar days" means—
(i) with respect to claims submitted electronically as prescribed by the Secretary, 13 days, and
(ii) with respect to claims submitted otherwise, 26 days.
(d) Nomination of agency or organization; withdrawal
If the nomination of an agency or organization as provided in this section is made by a group or association of providers of services, it shall not be binding on members of the group or association which notify the Secretary of their election to that effect. Any provider may, upon such notice as may be specified in the agreement under this section with an agency or organization, withdraw its nomination to receive payments through such agency or organization. Any provider which has withdrawn its nomination, and any provider which has not made a nomination, may elect to receive payments from any agency or organization which has entered into an agreement with the Secretary under this section if the Secretary and such agency or organization agree to it.
(e) Assignment or reassignment of provider of services; designation of agency or organization to perform provider services and home health agency functions
(1) Notwithstanding subsections (a) and (d) of this section, the Secretary, after taking into consideration any preferences of providers of services, may assign or reassign any provider of services to any agency or organization which has entered into an agreement with him under this section, if he determines, after applying the standards, criteria, and procedures developed under subsection (f) of this section, that such assignment or reassignment would result in the more effective and efficient administration of this part.
(2) Notwithstanding subsections (a) and (d) of this section, the Secretary may (subject to the provisions of paragraph (4)) designate a national or regional agency or organization which has entered into an agreement with him under this section to perform functions under the agreement with respect to a class of providers of services in the Nation or region (as the case may be), if he determines, after applying the standards, criteria, and procedures developed under subsection (f) of this section, that such designation would result in more effective and efficient administration of this part.
(3)(A) Before the Secretary makes an assignment or reassignment under paragraph (1) of a provider of services to other than the agency or organization nominated by the provider, he shall furnish (i) the provider and such agency or organization with a full explanation of the reasons for his determination as to the efficiency and effectiveness of the agency or organization to perform the functions required under this part with respect to the provider, and (ii) such agency or organization with opportunity for a hearing, and such determination shall be subject to judicial review in accordance with
(B) Before the Secretary makes a designation under paragraph (2) with respect to a class of providers of services, he shall furnish (i) such providers and the agencies and organizations adversely affected by such designation with a full explanation of the reasons for his determination as to the efficiency and effectiveness of such agencies and organizations to perform the functions required under this part with respect to such providers, and (ii) the agencies and organizations adversely affected by such designation with opportunity for a hearing, and such determination shall be subject to judicial review in accordance with
(4) Notwithstanding subsections (a) and (d) of this section and paragraphs (1), (2), and (3) of this subsection, the Secretary shall designate regional agencies or organizations which have entered into an agreement with him under this section to perform functions under such agreement with respect to home health agencies (as defined in
(5) Notwithstanding any other provision of this subchapter, the Secretary shall designate the agency or organization which has entered into an agreement under this section to perform functions under such an agreement with respect to each hospice program, except that with respect to a hospice program which is a subdivision of a provider of services (and such hospice program and provider of services are under common control) due regard shall be given to the agency or organization which performs the functions under this section for the provider of services.
(f) Development of standards, criteria, and procedures by Secretary for evaluation of agency or organization performance
(1) In order to determine whether the Secretary should enter into, renew, or terminate an agreement under this section with an agency or organization, whether the Secretary should assign or reassign a provider of services to an agency or organization, and whether the Secretary should designate an agency or organization to perform services with respect to a class of providers of services, the Secretary shall develop standards, criteria, and procedures to evaluate such agency's or organization's (A) overall performance of claims processing (including the agency's or organization's success in recovering payments made under this subchapter for services for which payment has been or could be made under a primary plan (as defined in
(2) The standards and criteria established under paragraph (1) shall include—
(A) with respect to claims for services furnished under this part by any provider of services other than a hospital—
(i) whether such agency or organization is able to process 75 percent of reconsiderations within 60 days (except in the case of fiscal year 1989, 66 percent of reconsiderations) and 90 percent of reconsiderations within 90 days, and
(ii) the extent to which such agency's or organization's determinations are reversed on appeal; and
(B) with respect to applications for an exemption from or exception or adjustment to the target amount applicable under
(i) if such agency or organization receives a completed application, whether such agency or organization is able to process such application not later than 75 days after the application is filed, and
(ii) if such agency or organization receives an incomplete application, whether such agency or organization is able to return the application with instructions on how to complete the application not later than 60 days after the application is filed.
(g) Termination of agreement; procedures applicable
An agreement with the Secretary under this section may be terminated—
(1) by the agency or organization which entered into such agreement at such time and upon such notice to the Secretary, to the public, and to the providers as may be provided in regulations, or
(2) by the Secretary at such time and upon such notice to the agency or organization, to the providers which have nominated it for purposes of this section, and to the public, as may be provided in regulations, but only if he finds, after applying the standards, criteria, and procedures developed under subsection (f) of this section and after reasonable notice and opportunity for hearing to the agency or organization, that (A) the agency or organization has failed substantially to carry out the agreement, or (B) the continuation of some or all of the functions provided for in the agreement with the agency or organization is disadvantageous or is inconsistent with the efficient administration of this part.
(h) Bonding requirement under agreement for officers and employees of agency or organization
An agreement with an agency or organization under this section may require any of its officers or employees certifying payments or disbursing funds pursuant to the agreement, or otherwise participating in carrying out the agreement, to give surety bond to the United States in such amount as the Secretary may deem appropriate.
(i) Liability of certifying and disbursing officers designated under agreement for negligent, etc., payments
(1) No individual designated pursuant to an agreement under this section as a certifying officer shall, in the absence of gross negligence or intent to defraud the United States, be liable with respect to any payments certified by him under this section.
(2) No disbursing officer shall, in the absence of gross negligence or intent to defraud the United States, be liable with respect to any payment by him under this section if it was based upon a voucher signed by a certifying officer designated as provided in paragraph (1) of this subsection.
(3) No such agency or organization shall be liable to the United States for any payments referred to in paragraph (1) or (2).
(j) Denial of claim; notification and reconsideration
An agreement with an agency or organization under this section shall require that, with respect to a claim for home health services, extended care services, or post-hospital extended care services submitted by a provider to such agency or organization that is denied, such agency or organization—
(1) furnish the provider and the individual with respect to whom the claim is made with a written explanation of the denial and of the statutory or regulatory basis for the denial; and
(2) in the case of a request for reconsideration of a denial, promptly notify such individual and the provider of the disposition of such reconsideration.
(k) Annual reporting requirement on erroneous payment recovery
An agreement with an agency or organization under this section shall require that such agency or organization submit an annual report to the Secretary describing the steps taken to recover payments made for items or services for which payment has been or could be made under a primary plan (as defined in
(Aug. 14, 1935, ch. 531, title XVIII, §1816, as added July 30, 1965,
References in Text
Part B of subchapter XI of this chapter, referred to in subsec. (a), is classified to
Amendments
1994—Subsec. (f)(1)(A).
Subsec. (f)(2)(A)(ii).
Subsec. (k).
1993—Subsec. (c)(2)(B)(ii)(IV), (V).
Subsec. (c)(3)(B).
"(i) with respect to claims received in the 3-month period beginning July 1, 1988, 10 days, and
"(ii) with respect to claims received in the 12-month period beginning October 1, 1988, 14 days."
1990—Subsec. (f).
1989—Subsec. (c)(1).
Subsec. (c)(2)(C).
Subsec. (k).
1988—Subsec. (j)(2).
Subsec. (k).
1987—Subsec. (c)(1).
Subsec. (c)(2)(C).
Subsec. (c)(3).
Subsec. (f).
Subsec. (j).
1986—Subsec. (a).
Subsec. (c).
1984—Subsec. (c).
Subsec. (e)(4).
Subsec. (f).
1982—Subsec. (e)(5).
1980—Subsec. (e)(2).
Subsec. (e)(4).
1977—Subsec. (a).
Subsec. (b).
Subsecs. (e), (f).
Subsec. (g).
Subsecs. (h), (i).
1972—Subsec. (a).
Effective Date of 1994 Amendment
Section 151(b)(4) of
Effective Date of 1993 Amendment
Section 13568(c) of
Effective Date of 1989 Amendments
Section 6202(d)(3) of
Amendment by
Effective Date of 1988 Amendment
Amendment by section 203(f) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4031(a)(3)(A) of
Section 4032(c)(1) of
"(A) The amendment made by subsection (a) [amending this section] shall apply with respect to claims received on or after January 1, 1988.
"(B) The amendment made by subsection (b) [amending this section] shall apply with respect to reconsiderations requested on or after October 1, 1988."
Section 4035(a)(3) of
Section 4085(d)(2) of
"(A) The amendment made by paragraph (1) [amending this section] shall apply to claims received on or after the date of enactment of this Act [Dec. 22, 1987].
"(B) The Secretary of Health and Human Services shall provide for such timely amendments to agreements under section 1816 [this section], and regulations, to such extent as may be necessary to implement the amendment made by paragraph (1)."
Effective Date of 1986 Amendment
Section 9311(d) of
"(1) Except as provided in paragraph (2), the amendments made by subsections (b) and (c) [amending this section and
"(2) Sections 1816(c)(2)(C)) [sic] and 1842(c)(2)(C) of the Social Security Act [subsec. (c)(2)(C) of this section and
"(3) The Secretary of Health and Human Services shall provide for such timely amendments to agreements under section 1816 of the Social Security Act [this section] and contracts under section 1842 of such Act [
Amendment by section 9352(a)(2) of
Effective Date of 1984 Amendment
Section 2326(d)(3) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendment
Amendment by
Effective Date of 1977 Amendment
Section 14(c), (d) of
"(c) The amendment made by paragraphs (2) and (3) of subsection (a) [amending this section] to the extent that they require application of standards, criteria, and procedures developed under section 1816(f) of the Social Security Act [subsec. (f) of this section] shall apply to the entering into, renewal, or termination of agreements on and after October 1, 1978.
"(d) Except as provided in subsection (c), the amendment made by subsection (a)(2) [amending this section] shall apply to agreements entered into or renewed on or after the date of enactment of this Act [Oct. 25, 1977]."
Effective Date of 1972 Amendment
Amendment by
Advisory Committee on Medicare Home Health Claims
Section 427 of
Amendments to Agreements and Contracts Necessary To Implement Section 4031(a) of Pub. L. 100–203
Section 4031(a)(3)(B) of
Prohibition of Policies Other Than as Provided by Section 4031 of Pub. L. 100–203 Intended To Slow Down Medicare Payments; Budget Considerations
Section 4031(b), (c) of
"(b)
"(c)
Amendments to Agreements and Contracts Necessary To Implement Section 4032(a), (b) of Pub. L. 100–203
Section 4032(c)(2) provided that: "The Secretary of Health and Human Services shall provide for such timely amendments to agreements under section 1816 [this section] and contracts under section 1842 of the Social Security Act [
Replacement of Agency, Organization, or Carrier Processing Medicare Claims; Number of Agreements and Contracts Authorized for Fiscal Years 1985 Through 1993
Section 2326(a) of
[Section 159(b) of
[Section 6215(b) of
Audit and Medical Claims Review
Section 118 of
[Section 9216(b) of
Developmental Date for Standards, Criteria, and Procedures Pursuant to Subsec. (f) of This Section
Section 14(b) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. The word "and" probably should not appear.
2 So in original. The period probably should be ", and".
§1395i. Federal Hospital Insurance Trust Fund
(a) Creation; deposits; transfers from Treasury
There is hereby created on the books of the Treasury of the United States a trust fund to be known as the "Federal Hospital Insurance Trust Fund" (hereinafter in this section referred to as the "Trust Fund"). The Trust Fund shall consist of such gifts and bequests as may be made as provided in
(1) the taxes imposed by sections 3101(b) and 3111(b) of the Internal Revenue Code of 1986 with respect to wages reported to the Secretary of the Treasury or his delegate pursuant to subtitle F of such Code after December 31, 1965, as determined by the Secretary of the Treasury by applying the applicable rates of tax under such sections to such wages, which wages shall be certified by the Commissioner of Social Security on the basis of records of wages established and maintained by the Commissioner of Social Security in accordance with such reports; and
(2) the taxes imposed by section 1401(b) of the Internal Revenue Code of 1986 with respect to self-employment income reported to the Secretary of the Treasury or his delegate on tax returns under subtitle F of such Code, as determined by the Secretary of the Treasury by applying the applicable rate of tax under such section to such self-employment income, which self-employment income shall be certified by the Commissioner of Social Security on the basis of records of self-employment established and maintained by the Commissioner of Social Security in accordance with such returns.
The amounts appropriated by the preceding sentence shall be transferred from time to time from the general fund in the Treasury to the Trust Fund, such amounts to be determined on the basis of estimates by the Secretary of the Treasury of the taxes, specified in the preceding sentence, paid to or deposited into the Treasury; and proper adjustments shall be made in amounts subsequently transferred to the extent prior estimates were in excess of or were less than the taxes specified in such sentence.
(b) Board of Trustees; composition; meetings; duties
With respect to the Trust Fund, there is hereby created a body to be known as the Board of Trustees of the Trust Fund (hereinafter in this section referred to as the "Board of Trustees") composed of the Commissioner of Social Security, the Secretary of the Treasury, the Secretary of Labor, and the Secretary of Health and Human Services, all ex officio, and of two members of the public (both of whom may not be from the same political party), who shall be nominated by the President for a term of four years and subject to confirmation by the Senate. A member of the Board of Trustees serving as a member of the public and nominated and confirmed to fill a vacancy occurring during a term shall be nominated and confirmed only for the remainder of such term. An individual nominated and confirmed as a member of the public may serve in such position after the expiration of such member's term until the earlier of the time at which the member's successor takes office or the time at which a report of the Board is first issued under paragraph (2) after the expiration of the member's term. The Secretary of the Treasury shall be the Managing Trustee of the Board of Trustees (hereinafter in this section referred to as the "Managing Trustee"). The Administrator of the Health Care Financing Administration shall serve as the Secretary of the Board of Trustees. The Board of Trustees shall meet not less frequently than once each calendar year. It shall be the duty of the Board of Trustees to—
(1) Hold the Trust Fund;
(2) Report to the Congress not later than the first day of April of each year on the operation and status of the Trust Fund during the preceding fiscal year and on its expected operation and status during the current fiscal year and the next 2 fiscal years;
(3) Report immediately to the Congress whenever the Board is of the opinion that the amount of the Trust Fund is unduly small; and
(4) Review the general policies followed in managing the Trust Fund, and recommend changes in such policies, including necessary changes in the provisions of law which govern the way in which the Trust Fund is to be managed.
The report provided for in paragraph (2) shall include a statement of the assets of, and the disbursements made from, the Trust Fund during the preceding fiscal year, an estimate of the expected income to, and disbursements to be made from, the Trust Fund during the current fiscal year and each of the next 2 fiscal years, and a statement of the actuarial status of the Trust Fund. Such report shall also include an actuarial opinion by the Chief Actuarial Officer of the Health Care Financing Administration certifying that the techniques and methodologies used are generally accepted within the actuarial profession and that the assumptions and cost estimates used are reasonable. Such report shall be printed as a House document of the session of the Congress to which the report is made. A person serving on the Board of Trustees shall not be considered to be a fiduciary and shall not be personally liable for actions taken in such capacity with respect to the Trust Fund.
(c) Investment of Trust Fund by Managing Trustee
It shall be the duty of the Managing Trustee to invest such portion of the Trust Fund as is not, in his judgment, required to meet current withdrawals. Such investments may be made only in interest-bearing obligations of the United States or in obligations guaranteed as to both principal and interest by the United States. For such purpose such obligations may be acquired (1) on original issue at the issue price, or (2) by purchase of outstanding obligations at the market price. The purposes for which obligations of the United States may be issued under
(d) Authority of Managing Trustee to sell obligations
Any obligations acquired by the Trust Fund (except public-debt obligations issued exclusively to the Trust Fund) may be sold by the Managing Trustee at the market price, and such public-debt obligations may be redeemed at par plus accrued interest.
(e) Interest on and proceeds from sale or redemption of obligations
The interest on, and the proceeds from the sale or redemption of, any obligations held in the Trust Fund shall be credited to and form a part of the Trust Fund.
(f) Payment of estimated taxes
(1) The Managing Trustee is directed to pay from time to time from the Trust Fund into the Treasury the amount estimated by him as taxes imposed under section 3101(b) which are subject to refund under section 6413(c) of the Internal Revenue Code of 1986 with respect to wages paid after December 31, 1965. Such taxes shall be determined on the basis of the records of wages established and maintained by the Commissioner of Social Security in accordance with the wages reported to the Secretary of the Treasury or his delegate pursuant to subtitle F of the Internal Revenue Code of 1986, and the Commissioner of Social Security shall furnish the Managing Trustee such information as may be required by the Managing Trustee for such purpose. The payments by the Managing Trustee shall be covered into the Treasury as repayments to the account for refunding internal revenue collections.
(2) Repayments made under paragraph (1) shall not be available for expenditures but shall be carried to the surplus fund of the Treasury. If it subsequently appears that the estimates under such paragraph in any particular period were too high or too low, appropriate adjustments shall be made by the Managing Trustee in future payments.
(g) Transfers from other Funds
There shall be transferred periodically (but not less often than once each fiscal year) to the Trust Fund from the Federal Old-Age and Survivors Insurance Trust Fund and from the Federal Disability Insurance Trust Fund amounts equivalent to the amounts not previously so transferred which the Secretary of Health and Human Services shall have certified as overpayments (other than amounts so certified to the Railroad Retirement Board) pursuant to
(h) Payments from Trust Fund amounts certified by Secretary
The Managing Trustee shall also pay from time to time from the Trust Fund such amounts as the Secretary of Health and Human Services certifies are necessary to make the payments provided for by this part, and the payments with respect to administrative expenses in accordance with
(i) Payment of travel expenses for travel within United States; reconsideration interviews and proceedings before administrative law judges
There are authorized to be made available for expenditure out of the Trust Fund such amounts as are required to pay travel expenses, either on an actual cost or commuted basis, to parties, their representatives, and all reasonably necessary witnesses for travel within the United States (as defined in
(j) Loans from other Funds; interest; repayment; report to Congress
(1) If at any time prior to January 1988 the Managing Trustee determines that borrowing authorized under this subsection is appropriate in order to best meet the need for financing the benefit payments from the Federal Hospital Insurance Trust Fund, the Managing Trustee may, subject to paragraph (5), borrow such amounts as he determines to be appropriate from either the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund for transfer to and deposit in the Federal Hospital Insurance Trust Fund.
(2) In any case where a loan has been made to the Federal Hospital Insurance Trust Fund under paragraph (1), there shall be transferred on the last day of each month after such loan is made, from such Trust Fund to the lending Trust Fund, the total interest accrued to such day with respect to the unrepaid balance of such loan at a rate equal to the rate which the lending Trust Fund would earn on the amount involved if the loan were an investment under subsection (c) of this section (even if such an investment would earn interest at a rate different than the rate earned by investments redeemed by the lending fund in order to make the loan).
(3)(A) If in any month after a loan has been made to the Federal Hospital Insurance Trust Fund under paragraph (1), the Managing Trustee determines that the assets of such Trust Fund are sufficient to permit repayment of all or part of any loans made to such Fund under paragraph (1), he shall make such repayments as he determines to be appropriate.
(B)(i) If on the last day of any year after a loan has been made under paragraph (1) by the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund to the Federal Hospital Insurance Trust Fund, the Managing Trustee determines that the Hospital Insurance Trust Fund ratio exceeds 15 percent, he shall transfer from such Trust Fund to the lending trust fund an amount that—
(I) together with any amounts transferred to another lending trust fund under this paragraph for such year, will reduce the Hospital Insurance Trust Fund ratio to 15 percent; and
(II) does not exceed the outstanding balance of such loan.
(ii) Amounts required to be transferred under clause (i) shall be transferred on the last day of the first month of the year succeeding the year in which the determination described in clause (i) is made.
(iii) For purposes of this subparagraph, the term "Hospital Insurance Trust Fund ratio" means, with respect to any calendar year, the ratio of—
(I) the balance in the Federal Hospital Insurance Trust Fund, as of the last day of such calendar year; to
(II) the amount estimated by the Secretary to be the total amount to be paid from the Federal Hospital Insurance Trust Fund during the calendar year following such calendar year (other than payments of interest on, and repayments of, loans from the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund under paragraph (1)), and reducing the amount of any transfer to the Railroad Retirement Account by the amount of any transfers into such Trust Fund from the Railroad Retirement Account.
(C)(i) The full amount of all loans made under paragraph (1) (whether made before or after January 1, 1983) shall be repaid at the earliest feasible date and in any event no later than December 31, 1989.
(ii) For the period after December 31, 1987 and before January 1, 1990, the Managing Trustee shall transfer each month from the Federal Hospital Insurance Trust Fund to any Trust Fund that is owed any amount by the Federal Hospital Insurance Trust Fund on a loan made under paragraph (1), an amount not less than an amount equal to (I) the amount owed to such Trust Fund by the Federal Hospital Insurance Trust Fund at the beginning of such month (plus the interest accrued on the outstanding balance of such loan during such month), divided by (II) the number of months elapsing after the preceding month and before January 1990. The Managing Trustee may, during this period, transfer larger amounts than prescribed by the preceding sentence.
(4) The Board of Trustees shall make a timely report to the Congress of any amounts transferred (including interest payments) under this subsection.
(5)(A) No amounts may be loaned by the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund under paragraph (1) during any month if the OASDI trust fund ratio for such month is less than 10 percent.
(B) For purposes of this paragraph, the term "OASDI trust fund ratio" means, with respect to any month, the ratio of—
(i) the combined balance in the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund, reduced by the outstanding amount of any loan (including interest thereon) theretofore made to either such Trust Fund from the Federal Hospital Insurance Trust Fund under
(ii) the amount obtained by multiplying by twelve the total amount which (as estimated by the Secretary) will be paid from the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund during the month for which such ratio is to be determined for all purposes authorized by
(Aug. 14, 1935, ch. 531, title XVIII, §1817, as added July 30, 1965,
References in Text
The Internal Revenue Code of 1986, referred to in subsecs. (a)(1), (2) and (f)(1), is classified generally to Title 26, Internal Revenue Code. Subtitle F of such Code appears at
Amendments
1994—Subsec. (a).
Subsec. (b).
Subsec. (f)(1).
1990—Subsec. (i).
1989—Subsec. (b).
1988—Subsec. (b).
1986—Subsec. (a)(1), (2).
Subsec. (b).
Subsec. (f)(1).
1984—Subsec. (a).
Subsec. (a)(1), (2).
Subsec. (c).
Subsecs. (f)(1), (g), (h).
1983—Subsec. (a).
Subsec. (b).
Subsec. (j)(1).
Subsec. (j)(2).
Subsec. (j)(3)(A).
Subsec. (j)(5).
1981—Subsec. (j).
1980—Subsec. (i).
1978—Subsec. (b).
1972—Subsec. (a).
1968—Subsec. (b)(2).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1990 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1984 Amendment
Section 2337(b) of
Amendment by section 2354(b)(2) of
Amendment by section 2663(j)(2)(F)(i) of
Effective Date of 1983 Amendment
Amendment by section 141(b) of
Section 142(b)(2)(B) of
Amendment by sections 154(b) and 341(b) of
Effective Date of 1981 Amendment
Amendment by
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by
Due Date for 1983 Report on Operation and Status of Trust Fund
Notwithstanding subsec. (b)(2) of this section, the annual report of the Board of Trustees of the Trust Fund required for calendar year 1983 under this section may be filed at any time not later than forty-five days after Apr. 20, 1983, see section 154(d) of
Section Referred to in Other Sections
This section is referred to in
§1395i–1. Authorization of appropriations
There are authorized to be appropriated to the Federal Hospital Insurance Trust Fund (established by
(1) payments made or to be made during such fiscal year from such Trust Fund under this part with respect to individuals who are qualified railroad retirement beneficiaries (as defined in
(2) the additional administrative expenses resulting or expected to result therefrom, and
(3) any loss of interest to such Trust Fund resulting from the payment of such amounts,
in order to place such Trust Fund in the same position at the end of such fiscal year in which it would have been if the individuals described in paragraph (1) had not been entitled to benefits under this part.
(
References in Text
The Railroad Retirement Act of 1937, referred to in text, is act Aug. 29, 1935, ch. 812,
Codification
Section was enacted as part of the Social Security Amendments of 1965 and also as part of the Health Insurance for the Aged Act, and not as part of the Social Security Act which comprises this chapter.
Effective Date
Section 111(e) of
"(1) The amendments made by the preceding provisions of this section [enacting this section and
"(2) The requirement referred to in paragraph (1) shall be deemed to have been met with respect to any calendar year if, as of the October 1 immediately preceding such calendar year, the Railroad Retirement Tax Act [
Cross References
Definitions relating to employment, see
§1395i–1a. Repealed. Pub. L. 101–234, title I, §102(a), Dec. 13, 1989, 103 Stat. 1980
Section, act Aug. 14, 1935, ch. 531, title XVIII, §1817A, as added July 1, 1988,
Effective Date of Repeal
Repeal effective Jan. 1, 1990, see section 102(d)(1) of
Adjustments for Interest Lost Due to Delay of Transfers to Reserve Fund During 1989
Section 112(b) of
§1395i–2. Hospital insurance benefits for uninsured elderly individuals not otherwise eligible
(a) Individuals eligible to enroll
Every individual who—
(1) has attained the age of 65,
(2) is enrolled under part B of this subchapter,
(3) is a resident of the United States, and is either (A) a citizen or (B) an alien lawfully admitted for permanent residence who has resided in the United States continuously during the 5 years immediately preceding the month in which he applies for enrollment under this section, and
(4) is not otherwise entitled to benefits under this part,
shall be eligible to enroll in the insurance program established by this part.
(b) Time, manner, and form of enrollment
An individual may enroll under this section only in such manner and form as may be prescribed in regulations, and only during an enrollment period prescribed in or under this section.
(c) Period of enrollment; scope of coverage
The provisions of
(1) individuals who meet the conditions of subsection (a)(1), (3), and (4) of this section on or before the last day of the seventh month after October 1972 may enroll under this part and (if not already so enrolled) may also enroll under part B of this subchapter during an initial general enrollment period which shall begin on the first day of the second month which begins after October 30, 1972, and shall end on the last day of the tenth month after October 1972;
(2) in the case of an individual who first meets the conditions of eligibility under this section on or after the first day of the eighth month after October 1972, the initial enrollment period shall begin on the first day of the third month before the month in which he first becomes eligible and shall end 7 months later;
(3) in the case of an individual who enrolls pursuant to paragraph (1) of this subsection, entitlement to benefits shall begin on—
(A) the first day of the second month after the month in which he enrolls,
(B) July 1, 1973, or
(C) the first day of the first month in which he meets the requirements of subsection (a) of this section,
whichever is the latest;
(4) an individual's entitlement under this section shall terminate with the month before the first month in which he becomes eligible for hospital insurance benefits under
(5) termination of coverage for supplementary medical insurance shall result in simultaneous termination of hospital insurance benefits for uninsured individuals who are not otherwise entitled to benefits under this chapter;
(6) any percent increase effected under
(7) an individual who meets the conditions of subsection (a) of this section may enroll under this part during a special enrollment period that includes any month during any part of which the individual is enrolled under
(8) in the case of an individual who enrolls during a special enrollment period under paragraph (7)—
(A) in any month of the special enrollment period in which the individual is at any time enrolled under
(B) in any other month of the special enrollment period, the coverage period shall begin on the first day of the month following the month in which the individual so enrolls; and
(9) in applying the provisions of
(d) Monthly premiums
(1) The Secretary shall, during September of each year (beginning with 1988), estimate the monthly actuarial rate for months in the succeeding year. Such actuarial rate shall be one-twelfth of the amount which the Secretary estimates (on an average, per capita basis) is equal to 100 percent of the benefits and administrative costs which will be payable from the Federal Hospital Insurance Trust Fund for services performed and related administrative costs incurred in the succeeding year with respect to individuals age 65 and over who will be entitled to benefits under this part during that year.
(2) The Secretary shall, during September of each year 1 determine and promulgate the dollar amount which shall be applicable for premiums for months occurring in the following year. Subject to paragraph (4), the amount of an individual's monthly premium under this section shall be equal to the monthly actuarial rate determined under paragraph (1) for that following year. Any amount determined under the preceding sentence which is not a multiple of $1 shall be rounded to the nearest multiple of $1 (or, if it is a multiple of 50 cents but not a multiple of $1, to the next higher multiple of $1).
(3) Whenever the Secretary promulgates the dollar amount which shall be applicable as the monthly premium under this section, he shall, at the time such promulgation is announced, issue a public statement setting forth the actuarial assumptions and bases employed by him in arriving at the amount of an adequate actuarial rate for individuals 65 and older as provided in paragraph (1).
(4)(A) In the case of an individual described in subparagraph (B), the monthly premium for a month shall be reduced by the applicable reduction percent specified in the following table:
(B) An individual described in this subparagraph with respect to a month is an individual who establishes to the satisfaction of the Secretary that, as of the last day of the previous month, the individual—
(i) had at least 30 quarters of coverage under subchapter II of this chapter;
(ii) was married (and had been married for the previous 1-year period) to an individual who had at least 30 quarters of coverage under such subchapter;
(iii) had been married to an individual for a period of at least 1 year (at the time of such individual's death) if at such time the individual had at least 30 quarters of coverage under such subchapter; or
(iv) is divorced from an individual and had been married to the individual for a period of at least 10 years (at the time of the divorce) if at such time the individual had at least 30 quarters of coverage under such subchapter.
(e) Contract or other arrangement for payment of monthly premiums
Payment of the monthly premiums on behalf of any individual who meets the conditions of subsection (a) of this section may be made by any public or private agency or organization under a contract or other arrangement entered into between it and the Secretary if the Secretary determines that payment of such premiums under such contract or arrangement is administratively feasible.
(f) Deposit of amounts into Treasury
Amounts paid to the Secretary for coverage under this section shall be deposited in the Treasury to the credit of the Federal Hospital Insurance Trust Fund.
(g) Buy-in under this part for qualified medicare beneficiaries
(1) The Secretary shall, at the request of a State made after 1989, enter into a modification of an agreement entered into with the State pursuant to
(2)(A) Except as provided in subparagraph (B), the provisions of subsections (c), (d), (e), and (f) of
(B) For purposes of this subsection,
(Aug. 14, 1935, ch. 531, title XVIII, §1818, as added Oct. 30, 1972,
References in Text
Part B of this subchapter, referred to in subsecs. (a)(2), (c)(1), and (g)(2)(A), is classified to
Amendments
1993—Subsec. (d)(2).
Subsec. (d)(4).
1990—Subsec. (c)(7) to (9).
Subsec. (g)(2)(B).
1989—
Subsec. (g).
1988—Subsec. (c)(4) to (7).
Subsec. (d).
"(1) The monthly premium of each individual for each month in his coverage period before July 1974 shall be $33.
"(2) The Secretary shall, during the next to last calendar quarter of each year determine and promulgate the dollar amount (whether or not such dollar amount was applicable for premiums for any prior month) which shall be applicable for premiums for months occurring in the following calendar year. Such amount shall be equal to $33, multiplied by the ratio of (A) the inpatient hospital deductible for that following calendar year, as promulgated under
Subsec. (d)(1).
1987—Subsec. (c)(4) to (7).
1986—Subsec. (c)(7).
1984—Subsec. (c).
Subsec. (c)(1).
Subsec. (d)(2).
1983—Subsec. (c).
Subsec. (d)(2).
Effective Date of 1993 Amendment
Section 13508(b) of
Effective Date of 1990 Amendment
Section 4008(g)(2) of
Effective Date of 1989 Amendment
Amendment by section 6012(a)(1) of
Section 6013(c) of
Effective Date of 1988 Amendments
Amendment by
Amendment by section 103 of
Except as specifically provided in section 411 of
Effective Date of 1986 Amendment
Section 9124(b) of
"(1) The amendment made by subsection (a)(3) [amending this section] shall apply to premiums paid for months beginning with July 1986.
"(2) In applying that amendment, months (before, during, or after April 1986) in which an individual was required to pay a premium increased under the section that was so amended shall be taken into account in determining the month in which the premium will no longer be subject to an increase under that section as so amended."
Effective Date of 1984 Amendment
Amendment by section 2315(e) of
Amendment by section 2354(b)(3), (4) of
Effective Date of 1983 Amendment; Transitional Rule
Amendment by
Special Enrollment Provisions for Merchant Seamen
"(a) Any individual who—
"(1) was entitled to medical, surgical, and dental treatment and hospitalization under section 322(a) of the Public Health Service Act [
"(2) as of September 30, 1981, was eligible under section 1818(a) or section 1836 of the Social Security Act [this section or
may enroll (if not otherwise enrolled) in the respective program during the period beginning on the first day of the first month beginning at least 20 days after the date of the enactment of this Act [Sept. 3, 1982] and ending on December 31, 1982.
"(b)(1) The coverage period under the respective program of an individual who enrolls under subsection (a) shall begin—
"(A) on the first day of the month following the month in which the individual enrolls, or
"(B) on October 1, 1981, if the individual files a request for this subparagraph to apply and pays the monthly premiums for the months so covered.
"(2) The coverage period under the respective program of an individual described in subsection (a) who enrolled in the respective program before the enrollment period described in that subsection shall be retroactively extended to October 1, 1981, if the individual files a request before January 1, 1983, for such retroactive extension and pays the monthly premiums for the months so covered.
"(c)(1) For purposes of section 1839(d) of the Social Security Act [
"(2) Paragraph (1) shall not apply to an individual—
"(A) if the individual has enrolled in the insurance program before March 10, 1981, unless the enrollment was terminated solely because the individual lost eligibility to be so enrolled, or
"(B) unless the individual applies for the benefit of such paragraph before January 1, 1983.
"(d)(1) The Secretary of Health and Human Services, beginning as soon as possible but not later than 30 days after the date of the enactment of this Act [Sept. 3, 1982], shall provide for the dissemination of information—
"(A) to unions and other associations representing or assisting seamen,
"(B) to offices enrolling individuals under the respective programs, and
"(C) to such other entities and in such a manner as will effectively inform individuals eligible for benefits under this section,
concerning the special benefits provided under this section.
"(2) An individual may establish that the individual was entitled at a date to medical, surgical, and dental treatment and hospitalization under section 322(a) of the Public Health Service Act [
"(A) documentation relating to the status under which the individual was provided care in (or under arrangements with) a Public Health Service facility on that date,
"(B) the individual's seamen's papers covering that date, or
"(C) such other reasonable documentation as the Secretary may require."
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be followed by a comma.
§1395i–2a. Hospital insurance benefits for disabled individuals who have exhausted other entitlement
(a) Eligibility
Every individual who—
(1) has not attained the age of 65;
(2)(A) has been entitled to benefits under this part under
(B)(i) continues to have the disabling physical or mental impairment on the basis of which the individual was found to be under a disability or to be a disabled qualified railroad retirement beneficiary, or (ii) is blind (within the meaning of
(C) whose entitlement under
(3) is not otherwise entitled to benefits under this part,
shall be eligible to enroll in the insurance program established by this part.
(b) Enrollment
(1) An individual may enroll under this section only in such manner and form as may be prescribed in regulations, and only during an enrollment period prescribed in or under this section.
(2) The individual's initial enrollment period shall begin with the month in which the individual receives notice that the individual's entitlement to benefits under
(3) There shall be a general enrollment period during the period beginning on January 1 and ending on March 31 of each year (beginning with 1990).
(c) Coverage period
(1) The period (in this subsection referred to as a "coverage period") during which an individual is entitled to benefits under the insurance program under this part shall begin on whichever of the following is the latest:
(A) In the case of an individual who enrolls under subsection (b)(2) of this section before the month in which the individual first satisfies subsection (a) of this section, the first day of such month.
(B) In the case of an individual who enrolls under subsection (b)(2) of this section in the month in which the individual first satisfies subsection (a) of this section, the first day of the month following the month in which the individual so enrolls.
(C) In the case of an individual who enrolls under subsection (b)(2) of this section in the month following the month in which the individual first satisfies subsection (a) of this section, the first day of the second month following the month in which the individual so enrolls.
(D) In the case of an individual who enrolls under subsection (b)(2) of this section more than one month following the month in which the individual first satisfies subsection (a) of this section, the first day of the third month following the month in which the individual so enrolls.
(E) In the case of an individual who enrolls under subsection (b)(3) of this section, the July 1 following the month in which the individual so enrolls.
(2) An individual's coverage period under this section shall continue until the individual's enrollment is terminated as follows:
(A) As of the month following the month in which the Secretary provides notice to the individual that the individual no longer meets the condition described in subsection (a)(2)(B) of this section.
(B) As of the month following the month in which the individual files notice that the individual no longer wishes to participate in the insurance program established by this part.
(C) As of the month before the first month in which the individual becomes eligible for hospital insurance benefits under
(D) As of a date, determined under regulations of the Secretary, for nonpayment of premiums.
The regulations under subparagraph (D) may provide a grace period of not longer than 90 days, which may be extended to not to exceed 180 days in any case where the Secretary determines that there was good cause for failure to pay the overdue premiums within such 90-day period. Termination of coverage under this section shall result in simultaneous termination of any coverage affected under any other part of this subchapter.
(3) The provisions of subsections (h) and (i) of
(d) Payment of premiums
(1)(A) Premiums for enrollment under this section shall be paid to the Secretary at such times, and in such manner, as the Secretary shall by regulations prescribe, and shall be deposited in the Treasury to the credit of the Federal Hospital Insurance Trust Fund.
(B)(i) Subject to clause (ii), such premiums shall be payable for the period commencing with the first month of an individual's coverage period and ending with the month in which the individual dies or, if earlier, in which the individual's coverage period terminates.
(ii) Such premiums shall not be payable for any month in which the individual is eligible for benefits under this part pursuant to
(2) The provisions of subsections (d) through (f) of
(Aug. 14, 1935, ch. 531, title XVIII, §1818A, as added Dec. 19, 1989,
Amendments
1990—Subsec. (d)(1)(A).
Subsec. (d)(1)(C).
Effective Date
Section 6012(b) of
§1395i–3. Requirements for, and assuring quality of care in, skilled nursing facilities
(a) "Skilled nursing facility" defined
In this subchapter, the term "skilled nursing facility" means an institution (or a distinct part of an institution) which—
(1) is primarily engaged in providing to residents—
(A) skilled nursing care and related services for residents who require medical or nursing care, or
(B) rehabilitation services for the rehabilitation of injured, disabled, or sick persons,
and is not primarily for the care and treatment of mental diseases;
(2) has in effect a transfer agreement (meeting the requirements of
(3) meets the requirements for a skilled nursing facility described in subsections (b), (c), and (d) of this section.
(b) Requirements relating to provision of services
(1) Quality of life
(A) In general
A skilled nursing facility must care for its residents in such a manner and in such an environment as will promote maintenance or enhancement of the quality of life of each resident.
(B) Quality assessment and assurance
A skilled nursing facility must maintain a quality assessment and assurance committee, consisting of the director of nursing services, a physician designated by the facility, and at least 3 other members of the facility's staff, which (i) meets at least quarterly to identify issues with respect to which quality assessment and assurance activities are necessary and (ii) develops and implements appropriate plans of action to correct identified quality deficiencies. A State or the Secretary may not require disclosure of the records of such committee except insofar as such disclosure is related to the compliance of such committee with the requirements of this subparagraph.
(2) Scope of services and activities under plan of care
A skilled nursing facility must provide services to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident, in accordance with a written plan of care which—
(A) describes the medical, nursing, and psychosocial needs of the resident and how such needs will be met;
(B) is initially prepared, with the participation to the extent practicable of the resident or the resident's family or legal representative, by a team which includes the resident's attending physician and a registered professional nurse with responsibility for the resident; and
(C) is periodically reviewed and revised by such team after each assessment under paragraph (3).
(3) Residents' assessment
(A) Requirement
A skilled nursing facility must conduct a comprehensive, accurate, standardized, reproducible assessment of each resident's functional capacity, which assessment—
(i) describes the resident's capability to perform daily life functions and significant impairments in functional capacity;
(ii) is based on a uniform minimum data set specified by the Secretary under subsection (f)(6)(A) of this section;
(iii) uses an instrument which is specified by the State under subsection (e)(5) of this section; and
(iv) includes the identification of medical problems.
(B) Certification
(i) In general
Each such assessment must be conducted or coordinated (with the appropriate participation of health professionals) by a registered professional nurse who signs and certifies the completion of the assessment. Each individual who completes a portion of such an assessment shall sign and certify as to the accuracy of that portion of the assessment.
(ii) Penalty for falsification
(I) An individual who willfully and knowingly certifies under clause (i) a material and false statement in a resident assessment is subject to a civil money penalty of not more than $1,000 with respect to each assessment.
(II) An individual who willfully and knowingly causes another individual to certify under clause (i) a material and false statement in a resident assessment is subject to a civil money penalty of not more than $5,000 with respect to each assessment.
(III) The provisions of
(iii) Use of independent assessors
If a State determines, under a survey under subsection (g) of this section or otherwise, that there has been a knowing and willful certification of false assessments under this paragraph, the State may require (for a period specified by the State) that resident assessments under this paragraph be conducted and certified by individuals who are independent of the facility and who are approved by the State.
(C) Frequency
(i) In general
Such an assessment must be conducted—
(I) promptly upon (but no later than 14 days after the date of) admission for each individual admitted on or after October 1, 1990, and by not later than January 1, 1991, for each resident of the facility on that date;
(II) promptly after a significant change in the resident's physical or mental condition; and
(III) in no case less often than once every 12 months.
(ii) Resident review
The skilled nursing facility must examine each resident no less frequently than once every 3 months and, as appropriate, revise the resident's assessment to assure the continuing accuracy of the assessment.
(D) Use
The results of such an assessment shall be used in developing, reviewing, and revising the resident's plan of care under paragraph (2).
(E) Coordination
Such assessments shall be coordinated with any State-required preadmission screening program to the maximum extent practicable in order to avoid duplicative testing and effort.
(4) Provision of services and activities
(A) In general
To the extent needed to fulfill all plans of care described in paragraph (2), a skilled nursing facility must provide, directly or under arrangements (or, with respect to dental services, under agreements) with others for the provision of—
(i) nursing services and specialized rehabilitative services to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident;
(ii) medically-related social services to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident;
(iii) pharmaceutical services (including procedures that assure the accurate acquiring, receiving, dispensing, and administering of all drugs and biologicals) to meet the needs of each resident;
(iv) dietary services that assure that the meals meet the daily nutritional and special dietary needs of each resident;
(v) an on-going program, directed by a qualified professional, of activities designed to meet the interests and the physical, mental, and psychosocial well-being of each resident;
(vi) routine and emergency dental services to meet the needs of each resident; and
(vii) treatment and services required by mentally ill and mentally retarded residents not otherwise provided or arranged for (or required to be provided or arranged for) by the State.
The services provided or arranged by the facility must meet professional standards of quality. Nothing in clause (vi) shall be construed as requiring a facility to provide or arrange for dental services described in that clause without additional charge.
(B) Qualified persons providing services
Services described in clauses (i), (ii), (iii), (iv), and (vi) of subparagraph (A) must be provided by qualified persons in accordance with each resident's written plan of care.
(C) Required nursing care
(i) In general
Except as provided in clause (ii), a skilled nursing facility must provide 24-hour licensed nursing service which is sufficient to meet nursing needs of its residents and must use the services of a registered professional nurse at least at least 1 8 consecutive hours a day, 7 days a week.
(ii) Exception
To the extent that clause (i) may be deemed to require that a skilled nursing facility engage the services of a registered professional nurse for more than 40 hours a week, the Secretary is authorized to waive such requirement if the Secretary finds that—
(I) the facility is located in a rural area and the supply of skilled nursing facility services in such area is not sufficient to meet the needs of individuals residing therein,
(II) the facility has one full-time registered professional nurse who is regularly on duty at such facility 40 hours a week,
(III) the facility either has only patients whose physicians have indicated (through physicians' orders or admission notes) that each such patient does not require the services of a registered nurse or a physician for a 48-hour period, or has made arrangements for a registered professional nurse or a physician to spend such time at such facility as may be indicated as necessary by the physician to provide necessary skilled nursing services on days when the regular full-time registered professional nurse is not on duty,
(IV) the Secretary provides notice of the waiver to the State long-term care ombudsman (established under section 307(a)(12) of the Older Americans Act of 1965 [
(V) the facility that is granted such a waiver notifies residents of the facility (or, where appropriate, the guardians or legal representatives of such residents) and members of their immediate families of the waiver.
A waiver under this subparagraph shall be subject to annual renewal.
(5) Required training of nurse aides
(A) In general
(i) Except as provided in clause (ii), a skilled nursing facility must not use on a full-time basis any individual as a nurse aide in the facility on or after October 1, 1990 for more than 4 months unless the individual—
(I) has completed a training and competency evaluation program, or a competency evaluation program, approved by the State under subsection (e)(1)(A) of this section, and
(II) is competent to provide nursing or nursing-related services.
(ii) A skilled nursing facility must not use on a temporary, per diem, leased, or on any basis other than as a permanent employee any individual as a nurse aide in the facility on or after January 1, 1991, unless the individual meets the requirements described in clause (i).
(B) Offering competency evaluation programs for current employees
A skilled nursing facility must provide, for individuals used as a nurse aide 2 by the facility as of January 1, 1990, for a competency evaluation program approved by the State under subsection (e)(1) of this section and such preparation as may be necessary for the individual to complete such a program by October 1, 1990.
(C) Competency
The skilled nursing facility must not permit an individual, other than in a training and competency evaluation program approved by the State, to serve as a nurse aide or provide services of a type for which the individual has not demonstrated competency and must not use such an individual as a nurse aide unless the facility has inquired of any State registry established under subsection (e)(2)(A) of this section that the facility believes will include information concerning the individual.
(D) Re-training required
For purposes of subparagraph (A), if, since an individual's most recent completion of a training and competency evaluation program, there has been a continuous period of 24 consecutive months during none of which the individual performed nursing or nursing-related services for monetary compensation, such individual shall complete a new training and competency evaluation program or a new competency evaluation program.
(E) Regular in-service education
The skilled nursing facility must provide such regular performance review and regular in-service education as assures that individuals used as nurse aides are competent to perform services as nurse aides, including training for individuals providing nursing and nursing-related services to residents with cognitive impairments.
(F) "Nurse aide" defined
In this paragraph, the term "nurse aide" means any individual providing nursing or nursing-related services to residents in a skilled nursing facility, but does not include an individual—
(i) who is a licensed health professional (as defined in subparagraph (G)) or a registered dietician, or
(ii) who volunteers to provide such services without monetary compensation.
(G) "Licensed health professional" defined
In this paragraph, the term "licensed health professional" means a physician, physician assistant, nurse practitioner, physical, speech, or occupational therapist, physical or occupational therapy assistant, registered professional nurse, licensed practical nurse, licensed or certified social worker, registered respiratory therapist, or certified respiratory therapy technician.
(6) Physician supervision and clinical records
A skilled nursing facility must—
(A) require that the medical care of every resident be provided under the supervision of a physician;
(B) provide for having a physician available to furnish necessary medical care in case of emergency; and
(C) maintain clinical records on all residents, which records include the plans of care (described in paragraph (2)) and the residents' assessments (described in paragraph (3)).
(7) Required social services
In the case of a skilled nursing facility with more than 120 beds, the facility must have at least one social worker (with at least a bachelor's degree in social work or similar professional qualifications) employed full-time to provide or assure the provision of social services.
(c) Requirements relating to residents' rights
(1) General rights
(A) Specified rights
A skilled nursing facility must protect and promote the rights of each resident, including each of the following rights:
(i) Free choice
The right to choose a personal attending physician, to be fully informed in advance about care and treatment, to be fully informed in advance of any changes in care or treatment that may affect the resident's well-being, and (except with respect to a resident adjudged incompetent) to participate in planning care and treatment or changes in care and treatment.
(ii) Free from restraints
The right to be free from physical or mental abuse, corporal punishment, involuntary seclusion, and any physical or chemical restraints imposed for purposes of discipline or convenience and not required to treat the resident's medical symptoms. Restraints may only be imposed—
(I) to ensure the physical safety of the resident or other residents, and
(II) only upon the written order of a physician that specifies the duration and circumstances under which the restraints are to be used (except in emergency circumstances specified by the Secretary until such an order could reasonably be obtained).
(iii) Privacy
The right to privacy with regard to accommodations, medical treatment, written and telephonic communications, visits, and meetings of family and of resident groups.
(iv) Confidentiality
The right to confidentiality of personal and clinical records and to access to current clinical records of the resident upon request by the resident or the resident's legal representative, within 24 hours (excluding hours occurring during a weekend or holiday) after making such a request.
(v) Accommodation of needs
The right—
(I) to reside and receive services with reasonable accommodation of individual needs and preferences, except where the health or safety of the individual or other residents would be endangered, and
(II) to receive notice before the room or roommate of the resident in the facility is changed.
(vi) Grievances
The right to voice grievances with respect to treatment or care that is (or fails to be) furnished, without discrimination or reprisal for voicing the grievances and the right to prompt efforts by the facility to resolve grievances the resident may have, including those with respect to the behavior of other residents.
(vii) Participation in resident and family groups
The right of the resident to organize and participate in resident groups in the facility and the right of the resident's family to meet in the facility with the families of other residents in the facility.
(viii) Participation in other activities
The right of the resident to participate in social, religious, and community activities that do not interfere with the rights of other residents in the facility.
(ix) Examination of survey results
The right to examine, upon reasonable request, the results of the most recent survey of the facility conducted by the Secretary or a State with respect to the facility and any plan of correction in effect with respect to the facility.
(x) Refusal of certain transfers
The right to refuse a transfer to another room within the facility, if a purpose of the transfer is to relocate the resident from a portion of the facility that is a skilled nursing facility (for purposes of this subchapter) to a portion of the facility that is not such a skilled nursing facility.
(xi) Other rights
Any other right established by the Secretary.
Clause (iii) shall not be construed as requiring the provision of a private room. A resident's exercise of a right to refuse transfer under clause (x) shall not affect the resident's eligibility or entitlement to benefits under this subchapter or to medical assistance under subchapter XIX of this chapter.
(B) Notice of rights and services
A skilled nursing facility must—
(i) inform each resident, orally and in writing at the time of admission to the facility, of the resident's legal rights during the stay at the facility;
(ii) make available to each resident, upon reasonable request, a written statement of such rights (which statement is updated upon changes in such rights) including the notice (if any) of the State developed under
(iii) inform each other resident, in writing before or at the time of admission and periodically during the resident's stay, of services available in the facility and of related charges for such services, including any charges for services not covered under this subchapter or by the facility's basic per diem charge.
The written description of legal rights under this subparagraph shall include a description of the protection of personal funds under paragraph (6) and a statement that a resident may file a complaint with a State survey and certification agency respecting resident abuse and neglect and misappropriation of resident property in the facility.
(C) Rights of incompetent residents
In the case of a resident adjudged incompetent under the laws of a State, the rights of the resident under this subchapter shall devolve upon, and, to the extent judged necessary by a court of competent jurisdiction, be exercised by, the person appointed under State law to act on the resident's behalf.
(D) Use of psychopharmacologic drugs
Psychopharmacologic drugs may be administered only on the orders of a physician and only as part of a plan (included in the written plan of care described in paragraph (2)) designed to eliminate or modify the symptoms for which the drugs are prescribed and only if, at least annually, an independent, external consultant reviews the appropriateness of the drug plan of each resident receiving such drugs. In determining whether such a consultant is qualified to conduct reviews under the preceding sentence, the Secretary shall take into account the needs of nursing facilities under this subchapter to have access to the services of such a consultant on a timely basis.
(E) Information respecting advance directives
A skilled nursing facility must comply with the requirement of
(2) Transfer and discharge rights
(A) In general
A skilled nursing facility must permit each resident to remain in the facility and must not transfer or discharge the resident from the facility unless—
(i) the transfer or discharge is necessary to meet the resident's welfare and the resident's welfare cannot be met in the facility;
(ii) the transfer or discharge is appropriate because the resident's health has improved sufficiently so the resident no longer needs the services provided by the facility;
(iii) the safety of individuals in the facility is endangered;
(iv) the health of individuals in the facility would otherwise be endangered;
(v) the resident has failed, after reasonable and appropriate notice, to pay (or to have paid under this subchapter or subchapter XIX of this chapter on the resident's behalf) for a stay at the facility; or
(vi) the facility ceases to operate.
In each of the cases described in clauses (i) through (v), the basis for the transfer or discharge must be documented in the resident's clinical record. In the cases described in clauses (i) and (ii), the documentation must be made by the resident's physician, and in the cases described in clauses (iii) and (iv) the documentation must be made by a physician.
(B) Pre-transfer and pre-discharge notice
(i) In general
Before effecting a transfer or discharge of a resident, a skilled nursing facility must—
(I) notify the resident (and, if known, a family member of the resident or legal representative) of the transfer or discharge and the reasons therefor,
(II) record the reasons in the resident's clinical record (including any documentation required under subparagraph (A)), and
(III) include in the notice the items described in clause (iii).
(ii) Timing of notice
The notice under clause (i)(I) must be made at least 30 days in advance of the resident's transfer or discharge except—
(I) in a case described in clause (iii) or (iv) of subparagraph (A);
(II) in a case described in clause (ii) of subparagraph (A), where the resident's health improves sufficiently to allow a more immediate transfer or discharge;
(III) in a case described in clause (i) of subparagraph (A), where a more immediate transfer or discharge is necessitated by the resident's urgent medical needs; or
(IV) in a case where a resident has not resided in the facility for 30 days.
In the case of such exceptions, notice must be given as many days before the date of the transfer or discharge as is practicable.
(iii) Items included in notice
Each notice under clause (i) must include—
(I) for transfers or discharges effected on or after October 1, 1990, notice of the resident's right to appeal the transfer or discharge under the State process established under subsection (e)(3) of this section; and
(II) the name, mailing address, and telephone number of the State long-term care ombudsman (established under title III or VII of the Older Americans Act of 1965 [
(C) Orientation
A skilled nursing facility must provide sufficient preparation and orientation to residents to ensure safe and orderly transfer or discharge from the facility.
(3) Access and visitation rights
A skilled nursing facility must—
(A) permit immediate access to any resident by any representative of the Secretary, by any representative of the State, by an ombudsman described in paragraph (2)(B)(iii)(II), or by the resident's individual physician;
(B) permit immediate access to a resident, subject to the resident's right to deny or withdraw consent at any time, by immediate family or other relatives of the resident;
(C) permit immediate access to a resident, subject to reasonable restrictions and the resident's right to deny or withdraw consent at any time, by others who are visiting with the consent of the resident;
(D) permit reasonable access to a resident by any entity or individual that provides health, social, legal, or other services to the resident, subject to the resident's right to deny or withdraw consent at any time; and
(E) permit representatives of the State ombudsman (described in paragraph (2)(B)(iii)(II)), with the permission of the resident (or the resident's legal representative) and consistent with State law, to examine a resident's clinical records.
(4) Equal access to quality care
A skilled nursing facility must establish and maintain identical policies and practices regarding transfer, discharge, and covered services under this subchapter for all individuals regardless of source of payment.
(5) Admissions policy
(A) Admissions
With respect to admissions practices, a skilled nursing facility must—
(i)(I) not require individuals applying to reside or residing in the facility to waive their rights to benefits under this subchapter or under a State plan under subchapter XIX of this chapter, (II) not require oral or written assurance that such individuals are not eligible for, or will not apply for, benefits under this subchapter or such a State plan, and (III) prominently display in the facility and provide to such individuals written information about how to apply for and use such benefits and how to receive refunds for previous payments covered by such benefits; and
(ii) not require a third party guarantee of payment to the facility as a condition of admission (or expedited admission) to, or continued stay in, the facility.
(B) Construction
(i) No preemption of stricter standards
Subparagraph (A) shall not be construed as preventing States or political subdivisions therein from prohibiting, under State or local law, the discrimination against individuals who are entitled to medical assistance under this subchapter with respect to admissions practices of skilled nursing facilities.
(ii) Contracts with legal representatives
Subparagraph (A)(ii) shall not be construed as preventing a facility from requiring an individual, who has legal access to a resident's income or resources available to pay for care in the facility, to sign a contract (without incurring personal financial liability) to provide payment from the resident's income or resources for such care.
(6) Protection of resident funds
(A) In general
The skilled nursing facility—
(i) may not require residents to deposit their personal funds with the facility, and
(ii) upon the written authorization of the resident, must hold, safeguard, and account for such personal funds under a system established and maintained by the facility in accordance with this paragraph.
(B) Management of personal funds
Upon written authorization of a resident under subparagraph (A)(ii), the facility must manage and account for the personal funds of the resident deposited with the facility as follows:
(i) Deposit
The facility must deposit any amount of personal funds in excess of $100 with respect to a resident in an interest bearing account (or accounts) that is separate from any of the facility's operating accounts and credits 3 all interest earned on such separate account to such account. With respect to any other personal funds, the facility must maintain such funds in a non-interest bearing account or petty cash fund.
(ii) Accounting and records
The facility must assure a full and complete separate accounting of each such resident's personal funds, maintain a written record of all financial transactions involving the personal funds of a resident deposited with the facility, and afford the resident (or a legal representative of the resident) reasonable access to such record.
(iii) Conveyance upon death
Upon the death of a resident with such an account, the facility must convey promptly the resident's personal funds (and a final accounting of such funds) to the individual administering the resident's estate.
(C) Assurance of financial security
The facility must purchase a surety bond, or otherwise provide assurance satisfactory to the Secretary, to assure the security of all personal funds of residents deposited with the facility.
(D) Limitation on charges to personal funds
The facility may not impose a charge against the personal funds of a resident for any item or service for which payment is made under this subchapter or subchapter XIX of this chapter.
(d) Requirements relating to administration and other matters
(1) Administration
(A) In general
A skilled nursing facility must be administered in a manner that enables it to use its resources effectively and efficiently to attain or maintain the highest practicable physical 4 mental, and psychosocial well-being of each resident (consistent with requirements established under subsection (f)(5) of this section).
(B) Required notices
If a change occurs in—
(i) the persons with an ownership or control interest (as defined in
(ii) the persons who are officers, directors, agents, or managing employees (as defined in
(iii) the corporation, association, or other company responsible for the management of the facility, or
(iv) the individual who is the administrator or director of nursing of the facility,
the skilled nursing facility must provide notice to the State agency responsible for the licensing of the facility, at the time of the change, of the change and of the identity of each new person, company, or individual described in the respective clause.
(C) Skilled nursing facility administrator
The administrator of a skilled nursing facility must meet standards established by the Secretary under subsection (f)(4) of this section.
(2) Licensing and Life Safety Code
(A) Licensing
A skilled nursing facility must be licensed under applicable State and local law.
(B) Life Safety Code
A skilled nursing facility must meet such provisions of such edition (as specified by the Secretary in regulation) of the Life Safety Code of the National Fire Protection Association as are applicable to nursing homes; except that—
(i) the Secretary may waive, for such periods as he deems appropriate, specific provisions of such Code which if rigidly applied would result in unreasonable hardship upon a facility, but only if such waiver would not adversely affect the health and safety of residents or personnel, and
(ii) the provisions of such Code shall not apply in any State if the Secretary finds that in such State there is in effect a fire and safety code, imposed by State law, which adequately protects residents of and personnel in skilled nursing facilities.
(3) Sanitary and infection control and physical environment
A skilled nursing facility must—
(A) establish and maintain an infection control program designed to provide a safe, sanitary, and comfortable environment in which residents reside and to help prevent the development and transmission of disease and infection, and
(B) be designed, constructed, equipped, and maintained in a manner to protect the health and safety of residents, personnel, and the general public.
(4) Miscellaneous
(A) Compliance with Federal, State, and local laws and professional standards
A skilled nursing facility must operate and provide services in compliance with all applicable Federal, State, and local laws and regulations (including the requirements of
(B) Other
A skilled nursing facility must meet such other requirements relating to the health, safety, and well-being of residents or relating to the physical facilities thereof as the Secretary may find necessary.
(e) State requirements relating to skilled nursing facility requirements
The requirements, referred to in
(1) Specification and review of nurse aide training and competency evaluation programs and of nurse aide competency evaluation programs
The State must—
(A) by not later than January 1, 1989, specify those training and competency evaluation programs, and those competency evaluation programs, that the State approves for purposes of subsection (b)(5) of this section and that meet the requirements established under subsection (f)(2) of this section, and
(B) by not later than January 1, 1990, provide for the review and reapproval of such programs, at a frequency and using a methodology consistent with the requirements established under subsection (f)(2)(A)(iii) of this section.
The failure of the Secretary to establish requirements under subsection (f)(2) of this section shall not relieve any State of its responsibility under this paragraph.
(2) Nurse aide registry
(A) In general
By not later than January 1, 1989, the State shall establish and maintain a registry of all individuals who have satisfactorily completed a nurse aide training and competency evaluation program, or a nurse aide competency evaluation program, approved under paragraph (1) in the State, or any individual described in subsection (f)(2)(B)(ii) of this section or in subparagraph (B), (C), or (D) of section 6901(b)(4) of the Omnibus Budget Reconciliation Act of 1989.
(B) Information in registry
The registry under subparagraph (A) shall provide (in accordance with regulations of the Secretary) for the inclusion of specific documented findings by a State under subsection (g)(1)(C) of this section of resident neglect or abuse or misappropriation of resident property involving an individual listed in the registry, as well as any brief statement of the individual disputing the findings, but shall not include any allegations of resident abuse or neglect or misappropriation of resident property that are not specifically documented by the State under such subsection. The State shall make available to the public information in the registry. In the case of inquiries to the registry concerning an individual listed in the registry, any information disclosed concerning such a finding shall also include disclosure of any such statement in the registry relating to the finding or a clear and accurate summary of such a statement.
(C) Prohibition against charges
A State may not impose any charges on a nurse aide relating to the registry established and maintained under subparagraph (A).
(3) State appeals process for transfers and discharges
The State, for transfers and discharges from skilled nursing facilities effected on or after October 1, 1989, must provide for a fair mechanism for hearing appeals on transfers and discharges of residents of such facilities. Such mechanism must meet the guidelines established by the Secretary under subsection (f)(3) of this section; but the failure of the Secretary to establish such guidelines shall not relieve any State of its responsibility to provide for such a fair mechanism.
(4) Skilled nursing facility administrator standards
By not later than January 1, 1990, the State must have implemented and enforced the skilled nursing facility administrator standards developed under subsection (f)(4) of this section respecting the qualification of administrators of skilled nursing facilities.
(5) Specification of resident assessment instrument
Effective July 1, 1990, the State shall specify the instrument to be used by nursing facilities in the State in complying with the requirement of subsection (b)(3)(A)(iii) of this section. Such instrument shall be—
(A) one of the instruments designated under subsection (f)(6)(B) of this section, or
(B) an instrument which the Secretary has approved as being consistent with the minimum data set of core elements, common definitions, and utilization guidelines specified by the Secretary under subsection (f)(6)(A) of this section.
(f) Responsibilities of Secretary relating to skilled nursing facility requirements
(1) General responsibility
It is the duty and responsibility of the Secretary to assure that requirements which govern the provision of care in skilled nursing facilities under this subchapter, and the enforcement of such requirements, are adequate to protect the health, safety, welfare, and rights of residents and to promote the effective and efficient use of public moneys.
(2) Requirements for nurse aide training and competency evaluation programs and for nurse aide competency evaluation programs
(A) In general
For purposes of subsections (b)(5) and (e)(1)(A) of this section, the Secretary shall establish, by not later than September 1, 1988—
(i) requirements for the approval of nurse aide training and competency evaluation programs, including requirements relating to (I) the areas to be covered in such a program (including at least basic nursing skills, personal care skills, recognition of mental health and social service needs, care of cognitively impaired residents, basic restorative services, and residents' rights) and content of the curriculum, (II) minimum hours of initial and ongoing training and retraining (including not less than 75 hours in the case of initial training), (III) qualifications of instructors, and (IV) procedures for determination of competency;
(ii) requirements for the approval of nurse aide competency evaluation programs, including requirement relating to the areas to be covered in such a program, including at least basic nursing skills, personal care skills, recognition of mental health and social service needs, care of cognitively impaired residents, basic restorative services, residents' rights, and procedures for determination of competency;
(iii) requirements respecting the minimum frequency and methodology to be used by a State in reviewing such programs' compliance with the requirements for such programs; and
(iv) requirements, under both such programs, that—
(I) provide procedures for determining competency that permit a nurse aide, at the nurse aide's option, to establish competency through procedures or methods other than the passing of a written examination and to have the competency evaluation conducted at the nursing facility at which the aide is (or will be) employed (unless the facility is described in subparagraph (B)(iii)(I)),
(II) prohibit the imposition on a nurse aide who is employed by (or who has received an offer of employment from) a facility on the date on which the aide begins either such program of any charges (including any charges for textbooks and other required course materials and any charges for the competency evaluation) for either such program, and
(III) in the case of a nurse aide not described in subclause (II) who is employed by (or who has received an offer of employment from) a facility not later than 12 months after completing either such program, the State shall provide for the reimbursement of costs incurred in completing such program on a prorata 5 basis during the period in which the nurse aide is so employed.
(B) Approval of certain programs
Such requirements—
(i) may permit approval of programs offered by or in facilities (subject to clause (iii)), as well as outside facilities (including employee organizations), and of programs in effect on December 22, 1987;
(ii) shall permit a State to find that an individual who has completed (before July 1, 1989) a nurse aide training and competency evaluation program shall be deemed to have completed such a program approved under subsection (b)(5) of this section if the State determines that, at the time the program was offered, the program met the requirements for approval under such paragraph; and
(iii) shall prohibit approval of such a program—
(I) offered by or in a skilled nursing facility which, within the previous 2 years—
(a) has operated under a waiver under subsection (b)(4)(C)(ii)(II) of this section;
(b) has been subject to an extended (or partial extended) survey under subsection (g)(2)(B)(i) of this section or
(c) has been assessed a civil money penalty described in subsection (h)(2)(B)(ii) of this section or
(II) offered by or in a skilled nursing facility unless the State makes the determination, upon an individual's completion of the program, that the individual is competent to provide nursing and nursing-related services in skilled nursing facilities.
A State may not delegate (through subcontract or otherwise) its responsibility under clause (iii)(II) to the skilled nursing facility.
(3) Federal guidelines for State appeals process for transfers and discharges
For purposes of subsections (c)(2)(B)(iii)(I) and (e)(3) of this section, by not later than October 1, 1988, the Secretary shall establish guidelines for minimum standards which State appeals processes under subsection (e)(3) of this section must meet to provide a fair mechanism for hearing appeals on transfers and discharges of residents from skilled nursing facilities.
(4) Secretarial standards for qualification of administrators
For purposes of subsections (d)(1)(C) and (e)(4) of this section, the Secretary shall develop, by not later than March 1, 1989, standards to be applied in assuring the qualifications of administrators of skilled nursing facilities.
(5) Criteria for administration
The Secretary shall establish criteria for assessing a skilled nursing facility's compliance with the requirement of subsection (d)(1) of this section with respect to—
(A) its governing body and management,
(B) agreements with hospitals regarding transfers of residents to and from the hospitals and to and from other skilled nursing facilities,
(C) disaster preparedness,
(D) direction of medical care by a physician,
(E) laboratory and radiological services,
(F) clinical records, and
(G) resident and advocate participation.
(6) Specification of resident assessment data set and instruments
The Secretary shall—
(A) not later than January 1, 1989, specify a minimum data set of core elements and common definitions for use by nursing facilities in conducting the assessments required under subsection (b)(3) of this section, and establish guidelines for utilization of the data set; and
(B) by not later than April 1, 1990, designate one or more instruments which are consistent with the specification made under subparagraph (A) and which a State may specify under subsection (e)(5)(A) of this section for use by nursing facilities in complying with the requirements of subsection (b)(3)(A)(iii) of this section.
(7) List of items and services furnished in skilled nursing facilities not chargeable to the personal funds of a resident
(A) Regulations required
Pursuant to the requirement of section 21(b) of the Medicare-Medicaid Anti-Fraud and Abuse Amendments of 1977, the Secretary shall issue regulations, on or before the first day of the seventh month to begin after December 22, 1987, that define those costs which may be charged to the personal funds of residents in skilled nursing facilities who are individuals receiving benefits under this part and those costs which are to be included in the reasonable cost (or other payment amount) under this subchapter for extended care services.
(B) Rule if failure to publish regulations
If the Secretary does not issue the regulations under subparagraph (A) on or before the date required in such subparagraph, in the case of a resident of a skilled nursing facility who is eligible to receive benefits under this part, the costs which may not be charged to the personal funds of such resident (and for which payment is considered to be made under this subchapter) shall include, at a minimum, the costs for routine personal hygiene items and services furnished by the facility.
(g) Survey and certification process
(1) State and Federal responsibility
(A) In general
Pursuant to an agreement under
(B) Educational program
Each State shall conduct periodic educational programs for the staff and residents (and their representatives) of skilled nursing facilities in order to present current regulations, procedures, and policies under this section.
(C) Investigation of allegations of resident neglect and abuse and misappropriation of resident property
The State shall provide, through the agency responsible for surveys and certification of nursing facilities under this subsection, for a process for the receipt and timely review and investigation of allegations of neglect and abuse and misappropriation of resident property by a nurse aide of a resident in a nursing facility or by another individual used by the facility in providing services to such a resident. The State shall, after providing the individual involved with a written notice of the allegations (including a statement of the availability of a hearing for the individual to rebut the allegations) and the opportunity for a hearing on the record, make a written finding as to the accuracy of the allegations. If the State finds that a nurse aide has neglected or abused a resident or misappropriated resident property in a facility, the State shall notify the nurse aide and the registry of such finding. If the State finds that any other individual used by the facility has neglected or abused a resident or misappropriated resident property in a facility, the State shall notify the appropriate licensure authority. A State shall not make a finding that an individual has neglected a resident if the individual demonstrates that such neglect was caused by factors beyond the control of the individual.
(D) Construction
The failure of the Secretary to issue regulations to carry out this subsection shall not relieve a State of its responsibility under this subsection.
(2) Surveys
(A) Standard survey
(i) In general
Each skilled nursing facility shall be subject to a standard survey, to be conducted without any prior notice to the facility. Any individual who notifies (or causes to be notified) a skilled nursing facility of the time or date on which such a survey is scheduled to be conducted is subject to a civil money penalty of not to exceed $2,000. The provisions of
(ii) Contents
Each standard survey shall include, for a case-mix stratified sample of residents—
(I) a survey of the quality of care furnished, as measured by indicators of medical, nursing, and rehabilitative care, dietary and nutrition services, activities and social participation, and sanitation, infection control, and the physical environment,
(II) written plans of care provided under subsection (b)(2) of this section and an audit of the residents' assessments under subsection (b)(3) of this section to determine the accuracy of such assessments and the adequacy of such plans of care, and
(III) a review of compliance with residents' rights under subsection (c) of this section.
(iii) Frequency
(I) In general
Each skilled nursing facility shall be subject to a standard survey not later than 15 months after the date of the previous standard survey conducted under this subparagraph. The Statewide average interval between standard surveys of skilled nursing facilities under this subsection shall not exceed 12 months.
(II) Special surveys
If not otherwise conducted under subclause (I), a standard survey (or an abbreviated standard survey) may be conducted within 2 months of any change of ownership, administration, management of a skilled nursing facility, or the director of nursing in order to determine whether the change has resulted in any decline in the quality of care furnished in the facility.
(B) Extended surveys
(i) In general
Each skilled nursing facility which is found, under a standard survey, to have provided substandard quality of care shall be subject to an extended survey. Any other facility may, at the Secretary's or State's discretion, be subject to such an extended survey (or a partial extended survey).
(ii) Timing
The extended survey shall be conducted immediately after the standard survey (or, if not practicable, not later than 2 weeks after the date of completion of the standard survey).
(iii) Contents
In such an extended survey, the survey team shall review and identify the policies and procedures which produced such substandard quality of care and shall determine whether the facility has complied with all the requirements described in subsections (b), (c), and (d) of this section. Such review shall include an expansion of the size of the sample of residents' assessments reviewed and a review of the staffing, of in-service training, and, if appropriate, of contracts with consultants.
(iv) Construction
Nothing in this paragraph shall be construed as requiring an extended or partial extended survey as a prerequisite to imposing a sanction against a facility under subsection (h) of this section on the basis of findings in a standard survey.
(C) Survey protocol
Standard and extended surveys shall be conducted—
(i) based upon a protocol which the Secretary has developed, tested, and validated by not later than January 1, 1990, and
(ii) by individuals, of a survey team, who meet such minimum qualifications as the Secretary establishes by not later than such date.
The failure of the Secretary to develop, test, or validate such protocols or to establish such minimum qualifications shall not relieve any State of its responsibility (or the Secretary of the Secretary's responsibility) to conduct surveys under this subsection.
(D) Consistency of surveys
Each State and the Secretary shall implement programs to measure and reduce inconsistency in the application of survey results among surveyors.
(E) Survey teams
(i) In general
Surveys under this subsection shall be conducted by a multidisciplinary team of professionals (including a registered professional nurse).
(ii) Prohibition of conflicts of interest
A State may not use as a member of a survey team under this subsection an individual who is serving (or has served within the previous 2 years) as a member of the staff of, or as a consultant to, the facility surveyed respecting compliance with the requirements of subsections (b), (c), and (d) of this section, or who has a personal or familial financial interest in the facility being surveyed.
(iii) Training
The Secretary shall provide for the comprehensive training of State and Federal surveyors in the conduct of standard and extended surveys under this subsection, including the auditing of resident assessments and plans of care. No individual shall serve as a member of a survey team unless the individual has successfully completed a training and testing program in survey and certification techniques that has been approved by the Secretary.
(3) Validation surveys
(A) In general
The Secretary shall conduct onsite surveys of a representative sample of skilled nursing facilities in each State, within 2 months of the date of surveys conducted under paragraph (2) by the State, in a sufficient number to allow inferences about the adequacies of each State's surveys conducted under paragraph (2). In conducting such surveys, the Secretary shall use the same survey protocols as the State is required to use under paragraph (2). If the State has determined that an individual skilled nursing facility meets the requirements of subsections (b), (c), and (d) of this section, but the Secretary determines that the facility does not meet such requirements, the Secretary's determination as to the facility's noncompliance with such requirements is binding and supersedes that of the State survey.
(B) Scope
With respect to each State, the Secretary shall conduct surveys under subparagraph (A) each year with respect to at least 5 percent of the number of skilled nursing facilities surveyed by the State in the year, but in no case less than 5 skilled nursing facilities in the State.
(C) Remedies for substandard performance
If the Secretary finds, on the basis of such surveys, that a State has failed to perform surveys as required under paragraph (2) or that a State's survey and certification performance otherwise is not adequate, the Secretary shall provide for an appropriate remedy, which may include the training of survey teams in the State.
(D) Special surveys of compliance
Where the Secretary has reason to question the compliance of a skilled nursing facility with any of the requirements of subsections (b), (c), and (d) of this section, the Secretary may conduct a survey of the facility and, on the basis of that survey, make independent and binding determinations concerning the extent to which the skilled nursing facility meets such requirements.
(4) Investigation of complaints and monitoring compliance
Each State shall maintain procedures and adequate staff to—
(A) investigate complaints of violations of requirements by skilled nursing facilities, and
(B) monitor, on-site, on a regular, as needed basis, a skilled nursing facility's compliance with the requirements of subsections (b), (c), and (d) of this section, if—
(i) the facility has been found not to be in compliance with such requirements and is in the process of correcting deficiencies to achieve such compliance;
(ii) the facility was previously found not to be in compliance with such requirements, has corrected deficiencies to achieve such compliance, and verification of continued compliance is indicated; or
(iii) the State has reason to question the compliance of the facility with such requirements.
A State may maintain and utilize a specialized team (including an attorney, an auditor, and appropriate health care professionals) for the purpose of identifying, surveying, gathering and preserving evidence, and carrying out appropriate enforcement actions against substandard skilled nursing facilities.
(5) Disclosure of results of inspections and activities
(A) Public information
Each State, and the Secretary, shall make available to the public—
(i) information respecting all surveys and certifications made respecting skilled nursing facilities, including statements of deficiencies, within 14 calendar days after such information is made available to those facilities, and approved plans of correction,
(ii) copies of cost reports of such facilities filed under this subchapter or subchapter XIX of this chapter,
(iii) copies of statements of ownership under
(iv) information disclosed under
(B) Notice to ombudsman
Each State shall notify the State long-term care ombudsman (established under title III or VII of the Older Americans Act of 1965 [
(C) Notice to physicians and skilled nursing facility administrator licensing board
If a State finds that a skilled nursing facility has provided substandard quality of care, the State shall notify—
(i) the attending physician of each resident with respect to which such finding is made, and
(ii) the State board responsible for the licensing of the skilled nursing facility administrator at the facility.
(D) Access to fraud control units
Each State shall provide its State medicaid fraud and abuse control unit (established under
(h) Enforcement process
(1) In general
If a State finds, on the basis of a standard, extended, or partial extended survey under subsection (g)(2) of this section or otherwise, that a skilled nursing facility no longer meets a requirement of subsection (b), (c), or (d) of this section, and further finds that the facility's deficiencies—
(A) immediately jeopardize the health or safety of its residents, the State shall recommend to the Secretary that the Secretary take such action as described in paragraph (2)(A)(i); or
(B) do not immediately jeopardize the health or safety of its residents, the State may recommend to the Secretary that the Secretary take such action as described in paragraph (2)(A)(ii).
If a State finds that a skilled nursing facility meets the requirements of subsections (b), (c), and (d) of this section, but, as of a previous period, did not meet such requirements, the State may recommend a civil money penalty under paragraph (2)(B)(ii) for the days in which it finds that the facility was not in compliance with such requirements.
(2) Secretarial authority
(A) In general
With respect to any skilled nursing facility in a State, if the Secretary finds, or pursuant to a recommendation of the State under paragraph (1) finds, that a skilled nursing facility no longer meets a requirement of subsection (b), (c), (d), or (e) of this section, and further finds that the facility's deficiencies—
(i) immediately jeopardize the health or safety of its residents, the Secretary shall take immediate action to remove the jeopardy and correct the deficiencies through the remedy specified in subparagraph (B)(iii), or terminate the facility's participation under this subchapter and may provide, in addition, for one or more of the other remedies described in subparagraph (B); or
(ii) do not immediately jeopardize the health or safety of its residents, the Secretary may impose any of the remedies described in subparagraph (B).
Nothing in this subparagraph shall be construed as restricting the remedies available to the Secretary to remedy a skilled nursing facility's deficiencies. If the Secretary finds, or pursuant to the recommendation of the State under paragraph (1) finds, that a skilled nursing facility meets such requirements but, as of a previous period, did not meet such requirements, the Secretary may provide for a civil money penalty under subparagraph (B)(ii) for the days on which he finds that the facility was not in compliance with such requirements.
(B) Specified remedies
The Secretary may take the following actions with respect to a finding that a facility has not met an applicable requirement:
(i) Denial of payment
The Secretary may deny any further payments under this subchapter with respect to all individuals entitled to benefits under this subchapter in the facility or with respect to such individuals admitted to the facility after the effective date of the finding.
(ii) Authority with respect to civil money penalties
The Secretary may impose a civil money penalty in an amount not to exceed $10,000 for each day of noncompliance. The provisions of
(iii) Appointment of temporary management
In consultation with the State, the Secretary may appoint temporary management to oversee the operation of the facility and to assure the health and safety of the facility's residents, where there is a need for temporary management while—
(I) there is an orderly closure of the facility, or
(II) improvements are made in order to bring the facility into compliance with all the requirements of subsections (b), (c), and (d) of this section.
The temporary management under this clause shall not be terminated under subclause (II) until the Secretary has determined that the facility has the management capability to ensure continued compliance with all the requirements of subsections (b), (c), and (d) of this section.
The Secretary shall specify criteria, as to when and how each of such remedies is to be applied, the amounts of any fines, and the severity of each of these remedies, to be used in the imposition of such remedies. Such criteria shall be designed so as to minimize the time between the identification of violations and final imposition of the remedies and shall provide for the imposition of incrementally more severe fines for repeated or uncorrected deficiencies. In addition, the Secretary may provide for other specified remedies, such as directed plans of correction.
(C) Continuation of payments pending remediation
The Secretary may continue payments, over a period of not longer than 6 months after the effective date of the findings, under this subchapter with respect to a skilled nursing facility not in compliance with a requirement of subsection (b), (c), or (d) of this section, if—
(i) the State survey agency finds that it is more appropriate to take alternative action to assure compliance of the facility with the requirements than to terminate the certification of the facility,
(ii) the State has submitted a plan and timetable for corrective action to the Secretary for approval and the Secretary approves the plan of corrective action, and
(iii) the facility agrees to repay to the Federal Government payments received under this subparagraph if the corrective action is not taken in accordance with the approved plan and timetable.
The Secretary shall establish guidelines for approval of corrective actions requested by States under this subparagraph.
(D) Assuring prompt compliance
If a skilled nursing facility has not complied with any of the requirements of subsections (b), (c), and (d) of this section, within 3 months after the date the facility is found to be out of compliance with such requirements, the Secretary shall impose the remedy described in subparagraph (B)(i) for all individuals who are admitted to the facility after such date.
(E) Repeated noncompliance
In the case of a skilled nursing facility which, on 3 consecutive standard surveys conducted under subsection (g)(2) of this section, has been found to have provided substandard quality of care, the Secretary shall (regardless of what other remedies are provided)—
(i) impose the remedy described in subparagraph (B)(i), and
(ii) monitor the facility under subsection (g)(4)(B) of this section,
until the facility has demonstrated, to the satisfaction of the Secretary, that it is in compliance with the requirements of subsections (b), (c), and (d) of this section, and that it will remain in compliance with such requirements.
(3) Effective period of denial of payment
A finding to deny payment under this subsection shall terminate when the Secretary finds that the facility is in substantial compliance with all the requirements of subsections (b), (c), and (d) of this section.
(4) Immediate termination of participation for facility where Secretary finds noncompliance and immediate jeopardy
If the Secretary finds that a skilled nursing facility has not met a requirement of subsection (b), (c), or (d) of this section, and finds that the failure immediately jeopardizes the health or safety of its residents, the Secretary shall take immediate action to remove the jeopardy and correct the deficiencies through the remedy specified in paragraph (2)(B)(iii), or the Secretary shall terminate the facility's participation under this subchapter. If the facility's participation under this subchapter is terminated, the State shall provide for the safe and orderly transfer of the residents eligible under this subchapter consistent with the requirements of subsection (c)(2) of this section.
(5) Construction
The remedies provided under this subsection are in addition to those otherwise available under State or Federal law and shall not be construed as limiting such other remedies, including any remedy available to an individual at common law. The remedies described in clauses (i),6 and (iii) of paragraph (2)(B) may be imposed during the pendency of any hearing.
(6) Sharing of information
Notwithstanding any other provision of law, all information concerning skilled nursing facilities required by this section to be filed with the Secretary or a State agency shall be made available by such facilities to Federal or State employees for purposes consistent with the effective administration of programs established under this subchapter and subchapter XIX of this chapter, including investigations by State medicaid fraud control units.
(i) Construction
Where requirements or obligations under this section are identical to those provided under
(Aug. 14, 1935, ch. 531, title XVIII, §1819, as added and amended Dec. 22, 1987,
References in Text
The Older Americans Act of 1965, referred to in subsecs. (c)(2)(B)(iii)(II) and (g)(5)(B), is
Subparagraphs (B), (C), and (D) of section 6901(b)(4) of the Omnibus Budget Reconciliation Act of 1989 [
Section 21(b) of the Medicare-Medicaid Anti-Fraud and Abuse Amendments of 1977, referred to in subsec. (f)(7)(A), probably means section 21(b) of the Medicare-Medicaid Anti-Fraud and Abuse Amendments,
Amendments
1994—Subsec. (b)(3)(C)(i)(I).
Subsec. (b)(5)(D).
Subsec. (b)(5)(G).
Subsec. (c)(1)(D).
Subsec. (c)(6)(B)(i).
Subsec. (e)(2)(B).
Subsec. (f)(2)(B)(i).
Subsec. (f)(2)(B)(iii)(I)(b).
Subsec. (f)(2)(B)(iii)(I)(c).
Subsec. (g)(1)(C).
Subsec. (g)(5)(B).
1992—Subsecs. (c)(2)(B)(iii)(II), (g)(5)(B).
1990—Subsec. (b)(1)(B).
Subsec. (b)(3)(C)(i)(I).
Subsec. (b)(4)(A)(vii).
Subsec. (b)(4)(C)(ii)(IV), (V).
Subsec. (b)(5)(A).
Subsec. (b)(5)(C).
Subsec. (b)(5)(D).
Subsec. (b)(5)(F)(i).
Subsec. (c)(1)(A).
Subsec. (c)(1)(A)(iv).
Subsec. (c)(1)(A)(x), (xi).
Subsec. (c)(1)(B)(ii).
Subsec. (c)(1)(E).
Subsec. (e)(1)(A).
Subsec. (e)(2)(A).
Subsec. (e)(2)(C).
Subsec. (f)(2)(A)(ii).
Subsec. (f)(2)(A)(iv).
Subsec. (f)(2)(B).
Subsec. (f)(2)(B)(iii)(I).
Subsec. (g)(1)(C).
Subsec. (g)(5)(A)(i).
Subsec. (g)(5)(B).
1989—Subsec. (b)(5)(A).
Subsec. (b)(5)(B).
Subsec. (c)(1)(A)(ii)(II).
Subsec. (c)(1)(A)(v)(I).
Subsec. (f)(2)(A)(i)(I).
Subsec. (f)(2)(A)(ii).
Subsec. (f)(2)(A)(iv).
Subsec. (h)(2)(C).
1988—Subsec. (b)(3)(A)(iii).
Subsec. (b)(3)(A)(iv).
Subsec. (b)(3)(B)(ii)(III).
Subsec. (b)(3)(C)(i)(I).
Subsec. (b)(4)(C)(i).
Subsec. (b)(5)(A).
Subsec. (b)(5)(A)(ii).
Subsec. (b)(5)(G).
Subsec. (c)(1)(D).
Subsec. (c)(2)(A)(v).
Subsec. (c)(6).
Subsec. (e)(1)(A).
Subsec. (e)(1)(B).
Subsec. (e)(2)(A).
Subsec. (e)(2)(B).
Subsec. (e)(3).
Subsec. (e)(5).
Subsec. (f)(2)(A)(i)(I).
Subsec. (f)(3).
Subsec. (f)(6)(A).
Subsec. (f)(6)(B).
Subsec. (f)(7)(A).
Subsec. (f)(7)(B).
Subsec. (g)(1)(C).
Subsec. (g)(1)(D).
Subsec. (g)(2)(A)(i).
Subsec. (g)(2)(B)(ii).
Subsec. (g)(2)(C)(i).
Subsec. (g)(3)(D).
Subsec. (g)(4).
Subsec. (h)(2)(B)(ii).
Subsec. (h)(5).
Subsec. (h)(6).
1987—Subsecs. (g) to (i).
Effective Date of 1994 Amendment
Section 106(c)(1)(B) of
Section 106(c)(2)(B) of
Section 106(c)(3)(B) of
Section 106(c)(4)(C) of
Section 106(d)(7) of
Effective Date of 1992 Amendment
Amendment by
Amendment by
Effective Date of 1990 Amendment
Section 4008(h)(1)(F)(ii) of
"(I) The amendments made by clause (i) [amending this section] shall take effect as if included in the enactment of the Omnibus Budget Reconciliation Act of 1987 [
"(aa) had its participation terminated under title XVIII of the Social Security Act [this subchapter] or under the State plan under title XIX of such Act [subchapter XIX of this chapter];
"(bb) was subject to a denial of payment under either such title;
"(cc) was assessed a civil money penalty not less than $5,000 for deficiencies in skilled nursing facility standards;
"(dd) operated under a temporary management appointed to oversee the operation of the facility and to ensure the health and safety of the facility's residents; or
"(ee) pursuant to State action, was closed or had its residents transferred.
"(II) Notwithstanding subclause (I) and subject to section 1819(f)(2)(B)(iii)(I) of the Social Security Act [subsec. (f)(2)(B)(iii)(I) of this section] (as amended by clause (i)), a State may approve a training and competency evaluation program or a competency evaluation program offered by or in a skilled nursing facility described in subclause (I) if, during the previous 2 years, item (aa), (bb), (cc), (dd), or (ee) of subclause (I) did not apply to the facility."
Section 4008(h)(1)(H) of
Section 4008(h)(2)(P) of
Section 4206(e)(1) of
Effective Date of 1989 Amendment
Section 6901(b)(6) of
"(A)
"(B)
Section 6901(d)(6) of
"(A)
"(B)
Effective Date of 1988 Amendments
Amendment by
Except as specifically provided in section 411 of
Effective Date
Section 4204 of title IV of
"(a)
"(b)
"(2) In applying the amendments made by section 4203 of this Act for services furnished by a skilled nursing facility before October 1, 1990, any reference to a requirement of subsection (b), (c), or (d), of section 1819 of the Social Security Act is deemed a reference to the provisions of section 1861(j) of such Act [
"(c)
Maintaining Regulatory Standards for Certain Services
Section 4008(h)(2)(O) of
Nurse Aide Training and Competency Evaluation Programs; Publication of Proposed Regulations
Section 6901(b)(2) of
Nurse Aide Training and Competency Evaluation; Satisfaction of Requirements; Waiver
Section 6901(b)(4)(B)–(D) of
"(B) A nurse aide shall be considered to satisfy the requirement of sections 1819(b)(5)(A) and 1919(b)(5)(A) of the Social Security Act [subsec. (b)(5)(A) of this section and
"(C) A nurse aide shall be considered to satisfy the requirement of sections 1819(b)(5)(A) and 1919(b)(5)(A) of the Social Security Act (of having completed a training and competency evaluation program approved by a State under section 1819(e)(1)(A) or 1919(e)(1)(A) of such Act), if such aide was found competent (whether or not by the State), before July 1, 1989, after the completion of a course of nurse aide training of at least 100 hours duration.
"(D) With respect to the nurse aide competency evaluation requirements described in sections 1819(b)(5)(A) and 1919(b)(5)(A) of the Social Security Act, a State may waive such requirements with respect to an individual who can demonstrate to the satisfaction of the State that such individual has served as a nurse aide at one or more facilities of the same employer in the State for at least 24 consecutive months before the date of the enactment of this Act [Dec. 19, 1989]."
Evaluation and Report on Implementation of Resident Assessment Process
Section 4201(c) of
Annual Report on Statutory Compliance and Enforcement Actions
Section 4205 of
Section Referred to in Other Sections
This section is referred to in
2 So in original. Probably should be "as nurse aides".
3 So in original. Probably should be "credit".
4 So in original. Probably should be followed by a comma.
5 So in original. Probably should be "pro rata".
6 So in original. The comma probably should not appear.
§1395i–4. Essential access community hospital program
(a) In general
There is hereby established a program under which the Secretary—
(1) shall make grants to not more than 7 States to carry out the activities described in subsection (d)(1) of this section;
(2) shall make grants to eligible hospitals and facilities (or consortia of hospitals and facilities) to carry out the activities described in subsection (d)(2) of this section; and
(3) shall designate (under subsection (i) of this section) hospitals and facilities located in States receiving grants under paragraph (1) as essential access community hospitals or rural primary care hospitals.
(b) Eligibility of States for grants
A State is eligible to receive a grant under subsection (a)(1) of this section only if the State submits to the Secretary, at such time and in such form as the Secretary may require, an application containing—
(1) assurances that the State—
(A) has developed, or is in the process of developing, a State rural health care plan that—
(i) provides for the creation of one or more rural health networks (as defined in subsection (g) of this section) in the State,
(ii) promotes regionalization of rural health services in the State,
(iii) improves access to hospital and other health services for rural residents of the State, and
(iv) enhances the provision of emergency and other transportation services related to health care;
(B) has developed the rural health care plan described in subparagraph (A) in consultation with the hospital association of the State and rural hospitals located in the State (or, in the case of a State in the process of developing such plan, that assures the Secretary that it will consult with its State hospital association and rural hospitals located in the State in developing such plan); and
(C) has designated, or is in the process of designating, rural non-profit or public hospitals or facilities located in the State as essential access community hospitals or rural primary care hospitals within such networks; and
(2) such other information and assurances as the Secretary may require.
(c) Eligibility of hospitals and consortia for grants
(1) In general
Except as provided in paragraph (3) or subsection (k) of this section, a hospital or facility is eligible to receive a grant under subsection (a)(2) of this section only if the hospital or facility—
(A) is located in a State receiving a grant under subsection (a)(1) of this section;
(B) is designated as an essential access community hospital or a rural primary care hospital by the State in which it is located or is a member of a rural health network (as defined in subsection (g) of this section);
(C) submits to the State in which it is located and to the Secretary, at such time and in such form as the Secretary may require, an application containing such information and assurances as the Secretary may require; and
(D) the State in which the hospital or facility is located certifies to the Secretary that—
(i) the receiving of such a grant by the hospital or facility is consistent with the State's rural health care plan (described in subsection (b)(1)(A) of this section), and
(ii) the State has approved the application submitted under subparagraph (C).
(2) Treatment of consortia
A consortium of hospitals or facilities each of which is part of the same rural health network is eligible to receive a grant under subsection (a)(2) of this section if each of its members would individually be eligible to receive such a grant.
(3) Eligibility of RPC hospitals not located in a State receiving grant
A facility designated as a rural primary care hospital by the Secretary under subsection (i)(2)(C) of this section shall be eligible to receive a grant under subsection (a)(2) of this section.
(d) Activities for which grants may be used
(1) Grants to States
A State shall use a grant received under subsection (a)(1) of this section to carry out the program established under this section in the State. Such grant may be used for engaging in activities relating to planning and implementing a rural health care plan and rural health networks, designating hospitals or facilities in the State as essential access community hospitals or rural primary care hospitals, and developing and supporting communication and emergency transportation systems.
(2) Grants to hospitals, facilities, and consortia
A hospital or facility shall use a grant received under subsection (a)(2) of this section to finance the costs it incurs in converting itself to a rural primary care hospital or an essential access community hospital or in becoming part of a rural health network in the State in which it is located, including capital costs, costs incurred in the development of necessary communications systems, and costs incurred in the development of an emergency transportation system. A consortium shall use a grant received under subsection (a)(2) of this section to finance the costs it incurs in converting hospitals or facilities that are part of the consortium into rural primary care hospitals or in developing and implementing a rural health network consisting of its members in the State in which it is located, including capital costs, costs incurred in the development of necessary communications systems, and costs incurred in the development of an emergency transportation system.
(e) Designation by State of essential access community hospitals
A State may designate a hospital as an essential access community hospital only if the hospital—
(1)(A) except in the case of a hospital located in an urban area, is located more than 35 miles from any hospital that either (i) has been designated as an essential access community hospital or (ii) is classified by the Secretary as a rural referral center under
(2) has at least 75 inpatient beds or is located more than 35 miles from any other hospital;
(3) has in effect an agreement to provide emergency and medical backup services to rural primary care hospitals participating in the rural health network of which it is a member and throughout its service area;
(4) has in effect an agreement, with each rural primary care hospital participating in the rural health network of which it is a member, to accept patients transferred from such primary care hospital, to receive data from and transmit data to such primary care hospital, and to provide staff privileges to physicians providing care at such primary care hospital; and
(5) meets any other requirements imposed by the State with the approval of the Secretary.
(f) Designation by State of rural primary care hospitals
(1) Criteria for designation
A State may designate a facility as a rural primary care hospital only if the facility—
(A) is located in a rural area (as defined in
(B) at the time such facility applies to the State for designation as a rural primary care hospital, is a hospital (or, in the case of a facility that closed during the 12-month period that ends on the date the facility applies for such designation, at the time the facility closed),1 with a participation agreement in effect under
(C) has ceased, or agrees (upon the approval of such application) to cease, providing inpatient care (except as required under subparagraph (F));
(D) in the case of a facility that is a member of a rural health network, has in effect an agreement to participate with other hospitals and facilities in the communications system of such network, including the network's system for the electronic sharing of patient data, including telemetry and medical records, if the network has in operation such a system;
(E) makes available 24-hour emergency care;
(F) subject to paragraph (4), provides not more than 6 inpatient beds (meeting such conditions as the Secretary may establish) for providing inpatient care to patients requiring stabilization before discharge or transfer to a hospital, except that the facility may not provide any inpatient hospital services—
(i) to any patient whose attending physician does not certify that the patient may reasonably be expected to be discharged or transferred to a hospital within 72 hours of admission to the facility; or
(ii) consisting of surgery or any other service requiring the use of general anesthesia (other than surgical procedures specified by the Secretary under
(G) meets such staffing requirements as would apply under
(i) the facility need not meet hospital standards relating to the number of hours during a day, or days during a week, in which the facility must be open, except insofar as the facility is required to provide emergency care on a 24-hour basis under subparagraph (E),
(ii) the facility may provide any services otherwise required to be provided by a full-time, on-site dietician, pharmacist, laboratory technician, medical technologist, and radiological technologist on a part-time, off-site basis, and
(iii) the inpatient care described in subparagraph (F) may be provided by a physician's assistant or nurse practitioner, subject to the oversight of a physician; and
(H) meets the requirements of subparagraphs (C) through (J) of paragraph (2) of
(2) Preference given to hospitals or facilities participating in rural health network
In designating facilities as rural primary care hospitals under paragraph (1), the State shall give preference to hospitals or facilities participating in a rural health network.
(3) Permitting rural primary care hospitals to maintain swing beds
Nothing in this subsection shall be construed to prohibit a State from designating a facility as a rural primary care hospital solely because, at the time the facility applies to the State for designation as a rural primary care hospital, there is in effect an agreement between the facility and the Secretary under
(4) Limitation on average length of inpatient stays
The Secretary may terminate a designation of a rural primary care hospital under paragraph (1) if the Secretary finds that the average length of stay for inpatients at the facility during the previous year in which the designation was in effect exceeded 72 hours. In determining the compliance of a facility with the requirement of the previous sentence, there shall not be taken into account periods of stay of inpatients in excess of 72 hours to the extent such periods exceed 72 hours because transfer to a hospital is precluded because of inclement weather or other emergency conditions.
(g) "Rural health network" defined
For purposes of this section, the term "rural health network" means, with respect to a State, an organization—
(1) consisting of—
(A) at least 1 hospital that—
(i) the State has designated or plans to designate as an essential access community hospital under subsection (b)(1)(C) of this section,
(ii) is classified by the Secretary as a regional referral center under
(iii) is located in an urban area and meets the criteria for classification as a regional referral center under such section, and
(B) at least 1 facility that the State has designated or plans to designate as a rural primary care hospital, and
(2) the members of which have entered into agreements regarding—
(A) patient referral and transfer,
(B) the development and use of communications systems, including (where feasible) telemetry systems and systems for electronic sharing of patient data, and
(C) the provision of emergency and non-emergency transportation among the members.
(h) Limit on amount of grant to hospital or facility
A grant made to a hospital or facility under subsection (a)(2) of this section may not exceed $200,000.
(i) Eligibility of hospitals or facilities for designation by Secretary
(1) Essential access community hospital
(A) The Secretary shall designate a hospital as an essential access community hospital if the hospital—
(i) is located in a State receiving a grant under subsection (a)(1) of this section (except as provided in subsection (k) of this section);
(ii) is designated as an essential access community hospital by the State in which it is located (except as provided in subparagraph (B) or subsection (k) of this section); and
(iii) meets such other criteria as the Secretary may require.
(B) In the case of a hospital that is not eligible for designation as an essential access community hospital under this paragraph solely because it is not designated as an essential access community hospital by the State in which it is located, the Secretary may designate such hospital as an essential access community hospital under this paragraph if the hospital is not so designated by the State in which it is located solely because of its failure to meet the criteria described in paragraph (2) of subsection (e) of this section.
(2) Rural primary care hospital
(A) The Secretary shall designate a facility as a rural primary care hospital if the facility—
(i) is located in a State receiving a grant under subsection (a)(1) of this section (except as provided in subsection (k) of this section);
(ii) is designated as a rural primary care hospital by the State in which it is located (except as provided in subparagraph (B) or subsection (k) of this section); and
(iii) meets such other criteria as the Secretary may require.
(B) In the case of a facility that is not eligible for designation as a rural primary care hospital under this paragraph solely because it is not designated as a rural primary care hospital by the State in which it is located, the Secretary may designate such facility as a rural primary care hospital under this paragraph if the facility is not so designated by the State in which it is located solely because of its failure to meet the criteria described in subparagraphs 3 (C), (F), or (G) of subsection (f)(1) of this section.
(C) The Secretary may designate not more than 15 facilities as rural primary care hospitals under this paragraph that do not meet the requirements of clauses (i) and (ii) of subparagraph (A) if such a facility meets the criteria described in subparagraphs (A), (B), and (E) of subsection (f)(1) of this section, except that nothing in this subparagraph shall be construed to prohibit the Secretary from designating a facility as a rural primary care hospital solely because the facility has entered into an agreement with the Secretary under
(j) Waiver of conflicting part A provisions
The Secretary is authorized to waive such provisions of this part and part C of this subchapter as are necessary to conduct the program established under this section.
(k) Eligibility of hospitals not located in participating States
Notwithstanding any other provision of this section—
(1) for purposes of including a hospital or facility as a member institution of a rural health network, a State may designate a hospital or facility that is not located in the State as an essential access community hospital or a rural primary care hospital if the hospital or facility is located in an adjoining State and is otherwise eligible for designation as such a hospital;
(2) the Secretary may designate a hospital or facility that is not located in a State receiving a grant under subsection (a)(1) of this section as an essential access community hospital or a rural primary care hospital if the hospital or facility is a member institution of a rural health network of a State receiving a grant under such subsection; and
(3) a hospital or facility designated pursuant to this subsection shall be eligible to receive a grant under subsection (a)(2) of this section.
(l) Authorization of appropriations
There are authorized to be appropriated from the Federal Hospital Insurance Trust Fund for each of the fiscal years 1990 through 1997—
(1) $10,000,000 for grants to States under subsection (a)(1) of this section; and
(2) $15,000,000 for grants to hospitals, facilities, and consortia under subsection (a)(2) of this section.
(Aug. 14, 1935, ch. 531, title XVIII, §1820, as added Dec. 19, 1989,
References in Text
Part C of this subchapter, referred to in subsec. (j), is classified to
Amendments
1994—Subsec. (c)(1).
Subsec. (e)(1).
Subsec. (e)(1)(A).
Subsec. (e)(2) to (6).
Subsec. (f)(1)(F).
Subsec. (f)(1)(H).
Subsec. (f)(3).
Subsec. (f)(4).
Subsec. (i)(1)(A).
Subsec. (i)(1)(B).
Subsec. (i)(2)(A).
Subsec. (k).
Subsec. (l).
1990—Subsec. (d)(1).
Subsec. (f)(1)(A).
Subsec. (f)(1)(B).
Subsec. (g)(1)(A)(ii).
Subsec. (i)(2)(C).
Subsec. (j).
Effective Date of 1990 Amendment
Section 4008(d)(4) of
GAO Reports
Section 102(a)(4) of
"(A) the application of the requirements under section 1820(f) of the Social Security Act [subsec. (f) of this section] (as amended by this subsection) that rural primary care hospitals provide inpatient care only to those individuals whose attending physicians certify may reasonably be expected to be discharged within 72 hours after admission and maintain an average length of inpatient stay during a year that does not exceed 72 hours; and
"(B) the extent to which such requirements have resulted in such hospitals providing inpatient care beyond their capabilities or have limited the ability of such hospitals to provide needed services."
Section Referred to in Other Sections
This section is referred to in
1 So in original. The comma probably should not appear.
2 So in original. The period probably should be a semicolon.
3 So in original. Probably should be "subparagraph".
Part B—Supplementary Medical Insurance Benefits for Aged and Disabled
Part Referred to in Other Sections
This part is referred to in
§1395j. Establishment of supplementary medical insurance program for aged and disabled
There is hereby established a voluntary insurance program to provide medical insurance benefits in accordance with the provisions of this part for aged and disabled individuals who elect to enroll under such program, to be financed from premium payments by enrollees together with contributions from funds appropriated by the Federal Government.
(Aug. 14, 1935, ch. 531, title XVIII, §1831, as added July 30, 1965,
Amendments
1972—
Study Regarding Coverage Under Part B of Medicare for Nonreimbursable Services Provided by Optometrists for Prosthetic Lenses for Patients With Aphakia
Study To Determine Feasibility of Inclusion of Certain Additional Services Under Part B
Section Referred to in Other Sections
This section is referred to in title 38 section 1729.
§1395k. Scope of benefits; definitions
(a) The benefits provided to an individual by the insurance program established by this part shall consist of—
(1) entitlement to have payment made to him or on his behalf (subject to the provisions of this part) for medical and other health services, except those described in subparagraphs (B) and (D) of paragraph (2); and
(2) entitlement to have payment made on his behalf (subject to the provisions of this part) for—
(A) home health services (other than items described in subparagraph (G) or subparagraph (I));
(B) medical and other health services (other than items described in subparagraph (G) or subparagraph (I)) furnished by a provider of services or by others under arrangement with them made by a provider of services, excluding—
(i) physician services except where furnished by—
(I) a resident or intern of a hospital, or
(II) a physician to a patient in a hospital which has a teaching program approved as specified in paragraph (6) of
(ii) services for which payment may be made pursuant to
(iii) services described by
(iv) services of a nurse practitioner or clinical nurse specialist provided in a rural area (as defined in
(C) outpatient physical therapy services (other than services to which the second sentence of
(D)(i) rural health clinic services and (ii) Federally qualified health center services;
(E) comprehensive outpatient rehabilitation facility services;
(F) facility services furnished in connection with surgical procedures specified by the Secretary—
(i) pursuant to
(ii) pursuant to
(I) a quality control and peer review organization (having a contract with the Secretary under part B of subchapter XI of this chapter) is willing, able, and has agreed to carry out a review (on a sample or other reasonable basis) of the physician's performing such procedures in the physician's office,
(II) the particular physician involved has agreed to make available to such organization such records as the Secretary determines to be necessary to carry out the review, and
(III) the physician is authorized to perform the procedure in a hospital located in the area in which the office is located,
and if the physician agrees to accept the standard overhead amount determined under
(G) covered items (described in
(H) outpatient rural primary care hospital services (as defined in
(I) prosthetic devices and orthotics and prosthetics (described in
(J) partial hospitalization services provided by a community mental health center (as described in
(b) For definitions of "spell of illness", "medical and other health services", and other terms used in this part, see
(Aug. 14, 1935, ch. 531, title XVIII, §1832, as added July 30, 1965,
References in Text
Part B of subchapter XI of this chapter, referred to in subsec. (a)(2)(F)(ii)(I), is classified to
Amendments
1990—Subsec. (a)(2)(A), (B).
Subsec. (a)(2)(B)(iii).
Subsec. (a)(2)(B)(iv).
Subsec. (a)(2)(D).
Subsec. (a)(2)(I).
Subsec. (a)(2)(J).
1989—Subsec. (a).
Subsec. (a)(2)(H).
Subsec. (b).
1988—Subsec. (a).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B)(iv).
Subsec. (a)(2)(F)(i).
Subsec. (a)(2)(F)(ii).
Subsec. (b).
1987—Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (a)(2)(B)(iv).
Subsec. (a)(2)(F)(i).
Subsec. (a)(2)(F)(ii).
Subsec. (a)(2)(G).
1986—Subsec. (a)(2)(B)(iii).
Subsec. (a)(2)(C).
Subsec. (a)(2)(F).
1984—Subsec. (a)(2)(F)(ii).
Subsec. (a)(2)(F)(ii)(II).
1982—Subsec. (a)(2)(F)(ii)(I).
1980—Subsec. (a)(2)(A).
Subsec. (a)(2)(B)(i)(II).
Subsec. (a)(2)(E).
Subsec. (a)(2)(F).
1977—Subsec. (a)(1).
Subsec. (a)(2)(D).
1972—Subsec. (a)(2)(B).
Subsec. (a)(2)(C).
1968—Subsec. (a)(2)(B).
Subsec. (a)(2)(C).
Effective Date of 1990 Amendment
Section 4153(a)(3) of
Section 4155(e) of
Section 4157(d) of
Section 4161(a)(8) of
"(A) Subject to subparagraphs (B) and (C), the amendments made by this section [probably means this subsection, which amended this section and
"(B) In the case of a Federally qualified health care center that has elected, as of January 1, 1990, under part B of title XVIII of the Social Security Act [this part], to have the amount of payments for services under such part determined on a reasonable-charge basis, the amendment made by paragraph (3)(A) [amending this section] shall only apply on and after such date (not earlier than October 1, 1991) as the center may elect.
"(C) The amendment made by paragraph (6) [amending
Section 4162(c) of
Effective Date of 1989 Amendment
Amendment by section 101(a) of
Amendment by section 201(a) of
Effective Date of 1988 Amendment
Amendment by section 104(d)(3) of
Amendment by section 203(a) of
Section 205(f) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Amendment by section 4062(d)(2) of
Section 4073(e) of
Section 4077(b)(5), formerly §4077(b)(6), of
Effective Date of 1986 Amendment
Section 9320(i) of
Section 9337(e) of
Effective Date of 1984 Amendment
Section 2341(d) of
Amendment by section 2354(b)(6) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendment
Amendment by section 930(g) of
Section 933(h) of
Amendment by section 948(a)(2) of
Effective Date of 1977 Amendment
Section 1(j) of
Effective Date of 1972 Amendment
Amendment by section 227(e)(1) of
Amendment by section 251(a)(4) of
Effective Date of 1968 Amendment
Amendment by section 129(c)(6)(B) of
Section 133(g) of
Quality and Utilization of In-Home Care for Chronically Dependent Individuals
Section 205(e)(2) of
Study of Alternative Out-of-Home Services
Section 205(g) of
Construction of Section 9320 of Pub. L. 99–509
Section 9320(j) of
Continuation of Cost Pass-Through for Certified Registered Nurse Anesthetists
Section 9320(k) of
"(1) Subject to paragraph (2), the amendments made by this section [amending this section and
"(A) as of January 1, 1988, the hospital employed or contracted with a certified registered nurse anesthetist (but not more than one full-time equivalent certified registered nurse anesthetist),
"(B) in 1987 the hospital had a volume of surgical procedures (including inpatient and outpatient procedures) requiring anesthesia services that did not exceed 500 (or such higher number as the Secretary determines to be appropriate), and
"(C) each certified registered nurse anesthetist employed by, or under contract with, the hospital has agreed not to bill under part B of title XVIII of such Act [this part] for professional services furnished by the anesthetist at the hospital.
"(2) Paragraph (1) shall not apply in a year (after 1989) to a hospital unless the hospital establishes, before the beginning of the year, that the hospital has had a volume of surgical procedures (including inpatient and outpatient procedures) requiring anesthesia services in the previous year that did not exceed 500 (or such higher number as the Secretary determines to be appropriate)."
[Section 6132(b) of
Payment for Services of Physicians Rendered in a Teaching Hospital for Accounting Periods Beginning After June 30, 1975, and Prior to October 1, 1978; Studies, Reports, etc.; Effective Dates
Section Referred to in Other Sections
This section is referred to in
1 So in original. The semicolon probably should be a comma.
2 So in original. The word "and" probably should not appear.
§1395l. Payment of benefits
(a) Amounts
Except as provided in
(1) in the case of services described in
(2) in the case of services described in
(A) with respect to home health services (other than a covered osteoporosis drug (as defined in
(i) the reasonable cost of such services, as determined under
(ii) the customary charges with respect to such services,
or, if such services are furnished by a public provider of services, or by another provider which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low-income (and requests that payment be made under this provision), free of charge or at nominal charges to the public, the amount determined in accordance with
(B) with respect to other items and services (except those described in subparagraph (C), (D), or (E) of this paragraph and except as may be provided in
(i) the lesser of—
(I) the reasonable cost of such services, as determined under
(II) the customary charges with respect to such services,
less the amount a provider may charge as described in clause (ii) of
(ii) if such services are furnished by a public provider of services, or by another provider which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low-income (and requests that payment be made under this clause), free of charge or at nominal charges to the public, 80 percent of the amount determined in accordance with
(iii) if (and for so long as) the conditions described in
(C) with respect to services described in the second sentence of
(D) with respect to clinical diagnostic laboratory tests for which payment is made under this part (i) on the basis of a fee schedule determined under subsection (h)(1) of this section, the amount paid shall be equal to 80 percent (or 100 percent, in the case of such tests for which payment is made on an assignment-related basis or to a provider having an agreement under
(E) with respect to—
(i) outpatient hospital radiology services (including diagnostic and therapeutic radiology, nuclear medicine and CAT scan procedures, magnetic resonance imaging, and ultrasound and other imaging services, but excluding screening mammography), and
(ii) effective for procedures performed on or after October 1, 1989, diagnostic procedures (as defined by the Secretary) described in
the amount determined under subsection (n) of this section; and
(F) with respect to a covered osteoporosis drug (as defined in
(3) in the case of services described in subparagraphs (D) and (E) of
(4) in the case of facility services described in
(5) in the case of covered items (described in
(6) in the case of outpatient rural primary care hospital services, the amounts described in
(7) in the case of prosthetic devices and orthotics and prosthetics (as described in
(b) Deductible provision
Before applying subsection (a) of this section with respect to expenses incurred by an individual during any calendar year, the total amount of the expenses incurred by such individual during such year (which would, except for this subsection, constitute incurred expenses from which benefits payable under subsection (a) of this section are determinable) shall be reduced by a deductible of $75 for calendar years before 1991 and $100 for 1991 and subsequent years; except that (1) such total amount shall not include expenses incurred for items and services described in
(c) Mental disorders
Notwithstanding any other provision of this part, with respect to expenses incurred in any calendar year in connection with the treatment of mental, psychoneurotic, and personality disorders of an individual who is not an inpatient of a hospital at the time such expenses are incurred, there shall be considered as incurred expenses for purposes of subsections (a) and (b) of this section only 62½ percent of such expenses. For purposes of this subsection, the term "treatment" does not include brief office visits (as defined by the Secretary) for the sole purpose of monitoring or changing drug prescriptions used in the treatment of such disorders or partial hospitalization services that are not directly provided by a physician.
(d) Nonduplication of payments
No payment may be made under this part with respect to any services furnished an individual to the extent that such individual is entitled (or would be entitled except for
(e) Information for determination of amounts due
No payment shall be made to any provider of services or other person under this part unless there has been furnished such information as may be necessary in order to determine the amounts due such provider or other person under this part for the period with respect to which the amounts are being paid or for any prior period.
(f) Maximum rate of payment per visit for independent rural health clinics
In establishing limits under subsection (a) of this section on payment for rural health clinic services provided by independent rural health clinics, the Secretary shall establish such limit, for services provided—
(1) in 1988, after March 31, at $46, and
(2) in a subsequent year, at the limit established under this subsection for the previous year increased by the percentage increase in the MEI (as defined in
(g) Physical therapy services
In the case of services described in the second sentence of
(h) Fee schedules for clinical diagnostic laboratory tests; percentage of prevailing charge level; nominal fee for samples; adjustments; recipients of payments; negotiated payment rate
(1)(A) The Secretary shall establish fee schedules for clinical diagnostic laboratory tests for which payment is made under this part, other than such tests performed by a provider of services for an inpatient of such provider.
(B) In the case of clinical diagnostic laboratory tests performed by a physician or by a laboratory (other than tests performed by a qualified hospital laboratory (as defined in subparagraph (D)) for outpatients of such hospital), the fee schedules established under subparagraph (A) shall be established on a regional, statewide, or carrier service area basis (as the Secretary may determine to be appropriate) for tests furnished on or after July 1, 1984.
(C) In the case of clinical diagnostic laboratory tests performed by a qualified hospital laboratory (as defined in subparagraph (D)) for outpatients of such hospital, the fee schedules established under subparagraph (A) shall be established on a regional, statewide, or carrier service area basis (as the Secretary may determine to be appropriate) for tests furnished on or after July 1, 1984.
(D) In this subsection, the term "qualified hospital laboratory" means a hospital laboratory, in a sole community hospital (as defined in
(2)(A)(i) Except as provided in paragraph (4), the Secretary shall set the fee schedules at 60 percent (or, in the case of a test performed by a qualified hospital laboratory (as defined in paragraph (1)(D)) for outpatients of such hospital, 62 percent) of the prevailing charge level determined pursuant to the third and fourth sentences of
(ii) Notwithstanding clause (i)—
(I) any change in the fee schedules which would have become effective under this subsection for tests furnished on or after January 1, 1988, shall not be effective for tests furnished during the 3-month period beginning on January 1, 1988,
(II) the Secretary shall not adjust the fee schedules under clause (i) to take into account any increase in the consumer price index for 1988,
(III) the annual adjustment in the fee schedules determined under clause (i) for each of the years 1991, 1992, and 1993 shall be 2 percent, and
(IV) the annual adjustment in the fee schedules determined under clause (i) for each of the years 1994 and 1995 shall be 0 percent.
(iii) In establishing fee schedules under clause (i) with respect to automated tests and tests (other than cytopathology tests) which before July 1, 1984, the Secretary made subject to a limit based on lowest charge levels under the sixth sentence of
(B) The Secretary may make further adjustments or exceptions to the fee schedules to assure adequate reimbursement of (i) emergency laboratory tests needed for the provision of bona fide emergency services, and (ii) certain low volume high-cost tests where highly sophisticated equipment or extremely skilled personnel are necessary to assure quality.
(3) In addition to the amounts provided under the fee schedules, the Secretary shall provide for and establish (A) a nominal fee to cover the appropriate costs in collecting the sample on which a clinical diagnostic laboratory test was performed and for which payment is made under this part, except that not more than one such fee may be provided under this paragraph with respect to samples collected in the same encounter, and (B) a fee to cover the transportation and personnel expenses for trained personnel to travel to the location of an individual to collect the sample, except that such a fee may be provided only with respect to an individual who is homebound or an inpatient in an inpatient facility (other than a hospital). In establishing a fee to cover the transportation and personnel expenses for trained personnel to travel to the location of an individual to collect a sample, the Secretary shall provide a method for computing the fee based on the number of miles traveled and the personnel costs associated with the collection of each individual sample, but the Secretary shall only be required to apply such method in the case of tests furnished during the period beginning on April 1, 1989, and ending on December 31, 1990, by a laboratory that establishes to the satisfaction of the Secretary (based on data for the 12-month period ending June 30, 1988) that (i) the laboratory is dependent upon payments under this subchapter for at least 80 percent of its collected revenues for clinical diagnostic laboratory tests, (ii) at least 85 percent of its gross revenues for such tests are attributable to tests performed with respect to individuals who are homebound or who are residents in a nursing facility, and (iii) the laboratory provided such tests for residents in nursing facilities representing at least 20 percent of the number of such facilities in the State in which the laboratory is located.
(4)(A) In establishing any fee schedule under this subsection, the Secretary may provide for an adjustment to take into account, with respect to the portion of the expenses of clinical diagnostic laboratory tests attributable to wages, the relative difference between a region's or local area's wage rates and the wage rate presumed in the data on which the schedule is based.
(B) For purposes of subsections (a)(1)(D)(i) and (a)(2)(D)(i) of this section, the limitation amount for a clinical diagnostic laboratory test performed—
(i) on or after July 1, 1986, and before April 1, 1988, is equal to 115 percent of the median of all the fee schedules established for that test for that laboratory setting under paragraph (1),
(ii) after March 31, 1988, and before January 1, 1990, is equal to the median of all the fee schedules established for that test for that laboratory setting under paragraph (1),
(iii) after December 31, 1989, and before January 1, 1991, is equal to 93 percent of the median of all the fee schedules established for that test for that laboratory setting under paragraph (1),
(iv) after December 31, 1990, and before January 1, 1994, is equal to 88 percent of such median,
(v) after December 31, 1993, and before January 1, 1995, is equal to 84 percent of such median,
(vi) after December 31, 1994, and before January 1, 1996, is equal to 80 percent of such median, and
(vii) after December 31, 1995, is equal to 76 percent of such median.
(5)(A) In the case of a bill or request for payment for a clinical diagnostic laboratory test for which payment may otherwise be made under this part on an assignment-related basis or under a provider agreement under
(i) if a physician performed or supervised the performance of such test, payment may be made to another physician with whom he shares his practice,
(ii) in the case of a test performed at the request of a laboratory by another laboratory, payment may be made to the referring laboratory but only if—
(I) the referring laboratory is located in, or is part of, a rural hospital,
(II) the referring laboratory is wholly owned by the entity performing such test, the referring laboratory wholly owns the entity performing such test, or both the referring laboratory and the entity performing such test are wholly-owned by a third entity, or
(III) not more than 30 percent of the clinical diagnostic laboratory tests for which such referring laboratory (but not including a laboratory described in subclause (II)),2 receives requests for testing during the year in which the test is performed 2 are performed by another laboratory, and
(iii) in the case of a clinical diagnostic laboratory test provided under an arrangement (as defined in
(B) In the case of such a bill or request for payment for a clinical diagnostic laboratory test for which payment may otherwise be made under this part, and which is not described in subparagraph (A), payment may be made to the beneficiary only on the basis of the itemized bill of the person or entity which performed or supervised the performance of the test.
(C) Payment for a clinical diagnostic laboratory test, including a test performed in a physician's office but excluding a test performed by a rural health clinic may only be made on an assignment-related basis or to a provider of services with an agreement in effect under
(D) A person may not bill for a clinical diagnostic laboratory test, including a test performed in a physician's office but excluding a test performed by a rural health clinic,,3 other than on an assignment-related basis. If a person knowingly and willfully and on a repeated basis bills for a clinical diagnostic laboratory test in violation of the previous sentence, the Secretary may apply sanctions against the person in the same manner as the Secretary may apply sanctions against a physician in accordance with paragraph (2) of
(6) In the case of any diagnostic laboratory test payment for which is not made on the basis of a fee schedule under paragraph (1), the Secretary may establish a payment rate which is acceptable to the person or entity performing the test and which would be considered the full charge for such tests. Such negotiated rate shall be limited to an amount not in excess of the total payment that would have been made for the services in the absence of such rate.
(i) Outpatient surgery
(1) The Secretary shall, in consultation with appropriate medical organizations—
(A) specify those surgical procedures which are appropriately (when considered in terms of the proper utilization of hospital inpatient facilities) performed on an inpatient basis in a hospital but which also can be performed safely on an ambulatory basis in an ambulatory surgical center (meeting the standards specified under
(B) specify those surgical procedures which are appropriately (when considered in terms of the proper utilization of hospital inpatient facilities) performed on an inpatient basis in a hospital but which also can be performed safely on an ambulatory basis in a physician's office.
The lists of procedures established under subparagraphs (A) and (B) shall be reviewed and updated not less often than every 2 years, in consultation with appropriate trade and professional organizations.
(2)(A) The amount of payment to be made for facility services furnished in connection with a surgical procedure specified pursuant to paragraph (1)(A) and furnished to an individual in an ambulatory surgical center described in such paragraph shall be equal to 80 percent of a standard overhead amount established by the Secretary (with respect to each such procedure) on the basis of the Secretary's estimate of a fair fee which—
(i) takes into account the costs incurred by such centers, or classes of centers, generally in providing services furnished in connection with the performance of such procedure, as determined in accordance with a survey (based upon a representative sample of procedures and facilities) taken not later than January 1, 1995, and every 5 years thereafter, of the actual audited costs incurred by such centers in providing such services,
(ii) takes such costs into account in such a manner as will assure that the performance of the procedure in such a center will result in substantially less amounts paid under this subchapter than would have been paid if the procedure had been performed on an inpatient basis in a hospital, and
(iii) in the case of insertion of an intraocular lens during or subsequent to cataract surgery includes payment which is reasonable and related to the cost of acquiring the class of lens involved.
Each amount so established shall be reviewed and updated not later than July 1, 1987, and annually thereafter to take account of varying conditions in different areas.
(B) The amount of payment to be made under this part for facility services furnished, in connection with a surgical procedure specified pursuant to paragraph (1)(B), in a physician's office shall be equal to 80 percent of a standard overhead amount established by the Secretary (with respect to each such procedure) on the basis of the Secretary's estimate of a fair fee which—
(i) takes into account additional costs, not usually included in the professional fee, incurred by physicians in securing, maintaining, and staffing the facilities and ancillary services appropriate for the performance of such procedure in the physician's office, and
(ii) takes such items into account in such a manner which will assure that the performance of such procedure in the physician's office will result in substantially less amounts paid under this subchapter than would have been paid if the services had been furnished on an inpatient basis in a hospital.
Each amount so established shall be reviewed and updated not later than July 1, 1987, and annually thereafter to take account of varying conditions in different areas.
(C) Notwithstanding the second sentence of subparagraph (A) or the second sentence of subparagraph (B), if the Secretary has not updated amounts established under such subparagraphs with respect to facility services furnished during a fiscal year (beginning with fiscal year 1996), such amounts shall be increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) as estimated by the Secretary for the 12-month period ending with the midpoint of the year involved.
(3)(A) The aggregate amount of the payments to be made under this part for outpatient hospital facility services or rural primary care hospital services furnished in connection with surgical procedures specified under paragraph (1)(A) in a cost reporting period shall be equal to the lesser of—
(i) the amount determined with respect to such services under subsection (a)(2)(B) of this section; or
(ii) the blend amount (described in subparagraph (B)).
(B)(i) The blend amount for a cost reporting period is the sum of—
(I) the cost proportion (as defined in clause (ii)(I)) of the amount described in subparagraph (A)(i), and
(II) the ASC proportion (as defined in clause (ii)(II)) of 80 percent of the standard overhead amount payable with respect to the same surgical procedure as if it were provided in an ambulatory surgical center in the same area, as determined under paragraph (2)(A).
(ii) Subject to paragraph (4), in this paragraph:
(I) The term "cost proportion" means 75 percent for cost reporting periods beginning in fiscal year 1988, 50 percent for portions of cost reporting periods beginning on or after October 1, 1988, and ending on or before December 31, 1990, and 42 percent for portions of cost reporting periods beginning on or after January 1, 1991.
(II) The term "ASC proportion" means 25 percent for cost reporting periods beginning in fiscal year 1988, 50 percent for portions of cost reporting periods beginning on or after October 1, 1988, and ending on or before December 31, 1990, and 58 percent for portions of cost reporting periods beginning on or after January 1, 1991.
(4)(A) In the case of a hospital that—
(i) makes application to the Secretary and demonstrates that it specializes in eye services or eye and ear services (as determined by the Secretary),
(ii) receives more than 30 percent of its total revenues from outpatient services, and
(iii) on October 1, 1987—
(I) was an eye specialty hospital or an eye and ear specialty hospital, or
(II) was operated as an eye or eye and ear unit (as defined in subparagraph (B)) of a general acute care hospital which, on the date of the application described in clause (i), operates less than 20 percent of the beds that the hospital operated on October 1, 1987, and has sold or otherwise disposed of a substantial portion of the hospital's other acute care operations,
the cost proportion and ASC proportion in effect under subclauses (I) and (II) of paragraph (3)(B)(ii) for cost reporting periods beginning in fiscal year 1988 shall remain in effect for cost reporting periods beginning on or after October 1, 1988, and before January 1, 1995.
(B) For purposes of this 5 subparagraph (A)(iii)(II), the term "eye or eye and ear unit" means a physically separate or distinct unit containing separate surgical suites devoted solely to eye or eye and ear services.
(5)(A) The Secretary is authorized to provide by regulations that in the case of a surgical procedure, specified by the Secretary pursuant to paragraph (1)(A), performed in an ambulatory surgical center described in such paragraph, there shall be paid (in lieu of any amounts otherwise payable under this part) with respect to the facility services furnished by such center and with respect to all related services (including physicians' services, laboratory, X-ray, and diagnostic services) a single all-inclusive fee established pursuant to subparagraph (B), if all parties furnishing all such services agree to accept such fee (to be divided among the parties involved in such manner as they shall have previously agreed upon) as full payment for the services furnished.
(B) In implementing this paragraph, the Secretary shall establish with respect to each surgical procedure specified pursuant to paragraph (1)(A) the amount of the all-inclusive fee for such procedure, taking into account such factors as may be appropriate. The amount so established with respect to any surgical procedure shall be reviewed periodically and may be adjusted by the Secretary, when appropriate, to take account of varying conditions in different areas.
(6) Any person, including a facility having an agreement under
(j) Accrual of interest on balance of excess or deficit not paid
Whenever a final determination is made that the amount of payment made under this part either to a provider of services or to another person pursuant to an assignment under
(k) Hepatitis B vaccine
With respect to services described in
(l) Fee schedule for services of certified registered nurse anesthetists
(1)(A) The Secretary shall establish a fee schedule for services of certified registered nurse anesthetists under
(B) In establishing the fee schedule under this paragraph the Secretary may utilize a system of time units, a system of base and time units, or any appropriate methodology.
(C) The provisions of this subsection shall not apply to certain services furnished in certain hospitals in rural areas under the provisions of section 9320(k) of the Omnibus Budget Reconciliation Act of 1986, as amended by section 6132 of the Omnibus Budget Reconciliation Act of 1989.
(2) Except as provided in paragraph (3), the fee schedule established under paragraph (1) shall be initially based on audited data from cost reporting periods ending in fiscal year 1985 and such other data as the Secretary determines necessary.
(3)(A) In establishing the initial fee schedule for those services, the Secretary shall adjust the fee schedule to the extent necessary to ensure that the estimated total amount which will be paid under this subchapter for those services plus applicable coinsurance in 1989 will equal the estimated total amount which would be paid under this subchapter for those services in 1989 if the services were included as inpatient hospital services and payment for such services was made under part A of this subchapter in the same manner as payment was made in fiscal year 1987, adjusted to take into account changes in prices and technology relating to the administration of anesthesia.
(B) The Secretary shall also reduce the prevailing charge of physicians for medical direction of a certified registered nurse anesthetist, or the fee schedule for services of certified registered nurse anesthetists, or both, to the extent necessary to ensure that the estimated total amount which will be paid under this subchapter plus applicable coinsurance for such medical direction and such services in 1989 and 1990 will not exceed the estimated total amount which would have been paid plus applicable coinsurance but for the enactment of the amendments made by section 9320 of the Omnibus Budget Reconciliation Act of 1986. A reduced prevailing charge under this subparagraph shall become the prevailing charge but for subsequent years for purposes of applying the economic index under the fourth sentence of
(4)(A) Except as provided in subparagraphs (C) and (D), in determining the amount paid under the fee schedule under this subsection for services furnished on or after January 1, 1991, by a certified registered nurse anesthetist who is not medically directed—
(i) the conversion factor shall be—
(I) for services furnished in 1991, $15.50,
(II) for services furnished in 1992, $15.75,
(III) for services furnished in 1993, $16.00,
(IV) for services furnished in 1994, $16.25,
(V) for services furnished in 1995, $16.50,
(VI) for services furnished in 1996, $16.75, and
(VII) for services furnished in calendar years after 1996, the previous year's conversion factor increased by the update determined under
(ii) the payment areas to be used shall be the fee schedule areas used under
(iii) the geographic adjustment factors to be applied to the conversion factor under clause (i) for services in a fee schedule area or locality is— 6
(I) in the case of services furnished in 1991, the geographic work index value and the geographic practice cost index value specified in
(II) in the case of services furnished after 1991, the geographic work index value, the geographic practice cost index value, and the geographic malpractice index value used for determining payments for physicians' services that are anesthesia services under
with 70 percent of the conversion factor treated as attributable to work and 30 percent as attributable to overhead for services furnished in 1991 (and the portions attributable to work, practice expenses, and malpractice expenses in 1992 and thereafter being the same as is applied under
(B)(i) Except as provided in clause (ii) and subparagraph (D), in determining the amount paid under the fee schedule under this subsection for services furnished on or after January 1, 1991, and before January 1, 1994, by a certified registered nurse anesthetist who is medically directed, the Secretary shall apply the same methodology specified in subparagraph (A).
(ii) The conversion factor used under clause (i) shall be—
(I) for services furnished in 1991, $10.50,
(II) for services furnished in 1992, $10.75, and
(III) for services furnished in 1993, $11.00.
(iii) In the case of services of a certified registered nurse anesthetist who is medically directed or medically supervised by a physician which are furnished on or after January 1, 1994, the fee schedule amount shall be one-half of the amount described in
(C) Notwithstanding subclauses (I) through (V) of subparagraph (A)(i)—
(i) in the case of a 1990 conversion factor that is greater than $16.50, the conversion factor for a calendar year after 1990 and before 1996 shall be the 1990 conversion factor reduced by the product of the last digit of the calendar year and one-fifth of the amount by which the 1990 conversion factor exceeds $16.50; and
(ii) in the case of a 1990 conversion factor that is greater than $15.49 but less than $16.51, the conversion factor for a calendar year after 1990 and before 1996 shall be the greater of—
(I) the 1990 conversion factor, or
(II) the conversion factor specified in subparagraph (A)(i) for the year involved.
(D) Notwithstanding subparagraph (C), in no case may the conversion factor used to determine payment for services in a fee schedule area or locality under this subsection, as adjusted by the adjustment factors specified in subparagraphs 7 (A)(iii), exceed the conversion factor used to determine the amount paid for physicians' services that are anesthesia services in the area or locality.
(5)(A) Payment for the services of a certified registered nurse anesthetist (for which payment may otherwise be made under this part) may be made on the basis of a claim or request for payment presented by the certified registered nurse anesthetist furnishing such services, or by a hospital, rural primary care hospital, physician, group practice, or ambulatory surgical center with which the certified registered nurse anesthetist furnishing such services has an employment or contractual relationship that provides for payment to be made under this part for such services to such hospital, rural primary care hospital, physician, group practice, or ambulatory surgical center.
(B) No hospital or rural primary care hospital that presents a claim or request for payment for services of a certified nurse anesthetist under this part may treat any uncollected coinsurance amount imposed under this part with respect to such services as a bad debt of such hospital or rural primary care hospital for purposes of this subchapter.
(6) If an adjustment under paragraph (3)(B) results in a reduction in the reasonable charge for a physicians' service and a nonparticipating physician furnishes the service to an individual entitled to benefits under this part after the effective date of the reduction, the physician's actual charge is subject to a limit under
(m) Incentive payments for physicians' services furnished in underserved areas
In the case of physicians' services furnished to an individual, who is covered under the insurance program established by this part and who incurs expenses for such services, in an area that is designated (under
(n) Payments to hospital outpatient departments for radiology; amount; definitions
(1)(A) 8 The aggregate amount of the payments to be made for all or part of a cost reporting period for services described in subsection (a)(2)(E)(i) of this section furnished under this part on or after October 1, 1988, and for services described in subsection (a)(2)(E)(ii) of this section furnished under this part on or after October 1, 1989, shall be equal to the lesser of—
(i) the amount determined with respect to such services under subsection (a)(2)(B) of this section, or
(ii) the blend amount for radiology services and diagnostic procedures determined in accordance with subparagraph (B).
(B)(i) The blend amount for radiology services and diagnostic procedures for a cost reporting period is the sum of—
(I) the cost proportion (as defined in clause (ii)) of the amount described in subparagraph (A)(i); and
(II) the charge proportion (as defined in clause (ii)(II)) of 62 percent (for services described in subsection (a)(2)(E)(i) of this section), or (for procedures described in subsection (a)(2)(E)(ii) of this section), 42 percent or such other percent established by the Secretary (or carriers acting pursuant to guidelines issued by the Secretary) based on prevailing charges established with actual charge data, of 80 percent of the prevailing charge or (for services described in subsection (a)(2)(E)(i) of this section furnished on or after April 1, 1989 and for services described in subsection (a)(2)(E)(ii) of this section furnished on or after January 1, 1992) the fee schedule amount established for participating physicians for the same services as if they were furnished in a physician's office in the same locality as determined under
(ii) In this subparagraph:
(I) The term "cost proportion" means 50 percent, except that such term means 65 percent in the case of outpatient radiology services for portions of cost reporting periods which occur in fiscal year 1989 and in the case of diagnostic procedures described in subsection (a)(2)(E)(ii) of this section for portions of cost reporting periods which occur in fiscal year 1990, and such term means 42 percent in the case of outpatient radiology services for portions of cost reporting periods beginning on or after January 1, 1991.
(II) The term "charge proportion" means 100 percent minus the cost proportion.
(o) Limitation on benefit for payment for therapeutic shoes for individuals with severe diabetic foot disease
(1) In the case of shoes described in
(A) no payment may be made under this part, with respect to any individual for any year, for the furnishing of—
(i) more than one pair of custom molded shoes (including inserts provided with such shoes) and 2 additional pairs of inserts for such shoes, or
(ii) more than one pair of extra-depth shoes (not including inserts provided with such shoes) and 3 pairs of inserts for such shoes, and
(B) with respect to expenses incurred in any calendar year, no more than the limits established under paragraph (2) shall be considered as incurred expenses for purposes of subsections (a) and (b) of this section.
Payment for shoes (or inserts) under this part shall be considered to include payment for any expenses for the fitting of such shoes (or inserts).
(2)(A) Except as provided by the Secretary under subparagraphs (B) and (C), the limits established under this paragraph—
(i) for the furnishing of—
(I) one pair of custom molded shoes (including any inserts that are provided initially with the shoes) is $300, and
(II) any additional pair of inserts with respect to such shoes is $50; and
(ii) for the furnishing of extra-depth shoes and inserts is—
(I) $100 for the pair of shoes itself, and
(II) $50 for any pairs of inserts for a pair of shoes.
(B) The Secretary or a carrier may establish limits for shoes that are lower than the limits established under subparagraph (A) if the Secretary finds that shoes and inserts of an appropriate quality are readily available at or below such lower limits.
(C) For each year after 1988, each dollar amount under subparagraph (A) or (B) (as previously adjusted under this subparagraph) shall be increased by the same percentage increase as the Secretary provides with respect to durable medical equipment for that year, except that if such increase is not a multiple of $1, it shall be rounded to the nearest multiple of $1.
(D) In accordance with procedures established by the Secretary, an individual entitled to benefits with respect to shoes described in
(3) In this subchapter, the term "shoes" includes, except for purposes of subparagraphs (A)(ii) and (B) of paragraph (2), inserts for extra-depth shoes.
(p) Repealed. Pub. L. 103–432, title I, §123(b)(2)(A)(ii), Oct. 31, 1994, 108 Stat. 4411
(q) Requests for payment to include information on referring physician
(1) Each request for payment, or bill submitted, for an item or service furnished by an entity for which payment may be made under this part and for which the entity knows or has reason to believe there has been a referral by a referring physician (within the meaning of
(2)(A) In the case of a request for payment for an item or service furnished by an entity under this part on an assignment-related basis and for which information is required to be provided under paragraph (1) but not included, payment may be denied under this part.
(B) In the case of a request for payment for an item or service furnished by an entity under this part not submitted on an assignment-related basis and for which information is required to be provided under paragraph (1) but not included—
(i) if the entity knowingly and willfully fails to provide such information promptly upon request of the Secretary or a carrier, the entity may be subject to a civil money penalty in an amount not to exceed $2,000, and
(ii) if the entity knowingly, willfully, and in repeated cases fails, after being notified by the Secretary of the obligations and requirements of this subsection to provide the information required under paragraph (1), the entity may be subject to exclusion from participation in the programs under this chapter for a period not to exceed 5 years, in accordance with the procedures of subsections (c), (f), and (g) of
The provisions of
(r) Cap on prevailing charge; billing on assignment-related basis
(1) With respect to services described in
(2)(A) For purposes of subsection (a)(1)(O) of this section, the prevailing charge for services described in
(B) In subparagraph (A), the term "applicable percentage" means—
(i) 75 percent in the case of services performed in a hospital, and
(ii) 85 percent in the case of other services.
(3) No hospital or rural primary care hospital that presents a claim or request for payment under this part for services described in
(s) Other prepaid organizations
The Secretary may not provide for payment under subsection (a)(1)(A) of this section with respect to an organization unless the organization provides assurances satisfactory to the Secretary that the organization meets the requirement of
(Aug. 14, 1935, ch. 531, title XVIII, §1833, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in subsecs. (d) and (l)(3)(A), is classified to
Section 9320(k) of the Omnibus Budget Reconciliation Act of 1986, as amended by section 6132 of the Omnibus Budget Reconciliation Act of 1989, referred to in subsec. (l)(1)(C), is section 9320(k) of
The amendments made by section 9320 of the Omnibus Budget Reconciliation Act of 1986, referred to in subsec. (l)(3)(B), are amendments made by section 9320 of
Amendments
1994—Subsec. (a)(1)(D)(i).
Subsec. (a)(1)(G).
Subsec. (a)(2)(A).
Subsec. (a)(2)(D)(i).
Subsec. (a)(2)(F).
Subsec. (a)(3).
Subsec. (b)(2).
Subsec. (b)(4), (5).
Subsec. (h)(5)(D).
Subsec. (i)(1).
Subsec. (i)(2)(A).
Subsec. (i)(2)(A)(i).
Subsec. (i)(2)(B).
Subsec. (i)(2)(C).
Subsec. (i)(3)(B)(ii).
Subsec. (l)(5)(B), (C).
"(B)(i) Payment for the services of a certified registered nurse anesthetist under this part may be made only on an assignment-related basis, and any such assignment agreed to by a certified registered nurse anesthetist shall be binding upon any other person presenting a claim or request for payment for such services.
"(ii) Except for deductible and coinsurance amounts applicable under this section, any person who knowingly and willfully presents, or causes to be presented, to an individual enrolled under this part a bill or request for payment for services of a certified registered nurse anesthetist for which payment may be made under this part only on an assignment-related basis is subject to a civil money penalty of not to exceed $2,000 for each such bill or request. The provisions of
Subsec. (n)(1)(B)(i)(II).
Subsec. (p).
Subsec. (q)(1).
Subsec. (r).
Subsec. (r)(1).
Subsec. (r)(2)(A).
Subsec. (r)(3), (4).
"(3)(A) Payment under this part for services described in
"(B) Except for deductible and coinsurance amounts applicable under this section, any person who knowingly and willfully presents, or causes to be presented, to an individual enrolled under this part a bill or request for payment for services described in
Subsec. (s).
1993—Subsec. (a)(1).
Subsec. (g).
Subsec. (h)(2)(A)(ii)(IV).
Subsec. (h)(4)(B)(iv) to (vii).
Subsec. (i)(3)(B)(ii).
Subsec. (i)(4).
Subsec. (l)(4)(B)(i).
Subsec. (l)(4)(B)(ii).
"(IV) for services furnished in 1994, $11.25,
"(V) for services furnished in 1995, $11.50,
"(VI) for services furnished in 1996, $11.70, and
"(VII) for services furnished in calendar years after 1997, the previous year's conversion factor increased by the update determined under
Subsec. (l)(4)(B)(iii).
1990—Subsec. (a)(1)(H).
Subsec. (a)(1)(J).
Subsec. (a)(1)(K).
Subsec. (a)(1)(L).
Subsec. (a)(1)(M).
Subsec. (a)(2).
Subsec. (a)(2)(E)(i).
Subsec. (a)(7).
Subsec. (b).
Subsec. (b)(5).
Subsec. (h)(2)(A)(ii).
Subsec. (h)(2)(A)(ii)(III).
Subsec. (h)(4)(B).
Subsec. (h)(5)(A)(ii)(II).
Subsec. (h)(5)(A)(ii)(III).
Subsec. (h)(5)(A)(iii).
Subsec. (h)(5)(C).
Subsec. (h)(5)(D).
Subsec. (i)(3)(B)(ii).
Subsec. (i)(3)(B)(ii)(I).
Subsec. (i)(3)(B)(ii)(II).
Subsec. (l)(1).
Subsec. (l)(2).
Subsec. (l)(4).
Subsec. (m).
Subsec. (n)(1)(B)(ii)(I).
Subsec. (r).
1989—Subsec. (a).
Subsec. (a)(1)(F).
Subsec. (a)(1)(H).
Subsec. (a)(1)(J).
Subsec. (a)(1)(K).
Subsec. (a)(1)(M).
Subsec. (a)(1)(N).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (a)(6).
Subsec. (b).
Subsec. (c).
Subsec. (d).
Subsec. (d)(1).
"(A) $1375.00, or
"(B) 62½ percent of such expenses."
Subsec. (g).
Subsec. (h)(1)(B), (C).
Subsec. (h)(1)(D).
Subsec. (h)(4)(B)(ii).
Subsec. (h)(4)(B)(iii).
Subsec. (h)(5)(A)(ii).
Subsec. (h)(5)(A)(iii).
Subsec. (i)(1)(A).
Subsec. (i)(3)(A).
Subsec. (l)(5)(A).
Subsec. (l)(5)(C).
Subsec. (m).
Subsec. (o)(1).
Subsec. (o)(1)(A).
Subsec. (o)(1)(B), (2)(A).
Subsec. (o)(2)(A)(i).
Subsec. (o)(2)(A)(ii)(II).
Subsec. (o)(2)(D).
Subsec. (p).
Subsec. (q).
1988—Subsec. (a).
Subsec. (a)(1)(D)(i).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G).
Subsec. (a)(1)(H).
Subsec. (a)(1)(J).
Subsec. (a)(1)(K).
Subsec. (a)(1)(L).
Subsec. (a)(1)(M).
Subsec. (a)(2).
Subsec. (a)(2)(B).
Subsec. (a)(2)(D)(i).
Subsec. (a)(2)(E)(i).
Subsec. (a)(2)(F).
Subsec. (a)(3).
Subsec. (b).
Subsec. (b)(1).
Subsec. (b)(2).
Subsec. (b)(3) to (5).
Subsec. (c).
Subsec. (d)(1).
Subsec. (d)(2).
Subsec. (f).
Subsec. (g).
Subsec. (h)(1)(D).
Subsec. (h)(2)(A)(i).
Subsec. (h)(2)(A)(ii).
Subsec. (h)(2)(A)(iii).
Subsec. (h)(2)(B).
Subsec. (h)(3).
Subsec. (h)(4)(B)(ii).
Subsec. (h)(5)(A).
Subsec. (h)(5)(C).
Subsec. (h)(5)(D).
Subsec. (i)(2)(A)(iii).
Subsec. (i)(4).
Subsec. (i)(6).
Subsec. (l)(2).
Subsec. (l)(3)(B).
Subsec. (l)(5)(B)(ii).
Subsec. (n)(1)(A).
Subsec. (n)(1)(B)(i)(II).
Subsec. (n)(1)(B)(ii).
"(I) The term 'cost proportion' means 65 percent for all or any part of cost reporting periods which occur in fiscal year 1989 and 50 percent for other cost reporting periods.
"(II) The term 'charge proportion' means 35 percent for all or any parts of cost reporting periods which occur in fiscal year 1989 and 50 percent for other cost reporting periods."
Subsec. (o).
Subsec. (p).
1987—Subsec. (a)(1)(D)(i).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G).
Subsec. (a)(1)(H).
Subsec. (a)(1)(I).
Subsec. (a)(1)(J).
Subsec. (a)(1)(K).
Subsec. (a)(1)(L).
Subsec. (a)(2).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (a)(2)(D)(i).
Subsec. (a)(2)(E).
Subsec. (a)(5).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (b)(4)(A).
Subsec. (b)(5).
Subsec. (c).
Subsec. (c)(1).
Subsec. (f).
Subsec. (h)(1)(C).
Subsec. (h)(1)(D).
Subsec. (h)(2).
Subsec. (h)(2)(A)(i).
Subsec. (h)(2)(A)(ii).
Subsec. (h)(2)(A)(iii).
Subsec. (h)(2)(B).
Subsec. (h)(4)(B)(i).
Subsec. (h)(4)(B)(ii).
Subsec. (h)(5)(A).
Subsec. (h)(5)(A)(iii).
Subsec. (h)(5)(C).
Subsec. (h)(5)(D).
Subsec. (i)(2)(A)(iii).
Subsec. (i)(3)(B)(ii).
Subsec. (i)(4).
Subsec. (i)(6).
Subsec. (l)(2).
Subsec. (l)(5)(A).
Subsec. (l)(5)(B)(ii).
Subsec. (l)(6).
"(B) In subparagraph (A), the term 'limiting charge' means, with respect to a service, 125 percent of the prevailing charge for the service after the reduction referred to in subparagraph (A).
"(C) If a physician knowingly and willfully imposes charges in violation of subparagraph (A), the Secretary may apply sanctions against such physician in accordance with subsection (j)(2) of this section.
"(D) This paragraph shall not apply to services furnished after the earlier of (i) December 31, 1990, or (ii) one-year after the date the Secretary reports to Congress, under
Subsec. (m).
Subsec. (n).
Subsec. (o).
Subsec. (p).
1986—Subsec. (a)(1)(D).
Subsec. (a)(1)(D)(i).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G).
Subsec. (a)(1)(H).
Subsec. (a)(2)(A).
Subsec. (a)(2)(D).
Subsec. (a)(2)(D)(i).
Subsec. (a)(3).
Subsec. (a)(4).
Subsec. (b)(3).
Subsec. (b)(5).
Subsec. (g).
Subsec. (h)(1)(B).
Subsec. (h)(1)(C).
Subsec. (h)(1)(D).
Subsec. (h)(2).
Subsec. (h)(3).
Subsec. (h)(4).
Subsec. (h)(5)(C).
Subsec. (i)(1).
Subsec. (i)(2).
Subsec. (i)(3) to (5).
Subsec. (l).
1984—Subsec. (a)(1).
Subsec. (a)(1)(B).
Subsec. (a)(1)(D).
Subsec. (a)(1)(F), (G).
Subsec. (a)(2).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (a)(2)(B)(ii).
Subsec. (a)(2)(D).
Subsec. (a)(3).
Subsec. (a)(5).
Subsec. (b)(1).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (f).
Subsec. (h).
Subsec. (h)(5)(C).
Subsec. (i)(3).
Subsec. (k).
1982—Subsec. (a)(1)(B).
Subsec. (a)(1)(H).
Subsec. (a)(2)(B).
Subsec. (b)(1).
Subsec. (i)(1).
Subsec. (j).
1981—Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (b).
1980—Subsec. (a)(1)(B).
Subsec. (a)(1)(D).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G).
Subsec. (a)(1)(H).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (a)(4), (5).
Subsec. (b)(2).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (g).
Subsec. (h).
Subsec. (i).
1978—Subsec. (a)(1)(E).
Subsec. (a)(2).
1977—Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (f)(1).
Subsec. (f)(2).
Subsec. (f)(3), (4).
1972—Subsec. (a).
Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (b).
Subsec. (f).
Subsec. (g).
Subsec. (h).
1968—Subsec. (a)(1).
Subsec. (b).
Subsec. (d).
Subsec. (f).
Effective Date of 1994 Amendment
Section 123(f)(1), (2) of
"(1)
"(2)
Section 141(c)(2) of
Amendment by section 147(a), (e)(2), (3), (f)(6)(C), (D) of
Section 147(d)(1), (2) of
Amendment by section 156(a)(2)(B) of
Effective Date of 1993 Amendment
Section 13532(b) of
Section 13544(b)(3) of
Section 13555(b) of
Effective Date of 1990 Amendment
Section 4104(d) of
Amendment by section 4153(a)(2)(B), (C) of
Section 4154(b)(2) of
Section 4154(c)(2) of
Section 4154(e)(5) of
Amendment by section 4155(b)(2), (3) of
Amendment by section 4161(a)(3)(B) of
Section 4163(e) of
Section 4206(e)(2) of
Effective Date of 1989 Amendments
Section 6102(c)(2) of
Section 6102(f)(3) of
Section 6102(g) of
Section 6111(b)(2) of
Section 6113(e) of
Section 6131(c) of
"(1) The amendments made by this section [amending this section and
"(2) In applying the amendments made by this section, the increase under subparagraph (C) of section 1833(o)(2) of the Social Security Act [subsec. (o)(2)(C) of this section] shall apply to the dollar amounts specified under subparagraph (A) of such section (as amended by this section) in the same manner as the increase would have applied to the dollar amounts specified under subparagraph (A) of such section (as in effect before the date of the enactment of this Act [Dec. 19, 1989])."
Section 6133(b) of
Amendment by section 6204(b) of
Amendment by section 201(a) of
Amendment by section 202(a) of
Effective Date of 1988 Amendments
Section 8422(b) of
Amendment by
Amendment by section 202(b)(1)–(3) of
Amendment by section 203(c)(1)(A)–(E) of
Amendment by section 204(d)(1) of
Amendment by section 205(c) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4043(c) of
Amendment by section 4045(c)(2)(A) of
Amendment by section 4049(a)(1) of
Section 4055(b), formerly §4054(b), of
Amendment by section 4062(d)(3) of
Section 4063(c) of
Section 4064(b)(3) of
Section 4064(c)(2) of
Section 4066(c) of
Section 4067(c) of
Section 4068(c) of
Section 4070(c)(1) of
For effective date of amendment by section 4072(b) of
Amendment by section 4073(b) of
Amendment by section 4077(b)(2), (3) of
Section 4084(b) of
Section 4084(c)(3) of
Section 4085(b)(2) of
Section 4085(i)(21) of
Effective Date of 1986 Amendments
Amendment by section 9320(e)(1), (2) of
Amendment by section 9337(b) of
Section 9339(a)(2) of
Section 9339(c)(2) of
Section 9343(h) of
"(1) The amendments made by subsection (a)(1) [amending this section] shall apply to cost reporting periods beginning on or after October 1, 1987.
"(2) The amendments made by subsections (b)(1) and (c) [amending this section and
"(3) The Secretary of Health and Human Services shall first provide, under the amendment made by subsection (b)(2) [amending this section], for the review and update of procedure lists within 6 months after the date of the enactment of this Act [Oct. 21, 1986].
"(4) The amendments made by subsection (d) [amending
Section 9303(a)(2) of
Section 9303(b)(5)(A), (B) of
"(A) The amendments made by paragraphs (1) and (2) [amending this section] shall apply to clinical diagnostic laboratory tests performed on or after July 1, 1986.
"(B) The amendment made by paragraph (3) [amending this section] shall apply to clinical diagnostic laboratory tests performed on or after January 1, 1987."
Effective Date of 1984 Amendments
Amendment by
Section 2303(j) of
"(1) Except as provided in paragraphs (2) and (3), the amendments made by this section [amending this section and
"(2) The amendments made by subsection (g)(2) [amending
"(3) The amendments made by this section shall not apply to clinical diagnostic laboratory tests furnished to inpatients of a provider operating under a waiver granted pursuant to section 602(k) of the Social Security Amendments of 1983 [section 602(k) of
Section 2305(e) of
Amendment by section 2321(b), (d)(4)(A) of
Section 2323(d) of
Amendment by section 2354(b)(5), (7) of
Effective Date of 1982 Amendment
Section 112(c) of
Amendment by section 117(a)(2) of
Amendment by section 148(d) of
Effective Date of 1981 Amendment
Section 2106(c) of
Section 2133(b) of
Section 2134(b) of
Effective Date of 1980 Amendments
Section 2 of
Amendment by section 930(h) of
Section 935(b) of
Section 943(b) of
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1977 Amendments
Amendment by
Section 16(b) of
Effective Date of 1972 Amendment
Section 204(c) of
Amendment by section 211(c)(4) of
Amendment by section 226(c)(2) of
Amendment by section 233(b) of
Amendment by section 251(a)(2), (3) of
Section 299K(b) of
Effective Date of 1968 Amendment
Amendment by section 129(c)(7), (8) of
Section 131(c) of
Section 132(c) of
Amendment by section 135(c) of
Adjustments to Payment Amounts for New Technology Intraocular Lenses
Section 141(b) of
"(1)
"(2)
"(3)
"(4)
Study of Medicare Coverage of Patient Care Costs Associated With Clinical Trials of New Cancer Therapies
Section 142 of
"(a)
"(1) an estimate of the cost of such coverage, taking into account the extent to which medicare currently pays for such patient care costs in practice;
"(2) an assessment of the extent to which such clinical trials represent the best available treatment for the patients involved and of the effects of participation in the trials on the health of such patients;
"(3) an assessment of whether progress in developing new anticancer therapies would be assisted by medicare coverage of such patient care costs; and
"(4) an evaluation of whether there should be special criteria for the admission of medicare beneficiaries (on account of their age or physical condition) to clinical trials for which medicare would pay the patient care costs.
"(b)
Study of Annual Cap on Amount of Medicare Payment for Outpatient Physical Therapy and Occupational Therapy Services
Section 143 of
"(a)
"(b)
Ambulatory Surgical Center Services; Inflation Update
Section 13531 of
Freeze in Allowance for Intraocular Lenses
Section 13533 of
Section 4151(c)(3) of
[Section 141(d) of
Reduction in Payments Under Part B During Final Two Months of 1990
Section 4158 of
"(a)
"(b)
"(1)
"(2)
"(3)
Effect on State Law
Conscientious objections of health care provider under State law unaffected by enactment of subsecs. (a)(1)(Q) and (f) of this section, see section 4206(c) of
Development of Criteria Regarding Consultation With a Physician
Section 6113(c) of
[Section 147(b) of
Study of Reimbursement for Ambulance Services
Section 6136 of
PROPAC Study of Payments for Services in Hospital Outpatient Departments
Section 6137 of
Budget Neutrality
Section 8421(b) of
Adjustment of Contracts With Prepaid Health Plans
For requirement that Secretary of Health and Human Services modify contracts under subsection (a)(1)(A) of this section to take into account amendments made by
Study and Report to Congress Respecting Incentive Payments for Physicians' Services Furnished in Underserved Areas
Section 4043(b) of
Fee Schedules for Physician Pathology Services
Section 4050 of
Applying Copayment and Deductible to Certain Outpatient Physicians' Services
Section 4054 of
Other Physician Payment Studies
Section 4056(c), formerly §4055(c), of
Study of Payment for Chemotherapy in Physicians' Offices
Section 4056(d), formerly §4055(d), of
Clinical Diagnostic Laboratory Tests; Limitation on Changes in Fee Schedules
Section 4064(a) of
GAO Study of Fee Schedules
Section 4064(b)(4) of
Amounts Paid for Independent Rural Health Clinic Services
Section 4067(b) of
Report on Establishment of National Fee Schedules for Payment of Clinical Diagnostic Laboratory Tests
Section 9339(b)(3) of
State Standards for Directors of Clinical Laboratories
Section 9339(d) of
"(1)
"(2)
Transitional Provisions for Payment of Fees for Clinical Diagnostic Laboratory Tests
Section 9303(a)(3) of
"(A) shall take effect on January 1, 1987,
"(B) shall apply for the 12-month period beginning on that date, and
"(C) shall take into account the percentage increase or decrease in the Consumer Price Index for all urban consumers (United States city average) occurring over an 18-month period, rather than over a 12-month period."
Extension of Medicare Physician Payment Provisions
Amount of payment under this part for physicians' services furnished between Oct. 1, 1985, and Mar. 14, 1986, to be determined on the same basis as the amount of such services furnished on Sept. 30, 1985, see section 5(b) of
Fee Schedules for Diagnostic Laboratory Tests and Feasibility of Direct Payments to Physicians; Report to Congress
Section 2303(i) of
"(1) The Comptroller General shall report to the Congress on—
"(A) the appropriateness of the fee schedules under section 1833(h) of the Social Security Act [subsec. (h) of this section] and their impact on the volume and quality of clinical diagnostic laboratory tests;
"(B) the potential impact of the adoption of a national fee schedule; and
"(C) the potential impact of applying a national fee schedule to clinical diagnostic laboratory tests provided by hospitals to their outpatients.
"(2) The Secretary of Health and Human Services shall report to the Congress with respect to the advisability and feasibility of a system of direct payment to any physician for all clinical diagnostic laboratory tests ordered by such physician.
"(3) The reports required by paragraphs (1) and (2) shall be submitted not later than January 1, 1987."
Pacemaker Reimbursement Review and Reform
Section 2304(a) of
"(1) The Secretary of Health and Human Services shall issue revisions to the current guidelines for the payment under part B of title XVIII of the Social Security Act [this part] for the transtelephonic monitoring of cardiac pacemakers. Such revised guidelines shall include provisions regarding the specifications for and frequency of transtelephonic monitoring procedures which will be found to be reasonable and necessary.
"(2)(A) Except as provided in subparagraph (B), if the guidelines required by paragraph (1) have not been issued and put into effect by October 1, 1984, and until such guidelines have been issued and put into effect, payment may not be made under part B of title XVIII of the Social Security Act for transtelephonic monitoring procedures, with respect to a single-chamber cardiac pacemaker powered by lithium batteries, conducted more frequently than—
"(i) weekly during the first month after implantation,
"(ii) once every two months during the period representing 80 percent of the estimated life of the implanted device, and
"(iii) monthly thereafter.
"(B) Subparagraph (A) shall not apply in cases where the Secretary determines that special medical factors (including possible evidence of pacemaker or lead malfunction) justify more frequent transtelephonic monitoring procedures."
Payment for Preadmission Diagnostic Testing Performed in Physician's Office
Section 2305(f) of
Providers of Services To Calculate and Report Lesser-of-Cost-or-Charges Determinations Separately With Respect to Payments Under Parts A and B of This Subchapter; Issuance of Regulations
For provision directing the Secretary to issue regulations requiring providers of services to calculate and report the lesser-of-cost-or-charges determinations separately with respect to payments for services under parts A and B of this subchapter other than diagnostic tests under subsec. (h) of this section, see section 2308(a) of
Determination of Nominal Charges for Applying Nominality Test
For provision directing the Secretary to provide, in addition to other rules deemed appropriate, that charges representing 60 percent or less of costs be considered nominal for purposes of applying the nominality test under subsec. (a)(2)(B)(ii) of this section, see section 2308(b)(1) of
Study of Medicare Part B Payments; Compilation of Centralized Charge Data Base; Report to Congress
Section 2309 of
Monitoring Provision of Hepatitis B Vaccine; Review of Changes in Medical Technology
Section 2323(e) of
Report on Preadmission Diagnostic Testing Expenses
Section 932(b) of
Study of Feasibility and Desirability of Imposing Copayment Requirement on Rural Health Clinic Visits; Report Not Later Than December 13, 1978
Section 1(c) of
Prohibition Against Payments in Cases of Nonentitlement to Monthly Benefits Under Subchapter II or Suspension of Benefits of Aliens Outside the United States
Section 104(b)(1) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. The word "and" probably should not appear.
2 So in original. The comma after "subclause (II))" probably should follow "is performed".
4 So in original. Probably should be "such paragraph applies".
5 So in original. The word "this" probably should not appear.
6 So in original. Probably should be "are—".
7 So in original. Probably should be "subparagraph".
8 So in original. No par. (2) has been enacted.
9 So in original. Probably should be "pair".
§1395m. Special payment rules for particular items and services
(a) Payment for durable medical equipment
(1) General rule for payment
(A) In general
With respect to a covered item (as defined in paragraph (13)) for which payment is determined under this subsection, payment shall be made in the frequency specified in paragraphs (2) through (7) and in an amount equal to 80 percent of the payment basis described in subparagraph (B).
(B) Payment basis
The payment basis described in this subparagraph is the lesser of—
(i) the actual charge for the item, or
(ii) the payment amount recognized under paragraphs (2) through (7) of this subsection for the item;
except that clause (i) shall not apply if the covered item is furnished by a public home health agency (or by another home health agency which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low income) free of charge or at nominal charges to the public.
(C) Exclusive payment rule
This subsection shall constitute the exclusive provision of this subchapter for payment for covered items under this part or under part A of this subchapter to a home health agency.
(D) Reduction in fee schedules for certain items
With respect to a seat-lift chair or transcutaneous electrical nerve stimulator furnished on or after April 1, 1990, the Secretary shall reduce the payment amount applied under subparagraph (B)(ii) for such an item by 15 percent, and, in the case of a transcutaneous electrical nerve stimulator furnished on or after January 1, 1991, the Secretary shall further reduce such payment amount (as previously reduced) by 45 percent.
(2) Payment for inexpensive and other routinely purchased durable medical equipment
(A) In general
Payment for an item of durable medical equipment (as defined in paragraph (13))—
(i) the purchase price of which does not exceed $150,
(ii) which the Secretary determines is acquired at least 75 percent of the time by purchase, or
(iii) which is an accessory used in conjunction with a nebulizer, aspirator, or a ventilator excluded under paragraph (3)(A),
shall be made on a rental basis or in a lump-sum amount for the purchase of the item. The payment amount recognized for purchase or rental of such equipment is the amount specified in subparagraph (B) for purchase or rental, except that the total amount of payments with respect to an item may not exceed the payment amount specified in subparagraph (B) with respect to the purchase of the item.
(B) Payment amount
For purposes of subparagraph (A), the amount specified in this subparagraph, with respect to the purchase or rental of an item furnished in a carrier service area—
(i) in 1989 and in 1990 is the average reasonable charge in the area for the purchase or rental, respectively, of the item for the 12-month period ending on June 30, 1987, increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 6-month period ending with December 1987;
(ii) in 1991 is the sum of (I) 67 percent of the local payment amount for the item or device computed under subparagraph (C)(i)(I) for 1991, and (II) 33 percent of the national limited payment amount for the item or device computed under subparagraph (C)(ii) for 1991;
(iii) in 1992 is the sum of (I) 33 percent of the local payment amount for the item or device computed under subparagraph (C)(i)(II) for 1992, and (II) 67 percent of the national limited payment amount for the item or device computed under subparagraph (C)(ii) for 1992; and
(iv) in 1993 and each subsequent year is the national limited payment amount for the item or device computed under subparagraph (C)(ii) for that year.
(C) Computation of local payment amount and national limited payment amount
For purposes of subparagraph (B)—
(i) the local payment amount for an item or device for a year is equal to—
(I) for 1991, the amount specified in subparagraph (B)(i) for 1990 increased by the covered item update for 1991, and
(II) for 1992, 1993, and 1994, the amount determined under this clause for the preceding year increased by the covered item update for the year; and
(ii) the national limited payment amount for an item or device for a year is equal to—
(I) for 1991, the local payment amount determined under clause (i) for such item or device for that year, except that the national limited payment amount may not exceed 100 percent of the weighted average of all local payment amounts determined under such clause for such item for that year and may not be less than 85 percent of the weighted average of all local payment amounts determined under such clause for such item,
(II) for 1992 and 1993, the amount determined under this clause for the preceding year increased by the covered item update for such subsequent year,
(III) for 1994, the local payment amount determined under clause (i) for such item or device for that year, except that the national limited payment amount may not exceed 100 percent of the median of all local payment amounts determined under such clause for such item for that year and may not be less than 85 percent of the median of all local payment amounts determined under such clause for such item or device for that year, and
(IV) for each subsequent year, the amount determined under this clause for the preceding year increased by the covered item update for such subsequent year.
(3) Payment for items requiring frequent and substantial servicing
(A) In general
Payment for a covered item (such as IPPB machines and ventilators, excluding ventilators that are either continuous airway pressure devices or intermittent assist devices with continuous airway pressure devices) for which there must be frequent and substantial servicing in order to avoid risk to the patient's health shall be made on a monthly basis for the rental of the item and the amount recognized is the amount specified in subparagraph (B).
(B) Payment amount
For purposes of subparagraph (A), the amount specified in this subparagraph, with respect to an item or device furnished in a carrier service area—
(i) in 1989 and in 1990 is the average reasonable charge in the area for the rental of the item or device for the 12-month period ending with June 1987, increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 6-month period ending with December 1987;
(ii) in 1991 is the sum of (I) 67 percent of the local payment amount for the item or device computed under subparagraph (C)(i)(I) for 1991, and (II) 33 percent of the national limited payment amount for the item or device computed under subparagraph (C)(ii) for 1991;
(iii) in 1992 is the sum of (I) 33 percent of the local payment amount for the item or device computed under subparagraph (C)(i)(II) for 1992, and (II) 67 percent of the national limited payment amount for the item or device computed under subparagraph (C)(ii) for 1992; and
(iv) in 1993 and each subsequent year is the national limited payment amount for the item or device computed under subparagraph (C)(ii) for that year.
(C) Computation of local payment amount and national limited payment amount
For purposes of subparagraph (B)—
(i) the local payment amount for an item or device for a year is equal to—
(I) for 1991, the amount specified in subparagraph (B)(i) for 1990 increased by the covered item update for 1991, and
(II) for 1992, 1993, and 1994, the amount determined under this clause for the preceding year increased by the covered item update for the year; and
(ii) the national limited payment amount for an item or device for a year is equal to—
(I) for 1991, the local payment amount determined under clause (i) for such item or device for that year, except that the national limited payment amount may not exceed 100 percent of the weighted average of all local payment amounts determined under such clause for such item for that year and may not be less than 85 percent of the weighted average of all local payment amounts determined under such clause for such item,
(II) for 1992 and 1993, the amount determined under this clause for the preceding year increased by the covered item update for such subsequent year,
(III) for 1994, the local payment amount determined under clause (i) for such item or device for that year, except that the national limited payment amount may not exceed 100 percent of the median of all local payment amounts determined under such clause for such item for that year and may not be less than 85 percent of the median of all local payment amounts determined under such clause for such item or device for that year, and
(IV) for each subsequent year, the amount determined under this clause for the preceding year increased by the covered item update for such subsequent year.
(4) Payment for certain customized items
Payment with respect to a covered item that is uniquely constructed or substantially modified to meet the specific needs of an individual patient, and for that reason cannot be grouped with similar items for purposes of payment under this subchapter, shall be made in a lump-sum amount (A) for the purchase of the item in a payment amount based upon the carrier's individual consideration for that item, and (B) for the reasonable and necessary maintenance and servicing for parts and labor not covered by the supplier's or manufacturer's warranty, when necessary during the period of medical need, and the amount recognized for such maintenance and servicing shall be paid on a lump-sum, as needed basis based upon the carrier's individual consideration for that item.
(5) Payment for oxygen and oxygen equipment
(A) In general
Payment for oxygen and oxygen equipment shall be made on a monthly basis in the monthly payment amount recognized under paragraph (9) for oxygen and oxygen equipment (other than portable oxygen equipment), subject to subparagraphs (B), (C), and (E).
(B) Add-on for portable oxygen equipment
When portable oxygen equipment is used, but subject to subparagraph (D), the payment amount recognized under subparagraph (A) shall be increased by the monthly payment amount recognized under paragraph (9) for portable oxygen equipment.
(C) Volume adjustment
When the attending physician prescribes an oxygen flow rate—
(i) exceeding 4 liters per minute, the payment amount recognized under subparagraph (A), subject to subparagraph (D), shall be increased by 50 percent, or
(ii) of less than 1 liter per minute, the payment amount recognized under subparagraph (A) shall be decreased by 50 percent.
(D) Limit on adjustment
When portable oxygen equipment is used and the attending physician prescribes an oxygen flow rate exceeding 4 liters per minute, there shall only be an increase under either subparagraph (B) or (C), whichever increase is larger, and not under both such subparagraphs.
(E) Recertification for patients receiving home oxygen therapy
In the case of a patient receiving home oxygen therapy services who, at the time such services are initiated, has an initial arterial blood gas value at or above a partial pressure of 56 or an arterial oxygen saturation at or above 89 percent (or such other values, pressures, or criteria as the Secretary may specify) no payment may be made under this part for such services after the expiration of the 90-day period that begins on the date the patient first receives such services unless the patient's attending physician certifies that, on the basis of a follow-up test of the patient's arterial blood gas value or arterial oxygen saturation conducted during the final 30 days of such 90-day period, there is a medical need for the patient to continue to receive such services.
(6) Payment for other covered items (other than durable medical equipment)
Payment for other covered items (other than durable medical equipment and other covered items described in paragraph (3), (4), or (5)) shall be made in a lump-sum amount for the purchase of the item in the amount of the purchase price recognized under paragraph (8).
(7) Payment for other items of durable medical equipment
(A) In general
In the case of an item of durable medical equipment not described in paragraphs (2) through (6)—
(i) payment shall be made on a monthly basis for the rental of such item during the period of medical need (but payments under this clause may not extend over a period of continuous use of longer than 15 months, or, in the case of an item for which a purchase agreement has been entered into under clause (iii), a period of continuous use of longer than 13 months), and, subject to subparagraph (B), the amount recognized for each of the first 3 months of such period is 10 percent of the purchase price recognized under paragraph (8) with respect to the item, and for each of the remaining months of such period is 7.5 percent of such purchase price;
(ii) in the case of a power-driven wheelchair, at the time the supplier furnishes the item, the supplier shall offer the individual patient the option to purchase the item, and payment for such item shall be made on a lump-sum basis if the patient exercises such option;
(iii) during the 10th continuous month during which payment is made for the rental of an item under clause (i), the supplier of such item shall offer the individual patient the option to enter into a purchase agreement under which, if the patient notifies the supplier not later than 1 month after the supplier makes such offer that the patient agrees to accept such offer and exercise such option—
(I) the supplier shall transfer title to the item to the individual patient on the first day that begins after the 13th continuous month during which payment is made for the rental of the item under clause (i),
(II) after the supplier transfers title to the item under subclause (I), maintenance and servicing payments shall be made in accordance with clause (vi);
(iv) in the case of an item for which a purchase agreement has not been entered into under clause (ii) or clause (iii), during the first 6-month period of medical need that follows the period of medical need during which payment is made under clause (i), no payment shall be made for rental or maintenance and servicing of the item;
(v) in the case of an item for which a purchase agreement has not been entered into under clause (ii) or clause (iii), during the first month of each succeeding 6-month period of medical need, a maintenance and servicing payment may be made (for parts and labor not covered by the supplier's or manufacturer's warranty, as determined by the Secretary to be appropriate for the particular type of durable medical equipment) and the amount recognized for each such 6-month period is the lower of (I) a reasonable and necessary maintenance and servicing fee or fees established by the Secretary, or (II) 10 percent of the total of the purchase price recognized under paragraph (8) with respect to the item; and
(vi) in the case of an item for which a purchase agreement has been entered into under clause (ii) or clause (iii), maintenance and servicing payments may be made (for parts and labor not covered by the supplier's or manufacturer's warranty, as determined by the Secretary to be appropriate for the particular type of durable medical equipment), and such payments shall be in an amount established by the Secretary on the basis of reasonable charges in the locality for maintenance and servicing.
The Secretary shall determine the meaning of the term "continuous" in subparagraph (A).
(B) Range for rental amounts
(i) For 1989
For items furnished during 1989, the payment amount recognized under subparagraph (A)(i) shall not be more than 115 percent, and shall not be less than 85 percent, of the prevailing charge established for rental of the item in January 1987, increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 6-month period ending with December 1987.
(ii) For 1990
For items furnished during 1990, clause (i) shall apply in the same manner as it applies to items furnished during 1989.
(C) Replacement of items
(i) Establishment of reasonable useful lifetime
In accordance with clause (iii), the Secretary shall determine and establish a reasonable useful lifetime for items of durable medical equipment for which payment may be made under this paragraph.
(ii) Payment for replacement items
If the reasonable lifetime of such an item, as so established, has been reached during a continuous period of medical need, or the carrier determines that the item is lost or irreparably damaged, the patient may elect to have payment for an item serving as a replacement for such item made—
(I) on a monthly basis for the rental of the replacement item in accordance with subparagraph (A); or
(II) in the case of an item for which a purchase agreement has been entered into under subparagraph (A)(ii) or (A)(iii), in a lump-sum amount for the purchase of the item.
(iii) Length of reasonable useful lifetime
The reasonable useful lifetime of an item of durable medical equipment under this subparagraph shall be equal to 5 years, except that, if the Secretary determines that, on the basis of prior experience in making payments for such an item under this subchapter, a reasonable useful lifetime of 5 years is not appropriate with respect to a particular item, the Secretary shall establish an alternative reasonable lifetime for such item.
(8) Purchase price recognized for miscellaneous devices and items
For purposes of paragraphs (6) and (7), the amount that is recognized under this paragraph as the purchase price for a covered item is the amount described in subparagraph (C) of this paragraph, determined as follows:
(A) Computation of local purchase price
Each carrier under
(i) The carrier shall compute a base local purchase price, for each item described—
(I) in paragraph (6) equal to the average reasonable charge in the locality for the purchase of the item for the 12-month period ending with June 1987, or
(II) in paragraph (7) equal to the average of the purchase prices on the claims submitted on an assignment-related basis for the unused item supplied during the 6-month period ending with December 1986.
(ii) The carrier shall compute a local purchase price, with respect to the furnishing of each particular item—
(I) in 1989 and 1990, equal to the base local purchase price computed under clause (i) increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 6-month period ending with December 1987,
(II) in 1991, equal to the local purchase price computed under this clause for the previous year, increased by the covered item update for 1991, and decreased by the percentage by which the average of the reasonable charges for claims paid for all items described in paragraph (7) is lower than the average of the purchase prices submitted for such items during the final 9 months of 1988; 1 or
(III) in 1992, 1993, and 1994, equal to the local purchase price computed under this clause for the previous year increased by the covered item update for the year.
(B) Computation of national limited purchase price
With respect to the furnishing of a particular item in a year, the Secretary shall compute a national limited purchase price—
(i) for 1991, equal to the local purchase price computed under subparagraph (A)(ii) for the item for the year, except that such national limited purchase price may not exceed 100 percent of the weighted average of all local purchase prices for the item computed under such subparagraph for the year, and may not be less than 85 percent of the weighted average of all local purchase prices for the item computed under such subparagraph for the year;
(ii) for 1992 and 1993, the amount determined under this subparagraph for the preceding year increased by the covered item update for such subsequent year;
(iii) for 1994, the local purchase price computed under subparagraph (A)(ii) for the item for the year, except that such national limited purchase price may not exceed 100 percent of the median of all local purchase prices computed for the item under such subparagraph for the year and may not be less than 85 percent of the median of all local purchase prices computed under such subparagraph for the item for the year; and
(iv) for each subsequent year, equal to the amount determined under this subparagraph for the preceding year increased by the covered item update for such subsequent year.
(C) Purchase price recognized
For purposes of paragraphs (6) and (7), the amount that is recognized under this paragraph as the purchase price for each item furnished—
(i) in 1989 or 1990, is 100 percent of the local purchase price computed under subparagraph (A)(ii)(I);
(ii) in 1991, is the sum of (I) 67 percent of the local purchase price computed under subparagraph (A)(ii)(II) for 1991, and (II) 33 percent of the national limited purchase price computed under subparagraph (B) for 1991;
(iii) in 1992, is the sum of (I) 33 percent of the local purchase price computed under subparagraph (A)(ii)(III) for 1992, and (II) 67 percent of the national limited purchase price computed under subparagraph (B) for 1992; and
(iv) in 1993 or a subsequent year, is the national limited purchase price computed under subparagraph (B) for that year.
(9) Monthly payment amount recognized with respect to oxygen and oxygen equipment
For purposes of paragraph (5), the amount that is recognized under this paragraph for payment for oxygen and oxygen equipment is the monthly payment amount described in subparagraph (C) of this paragraph. Such amount shall be computed separately (i) for all items of oxygen and oxygen equipment (other than portable oxygen equipment) and (ii) for portable oxygen equipment (each such group referred to in this paragraph as an "item").
(A) Computation of local monthly payment rate
Each carrier under this section shall compute a base local payment rate for each item as follows:
(i) The carrier shall compute a base local average monthly payment rate per beneficiary as an amount equal to (I) the total reasonable charges for the item during the 12-month period ending with December 1986, divided by (II) the total number of months for all beneficiaries receiving the item in the area during the 12-month period for which the carrier made payment for the item under this subchapter.
(ii) The carrier shall compute a local average monthly payment rate for the item applicable—
(I) to 1989 and 1990, equal to 95 percent of the base local average monthly payment rate computed under clause (i) for the item increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 6-month period ending with December 1987, or
(II) to 1991, 1992, 1993, and 1994, equal to the local average monthly payment rate computed under this clause for the item for the previous year increased by the covered item increase for the year.
(B) Computation of national limited monthly payment rate
With respect to the furnishing of an item in a year, the Secretary shall compute a national limited monthly payment rate equal to—
(i) for 1991, the local monthly payment rate computed under subparagraph (A)(ii)(II) for the item for the year, except that such national limited monthly payment rate may not exceed 100 percent of the weighted average of all local monthly payment rates computed for the item under such subparagraph for the year, and may not be less than 85 percent of the weighted average of all local monthly payment rates computed for the item under such subparagraph for the year;
(ii) for 1992 and 1993, the amount determined under this subparagraph for the preceding year increased by the covered item update for such subsequent year;
(iii) for 1994, the local monthly payment rate computed under subparagraph (A)(ii) for the item for the year, except that such national limited monthly payment rate may not exceed 100 percent of the median of all local monthly payment rates computed for the item under such subparagraph for the year and may not be less than 85 percent of the median of all local monthly payment rates computed for the item under such subparagraph for the year; and
(iv) for each subsequent year, equal to the amount determined under this subparagraph for the preceding year increased by the covered item update for such subsequent year.
(C) Monthly payment amount recognized
For purposes of paragraph (5), the amount that is recognized under this paragraph as the base monthly payment amount for each item furnished—
(i) in 1989 and in 1990, is 100 percent of the local average monthly payment rate computed under subparagraph (A)(ii) for the item;
(ii) in 1991, is the sum of (I) 67 percent of the local average monthly payment rate computed under subparagraph (A)(ii)(II) for the item for 1991, and (II) 33 percent of the national limited monthly payment rate computed under subparagraph (B)(i) for the item for 1991;
(iii) in 1992, is the sum of (I) 33 percent of the local average monthly payment rate computed under subparagraph (A)(ii)(II) for the item for 1992, and (II) 67 percent of the national limited monthly payment rate computed under subparagraph (B)(ii) for the item for 1992; and
(iv) in a subsequent year, is the national limited monthly payment rate computed under subparagraph (B) for the item for that year.
(10) Exceptions and adjustments
(A) Areas outside continental United States
Exceptions to the amounts recognized under the previous provisions of this subsection shall be made to take into account the unique circumstances of covered items furnished in Alaska, Hawaii, or Puerto Rico.
(B) Adjustment for inherent reasonableness
For covered items furnished on or after January 1, 1991, the Secretary is authorized to apply the provisions of paragraphs (8) and (9) (other than subparagraph (D)) of
(C) Transcutaneous electrical nerve stimulator (TENS)
In order to permit an attending physician time to determine whether the purchase of a transcutaneous electrical nerve stimulator is medically appropriate for a particular patient, the Secretary may determine an appropriate payment amount for the initial rental of such item for a period of not more than 2 months. If such item is subsequently purchased, the payment amount with respect to such purchase is the payment amount determined under paragraph (2).
(11) Improper billing and requirement of physician order
(A) Improper billing for certain rental items
Notwithstanding any other provision of this subchapter, a supplier of a covered item for which payment is made under this subsection and which is furnished on a rental basis shall continue to supply the item without charge (other than a charge provided under this subsection for the maintenance and servicing of the item) after rental payments may no longer be made under this subsection. If a supplier knowingly and willfully violates the previous sentence, the Secretary may apply sanctions against the supplier under
(B) Requirement of physician order
The Secretary is authorized to require, for specified covered items, that payment may be made under this subsection with respect to the item only if a physician has communicated to the supplier, before delivery of the item, a written order for the item.
(12) Regional carriers
The Secretary may designate, by regulation under
(13) "Covered item" defined
In this subsection, the term "covered item" means durable medical equipment (as defined in
(14) Covered item update
In this subsection, the term "covered item update" means, with respect to a year—
(A) for 1991 and 1992, the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year reduced by 1 percentage point; and
(B) for a subsequent year, the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year.
(15) Advance determinations of coverage for certain items
(A) Development of lists of items by Secretary
The Secretary may develop and periodically update a list of items for which payment may be made under this subsection that the Secretary determines, on the basis of prior payment experience, are frequently subject to unnecessary utilization throughout a carrier's entire service area or a portion of such area.
(B) Development of lists of suppliers by Secretary
The Secretary may develop and periodically update a list of suppliers of items for which payment may be made under this subsection with respect to whom—
(i) the Secretary has found that a substantial number of claims for payment under this part for items furnished by the supplier have been denied on the basis of the application of
(ii) the Secretary has identified a pattern of overutilization resulting from the business practice of the supplier.
(C) Determinations of coverage in advance
A carrier shall determine in advance of delivery of an item whether payment for the item may not be made because the item is not covered or because of the application of
(i) the item is included on the list developed by the Secretary under subparagraph (A);
(ii) the item is furnished by a supplier included on the list developed by the Secretary under subparagraph (B); or
(iii) the item is a customized item (other than inexpensive items specified by the Secretary) and the patient to whom the item is to be furnished or the supplier requests that such advance determination be made.
(16) Repealed. Pub. L. 103–432, title I, §131(a)(2), Oct. 31, 1994, 108 Stat. 4419
(17) Prohibition against unsolicited telephone contacts by suppliers
(A) In general
A supplier of a covered item under this subsection may not contact an individual enrolled under this part by telephone regarding the furnishing of a covered item to the individual unless 1 of the following applies:
(i) The individual has given written permission to the supplier to make contact by telephone regarding the furnishing of a covered item.
(ii) The supplier has furnished a covered item to the individual and the supplier is contacting the individual only regarding the furnishing of such covered item.
(iii) If the contact is regarding the furnishing of a covered item other than a covered item already furnished to the individual, the supplier has furnished at least 1 covered item to the individual during the 15-month period preceding the date on which the supplier makes such contact.
(B) Prohibiting payment for items furnished subsequent to unsolicited contacts
If a supplier knowingly contacts an individual in violation of subparagraph (A), no payment may be made under this part for any item subsequently furnished to the individual by the supplier.
(C) Exclusion from program for suppliers engaging in pattern of unsolicited contacts
If a supplier knowingly contacts individuals in violation of subparagraph (A) to such an extent that the supplier's conduct establishes a pattern of contacts in violation of such subparagraph, the Secretary shall exclude the supplier from participation in the programs under this chapter, in accordance with the procedures set forth in subsections (c), (f), and (g) of
(18) Refund of amounts collected for certain disallowed items
(A) In general
If a nonparticipating supplier furnishes to an individual enrolled under this part a covered item for which no payment may be made under this part by reason of paragraph (17)(B), the supplier shall refund on a timely basis to the patient (and shall be liable to the patient for) any amounts collected from the patient for the item, unless—
(i) the supplier establishes that the supplier did not know and could not reasonably have been expected to know that payment may not be made for the item by reason of paragraph (17)(B), or
(ii) before the item was furnished, the patient was informed that payment under this part may not be made for that item and the patient has agreed to pay for that item.
(B) Sanctions
If a supplier knowingly and willfully fails to make refunds in violation of subparagraph (A), the Secretary may apply sanctions against the supplier in accordance with
(C) Notice
Each carrier with a contract in effect under this part with respect to suppliers of covered items shall send any notice of denial of payment for covered items by reason of paragraph (17)(B) and for which payment is not requested on an assignment-related basis to the supplier and the patient involved.
(D) Timely basis defined
A refund under subparagraph (A) is considered to be on a timely basis only if—
(i) in the case of a supplier who does not request reconsideration or seek appeal on a timely basis, the refund is made within 30 days after the date the supplier receives a denial notice under subparagraph (C), or
(ii) in the case in which such a reconsideration or appeal is taken, the refund is made within 15 days after the date the supplier receives notice of an adverse determination on reconsideration or appeal.
(b) Fee schedules for radiologist services
(1) Development
The Secretary shall develop—
(A) a relative value scale to serve as the basis for the payment for radiologist services under this part, and
(B) using such scale and appropriate conversion factors and subject to subsection (c)(1)(A) of this section, fee schedules (on a regional, statewide, locality, or carrier service area basis) for payment for radiologist services under this part, to be implemented for such services furnished during 1989.
(2) Consultation
In carrying out paragraph (1), the Secretary shall regularly consult closely with the Physician Payment Review Commission, the American College of Radiology, and other organizations representing physicians or suppliers who furnish radiologist services and shall share with them the data and data analysis being used to make the determinations under paragraph (1), including data on variations in current medicare payments by geographic area, and by service and physician specialty.
(3) Considerations
In developing the relative value scale and fee schedules under paragraph (1), the Secretary—
(A) shall take into consideration variations in the cost of furnishing such services among geographic areas and among different sites where services are furnished, and
(B) may also take into consideration such other factors respecting the manner in which physicians in different specialties furnish such services as may be appropriate to assure that payment amounts are equitable and designed to promote effective and efficient provision of radiologist services by physicians in the different specialties.
(4) Savings
(A) Budget neutral fee schedules
The Secretary shall develop preliminary fee schedules for 1989, which are designed to result in the same amount of aggregate payments (net of any coinsurance and deductibles under
(B) Initial savings
The fee schedules established for payment purposes under this subsection for services furnished in 1989 shall be 97 percent of the amounts permitted under the preliminary fee schedules developed under subparagraph (A).
(C) 1990 fee schedules
For radiologist services (other than portable X-ray services) furnished under this part during 1990, after March 31 of such year, the conversion factors used under this subsection shall be 96 percent of the conversion factors that applied under this subsection as of December 31, 1989.
(D) 1991 fee schedules
For radiologist services (other than portable X-ray services) furnished under this part during 1991, the conversion factors used in a locality under this subsection shall, subject to clause (vii), be reduced to the adjusted conversion factor for the locality determined as follows:
(i) National weighted average conversion factor
The Secretary shall estimate the national weighted average of the conversion factors used under this subsection for services furnished during 1990 beginning on April 1, using the best available data.
(ii) Reduced national weighted average
The national weighted average estimated under clause (i) shall be reduced by 13 percent.
(iii) Computation of 1990 locality index relative to national average
The Secretary shall establish an index which reflects, for each locality, the ratio of the conversion factor used in the locality under this subsection to the national weighted average estimated under clause (i).
(iv) Adjusted conversion factor
The adjusted conversion factor for the professional or technical component of a service in a locality is the sum of ½ of the locally-adjusted amount determined under clause (v) and ½ of the GPCI-adjusted amount determined under clauses 3 (vi).
(v) Locally-adjusted amount
For purposes of clause (iv), the locally adjusted amount determined under this clause is the product of (I) the national weighted average conversion factor computed under clause (ii), and (II) the index value established under clause (iii) for the locality.
(vi) GPCI-adjusted amount
For purposes of clause (iv), the GPCI-adjusted amount determined under this clause is the sum of—
(I) the product of (a) the portion of the reduced national weighted average conversion factor computed under clause (ii) which is attributable to physician work and (b) the geographic work index value for the locality (specified in Addendum C to the Model Fee Schedule for Physician Services (published on September 4, 1990, 55 Federal Register pp. 36238–36243)); and
(II) the product of (a) the remaining portion of the reduced national weighted average conversion factor computed under clause (ii), and (b) the geographic practice cost index value specified in
In applying this clause with respect to the professional component of a service, 80 percent of the conversion factor shall be considered to be attributable to physician work and with respect to the technical component of the service, 0 percent shall be considered to be attributable to physician work.
(vii) Limits on conversion factor
The conversion factor to be applied to a locality to the professional or technical component of a service shall not be reduced under this subparagraph by more than 9.5 percent below the conversion factor applied in the locality under subparagraph (C) to such component, but in no case shall the conversion factor be less than 60 percent of the national weighted average of the conversion factors (computed under clause (i)).
(E) Rule for certain scanning services
In the case of the technical components of magnetic resonance imaging (MRI) services and computer assisted tomography (CAT) services furnished after December 31, 1990, the amount otherwise payable shall be reduced by 10 percent.
(F) Subsequent updating
For radiologist services furnished in subsequent years, the fee schedules shall be the schedules for the previous year updated by the percentage increase in the MEI (as defined in
(G) Nonparticipating physicians and suppliers
Each fee schedule so established shall provide that the payment rate recognized for nonparticipating physicians and suppliers is equal to the appropriate percent (as defined in
(5) Limiting charges of nonparticipating physicians and suppliers
(A) In general
In the case of radiologist services furnished after January 1, 1989, for which payment is made under a fee schedule under this subsection, if a nonparticipating physician or supplier furnishes the service to an individual entitled to benefits under this part, the physician or supplier may not charge the individual more than the limiting charge (as defined in subparagraph (B)).
(B) "Limiting charge" defined
In subparagraph (A), the term "limiting charge" means, with respect to a service furnished—
(i) in 1989, 125 percent of the amount specified for the service in the appropriate fee schedule established under paragraph (1),
(ii) in 1990, 120 percent of the amount specified for the service in the appropriate fee schedule established under paragraph (1), and
(iii) after 1990, 115 percent of the amount specified for the service in the appropriate fee schedule established under paragraph (1).
(C) Enforcement
If a physician or supplier knowingly and willfully bills in violation of subparagraph (A), the Secretary may apply sanctions against such physician or supplier in accordance with
(6) "Radiologist services" defined
For the purposes of this subsection and
(A) who is certified, or eligible to be certified, by the American Board of Radiology, or
(B) for whom radiology services account for at least 50 percent of the total amount of charges made under this part.
(c) Payments and standards for screening mammography
(1) In general
Notwithstanding any other provision of this part, with respect to expenses incurred for screening mammography (as defined in
(A) payment may be made only for screening mammography conducted consistent with the frequency permitted under paragraph (2);
(B) payment may be made only if the screening mammography is conducted by a facility that has a certificate (or provisional certificate) issued under
(C) the amount of the payment under this part shall, subject to the deductible established under
(i) the actual charge for the screening,
(ii) the fee schedule established under subsection (b) of this section or the fee schedule established under
(iii) the limit established under paragraph (3) for the screening mammography.
(2) Frequency covered
(A) In general
Subject to revision by the Secretary under subparagraph (B)—
(i) No payment may be made under this part for screening mammography performed on a woman under 35 years of age.
(ii) Payment may be made under this part for only 1 screening mammography performed on a woman over 34 years of age, but under 40 years of age.
(iii) In the case of a woman over 39 years of age, but under 50 years of age, who—
(I) is at a high risk of developing breast cancer (as determined pursuant to factors identified by the Secretary), payment may not be made under this part for a screening mammography performed within the 11 months following the month in which a previous screening mammography was performed, or
(II) is not at a high risk of developing breast cancer, payment may not be made under this part for a screening mammography performed within the 23 months following the month in which a previous screening mammography was performed.
(iv) In the case of a woman over 49 years of age, but under 65 years of age, payment may not be made under this part for screening mammography performed within 11 months following the month in which a previous screening mammography was performed.
(v) In the case of a woman over 64 years of age, payment may not be made for screening mammography performed within 23 months following the month in which a previous screening mammography was performed.
(B) Revision of frequency
(i) Review
The Secretary, in consultation with the Director of the National Cancer Institute, shall review periodically the appropriate frequency for performing screening mammography, based on age and such other factors as the Secretary believes to be pertinent.
(ii) Revision of frequency
The Secretary, taking into consideration the review made under clause (i), may revise from time to time the frequency with which screening mammography may be paid for under this subsection, but no such revision shall apply to screening mammography performed before January 1, 1992.
(3) Limit
(A) $55, indexed
Except as provided by the Secretary under subparagraph (B), the limit established under this paragraph—
(i) for screening mammography performed in 1991, is $55, and
(ii) for screening mammography performed in a subsequent year is the limit established under this paragraph for the preceding year increased by the percentage increase in the MEI for that subsequent year.
(B) Reduction of limit
The Secretary shall review from time to time the appropriateness of the amount of the limit established under this paragraph. The Secretary may, with respect to screening mammography performed in a year after 1992, reduce the amount of such limit as it applies nationally or in any area to the amount that the Secretary estimates is required to assure that screening mammography of an appropriate quality is readily and conveniently available during the year.
(C) Application of limit in hospital outpatient setting
The Secretary shall provide for an appropriate allocation of the limit established under this paragraph between professional and technical components in the case of hospital outpatient screening mammography (and comparable situations) where there is a claim for professional services separate from the claim for the radiologic procedure.
(4) Limiting charges of nonparticipating physicians
(A) In general
In the case of mammography screening performed on or after January 1, 1991, for which payment is made under this subsection, if a nonparticipating physician or supplier provides the screening to an individual entitled to benefits under this part, the physician or supplier may not charge the individual more than the limiting charge (as defined in subparagraph (B), or if less, as defined in subsection (b)(5)(B) of this section or as defined in
(B) "Limiting charge" defined
In subparagraph (A), the term "limiting charge" means, with respect to screening mammography performed—
(i) in 1991, 125 percent of the limit established under paragraph (4),
(ii) in 1992, 120 percent of the limit established under paragraph (4), or
(iii) after 1992, 115 percent of the limit established under paragraph (4).
(C) Enforcement
If a physician or supplier knowing 4 and willfully imposes a charge in violation of subparagraph (A), the Secretary may apply sanctions against such physician or supplier in accordance with
(d), (e) Repealed. Pub. L. 101–234, title II, §201(a), Dec. 13, 1989, 103 Stat. 1981
(f) Reduction in payments for physician pathology services during 1991
(1) In general
For physician pathology services furnished under this part during 1991, the prevailing charges used in a locality under this part shall be 7 percent below the prevailing charges used in the locality under this part in 1990 after March 31.
(2) Limitation
The prevailing charge for the technical and professional components of an 5 physician pathology service furnished by a physician through an independent laboratory shall not be reduced pursuant to paragraph (1) to the extent that such reduction would reduce such prevailing charge below 115 percent of the prevailing charge for the professional component of such service when furnished by a hospital-based physician in the same locality. For purposes of the preceding sentence, an independent laboratory is a laboratory that is independent of a hospital and separate from the attending or consulting physicians' office.
(g) Payment for outpatient rural primary care hospital services
(1) In general
The amount of payment for outpatient rural primary care hospital services provided during a year before the prospective payment system described in paragraph (2) is in effect in a rural primary care hospital under this part shall be determined by one of the 2 following methods, as elected by the rural primary care hospital:
(A) Cost-based facility fee plus professional charges
(i) Facility fee
With respect to facility services, not including any services for which payment may be made under clause (ii), there shall be paid amounts equal to the amounts described in
(ii) Reasonable charges for professional services
In electing treatment under this subparagraph, payment for professional medical services otherwise included within outpatient rural primary care hospital services shall be made under such other provisions of this part as would apply to payment for such services if they were not included in outpatient rural primary care hospital services.
(B) All-inclusive rate
With respect to both facility services and professional medical services, there shall be paid amounts equal to the costs which are reasonable and related to the cost of furnishing such services or which are based on such other tests of reasonableness as the Secretary may prescribe in regulations, less the amount the hospital may charge as described in clause (i) of
The amount of payment shall be determined under either method without regard to the amount of the customary or other charge.
(2) Development and implementation of all inclusive, prospective payment system
Not later than January 1, 1996, the Secretary shall develop and implement a prospective payment system for determining payments under this part for outpatient rural primary care hospital services using a methodology that includes all costs in providing all such services (including related professional medical services) and that determines the payment amount for such services on a prospective basis.
(h) Payment for prosthetic devices and orthotics and prosthetics
(1) General rule for payment
(A) In general
Payment under this subsection for prosthetic devices and orthotics and prosthetics shall be made in a lump-sum amount for the purchase of the item in an amount equal to 80 percent of the payment basis described in subparagraph (B).
(B) Payment basis
Except as provided in subparagraphs (C) and (E), the payment basis described in this subparagraph is the lesser of—
(i) the actual charge for the item; or
(ii) the amount recognized under paragraph (2) as the purchase price for the item.
(C) Exception for certain public home health agencies
Subparagraph (B)(i) shall not apply to an item furnished by a public home health agency (or by another home health agency which demonstrates to the satisfaction of the Secretary that a significant portion of its patients are low income) free of charge or at nominal charges to the public.
(D) Exclusive payment rule
This subsection shall constitute the exclusive provision of this subchapter for payment for prosthetic devices, orthotics, and prosthetics under this part or under part A of this subchapter to a home health agency.
(E) Exception for certain items
Payment for ostomy supplies, tracheostomy supplies, and urologicals shall be made in accordance with subparagraphs (B) and (C) of subsection (a)(2) of this section.
(2) Purchase price recognized
For purposes of paragraph (1), the amount that is recognized under this paragraph as the purchase price for prosthetic devices, orthotics, and prosthetics is the amount described in subparagraph (C) of this paragraph, determined as follows:
(A) Computation of local purchase price
Each carrier under
(i) The carrier shall compute a base local purchase price for each item equal to the average reasonable charge in the locality for the purchase of the item for the 12-month period ending with June 1987.
(ii) The carrier shall compute a local purchase price, with respect to the furnishing of each particular item—
(I) in 1989 and 1990, equal to the base local purchase price computed under clause (i) increased by the percentage increase in the consumer price index for all urban consumers (United States city average) for the 6-month period ending with December 1987, or
(II) in 1991, 1992 or 1993, equal to the local purchase price computed under this clause for the previous year increased by the applicable percentage increase for the year.
(B) Computation of regional purchase price
With respect to the furnishing of a particular item in each region (as defined by the Secretary), the Secretary shall compute a regional purchase price—
(i) for 1992, equal to the average (weighted by relative volume of all claims among carriers) of the local purchase prices for the carriers in the region computed under subparagraph (A)(ii)(II) for the year, and
(ii) for each subsequent year, equal to the regional purchase price computed under this subparagraph for the previous year increased by the applicable percentage increase for the year.
(C) Purchase price recognized
For purposes of paragraph (1) and subject to subparagraph (D), the amount that is recognized under this paragraph as the purchase price for each item furnished—
(i) in 1989, 1990, or 1991, is 100 percent of the local purchase price computed under subparagraph (A)(ii);
(ii) in 1992, is the sum of (I) 75 percent of the local purchase price computed under subparagraph (A)(ii)(II) for 1992, and (II) 25 percent of the regional purchase price computed under subparagraph (B) for 1992;
(iii) in 1993, is the sum of (I) 50 percent of the local purchase price computed under subparagraph (A)(ii)(II) for 1993, and (II) 50 percent of the regional purchase price computed under subparagraph (B) for 1993; and
(iv) in 1994 or a subsequent year, is the regional purchase price computed under subparagraph (B) for that year.
(D) Range on amount recognized
The amount that is recognized under subparagraph (C) as the purchase price for an item furnished—
(i) in 1992, may not exceed 125 percent, and may not be lower than 85 percent, of the average of the purchase prices recognized under such subparagraph for all the carrier service areas in the United States in that year; and
(ii) in a subsequent year, may not exceed 120 percent, and may not be lower than 90 percent, of the average of the purchase prices recognized under such subparagraph for all the carrier service areas in the United States in that year.
(3) Applicability of certain provisions relating to durable medical equipment
Paragraphs (12), (15), and (17) and subparagraphs (A) and (B) of paragraph (10) and paragraph (11) of subsection (a) of this section shall apply to prosthetic devices, orthotics, and prosthetics in the same manner as such provisions apply to covered items under such subsection.
(4) Definitions
In this subsection—
(A) the term "applicable percentage increase" means—
(i) for 1991, 0 percent,
(ii) for 1992 and 1993, the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year; 6
(iii) for 1994 and 1995, 0 percent, and
(iv) for a subsequent year, the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year;
(B) the term "prosthetic devices" has the meaning given such term in
(C) the term "orthotics and prosthetics" has the meaning given such term in
(i) Payment for surgical dressings
(1) In general
Payment under this subsection for surgical dressings (described in
(A) the actual charge for the item; or
(B) a payment amount determined in accordance with the methodology described in subparagraphs (B) and (C) of subsection (a)(2) of this section (except that in applying such methodology, the national limited payment amount referred to in such subparagraphs shall be initially computed based on local payment amounts using average reasonable charges for the 12-month period ending December 31, 1992, increased by the covered item updates described in such subsection for 1993 and 1994).
(2) Exceptions
Paragraph (1) shall not apply to surgical dressings that are—
(A) furnished as an incident to a physician's professional service; or
(B) furnished by a home health agency.
(j) Requirements for suppliers of medical equipment and supplies
(1) Issuance and renewal of supplier number
(A) Payment
Except as provided in subparagraph (C), no payment may be made under this part after October 31, 1994, for items furnished by a supplier of medical equipment and supplies unless such supplier obtains (and renews at such intervals as the Secretary may require) a supplier number.
(B) Standards for possessing a supplier number
A supplier may not obtain a supplier number unless—
(i) for medical equipment and supplies furnished on or after October 31, 1994, and before January 1, 1996, the supplier meets standards prescribed by the Secretary in regulations issued on June 18, 1992; and
(ii) for medical equipment and supplies furnished on or after January 1, 1996, the supplier meets revised standards prescribed by the Secretary (in consultation with representatives of suppliers of medical equipment and supplies, carriers, and consumers) that shall include requirements that the supplier—
(I) comply with all applicable State and Federal licensure and regulatory requirements;
(II) maintain a physical facility on an appropriate site;
(III) have proof of appropriate liability insurance; and
(IV) meet such other requirements as the Secretary may specify.
(C) Exception for items furnished as incident to a physician's service
Subparagraph (A) shall not apply with respect to medical equipment and supplies furnished incident to a physician's service.
(D) Prohibition against multiple supplier numbers
The Secretary may not issue more than one supplier number to any supplier of medical equipment and supplies unless the issuance of more than one number is appropriate to identify subsidiary or regional entities under the supplier's ownership or control.
(E) Prohibition against delegation of supplier determinations
The Secretary may not delegate (other than by contract under
(2) Certificates of medical necessity
(A) Limitation on information provided by suppliers on certificates of medical necessity
(i) In general
Effective 60 days after October 31, 1994, a supplier of medical equipment and supplies may distribute to physicians, or to individuals entitled to benefits under this part, a certificate of medical necessity for commercial purposes which contains no more than the following information completed by the supplier:
(I) An identification of the supplier and the beneficiary to whom such medical equipment and supplies are furnished.
(II) A description of such medical equipment and supplies.
(III) Any product code identifying such medical equipment and supplies.
(IV) Any other administrative information (other than information relating to the beneficiary's medical condition) identified by the Secretary.
(ii) Information on payment amount and charges
If a supplier distributes a certificate of medical necessity containing any of the information permitted to be supplied under clause (i), the supplier shall also list on the certificate of medical necessity the fee schedule amount and the supplier's charge for the medical equipment or supplies being furnished prior to distribution of such certificate to the physician.
(iii) Penalty
Any supplier of medical equipment and supplies who knowingly and willfully distributes a certificate of medical necessity in violation of clause (i) or fails to provide the information required under clause (ii) is subject to a civil money penalty in an amount not to exceed $1,000 for each such certificate of medical necessity so distributed. The provisions of
(B) "Certificate of medical necessity" defined
For purposes of this paragraph, the term "certificate of medical necessity" means a form or other document containing information required by the carrier to be submitted to show that an item is reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.
(3) Coverage and review criteria
The Secretary shall annually review the coverage and utilization of items of medical equipment and supplies to determine whether such items should be made subject to coverage and utilization review criteria, and if appropriate, shall develop and apply such criteria to such items.
(4) Limitation on patient liability
If a supplier of medical equipment and supplies (as defined in paragraph (5))—
(A) furnishes an item or service to a beneficiary for which no payment may be made by reason of paragraph (1);
(B) furnishes an item or service to a beneficiary for which payment is denied in advance under subsection (a)(15) of this section; or
(C) furnishes an item or service to a beneficiary for which payment is denied under
any expenses incurred for items and services furnished to an individual by such a supplier not on an assigned basis shall be the responsibility of such supplier. The individual shall have no financial responsibility for such expenses and the supplier shall refund on a timely basis to the individual (and shall be liable to the individual for) any amounts collected from the individual for such items or services. The provisions of subsection (a)(18) of this section shall apply to refunds required under the previous sentence in the same manner as such provisions apply to refunds under such subsection.
(5) "Medical equipment and supplies" defined
The term "medical equipment and supplies" means—
(A) durable medical equipment (as defined in
(B) prosthetic devices (as described in
(C) orthotics and prosthetics (as described in
(D) surgical dressings (as described in
(E) such other items as the Secretary may determine; and
(F) for purposes of paragraphs (1) and (3)—
(i) home dialysis supplies and equipment (as described in
(ii) immunosuppressive drugs (as described in
(iii) therapeutic shoes for diabetics (as described in
(iv) oral drugs prescribed for use as an anticancer therapeutic agent (as described in
(v) self-administered erythropoetin (as described in
(Aug. 14, 1935, ch. 531, title XVIII, §1834, as added and amended Dec. 22, 1987,
References in Text
Part A of this subchapter, referred to in subsecs. (a)(1)(C) and (h)(1)(D), is classified to
Codification
Amendment of subsec. (a)(4) by
Prior Provisions
A prior section 1395m, act Aug. 14, 1935, ch. 531, title XVIII, §1834, as added July 30, 1965,
Amendments
1994—Subsec. (a)(3)(D).
Subsec. (a)(5)(E).
Subsec. (a)(7).
Subsec. (a)(7)(A)(iii)(II).
Subsec. (a)(7)(C)(i).
Subsec. (a)(10)(B).
Subsec. (a)(14)(A).
Subsec. (a)(15).
"(A)
"(B)
Subsec. (a)(16).
"(A)
"(B)
Subsec. (a)(17), (18).
Subsec. (b)(4)(D).
Subsec. (b)(4)(D)(iv).
Subsec. (b)(4)(D)(vii).
Subsec. (b)(4)(E).
Subsec. (b)(4)(F), (G).
Subsec. (c)(1)(B).
Subsec. (c)(1)(C)(iii).
Subsec. (c)(3) to (5).
Subsec. (f).
Subsec. (g)(1).
Subsec. (g)(1)(B).
Subsec. (g)(2).
Subsec. (h)(3).
Subsec. (j).
Subsec. (j)(4), (5).
1993—Subsec. (a)(1)(D).
Subsec. (a)(2)(A)(iii).
Subsec. (a)(2)(C).
Subsec. (a)(3)(A).
Subsec. (a)(3)(C).
Subsec. (a)(8)(A)(ii)(III).
Subsec. (a)(8)(B)(ii) to (iv).
Subsec. (a)(9)(A)(ii)(II).
Subsec. (a)(9)(B)(ii) to (iv).
Subsec. (h)(1)(B).
Subsec. (h)(1)(E).
Subsec. (h)(4)(A).
Subsec. (i).
1990—Subsec. (a).
Subsec. (a)(1)(D).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (a)(2)(C).
Subsec. (a)(3)(B).
Subsec. (a)(3)(C).
Subsec. (a)(3)(D).
Subsec. (a)(4).
Subsec. (a)(5)(A).
Subsec. (a)(5)(E).
Subsec. (a)(7)(A)(i).
Subsec. (a)(7)(A)(ii), (iii).
Subsec. (a)(7)(A)(iv).
Subsec. (a)(7)(A)(v).
Subsec. (a)(7)(A)(vi).
Subsec. (a)(7)(C).
Subsec. (a)(8)(A)(ii).
Subsec. (a)(8)(B).
"(i) for 1991 and for 1992, equal to the average (weighted by relative volume of all claims among carriers) of the local purchase prices for the carriers in the region computed under subparagraph (A)(ii)(II) for the year, and
"(ii) for each subsequent year, equal to the regional purchase price computed under this subparagraph for the previous year increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year."
Subsec. (a)(8)(C).
Subsec. (a)(8)(C)(ii).
Subsec. (a)(8)(C)(iii).
Subsec. (a)(8)(C)(iv).
Subsec. (a)(8)(D).
"(i) in 1991, may not exceed 125 percent, and may not be lower than 85 percent, of the average of the purchase prices recognized under such subparagraph for all the carrier service areas in the United States in that year; and
"(ii) in a subsequent year, may not exceed 120 percent, and may not be lower than 90 percent, of the average of the purchase prices recognized under such subparagraph for all the carrier service areas in the United States in that year."
Subsec. (a)(9)(A)(ii)(II).
Subsec. (a)(9)(B).
"(i) for 1991 and 1992, equal to the average (weighted by relative volume of all claims among carriers) of the local monthly payment rates for the carriers in the region computed under subparagraph (A)(ii)(II) for the year, and
"(ii) for each subsequent year, equal to the regional monthly payment rates computed under this subparagraph for the previous year increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year."
Subsec. (a)(9)(C)(ii).
Subsec. (a)(9)(C)(iii).
Subsec. (a)(9)(C)(iv).
Subsec. (a)(9)(D).
"(i) in 1991, may not exceed 125 percent, and may not be lower than 85 percent, of the average of the base monthly payment amounts recognized under such subparagraph for all the carrier service areas in the United States in that year; and
"(ii) in a subsequent year, may not exceed 120 percent, and may not be lower than 90 percent, of the average of the base monthly payment amounts recognized under such subparagraph for all the carrier service areas in the United States in that year."
Subsec. (a)(12).
Subsec. (a)(13).
"(A) durable medical equipment (as defined in
"(B) prosthetic devices (described in
"(C) orthotics and prosthetics (described in
but does not include intraocular lenses or medical supplies (including catheters, catheter supplies, ostomy bags, and supplies related to ostomy care) furnished by a home health agency under
Subsec. (a)(14).
Subsec. (a)(15).
Subsec. (a)(16).
Subsec. (b)(1)(B).
Subsec. (b)(4)(D).
Subsec. (b)(4)(E).
Subsec. (b)(4)(F).
Subsec. (c).
Subsec. (f).
Subsec. (h).
1989—Subsec. (a)(1)(D).
Subsec. (a)(2)(A)(iii).
Subsec. (a)(2)(B)(i), (3)(B)(i).
Subsec. (a)(7)(A)(i).
Subsec. (a)(7)(B)(i).
Subsec. (a)(7)(B)(ii).
Subsec. (a)(8)(A)(ii)(I).
Subsec. (a)(8)(A)(ii)(II).
Subsec. (a)(8)(D)(i).
Subsec. (a)(8)(D)(ii).
Subsec. (a)(9)(A)(ii)(I).
Subsec. (a)(9)(A)(ii)(II).
Subsec. (a)(9)(D)(i).
Subsec. (a)(9)(D)(ii).
Subsec. (a)(13).
Subsec. (b)(1)(B).
Subsec. (b)(4)(A).
Subsec. (b)(4)(C) to (E).
Subsecs. (c) to (e).
Subsec. (f).
Subsec. (g).
1988—
Subsec. (a)(1)(C).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B)(i).
Subsec. (a)(3)(A).
Subsec. (a)(3)(B)(i).
Subsec. (a)(4).
Subsec. (a)(7)(A)(ii).
Subsec. (a)(7)(A)(iii).
Subsec. (a)(7)(B)(i).
Subsec. (a)(8)(A)(i)(I).
Subsec. (a)(8)(B).
Subsec. (a)(9)(A)(ii)(I).
Subsec. (a)(9)(A)(ii)(II).
Subsec. (a)(9)(B).
Subsec. (a)(9)(C)(i).
Subsec. (a)(10)(B).
Subsec. (a)(11)(A).
Subsec. (a)(12).
Subsec. (a)(14).
Subsec. (b).
Subsec. (b)(1)(B).
Subsec. (b)(4)(C).
Subsec. (b)(4)(D), (5).
Subsec. (b)(5)(C).
Subsec. (b)(6).
Subsec. (b)(6)(B).
Subsec. (c).
Subsec. (d).
Subsec. (e).
1987—Subsec. (b).
Effective Date of 1994 Amendment
Section 126(i) of
Section 131(a)(2) of
Section 132(c) of
Section 133(c) of
Section 134(a)(2) of
Section 135(a)(2) of
Section 135(b)(1) of
Section 135(b)(3) of
Section 135(d)(2) of
Section 135(e)(8) of
Section 145(d) of
Amendment by section 156(a)(2)(C) of
Effective Date of 1993 Amendment
Section 13542(b) of
Section 13543(c) of
Section 13544(a)(3) of
Amendment by section 13544(b)(1) of
Section 13545(b) of
Effective Date of 1990 Amendment
Section 4102(i) of
"(1) Except as otherwise provided, the amendments made by this section [amending this section,
"(2) The amendment made by subsection (f) [amending this section] shall be effective as if included in the enactment of the Omnibus Budget Reconciliation Act of 1987 [
Amendment by section 4104(a) of
Section 4152(a)(3) of
Section 4152(c)(4)(B)(ii) of
Section 4152(f)(2) of
Section 4152(g)(2) of
Section 4152(i) of
Amendment by section 4153(a)(1), (2)(D) of
Amendment by section 4163(b) of
Effective Date of 1989 Amendments
Amendment by section 6102(f)(1) of
Section 6112(e)(4) of
Amendment by section 201(a) of
Section 301(b)(1), (c)(1) of
Effective Date of 1988 Amendments
Amendment by
Amendment by section 202(b)(4) of
Amendment by section 203(c)(1)(F) of
Section 204(e) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4049(b)(2) of
[Section 4118(h) of
Effective Date
Subsection (a) of this section applicable to covered items (other than oxygen and oxygen equipment) furnished on or after Jan. 1, 1989, and to oxygen and oxygen equipment furnished on or after June 1, 1989, see section 4062(e) of
Use of Covered Items by Disabled Beneficiaries
Section 131(b) of
"(1)
"(2)
Criteria for Treatment of Items as Prosthetic Devices or Orthotics and Prosthetics
Section 131(c) of
Adjustment Required for Certain Items
Section 134(b) of
"(1)
"(2)
Limitation on Prevailing Charge for Physicians' Radiology Services Furnished During 1991; Exceptions
Section 4102(c) of
"(1)
"(2)
Limitation on Carrier Adjustments for Radiologist Services Furnished During 1991
Section 4102(e) of
"(1) a carrier may not make any adjustment, under section 1842(b)(3)(B) of such Act [
"(2) no payment adjustment may be made under section 1842(b)(8) of such Act, and
"(3) section 1842(b)(9) of such Act shall not apply."
Study of Payments for Prosthetic Devices, Orthotics, and Prosthetics
Section 4153(c) of
Special Rule for Nuclear Medicine Physicians
Section 6105(b) of
Special Rule for Interventional Radiologists; "Split Billing"
Section 6105(c) of
Rental Payments for Enteral and Parenteral Pumps
Section 6112(b) of
"(1)
"(2)
"(A) monthly rental payments shall not be made under part B of title XVIII of the Social Security Act for more than 15 months during such period, and
"(B) after monthly rental payments have been made for 15 months during such period, payment under such part shall be made for maintenance and servicing of the pump in such amounts as the Secretary of Health and Human Services determines to be reasonable and necessary to ensure the proper operation of the pump."
Treatment of Power-Driven Wheelchairs as Customized Items
Section 6112(d)(2) of
Study of Payment for Portable X-Ray Services
Section 6134 of
GAO Study of Standards for Use of and Payment for Items of Durable Medical Equipment
Section 6139 of
Reports on Medicare Beneficiary Drug Expenses
Section 202(i) of
Additional Studies by Secretary or Comptroller General
Section 202(k) of
Development of Standard Medicare Claims Forms
Section 202(l) of
Studies and Reports on Screening Mammography
Section 204(f) of
Deadline for Establishment of Fee Schedules for Radiologist Services; Report to Congress
Section 4049(b)(1) of
Study and Evaluation
Section 4062(c) of
"(1) The Secretary of Health and Human Services shall monitor the impact of the amendments made by this section [enacting this section, amending
"(2) Before January 1, 1991, the Secretary may not conduct any demonstration project respecting alternative methods of payment for covered items under title XVIII of the Social Security Act [this subchapter].
"(3) In this subsection, the term 'covered item' has the meaning given such term in section 1834(a)(13) of the Social Security Act [subsec. (a)(13) of this section] (as amended by subsection (b) of this section).
"(4) The Secretary shall, upon written request and payment of a reasonable copying fee which the Secretary may establish, provide the data and information used in determining the payment amounts for covered items under section 1834(a) of the Social Security Act [subsec. (a) of this section], but only in a form which does not permit identification of individual suppliers.
"(5) The Comptroller General shall conduct a study on the appropriateness of the level of payments allowed for covered items under the medicare program, and shall report to Congress on the results of such study (including recommendations on the transition to regional or national rates) by not later than January 1, 1991. Entities furnishing such items which fail to provide the Comptroller General with reasonable access to necessary records to carry out the study under this paragraph are subject to exclusion from the medicare program under section 1128(a) of the Social Security Act [
Section Referred to in Other Sections
This section is referred to in
1 So in original. The semicolon probably should be a comma.
2 So in original. The closing parenthesis probably should not appear.
3 So in original. Probably should be "clause".
4 So in original. Probably should be "knowingly".
5 So in original. Probably should be "a".
6 So in original. The semicolon probably should be a comma.
§1395n. Procedure for payment of claims of providers of services
(a) Conditions for payment for services described in section 1395k(a)(2) of this title
Except as provided in subsections (b), (c), and (e) of this section, payment for services described in
(1) written request, signed by such individual, except in cases in which the Secretary finds it impracticable for the individual to do so, is filed for such payment in such form, in such manner and by such person or persons as the Secretary may by regulation prescribe, no later than the close of the period of 3 calendar years following the year in which such services are furnished (deeming any services furnished in the last 3 calendar months of any calendar year to have been furnished in the succeeding calendar year) except that, where the Secretary deems that efficient administration so requires, such period may be reduced to not less than 1 calendar year; and
(2) a physician certifies (and recertifies, where such services are furnished over a period of time, in such cases, with such frequency, and accompanied by such supporting material, appropriate to the case involved, as may be provided by regulations) that—
(A) in the case of home health services (i) such services are or were required because the individual is or was confined to his home (except when receiving items and services referred to in
(B) in the case of medical and other health services, except services described in subparagraphs (B), (C), and (D) of
(C) in the case of outpatient physical therapy services or outpatient occupational therapy services, (i) such services are or were required because the individual needed physical therapy services or occupational therapy services, respectively, (ii) a plan for furnishing such services has been established by a physician or by the qualified physical therapist or qualified occupational therapist, respectively, providing such services and is periodically reviewed by a physician, and (iii) such services are or were furnished while the individual is or was under the care of a physician;
(D) in the case of outpatient speech pathology services, (i) such services are or were required because the individual needed speech pathology services, (ii) a plan for furnishing such services has been established by a physician or by the speech pathologist providing such services and is periodically reviewed by a physician, and (iii) such services are or were furnished while the individual is or was under the care of a physician;
(E) in the case of comprehensive outpatient rehabilitation facility services, (i) such services are or were required because the individual needed skilled rehabilitation services, (ii) a plan for furnishing such services has been established and is periodically reviewed by a physician, and (iii) such services are or were furnished while the individual is or was under the care of a physician; and
(F) in the case of partial hospitalization services, (i) the individual would require inpatient psychiatric care in the absence of such services, (ii) an individualized, written plan for furnishing such services has been established by a physician and is reviewed periodically by a physician, and (iii) such services are or were furnished while the individual is or was under the care of a physician.
For purposes of this section, the term "provider of services" shall include a clinic, rehabilitation agency, or public health agency if, in the case of a clinic or rehabilitation agency, such clinic or agency meets the requirements of
To the extent provided by regulations, the certification and recertification requirements of paragraph (2) shall be deemed satisfied where, at a later date, a physician makes a certification of the kind provided in subparagraph (A) or (B) of paragraph (2) (whichever would have applied), but only where such certification is accompanied by such medical and other evidence as may be required by such regulations. With respect to the physician certification required by paragraph (2) for home health services furnished to any individual by a home health agency (other than an agency which is a governmental entity) and with respect to the establishment and review of a plan for such services, the Secretary shall prescribe regulations which shall become effective no later than July 1, 1981, and which prohibit a physician who has a significant ownership interest in, or a significant financial or contractual relationship with, such home health agency from performing such certification and from establishing or reviewing such plan, except that such prohibition shall not apply with respect to a home health agency which is a sole community home health agency (as determined by the Secretary). For purposes of the preceding sentence, service by a physician as an uncompensated officer or director of a home health agency shall not constitute having a significant ownership interest in, or a significant financial or contractual relationship with, such agency. For purposes of paragraph (2)(A), an individual shall be considered to be "confined to his home" if the individual has a condition, due to an illness or injury, that restricts the ability of the individual to leave his or her home except with the assistance of another individual or the aid of a supportive device (such as crutches, a cane, a wheelchair, or a walker), or if the individual has a condition such that leaving his or her home is medically contraindicated. While an individual does not have to be bedridden to be considered "confined to his home", the condition of the individual should be such that there exists a normal inability to leave home, that leaving home requires a considerable and taxing effort by the individual, and that absences of the individual from home are infrequent or of relatively short duration, or are attributable to the need to receive medical treatment.
(b) Conditions for payment for services described in section 1395x(s) of this title
(1) Payment may also be made to any hospital for services described in
(2) Payment may also be made on the basis of an itemized bill to an individual for services described in paragraph (1) of this subsection if (A) payment cannot be made under such paragraph (1) solely because the hospital does not elect, in accordance with
(c) Collection of charges from individuals for services specified in section 1395x(s) of this title
Notwithstanding the provisions of this section and
(d) Payment to Federal provider of services or other Federal agencies prohibited
Subject to
(e) Payment to fund designated by medical staff or faculty of medical school
For purposes of services (1) which are inpatient hospital services by reason of paragraph (7) of
(A) such hospital has an agreement with the Secretary under
(B) the Secretary has received written assurances that (i) such payment will be used by such fund solely for the improvement of care to patients in such hospital or for educational or charitable purposes and (ii) the individuals who were furnished such services or any other persons will not be charged for such services (or if charged provision will be made for return of any moneys incorrectly collected).
(Aug. 14, 1935, ch. 531, title XVIII, §1835, as added July 30, 1965,
Amendments
1990—Subsec. (c).
1989—Subsec. (a)(2)(G), (H).
Subsec. (c).
1988—Subsec. (a)(2)(G).
Subsec. (a)(2)(H).
1987—Subsec. (a).
Subsec. (a)(2)(C)(i).
Subsec. (a)(2)(F).
1986—Subsec. (a)(2).
Subsec. (a)(2)(C).
1984—Subsec. (a).
Subsec. (a)(2)(B), (C).
Subsec. (a)(2)(C)(ii).
Subsec. (a)(2)(D).
Subsec. (e)(2).
1983—Subsec. (e).
1981—Subsec. (a)(2)(A).
Subsec. (a)(2)(D).
Subsec. (a)(2)(E).
1980—Subsec. (a).
Subsec. (a)(2)(A).
Subsec. (a)(2)(D)(ii).
Subsec. (a)(2(E).
1976—Subsec. (d).
1972—Subsec. (a).
Subsec. (a)(1).
Subsec. (a)(2)(C).
Subsec. (a)(2)(D).
Subsec. (c).
Subsec. (e).
1968—Subsec. (a).
Subsec. (a)(2).
Subsec. (a)(2)(B).
Subsec. (a)(2)(C).
Subsec. (b).
Subsec. (c).
Subsec. (d).
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by section 203(d)(1) of
Amendment by section 205(d) of
Effective Date of 1987 Amendment
Amendment by section 4024(b) of
Effective Date of 1986 Amendment
Amendment by
Effective Date of 1984 Amendments
Amendment by
Amendment by section 2336(a) of
Section 2342(c) of
Amendment by section 2354(b)(1), (8), (9) of
Effective Date of 1983 Amendment
Amendment by
Effective Date of 1981 Amendment
Amendment by section 2122(a)(1) of
Effective Date of 1980 Amendment
Amendment by section 930(e), (j) of
Amendment by section 933(b) of
Section 944(b) of
Effective Date of 1972 Amendment
Amendment by section 204(b) of
Amendment by section 227(e)(2) of
Amendment by section 251(b)(2) of
Amendment by section 281(f) of
Section 283(c) of
Effective Date of 1968 Amendment
Amendment by section 126(b) of
Amendment by section 129(c)(9)(A), (B) of
Section 130(c) of
Amendment by section 133(e) of
Regulations
Secretary of Health and Human Services required to provide, not later than 90 days after July 18, 1984, for revision of regulations as may be required to reflect amendment to subsec. (a) by section 2336(b) of
Home Health Prospective Payment Demonstration Project
Section 4027 of
Section Referred to in Other Sections
This section is referred to in
§1395o. Eligible individuals
Every individual who—
(1) is entitled to hospital insurance benefits under part A of this subchapter, or
(2) has attained age 65 and is a resident of the United States, and is either (A) a citizen or (B) an alien lawfully admitted for permanent residence who has resided in the United States continuously during the 5 years immediately preceding the month in which he applies for enrollment under this part,
is eligible to enroll in the insurance program established by this part.
(Aug. 14, 1935, ch. 531, title XVIII, §1836, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in par. (1), is classified to
Amendments
1972—
Persons Convicted of Subversive Activities
Section 104(b)(2) of
Section Referred to in Other Sections
This section is referred to in
§1395p. Enrollment periods
(a) Generally; regulations
An individual may enroll in the insurance program established by this part only in such manner and form as may be prescribed by regulations, and only during an enrollment period prescribed in or under this section.
(b) Repealed. Pub. L. 96–499, title IX, §945(a), Dec. 5, 1980, 94 Stat. 2642
(c) Initial general enrollment period; eligible individuals before March 1, 1966
In the case of individuals who first satisfy paragraph (1) or (2) of
(d) Eligible individuals on or after March 1, 1966
In the case of an individual who first satisfies paragraph (1) or (2) of
(e) General enrollment period
There shall be a general enrollment period during the period beginning on January 1 and ending on March 31 of each year.
(f) Individuals deemed enrolled in medical insurance program
Any individual—
(1) who is eligible under
(2) whose initial enrollment period under subsection (d) of this section begins after March 31, 1973, and
(3) who is residing in the United States, exclusive of Puerto Rico,
shall be deemed to have enrolled in the medical insurance program established by this part.
(g) Commencement of enrollment period
All of the provisions of this section shall apply to individuals satisfying subsection (f) of this section, except that—
(1) in the case of an individual who satisfies subsection (f) of this section by reason of entitlement to disability insurance benefits described in
(2)(A) in the case of an individual who is entitled to monthly benefits under
(B) in the case of an individual who is not entitled to benefits under
(3) in the case of an individual who would otherwise satisfy subsection (f) of this section but does not establish his entitlement to hospital insurance benefits until after the last day of his initial enrollment period (as defined in subsection (d) of this section), his enrollment shall be deemed to have occurred on the first day of the earlier of the then current or immediately succeeding general enrollment period (as defined in subsection (e) of this section).
(h) Waiver of enrollment period requirements where individual's rights were prejudiced by administrative error or inaction
In any case where the Secretary finds that an individual's enrollment or nonenrollment in the insurance program established by this part or part A of this subchapter pursuant to
(i) Special enrollment periods
(1) In the case of an individual who—
(A) at the time the individual first satisfies paragraph (1) or (2) of
(B) has elected not to enroll (or to be deemed enrolled) under this section during the individual's initial enrollment period,
there shall be a special enrollment period described in paragraph (3). In the case of an individual not described in the previous sentence who has not attained the age of 65, at the time the individual first satisfies paragraph (1) of
(2) In the case of an individual who—
(A)(i) has enrolled (or has been deemed to have enrolled) in the medical insurance program established under this part during the individual's initial enrollment period, or (ii) is an individual described in paragraph (1)(A);
(B) has enrolled in such program during any subsequent special enrollment period under this subsection during which the individual was not enrolled in a group health plan described in
(C) has not terminated enrollment under this section at any time at which the individual is not enrolled in such a group health plan by reason of the individual's (or individual's spouse's) current employment status,
there shall be a special enrollment period described in paragraph (3). In the case of an individual not described in the previous sentence who has not attained the age of 65, has enrolled (or has been deemed to have enrolled) in the medical insurance program established under this part during the individual's initial enrollment period, or is an individual described in the second sentence of paragraph (1), has enrolled in such program during any subsequent special enrollment period under this subsection during which the individual was not enrolled in a large group health plan (as that term is defined in
(3)(A) The special enrollment period referred to in the first sentences of paragraphs (1) and (2) is the period including each month during any part of which the individual is enrolled in a group health plan described in
(B) The special enrollment period referred to in the second sentences of paragraphs (1) and (2) is the period including each month during any part of which the individual is enrolled in a large group health plan (as that term is defined in
(Aug. 14, 1935, ch. 531, title XVIII, §1837, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in subsecs. (c) and (h), is classified to
Amendments
1994—Subsec. (i)(1).
Subsec. (i)(1)(A).
Subsec. (i)(2).
Subsec. (i)(2)(B), (C).
Subsec. (i)(3)(A).
Subsec. (i)(3)(B).
1989—Subsec. (i)(1).
Subsec. (i)(2).
Subsec. (i)(3).
1986—Subsec. (i)(1).
Subsec. (i)(1)(A).
Subsec. (i)(2).
Subsec. (i)(2)(A).
Subsec. (i)(2)(B).
Subsec. (i)(2)(C), (D).
Subsec. (i)(3).
1984—Subsec. (g)(1).
Subsec. (i).
1981—Subsec. (e).
Subsec. (g)(3).
1980—Subsec. (b).
Subsec. (e).
Subsec. (g)(1).
Subsec. (g)(3).
1972—Subsec. (b).
Subsec. (c).
Subsec. (d).
Subsecs. (f), (g).
Subsec. (h).
1968—Subsec. (b)(1).
Subsec. (d).
Subsec. (e).
1966—Subsec. (c).
Subsec. (d).
Effective Date of 1994 Amendment
Section 147(f)(1)(C) of
Section 151(c)(2) of
Effective Date of 1989 Amendment
Amendment by section 6202(b)(4)(C) of
Section 6202(c)(3) of
Effective Date of 1986 Amendments
Amendment by
Amendment by
Section 9201(d)(2) of
Section 9219(a)(3)(B) of
"(i) The amendments made by paragraph (2) [amending this section] shall apply to enrollments in months beginning with the first effective month (as defined in clause (ii)), except that in the case of any individual who would have a special enrollment period under section 1837(i) of the Social Security Act [subsec. (i) of this section] that would have begun after November 1984 and before the first effective month, the period shall be deemed to begin with the first day of the first effective month.
"(ii) For purposes of clause (i), the term 'first effective month' means the first month that begins more than 90 days after the date of the enactment of this Act [Apr. 7, 1986]."
Effective Date of 1984 Amendment
Section 2338(d)(2) of
"(A) The amendments made by subsections (b) and (c) [amending this section and
"(B) For purposes of subparagraph (A), the term 'first effective month' means the first month which begins more than 90 days after the date of the enactment of this Act [July 18, 1984]."
Amendment by section 2354(b)(10) of
Effective Date of 1981 Amendment
Section 2151(b) of
Effective Date of 1980 Amendments
Section 945(d) of
Amendment by
Effective Date of 1972 Amendment
Section 259(b) of
Effective Date of 1968 Amendment
Section 136(b) of
Section 145(e) of
Extension Through March 31, 1968 of 1967 General Enrollment Period
Enrollment Before Oct. 1, 1966, of Eligible Individuals Failing for Good Cause To Enroll Before June 1, 1966; Commencement of Coverage Period
Section 102(b) of
"(1) an individual was eligible to enroll under section 1837(c) of the Social Security Act [subsec. (c) of this section] before June 1, 1966, but failed to enroll before such date, and
"(2) it is shown to the satisfaction of the Secretary of Health, Education, and Welfare [now Health and Human Services] that there was good cause for such failure to enroll before June 1, 1966,
such individual may enroll pursuant to this subsection at any time before October 1, 1966. The determination of what constitutes good cause for purposes of the preceding sentence shall be made in accordance with regulations of the Secretary. In the case of any individual who enrolls pursuant to this subsection, the coverage period (within the meaning of section 1838 of the Social Security Act [
Section Referred to in Other Sections
This section is referred to in
§1395q. Coverage period
(a) Commencement
The period during which an individual is entitled to benefits under the insurance program established by this part (hereinafter referred to as his "coverage period") shall begin on whichever of the following is the latest:
(1) July 1, 1966 or (in the case of a disabled individual who has not attained age 65) July 1, 1973; or
(2)(A) in the case of an individual who enrolls pursuant to subsection (d) of
(B) in the case of an individual who enrolls pursuant to such subsection (d) in the month in which he first satisfies such paragraph, the first day of the month following the month in which he so enrolls, or
(C) in the case of an individual who enrolls pursuant to such subsection (d) in the month following the month in which he first satisfies such paragraph, the first day of the second month following the month in which he so enrolls, or
(D) in the case of an individual who enrolls pursuant to such subsection (d) more than one month following the month in which he satisfies such paragraph, the first day of the third month following the month in which he so enrolls, or
(E) in the case of an individual who enrolls pursuant to subsection (e) of
(3)(A) in the case of an individual who is deemed to have enrolled on or before the last day of the third month of his initial enrollment period, the first day of the month in which he first meets the applicable requirements of
(B) in the case of an individual who is deemed to have enrolled on or after the first day of the fourth month of his initial enrollment period, as prescribed under subparagraphs (B), (C), (D), and (E) of paragraph (2) of this subsection.
(b) Continuation
An individual's coverage period shall continue until his enrollment has been terminated—
(1) by the filing of notice that the individual no longer wishes to participate in the insurance program established by this part, or
(2) for nonpayment of premiums.
The termination of a coverage period under paragraph (1) shall (except as otherwise provided in
Where an individual who is deemed to have enrolled for medical insurance pursuant to
(c) Termination
In the case of an individual satisfying paragraph (1) of
(d) Payment of expenses incurred during coverage period
No payments may be made under this part with respect to the expenses of an individual unless such expenses were incurred by such individual during a period which, with respect to him, is a coverage period.
(e) Commencement of coverage for special enrollment periods
Notwithstanding subsection (a) of this section, in the case of an individual who enrolls during a special enrollment period pursuant to
(1) in any month of the special enrollment period in which the individual is at any time enrolled in a plan (specified in subparagraph (A) or (B), as applicable, of
(2) in any other month of the special enrollment period, the coverage period shall begin on the first day of the month following the month in which the individual so enrolls.
(Aug. 14, 1935, ch. 531, title XVIII, §1838, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in subsec. (c), is classified to
Amendments
1994—Subsec. (e).
"(1) in the first month of the special enrollment period, the coverage period shall begin on the first day of that month, or
"(2) in a month after the first month of the special enrollment period, the coverage period shall begin on the first day of the month following the month in which the individual so enrolls."
1986—Subsec. (b).
Subsec. (e).
"(1) subparagraph (A) of
"(A) before the month in which he attains the age of 70, the coverage period shall begin on the first day of the month in which he has attained the age of 70, or
"(B) in or after the month in which he attains the age of 70, the coverage period shall begin on the first day of the month following the month in which he so enrolls; or
"(2) subparagraph (B) of
"(A) in the first month of the special enrollment period, the coverage period shall begin on the first day of such month, or
"(B) in a month after the first month of the special enrollment period, the coverage period shall begin on the first day of the month following the month in which he so enrolls."
1984—Subsec. (e).
1981—Subsec. (a)(2)(E).
Subsec. (b).
1980—Subsec. (a)(2)(E).
Subsec. (b).
1972—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (b).
Subsecs. (c), (d).
1968—Subsec. (b).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1986 Amendments
Section 9344(b)(2) of
Amendment by
Effective Date of 1984 Amendment
For effective date of amendment by
Effective Date of 1981 Amendment
Amendment by section 2106(b)(2) of
Amendment by section 2151(a)(3) of
Effective Date of 1980 Amendment
Amendment by section 945(c)(1) of
Amendment by section 947(b) of
Effective Date of 1972 Amendment
Section 257(b) of
Effective Date of 1968 Amendment
Amendment by
Coverage Period; Termination Dates
"(1) shall terminate at the close of December 31, 1967, if he filed his notice of termination before January 1, 1968, or
"(2) shall terminate at the close of March 31, 1968, if he filed his notice of termination after December 31, 1967, and before April 1, 1968.
An individual whose coverage period terminated pursuant to paragraph (1) at the close of December 31, 1967, may, notwithstanding section 1837(b)(2) of such Act [
Extension of 1967 General Enrollment Period Through March 31, 1968
Extension of the general enrollment period under
Coverage Period for Individuals Becoming Eligible in March 1966 Who Enroll in May 1966
Commencement of Coverage Period of Certain Enrollees
Commencement of coverage period upon enrollment before Oct. 1, 1966 of eligible individuals failing for good cause to enroll before June 1, 1966, see section 102(b) of
Section Referred to in Other Sections
This section is referred to in
§1395r. Amount of premiums for individuals enrolled under this part
(a) Determination of monthly actuarial rates and premiums
(1) The Secretary shall, during September of 1983 and of each year thereafter, determine the monthly actuarial rate for enrollees age 65 and over which shall be applicable for the succeeding calendar year. Such actuarial rate shall be the amount the Secretary estimates to be necessary so that the aggregate amount for such calendar year with respect to those enrollees age 65 and older will equal one-half of the total of the benefits and administrative costs which he estimates will be payable from the Federal Supplementary Medical Insurance Trust Fund for services performed and related administrative costs incurred in such calendar year with respect to such enrollees. In calculating the monthly actuarial rate, the Secretary shall include an appropriate amount for a contingency margin.
(2) The monthly premium of each individual enrolled under this part for each month after December 1983 shall, except as provided in subsections (b) and (e) of this section, be the amount determined under paragraph (3).
(3) The Secretary shall, during September of 1983 and of each year thereafter, determine and promulgate the monthly premium applicable for individuals enrolled under this part for the succeeding calendar year. The monthly premium shall (except as otherwise provided in subsection (e) of this section) be equal to the smaller of—
(A) the monthly actuarial rate for enrollees age 65 and over, determined according to paragraph (1) of this subsection, for that calendar year, or
(B) the monthly premium rate most recently promulgated by the Secretary under this paragraph, increased by a percentage determined as follows: The Secretary shall ascertain the primary insurance amount computed under
Whenever the Secretary promulgates the dollar amount which shall be applicable as the monthly premium for any period, he shall, at the time such promulgation is announced, issue a public statement setting forth the actuarial assumptions and bases employed by him in arriving at the amount of an adequate actuarial rate for enrollees age 65 and older as provided in paragraph (1) and the derivation of the dollar amounts specified in this paragraph.
(4) The Secretary shall also, during September of 1983 and of each year thereafter, determine the monthly actuarial rate for disabled enrollees under age 65 which shall be applicable for the succeeding calendar year. Such actuarial rate shall be the amount the Secretary estimates to be necessary so that the aggregate amount for such calendar year with respect to disabled enrollees under age 65 which will equal one-half of the total of the benefits and administrative costs which he estimates will be payable from the Federal Supplementary Medical Insurance Trust Fund for services performed and related administrative costs incurred in such calendar year with respect to such enrollees. In calculating the monthly actuarial rate under this paragraph, the Secretary shall include an appropriate amount for a contingency margin.
(b) Increase in monthly premium
In the case of an individual whose coverage period began pursuant to an enrollment after his initial enrollment period (determined pursuant to subsection (c) or (d) of
(c) Premiums rounded to nearest multiple of ten cents
If any monthly premium determined under the foregoing provisions of this section is not a multiple of 10 cents, such premium shall be rounded to the nearest multiple of 10 cents.
(d) "Continuous period of eligibility" defined
For purposes of subsection (b) of this section (and
(e) Monthly premium for individuals enrolled for each month after December 1995 and prior to January 1999
(1)(A) Notwithstanding the provisions of subsection (a) of this section, the monthly premium for each individual enrolled under this part for each month after after 1 December 1995 and prior to January 1999 shall be an amount equal to 50 percent of the monthly actuarial rate for enrollees age 65 and over, as determined under subsection (a)(1) of this section and applicable to such month.
(B) Notwithstanding the provisions of subsection (a) of this section, the monthly premium for each individual enrolled under this part for each month in—
(i) 1991 shall be $29.90,
(ii) 1992 shall be $31.80,
(iii) 1993 shall be $36.60,
(iv) 1994 shall be $41.10, and
(v) 1995 shall be $46.10.
(2) Any increases in premium amounts taking effect prior to January 1998 by reason of paragraph (1) shall be taken into account for purposes of determining increases thereafter under subsection (a)(3) of this section.
(f) Limitation on increase in monthly premium
For any calendar year after 1988, if an individual is entitled to monthly benefits under
(g) State payment of part B late enrollment premium increases
(1) Upon the request of a State, the Secretary may enter into an agreement with the State under which the State agrees to pay on a quarterly or other periodic basis to the Secretary (to be deposited in the Treasury to the credit of the Federal Supplementary Medical Insurance Trust Fund) an amount equal to the amount of the part B late enrollment premium increases with respect to the premiums for eligible individuals (as defined in paragraph (3)(A)).
(2) No part B late enrollment premium increase shall apply to an eligible individual for premiums for months for which the amount of such an increase is payable under an agreement under paragraph (1).
(3) In this subsection:
(A) The term "eligible individual" means an individual who is enrolled under this part B and who is within a class of individuals specified in the agreement under paragraph (1).
(B) The term "part B late enrollment premium increase" means any increase in a premium as a result of the application of subsection (b) of this section.
(Aug. 14, 1935, ch. 531, title XVIII, §1839, as added July 30, 1965,
References in Text
The Railroad Retirement Act of 1974, referred to in subsec. (f), is act Aug. 29, 1935, ch. 812, as amended generally by
Amendments
1994—Subsec. (b).
Subsec. (g).
1993—Subsec. (e)(1)(A).
Subsec. (e)(2).
1990—Subsec. (e)(1).
1989—Subsec. (a).
Subsec. (b).
Subsec. (e).
Subsec. (e)(1).
Subsec. (g).
1988—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (a)(4).
Subsec. (b).
Subsec. (e)(1).
Subsec. (f).
Subsec. (g).
Subsec. (g)(1)(B)(iii)(I).
Subsec. (g)(1)(B)(iii)(II).
Subsec. (g)(7)(A)(ii).
1987—Subsec. (e).
Subsec. (f)(1).
Subsec. (f)(2).
1986—Subsec. (b).
Subsec. (e).
Subsec. (f)(1).
Subsec. (f)(2).
Subsec. (f)(2)(A).
1984—Subsec. (b).
Subsec. (e).
Subsec. (f).
Subsec. (f)(2)(A).
1983—Subsec. (a).
Subsec. (b).
Subsec. (c).
Subsec. (d).
Subsec. (e).
Subsec. (e)(1).
Subsec. (e)(2).
Subsecs. (f), (g).
1982—Subsec. (c)(2).
Subsec. (c)(3).
Subsec. (g).
1981—Subsec. (d).
1980—Subsec. (d).
1977—Subsec. (c)(3)(B).
1975—Subsec. (c)(3).
1972—Subsec. (b)(1).
Subsec. (b)(2).
Subsec. (c).
Subsec. (d).
Subsec. (e).
Subsec. (f).
1968—Subsec. (b)(2).
Effective Date of 1994 Amendment
Section 151(c)(3) of
Effective Date of 1989 Amendments
Amendment by section 6202(b)(4)(C) of
Amendment by section 6202(c)(2) of
Amendment by
Effective Date of 1988 Amendments
Amendment by
Section 211(d) of
Effective Date of 1986 Amendments
Amendment by section 9001(c) of
Amendment by section 9319(c)(4) of
Section 9219(a)(3)(A) of
Effective Date of 1984 Amendments
Amendment by
Section 2302(c) of
Section 2338(d)(1) of
Effective Date of 1983 Amendments; Transitional Rule
Section 606(c) of
"(1) the monthly premiums under part A and under part B of title XVIII of the Social Security Act [parts A and B of this subchapter] for individuals enrolled under each respective part shall be the monthly premium under that part for the month of June 1983, and
"(2) the amount of the Government contributions under section 1844(a)(1) of such Act [
Amendment by
Effective Date of 1981 Amendment
Amendment by
Effective Date of 1980 Amendment
Amendment by
Effective Date of 1977 Amendment
Amendment by
Effective Date of 1975 Amendment
Section 104(b) of
Effective Date of 1968 Amendment
Amendment by
Determination of Premium Amounts by Secretary
"(1) the dollar amount applicable for premiums under part B of title XVIII of such Act [this part] for each month before April 1968 shall be $3, and
"(2) the Secretary of Health, Education, and Welfare may determine and promulgate such dollar amount for months after March 1968 and before January 1970 at any time on or before December 31, 1967."
Persons Enrolling Before April 1, 1968, Who Did Not Enroll During Their Initial Enrollment Period
Section Referred to in Other Sections
This section is referred to in
§1395s. Payment of premiums
(a) Deductions from section 402 or 423 monthly benefits
(1) In the case of an individual who is entitled to monthly benefits under
(2) The Secretary of the Treasury shall, from time to time, transfer from the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund to the Federal Supplementary Medical Insurance Trust Fund the aggregate amount deducted under paragraph (1) for the period to which such transfer relates from benefits under
(b) Deductions from railroad retirement annuities or pensions
(1) In the case of an individual who is entitled to receive for a month an annuity under the Railroad Retirement Act of 1974 [
(2) The Secretary of the Treasury shall, from time to time, transfer from the Railroad Retirement Account to the Federal Supplementary Medical Insurance Trust Fund the aggregate amount deducted under paragraph (1) for the period to which such transfer relates. Such transfers shall be made on the basis of a certification by the Railroad Retirement Board and shall be appropriately adjusted to the extent that prior transfers were too great or too small.
(c) Portion of monthly premium in excess of deducted amount
If an individual to whom subsection (a) or (b) of this section applies estimates that the amount which will be available for deduction under such subsection for any premium payment period will be less than the amount of the monthly premiums for such period, he may (under regulations) pay to the Secretary such portion of the monthly premiums for such period as he desires.
(d) Deductions from civil service retirement annuities
(1) In the case of an individual receiving an annuity under subchapter III of
(2) The Secretary of the Treasury shall, from time to time, but not less often than quarterly, transfer from the Civil Service Retirement and Disability Fund, or the account (if any) applicable in the case of such other law administered by the Director of the Office of Personnel Management, to the Federal Supplementary Medical Insurance Trust Fund the aggregate amount deducted under paragraph (1) for the period to which such transfer relates. Such transfer shall be made on the basis of a certification by the Director of the Office of Personnel Management and shall be appropriately adjusted to the extent that prior transfers were too great or too small.
(e) Manner and time of payment prescribed by Secretary
In the case of an individual who participates in the insurance program established by this part but with respect to whom none of the preceding provisions of this section applies, or with respect to whom subsection (c) of this section applies, the premiums shall be paid to the Secretary at such times, and in such manner, as the Secretary shall by regulations prescribe.
(f) Deposit of amounts in Treasury
Amounts paid to the Secretary under subsection (c) or (e) of this section shall be deposited in the Treasury to the credit of the Federal Supplementary Medical Insurance Trust Fund.
(g) Premium payability period
In the case of an individual who participates in the insurance program established by this part, premiums shall be payable for the period commencing with the first month of his coverage period and ending with the month in which he dies or, if earlier, in which his coverage under such program terminates.
(h) Exempted monthly benefits
In the case of an individual who is enrolled under the program established by this part as a member of a coverage group to which an agreement with a State entered into pursuant to
(Aug. 14, 1935, ch. 531, title XVIII, §1840, as added July 30, 1965,
References in Text
The Railroad Retirement Act of 1974, referred to in subsec. (b)(1), is act Aug. 29, 1935, ch. 812, as amended generally by
Amendments
1994—Subsec. (a)(1).
Subsec. (a)(2).
1989—Subsec. (i).
1988—Subsec. (i).
1985—Subsec. (d)(1).
1984—Subsec. (a)(2).
Subsec. (d)(1).
Subsec. (d)(2).
1974—Subsec. (b)(1).
1972—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (b)(1).
Subsec. (c).
Subsec. (d).
Subsec. (e).
Subsec. (f).
Subsec. (g).
Subsecs. (h), (i).
1968—Subsec. (e).
1966—Subsec. (i).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1984 Amendment
Amendment by section 2354(b)(11) of
Amendment by section 2663(j)(2)(F)(ii) of
Effective Date of 1974 Amendment
Amendment by
Effective Date of 1972 Amendment
Section 263(f) of
Section Referred to in Other Sections
This section is referred to in
§1395t. Federal Supplementary Medical Insurance Trust Fund
(a) Creation; deposits; fund transfers
There is hereby created on the books of the Treasury of the United States a trust fund to be known as the "Federal Supplementary Medical Insurance Trust Fund" (hereinafter in this section referred to as the "Trust Fund"). The Trust Fund shall consist of such gifts and bequests as may be made as provided in
(b) Board of Trustees; composition; meetings; duties
With respect to the Trust Fund, there is hereby created a body to be known as the Board of Trustees of the Trust Fund (hereinafter in this section referred to as the "Board of Trustees") composed of the Commissioner of Social Security, the Secretary of the Treasury, the Secretary of Labor, and the Secretary of Health and Human Services, all ex officio, and of two members of the public (both of whom may not be from the same political party), who shall be nominated by the President for a term of four years and subject to confirmation by the Senate. A member of the Board of Trustees serving as a member of the public and nominated and confirmed to fill a vacancy occurring during a term shall be nominated and confirmed only for the remainder of such term. An individual nominated and confirmed as a member of the public may serve in such position after the expiration of such member's term until the earlier of the time at which the member's successor takes office or the time at which a report of the Board is first issued under paragraph (2) after the expiration of the member's term. The Secretary of the Treasury shall be the Managing Trustee of the Board of Trustees (hereinafter in this section referred to as the "Managing Trustee"). The Administrator of the Health Care Financing Administration shall serve as the Secretary of the Board of Trustees. The Board of Trustees shall meet not less frequently than once each calendar year. It shall be the duty of the Board of Trustees to—
(1) Hold the Trust Fund;
(2) Report to the Congress not later than the first day of April of each year on the operation and status of the Trust Fund during the preceding fiscal year and on its expected operation and status during the current fiscal year and the next 2 fiscal years;
(3) Report immediately to the Congress whenever the Board is of the opinion that the amount of the Trust Fund is unduly small; and
(4) Review the general policies followed in managing the Trust Fund, and recommend changes in such policies, including necessary changes in the provisions of law which govern the way in which the Trust Fund is to be managed.
The report provided for in paragraph (2) shall include a statement of the assets of, and the disbursements made from, the Trust Fund during the preceding fiscal year, an estimate of the expected income to, and disbursements to be made from, the Trust Fund during the current fiscal year and each of the next 2 fiscal years, and a statement of the actuarial status of the Trust Fund. Such report shall also include an actuarial opinion by the Chief Actuarial Officer of the Health Care Financing Administration certifying that the techniques and methodologies used are generally accepted within the actuarial profession and that the assumptions and cost estimates used are reasonable. Such report shall be printed as a House document of the session of the Congress to which the report is made. A person serving on the Board of Trustees shall not be considered to be a fiduciary and shall not be personally liable for actions taken in such capacity with respect to the Trust Fund.
(c) Investment of Trust Fund by Managing Trustee
It shall be the duty of the Managing Trustee to invest such portion of the Trust Fund as is not, in his judgment, required to meet current withdrawals. Such investments may be made only in interest-bearing obligations of the United States or in obligations guaranteed as to both principal and interest by the United States. For such purpose such obligations may be acquired (1) on original issue at the issue price, or (2) by purchase of outstanding obligations at the market price. The purposes for which obligations of the United States may be issued under
(d) Authority of Managing Trustee to sell obligations
Any obligations acquired by the Trust Fund (except public-debt obligations issued exclusively to the Trust Fund) may be sold by the Managing Trustee at the market price, and such public-debt obligations may be redeemed at par plus accrued interest.
(e) Interest on or proceeds from sale or redemption of obligations
The interest on, and the proceeds from the sale or redemption of, any obligations held in the Trust Fund shall be credited to and form a part of the Trust Fund.
(f) Transfers to other Funds
There shall be transferred periodically (but not less often than once each fiscal year) to the Trust Fund from the Federal Old-Age and Survivors Insurance Trust Fund and from the Federal Disability Insurance Trust Fund amounts equivalent to the amounts not previously so transferred which the Secretary of Health and Human Services shall have certified as overpayments (other than amounts so certified to the Railroad Retirement Board) pursuant to
(g) Payments from Trust Fund of amounts provided for by this part or with respect to administrative expenses
The Managing Trustee shall pay from time to time from the Trust Fund such amounts as the Secretary of Health and Human Services certifies are necessary to make the payments provided for by this part, and the payments with respect to administrative expenses in accordance with
(h) Payments from Trust Fund of costs incurred by Director of Office of Personnel Management
The Managing Trustee shall pay from time to time from the Trust Fund such amounts as the Secretary of Health and Human Services certifies are necessary to pay the costs incurred by the Director of the Office of Personnel Management in making deductions pursuant to
(i) Payments from Trust Fund of costs incurred by Railroad Retirement Board
The Managing Trustee shall pay from time to time from the Trust Fund such amounts as the Secretary of Health and Human Services certifies are necessary to pay the costs incurred by the Railroad Retirement Board for services performed pursuant to section 1395s(b)(1) and
(Aug. 14, 1935, ch. 531, title XVIII, §1841, as added July 30, 1965,
Amendments
1994—Subsec. (b).
1989—Subsecs. (a), (b).
1988—Subsec. (a).
Subsec. (b).
1986—Subsec. (b).
1984—Subsec. (c).
Subsecs. (f), (g).
Subsec. (h).
Subsec. (i).
1983—Subsec. (b).
1978—Subsec. (b).
1972—Subsec. (a).
Subsec. (h).
Subsec. (i).
1968—Subsec. (b)(2).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1984 Amendment
Amendment by section 2354(b)(2), (11), (12) of
Amendment by section 2663(j)(2)(F)(iii) of
Effective Date of 1983 Amendment
Amendment by sections 154(c) and 341(c) of
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by section 132(e) of
Amendment by section 263(d)(4), (e) of
Disposal of Funds in Federal Hospital Insurance Catastrophic Coverage Reserve Fund
Section 102(c) of
Due Date for 1983 Report on Operation and Status of Trust Fund
Notwithstanding subsec. (b)(2) of this section, the annual report of the Board of Trustees of the Trust Fund required for calendar year 1983 under this section may be filed at any time not later than forty-five days after Apr. 20, 1983, see section 154(d) of
Section Referred to in Other Sections
This section is referred to in
§§1395t–1, 1395t–2. Repealed. Pub. L. 101–234, title II, §202(a), Dec. 13, 1989, 103 Stat. 1981
Section 1395t–1, act Aug. 14, 1935, ch. 531, title XVIII, §1841A, as added July 1, 1988,
Section 1395t–2, act Aug. 14, 1935, ch. 531, title XVIII, §1841B, as added July 1, 1988,
Effective Date of Repeal
Repeal effective Jan. 1, 1990, see section 202(b) of
§1395u. Use of carriers for administration of benefits
(a) Authority of Secretary to enter into contracts with carriers
In order to provide for the administration of the benefits under this part with maximum efficiency and convenience for individuals entitled to benefits under this part and for providers of services and other persons furnishing services to such individuals, and with a view to furthering coordination of the administration of the benefits under part A of this subchapter and under this part, the Secretary is authorized to enter into contracts with carriers, including carriers with which agreements under
(1)(A) make determinations of the rates and amounts of payments required pursuant to this part to be made to providers of services and other persons on a reasonable cost or reasonable charge basis (as may be applicable);
(B) receive, disburse, and account for funds in making such payments; and
(C) make such audits of the records of providers of services as may be necessary to assure that proper payments are made under this part;
(2)(A) determine compliance with the requirements of
(B) assist providers of services and other persons who furnish services for which payment may be made under this part in the development of procedures relating to utilization practices, make studies of the effectiveness of such procedures and methods for their improvement, assist in the application of safeguards against unnecessary utilization of services furnished by providers of services and other persons to individuals entitled to benefits under this part, and provide procedures for and assist in arranging, where necessary, the establishment of groups outside hospitals (meeting the requirements of
(3) serve as a channel of communication of information relating to the administration of this part; and
(4) otherwise assist, in such manner as the contract may provide, in discharging administrative duties necessary to carry out the purposes of this part.
(b) Applicability of competitive bidding provisions; findings as to financial responsibility, etc., of carrier; contractual duties imposed by contract
(1) Contracts with carriers under subsection (a) of this section may be entered into without regard to
(2)(A) No such contract shall be entered into with any carrier unless the Secretary finds that such carrier will perform its obligations under the contract efficiently and effectively and will meet such requirements as to financial responsibility, legal authority, and other matters as he finds pertinent. The Secretary shall publish in the Federal Register standards and criteria for the efficient and effective performance of contract obligations under this section, and opportunity shall be provided for public comment prior to implementation. In establishing such standards and criteria, the Secretary shall provide a system to measure a carrier's performance of responsibilities described in paragraph (3)(H), subsection (h) of this section, and section 1395w–1(e)(2) 1 of this title. The Secretary may not require, as a condition of entering into or renewing a contract under this section or under
(B) The Secretary shall establish standards for evaluating carriers' performance of reviews of initial carrier determinations and of fair hearings under paragraph (3)(C), under which a carrier is expected—
(i) to complete such reviews, within 45 days after the date of a request by an individual enrolled under this part for such a review, in 95 percent of such requests, and
(ii) to make a final determination, within 120 days after the date of receipt of a request by an individual enrolled under this part for a fair hearing under paragraph (3)(C), in 90 percent of such cases.
(C) In the case of residents of nursing facilities who receive services described in clause (i) or (ii) of
(D) In addition to any other standards and criteria established by the Secretary for evaluating carrier performance under this paragraph relating to avoiding erroneous payments, the carrier shall be subject to standards and criteria relating to the carrier's success in recovering payments made under this part for items or services for which payment has been or could be made under a primary plan (as defined in
(3) Each such contract shall provide that the carrier—
(A) will take such action as may be necessary to assure that, where payment under this part for a service is on a cost basis, the cost is reasonable cost (as determined under
(B) will take such action as may be necessary to assure that, where payment under this part for a service is on a charge basis, such charge will be reasonable and not higher than the charge applicable, for a comparable service and under comparable circumstances, to the policyholders and subscribers of the carrier, and such payment will (except as otherwise provided in
(i) on the basis of an itemized bill; or
(ii) on the basis of an assignment under the terms of which (I) the reasonable charge is the full charge for the service, (II) the physician or other person furnishing such service agrees not to charge (and to refund amounts already collected) for services for which payment under this subchapter is denied under
but (in the case of bills submitted, or requests for payment made, after March 1968) only if the bill is submitted, or a written request for payment is made in such other form as may be permitted under regulations, no later than the close of the calendar year following the year in which such service is furnished (deeming any service furnished in the last 3 months of any calendar year to have been furnished in the succeeding calendar year);
(C) will establish and maintain procedures pursuant to which an individual enrolled under this part will be granted an opportunity for a fair hearing by the carrier, in any case where the amount in controversy is at least $100, but less than $500, when requests for payment under this part with respect to services furnished him are denied or are not acted upon with reasonable promptness or when the amount of such payment is in controversy;
(D) will furnish to the Secretary such timely information and reports as he may find necessary in performing his functions under this part;
(E) will maintain such records and afford such access thereto as the Secretary finds necessary to assure the correctness and verification of the information and reports under subparagraph (D) and otherwise to carry out the purposes of this part;
(F) will take such action as may be necessary to assure that where payment under this part for a service rendered is on a charge basis, such payment shall be determined on the basis of the charge that is determined in accordance with this section on the basis of customary and prevailing charge levels in effect at the time the service was rendered or, in the case of services rendered more than 12 months before the year in which the bill is submitted or request for payment is made, on the basis of such levels in effect for the 12-month period preceding such year;
(G) will, for a service that is furnished with respect to an individual enrolled under this part, that is not paid on an assignment-related basis, and that is subject to a limiting charge under
(i) determine, prior to making payment, whether the amount billed for such service exceeds the limiting charge applicable under
(ii) notify the physician, supplier, or other person periodically (but not less often than once every 30 days) of determinations that amounts billed exceeded such applicable limiting charges; and
(iii) provide for prompt response to inquiries of physicians, suppliers, and other persons concerning the accuracy of such limiting charges for their services;
(H) if it makes determinations or payments with respect to physicians' services, will implement—
(i) programs to recruit and retain physicians as participating physicians in the area served by the carrier, including educational and outreach activities and the use of professional relations personnel to handle billing and other problems relating to payment of claims of participating physicians; and
(ii) programs to familiarize beneficiaries with the participating physician program and to assist such beneficiaries in locating participating physicians;
(I) will submit annual reports to the Secretary describing the steps taken to recover payments made under this part for items or services for which payment has been or could be made under a primary plan (as defined in
(J), (K) Repealed.
(L) will monitor and profile physicians' billing patterns within each area or locality and provide comparative data to physicians whose utilization patterns vary significantly from other physicians in the same payment area or locality;
and shall contain such other terms and conditions not inconsistent with this section as the Secretary may find necessary or appropriate. In determining the reasonable charge for services for purposes of this paragraph, there shall be taken into consideration the customary charges for similar services generally made by the physician or other person furnishing such services, as well as the prevailing charges in the locality for similar services. No charge may be determined to be reasonable in the case of bills submitted or requests for payment made under this part after December 31, 1970, if it exceeds the higher of (i) the prevailing charge recognized by the carrier and found acceptable by the Secretary for similar services in the same locality in administering this part on December 31, 1970, or (ii) the prevailing charge level that, on the basis of statistical data and methodology acceptable to the Secretary, would cover 75 percent of the customary charges made for similar services in the same locality during the 12-month period ending on the June 30 last preceding the start of the calendar year in which the service is rendered. In the case of physicians' services the prevailing charge level determined for purposes of clause (ii) of the preceding sentence for any twelve-month period (beginning after June 30, 1973) specified in clause (ii) of such sentence may not exceed (in the aggregate) the level determined under such clause for the fiscal year ending June 30, 1973, or (with respect to physicians' services furnished in a year after 1987) the level determined under this sentence (or under any other provision of law affecting the prevailing charge level) for the previous year except to the extent that the Secretary finds, on the basis of appropriate economic index data, that such higher level is justified by year-to-year economic changes. With respect to power-operated wheelchairs for which payment may be made in accordance with
(4)(A)(i) In determining the prevailing charge levels under the third and fourth sentences of paragraph (3) for physicians' services furnished during the 15-month period beginning July 1, 1984, the Secretary shall not set any level higher than the same level as was set for the 12-month period beginning July 1, 1983.
(ii)(I) In determining the prevailing charge levels under the third and fourth sentences of paragraph (3) for physicians' services furnished during the 8-month period beginning May 1, 1986, by a physician who is not a participating physician (as defined in subsection (h)(1) of this section) at the time of furnishing the services, the Secretary shall not set any level higher than the same level as was set for the 12-month period beginning July 1, 1983.
(II) In determining the prevailing charge levels under the fourth sentence of paragraph (3) for physicians' services furnished during the 8-month period beginning May 1, 1986, by a physician who is a participating physician (as defined in subsection (h)(1) of this section) at the time of furnishing the services, the Secretary shall permit an additional one percentage point increase in the increase otherwise permitted under that sentence.
(iii) In determining the maximum allowable prevailing charges which may be recognized consistent with the index described in the fourth sentence of paragraph (3) for physicians' services furnished on or after January 1, 1987, by participating physicians, the Secretary shall treat the maximum allowable prevailing charges recognized as of December 31, 1986, under such sentence with respect to participating physicians as having been justified by economic changes.
(iv) The reasonable charge for physicians' services furnished on or after January 1, 1987, and before January 1, 1992, by a nonparticipating physician shall be no greater than the applicable percent of the prevailing charge levels established under the third and fourth sentences of paragraph (3) (or under any other applicable provision of law affecting the prevailing charge level). In the previous sentence, the term "applicable percent" means for services furnished (I) on or after January 1, 1987, and before April 1, 1988, 96 percent, (II) on or after April 1, 1988, and before January 1, 1989, 95.5 percent, and (III) on or after January 1, 1989, 95 percent.
(v) In determining the prevailing charge levels under the third and fourth sentences of paragraph (3) for physicians' services furnished during the 3-month period beginning January 1, 1988, the Secretary shall not set any level higher than the same level as was set for the 12-month period beginning January 1, 1987.
(vi) Before each year (beginning with 1989), the Secretary shall establish a prevailing charge floor for primary care services (as defined in subsection (i)(4) of this section) equal to 60 percent of the estimated average prevailing charge levels based on the best available data (determined, under the third and fourth sentences of paragraph (3) and under paragraph (4), without regard to this clause and without regard to physician specialty) for such service for all localities in the United States (weighted by the relative frequency of the service in each locality) for the year.
(vii) Beginning with 1987, the percentage increase in the MEI (as defined in subsection (i)(3) of this section) for each year shall be the same for nonparticipating physicians as for participating physicians.
(B)(i) In determining the reasonable charge under paragraph (3) for physicians' services furnished during the 15-month period beginning July 1, 1984, the customary charges shall be the same customary charges as were recognized under this section for the 12-month period beginning July 1, 1983.
(ii) In determining the reasonable charge under paragraph (3) for physicians' services furnished during the 8-month period beginning May 1, 1986, by a physician who is not a participating physician (as defined in subsection (h)(1) of this section) at the time of furnishing the services—
(I) if the physician was not a participating physician at any time during the 12-month period beginning on October 1, 1984, the customary charges shall be the same customary charges as were recognized under this section for the 12-month period beginning July 1, 1983, and
(II) if the physician was a participating physician at any time during the 12-month period beginning on October 1, 1984, the physician's customary charges shall be determined based upon the physician's actual charges billed during the 12-month period ending on March 31, 1985.
(iii) In determining the reasonable charge under paragraph (3) for physicians' services furnished during the 3-month period beginning January 1, 1988, the customary charges shall be the same customary charges as were recognized under this section for the 12-month period beginning January 1, 1987.
(iv) In determining the reasonable charge under paragraph (3) for physicians' services (other than primary care services, as defined in subsection (i)(4) of this section) furnished during 1991, the customary charges shall be the same customary charges as were recognized under this section for the 9-month period beginning April 1, 1990. In a case in which subparagraph (F) applies (relating to new physicians) so as to limit the customary charges of a physician during 1990 to a percent of prevailing charges, the previous sentence shall not prevent such limit on customary charges under such subparagraph from increasing in 1991 to a higher percent of such prevailing charges.
(C) In determining the prevailing charge levels under the third and fourth sentences of paragraph (3) for physicians' services furnished during periods beginning after September 30, 1985, the Secretary shall treat the level as set under subparagraph (A)(i) as having fully provided for the economic changes which would have been taken into account but for the limitations contained in subparagraph (A)(i).
(D)(i) In determining the customary charges for physicians' services furnished during the 8-month period beginning May 1, 1986, or the 12-month period beginning January 1, 1987, by a physician who was not a participating physician (as defined in subsection (h)(1) of this section) on September 30, 1985, the Secretary shall not recognize increases in actual charges for services furnished during the 15-month period beginning on July 1, 1984, above the level of the physician's actual charges billed in the 3-month period ending on June 30, 1984.
(ii) In determining the customary charges for physicians' services furnished during the 12-month period beginning January 1, 1987, by a physician who is not a participating physician (as defined in subsection (h)(1) of this section) on April 30, 1986, the Secretary shall not recognize increases in actual charges for services furnished during the 7-month period beginning on October 1, 1985, above the level of the physician's actual charges billed during the 3-month period ending on June 30, 1984.
(iii) In determining the customary charges for physicians' services furnished during the 12-month period beginning January 1, 1987, or January 1, 1988, by a physician who is not a participating physician (as defined in subsection (h)(1) of this section) on December 31, 1986, the Secretary shall not recognize increases in actual charges for services furnished during the 8-month period beginning on May 1, 1986, above the level of the physician's actual charges billed during the 3-month period ending on June 30, 1984.
(iv) In determining the customary charges for a physicians' service furnished on or after January 1, 1988, if a physician was a nonparticipating physician in a previous year (beginning with 1987), the Secretary shall not recognize any amount of such actual charges (for that service furnished during such previous year) that exceeds the maximum allowable actual charge for such service established under subsection (j)(1)(C) of this section.
(E)(i) For purposes of this part for physicians' services furnished in 1987, the percentage increase in the MEI is 3.2 percent.
(ii) For purposes of this part for physicians' services furnished in 1988, on or after April 1, the percentage increase in the MEI is—
(I) 3.6 percent for primary care services (as defined in subsection (i)(4) of this section), and
(II) 1 percent for other physicians' services.
(iii) For purposes of this part for physicians' services furnished in 1989, the percentage increase in the MEI is—
(I) 3.0 percent for primary care services, and
(II) 1 percent for other physicians' services.
(iv) For purposes of this part for items and services furnished in 1990, after March 31, 1990, the percentage increase in the MEI is—
(I) 0 percent for radiology services, for anesthesia services, and for other services specified in the list referred to in paragraph (14)(C)(i),
(II) 2 percent for other services (other than primary care services), and
(III) such percentage increase in the MEI (as defined in subsection (i)(3) of this section) as would be otherwise determined for primary care services (as defined in subsection (i)(4) of this section).
(v) For purposes of this part for items and services furnished in 1991, the percentage increase in the MEI is—
(I) 0 percent for services (other than primary care services), and
(II) 2 percent for primary care services (as defined in subsection (i)(4) of this section).
(5) Each contract under this section shall be for a term of at least one year, and may be made automatically renewable from term to term in the absence of notice by either party of intention to terminate at the end of the current term; except that the Secretary may terminate any such contract at any time (after such reasonable notice and opportunity for hearing to the carrier involved as he may provide in regulations) if he finds that the carrier has failed substantially to carry out the contract or is carrying out the contract in a manner inconsistent with the efficient and effective administration of the insurance program established by this part.
(6) No payment under this part for a service provided to any individual shall (except as provided in
(7)(A) In the case of physicians' services furnished to a patient in a hospital with a teaching program approved as specified in
(i) unless—
(I) the physician renders sufficient personal and identifiable physicians' services to the patient to exercise full, personal control over the management of the portion of the case for which the payment is sought,
(II) the services are of the same character as the services the physician furnishes to patients not entitled to benefits under this subchapter, and
(III) at least 25 percent of the hospital's patients (during a representative past period, as determined by the Secretary) who were not entitled to benefits under this subchapter and who were furnished services described in subclauses (I) and (II) paid all or a substantial part of charges (other than nominal charges) imposed for such services; and
(ii) to the extent that the payment is based upon a reasonable charge for the services in excess of the customary charge as determined in accordance with subparagraph (B).
(B) The customary charge for such services in a hospital shall be determined in accordance with regulations issued by the Secretary and taking into account the following factors:
(i) In the case of a physician who is not a teaching physician (as defined by the Secretary), the carrier shall take into account the amounts the physician charges for similar services in the physician's practice outside the teaching setting.
(ii) In the case of a teaching physician, if the hospital, its physicians, or other appropriate billing entity has established one or more schedules of charges which are collected for medical and surgical services, the carrier shall base payment under this subchapter on the greatest of—
(I) the charges (other than nominal charges) which are most frequently collected in full or substantial part with respect to patients who were not entitled to benefits under this subchapter and who were furnished services described in subclauses (I) and (II) of subparagraph (A)(i),
(II) the mean of the charges (other than nominal charges) which were collected in full or substantial part with respect to such patients, or
(III) 85 percent of the prevailing charges paid for similar services in the same locality.
(iii) If all the teaching physicians in a hospital agree to have payment made for all of their physicians' services under this part furnished to patients in such hospital on an assignment-related basis, the customary charge for such services shall be equal to 90 percent of the prevailing charges paid for similar services in the same locality.
(C) In the case of physicians' services furnished to a patient in a hospital with a teaching program approved as specified in
(D)(i) In the case of physicians' services furnished to a patient in a hospital with a teaching program approved as specified in
(I) are required due to exceptional medical circumstances,
(II) are performed by team physicians needed to perform complex medical procedures, or
(III) constitute concurrent medical care relating to a medical condition which requires the presence of, and active care by, a physician of another specialty during surgery,
and under such other circumstances as the Secretary determines by regulation to be appropriate.
(ii) For purposes of this subparagraph, the term "assistant at surgery" means a physician who actively assists the physician in charge of a case in performing a surgical procedure.
(iii) The Secretary shall determine appropriate methods of reimbursement of assistants at surgery where such services are reimbursable under this part.
(8)(A) The Secretary by regulation shall—
(i) describe the factors to be used in determining the cases (of particular items or services) in which the application of this subsection results in the determination of a reasonable charge that, by reason of its grossly excessive or grossly deficient amount, is not inherently reasonable, and
(ii) provide in those cases for the factors that will be considered in establishing a reasonable charge that is realistic and equitable.
(B)(i) The Secretary may provide for an increase or decrease in the reasonable charge otherwise recognized under this section with respect to a specific physicians' service only in accordance with the criteria set forth in subparagraph (A) and with the succeeding provisions of this paragraph.
(ii) The factors described pursuant to subparagraph (A)(i) with respect to payment for physicians' services shall include, but need not be limited to, the following:
(I) Prevailing charges for a service in a particular locality are significantly in excess of or below prevailing charges in other comparable localities, taking into account the relative costs of furnishing the services in the different localities.
(II) The programs established under this subchapter and subchapter XIX of this chapter are the sole or primary sources of payment for a service.
(III) The marketplace for a service is not truly competitive because of a limited number of physicians who perform that service.
(IV) There have been increases in charges for a service that cannot be explained by inflation or technology.
(V) The charges do not reflect changing technology, increased facility with that technology, or reductions in acquisition or production costs.
(VI) The prevailing charges for a service under this part are substantially higher or lower than the payments made for the service by other purchasers in the same locality.
(iii) In applying subparagraph (A), the Secretary may compare—
(I) the charges and resource costs for related procedures,
(II) charges and resource costs for the procedure over a period of time,
(III) charges for a procedure in different geographic areas, and
(IV) the charges and allowed payments for a procedure under this part and by other payors.
(iv) The factors considered under subparagraph (A)(ii) shall take into account regional differences in fees, unless there is substantial economic justification for a uniform fee or a uniform payment limit. Such substantial economic justification must be explained by the Secretary in the notice and final determination required by paragraph (9).
(v) An adjustment under clause (i) on the basis of a comparison of the prevailing charges in different localities may be made only if the Secretary determines that the prevailing charge allowed in one locality is out of line with prevailing charges allowed in other localities after accounting for differences in practice costs.
(vi) In this subparagraph, "resource costs" include factors such as the time required to provide a procedure (including pre-procedure evaluation and post-procedure follow-up), the complexity of the procedure, the training required to perform the procedure, and the risk involved in the procedure.
(C) In determining whether to adjust payment rates under subparagraph (B)(i), the Secretary shall consider the potential impacts on quality, access, and beneficiary liability of the adjustment, including the likely effects on assignment rates, reasonable charge reductions on unassigned claims, and participation rates of physicians.
(9)(A) In the case of any physicians' service with respect to which the Secretary—
(i) determines, after appropriate consultation with representatives of the physicians likely to be affected by any change in the reasonable charge, that the application of this subsection results in the determination of a reasonable charge that, by reason of its grossly excessive or grossly deficient amount, is not inherently reasonable, and
(ii) proposes to establish a reasonable charge that is realistic and equitable or a methodology for arriving at such a charge,
the Secretary shall publish notice of such proposal in the Federal Register.
(B) A notice required by subparagraph (A) shall—
(i) specify the charge or methodology proposed to be established with respect to a service and shall explain the factors and data that the Secretary took into account in determining the charge or methodology so specified, and
(ii) explain the potential impacts described in paragraph (8)(C).
(C) After publication of the notice required by subparagraph (A), the Secretary shall allow not less than 60 days for public comment on the proposal.
(D) In addition to carrying out its functions under
(E)(i) Taking into consideration the comments made by the Commission and the public, the Secretary shall publish in the Federal Register a final determination with respect to the reasonable charge or methodology to be established with respect to the service.
(ii) A final determination published pursuant to clause (i) shall explain the factors and data that the Secretary took into consideration in making the final determination, and shall include and respond to the comments made by the Commission pursuant to subparagraph (D).
(10)(A)(i) In determining the reasonable charge for procedures described in subparagraph (B) and performed during the 9-month period beginning on April 1, 1988, the prevailing charge for such procedure shall be the prevailing charge otherwise recognized for such procedure for 1987—
(I) subject to clause (iii), reduced by 2.0 percent, and
(II) further reduced by the applicable percentage specified in clause (ii).
(ii) For purposes of clause (i), the applicable percentage specified in this clause is—
(I) 15 percent, in the case of a prevailing charge otherwise recognized (without regard to this paragraph and determined without regard to physician specialty) that is at least 150 percent of the weighted national average (as determined by the Secretary) of such prevailing charges for such procedure for all localities in the United States for 1987;
(II) 0 percent, in the case of a prevailing charge that does not exceed 85 percent of such weighted national average; and
(III) in the case of any other prevailing charge, a percent determined on the basis of a straight-line sliding scale, equal to 3/13 of a percentage point for each percent by which the prevailing charge exceeds 85 percent of such weighted national average.
(iii) In no case shall the reduction under clause (i) for a procedure result in a prevailing charge in a locality for 1988 which is less than 85 percent of the Secretary's estimate of the weighted national average of such prevailing charges for such procedure for all localities in the United States for 1987 (based upon the best available data and determined without regard to physician specialty) after making the reduction described in clause (i)(I).
(B) The procedures described in this subparagraph are as follows: bronchoscopy, carpal tunnel repair, cataract surgery (including subsequent insertion of an intraocular lens), coronary artery bypass surgery, diagnostic and/or therapeutic dilation and curettage, knee arthroscopy, knee arthroplasty, pacemaker implantation surgery, total hip replacement, suprapubic prostatectomy, transurethral resection of the prostate, and upper gastrointestinal endoscopy.
(C) In the case of a reduction in the reasonable charge for a physicians' service under subparagraph (A), if a nonparticipating physician furnishes the service to an individual entitled to benefits under this part, after the effective date of such reduction, the physician's actual charge is subject to a limit under subsection (j)(1)(D) of this section.
(D) There shall be no administrative or judicial review under
(11)(A) In providing payment for cataract eyeglasses and cataract contact lenses, and professional services relating to them, under this part, each carrier shall—
(i) provide for separate determinations of the payment amount for the eyeglasses and lenses and of the payment amount for the professional services of a physician (as defined in
(ii) not recognize as reasonable for such eyeglasses and lenses more than such amount as the Secretary establishes in guidelines relating to the inherent reasonableness of charges for such eyeglasses and lenses.
(B)(i) In determining the reasonable charge under paragraph (3) for a cataract surgical procedure, subject to clause (ii), the prevailing charge for such procedure otherwise recognized for participating and nonparticipating physicians shall be reduced by 10 percent with respect to procedures performed in 1987.
(ii) In no case shall the reduction under clause (i) for a surgical procedure result in a prevailing charge in a locality for a year which is less than 75 percent of the weighted national average of such prevailing charges for such procedure for all the localities in the United States for 1986.
(C)(i) The prevailing charge level determined with respect to A-mode ophthalmic ultrasound procedures may not exceed 5 percent of the prevailing charge level established with respect to extracapsular cataract removal with lens insertion.
(ii) The reasonable charge for an intraocular lens inserted during or subsequent to cataract surgery in a physician's office may not exceed the actual acquisition cost for the lens (taking into account any discount) plus a handling fee (not to exceed 5 percent of such actual acquisition cost).
(D) In the case of a reduction in the reasonable charge for a physicians' service or item under subparagraph (B) or (C), if a nonparticipating physician furnishes the service or item to an individual entitled to benefits under this part after the effective date of such reduction, the physician's actual charge is subject to a limit under subsection (j)(1)(D) of this section.
(12)(A) With respect to services described in clauses 3 (i), (ii), or (iv) of
(i) payment under this part may only be made on an assignment-related basis; and
(ii) the prevailing charges determined under paragraph (3) shall not exceed—
(I) in the case of services performed as an assistant at surgery, 65 percent of the amount that would otherwise be recognized if performed by a physician who is serving as an assistant at surgery, or
(II) in other cases, the applicable percentage (as defined in subparagraph (B)) of the prevailing charge rate determined for such services (or, for services furnished on or after January 1, 1992, the fee schedule amount specified in
(B) In subparagraph (A)(ii)(II), the term "applicable percentage" means—
(i) 75 percent in the case of services performed (other than as an assistant at surgery) in a hospital, and
(ii) 85 percent in the case of other services.
(13)(A) In determining payments under
(B) The Secretary shall require claims for physicians' services for medical direction of nurse anesthetists during the periods in which the provisions of subparagraph (A) apply to indicate the number of such anesthetists being medically directed concurrently at any time during the procedure, the name of each nurse anesthetist being directed, and the type of procedure for which the services are provided.
(14)(A)(i) In determining the reasonable charge for a physicians' service specified in subparagraph (C)(i) and furnished during the 9-month period beginning on April 1, 1990, the prevailing charge for such service shall be the prevailing charge otherwise recognized for such service for 1989 reduced by 15 percent or, if less, 1/3 of the percent (if any) by which the prevailing charge otherwise applied in the locality in 1989 exceeds the locally-adjusted reduced prevailing amount (as determined under subparagraph (B)(i)) for the service.
(ii) In determining the reasonable charge for a physicians' service specified in subparagraph (C)(i) and furnished during 1991, the prevailing charge for such service shall be the prevailing charge otherwise recognized for such service for the period during 1990 beginning on April 1, reduced by the same amount as the amount of the reduction effected under this paragraph (as amended by the Omnibus Budget Reconciliation Act of 1990) for such service during such period.
(B) For purposes of this paragraph:
(i) The "locally-adjusted reduced prevailing amount" for a locality for a physicians' service is equal to the product of—
(I) the reduced national weighted average prevailing charge for the service (specified under clause (ii)), and
(II) the adjustment factor (specified under clause (iii)) for the locality.
(ii) The "reduced national weighted average prevailing charge" for a physicians' service is equal to the national weighted average prevailing charge for the service (specified in subparagraph (C)(ii)) reduced by the percentage change (specified in subparagraph (C)(iii)) for the service.
(iii) The "adjustment factor", for a physicians' service for a locality, is the sum of—
(I) the practice expense component (percent), divided by 100, specified in appendix A (pages 187 through 194) of the Report of the Medicare and Medicaid Health Budget Reconciliation Amendments of 1989, prepared by the Subcommittee on Health and the Environment of the Committee on Energy and Commerce, House of Representatives, (Committee Print 101–M, 101st Congress, 1st Session) for the service, multiplied by the geographic practice cost index value (specified in subparagraph (C)(iv)) for the locality, and
(II) 1 minus the practice expense component (percent), divided by 100.
(C) For purposes of this paragraph:
(i) The physicians' services specified in this clause are the procedures specified (by code and description) in the Overvalued Procedures List for Finance Committee, Revised September 20, 1989, prepared by the Physician Payment Review Commission which specification is of physicians' services that have been identified as overvalued by at least 10 percent based on a comparison of payments for such services under a resource-based relative value scale and of the national average prevailing charges under this part.
(ii) The "national weighted average prevailing charge" specified in this clause, for a physicians' service specified in clause (i), is the national weighted average prevailing charge for the service in 1989 as determined by the Secretary using the best data available.
(iii) The "percentage change" specified in this clause, for a physicians' service specified in clause (i), is the percent difference (but expressed as a positive number) specified for the service in the list referred to in clause (i).
(iv) The geographic practice cost index value specified in this clause for a locality is the Geographic Overhead Costs Index specified for the locality in table 1 of the September 1989 Supplement to the Geographic Medicare Economic Index: Alternative Approaches (prepared by the Urban Institute and the Center for Health Economics Research).
(D) In the case of a reduction in the prevailing charge for a physicians' service under subparagraph (A), if a nonparticipating physician furnishes the service to an individual entitled to benefits under this part, after the effective date of such reduction, the physician's actual charge is subject to a limit under subsection (j)(1)(D) of this section.
(15)(A) In determining the reasonable charge for surgery, radiology, and diagnostic physicians' services which the Secretary shall designate (based on their high volume of expenditures under this part) and for which the prevailing charge (but for this paragraph) differs by physician specialty, the prevailing charge for such a service may not exceed the prevailing charge or fee schedule amount for that specialty of physicians that furnish the service most frequently nationally.
(B) In the case of a reduction in the prevailing charge for a physician's service under subparagraph (A), if a nonparticipating physician furnishes the service to an individual entitled to benefits under this part, after the effective date of the reduction, the physician's actual charge is subject to a limit under subsection (j)(1)(D) of this section.
(16)(A) In determining the reasonable charge for all physicians' services other than physicians' services specified in subparagraph (B) furnished during 1991, the prevailing charge for a locality shall be 6.5 percent below the prevailing charges used in the locality under this part in 1990 after March 31.
(B) For purposes of subparagraph (A), the physicians' services specified in this subparagraph are as follows:
(i) Radiology, anesthesia and physician pathology services, the technical components of diagnostic tests specified in paragraph (17) and physicians' services specified in paragraph (14)(C)(i).
(ii) Primary care services specified in subsection (i)(4) of this section, hospital inpatient medical services, consultations, other visits, preventive medicine visits, psychiatric services, emergency care facility services, and critical care services.
(iii) Partial mastectomy; tendon sheath injections and small joint arthrocentesis; femoral fracture and trochanteric fracture treatments; endotracheal intubation; thoracentesis; thoracostomy; aneurysm repair; cystourethroscopy; transurethral fulguration and resection; tympanoplasty with mastoidectomy; and ophthalmoscopy.
(17) With respect to payment under this part for the technical (as distinct from professional) component of diagnostic tests (other than clinical diagnostic laboratory tests, tests specified in paragraph (14)(C)(i), and radiology services, including portable x-ray services) which the Secretary shall designate (based on their high volume of expenditures under this part), the reasonable charge for such technical component (including the applicable portion of a global service) may not exceed the national median of such charges for all localities, as estimated by the Secretary using the best available data.
(18)(A) Payment for any service furnished by a practitioner described in subparagraph (C) and for which payment may be made under this part on a reasonable charge or fee schedule basis may only be made under this part on an assignment-related basis.
(B) A practitioner described in subparagraph (C) or other person may not bill (or collect any amount from) the individual or another person for any service described in subparagraph (A), except for deductible and coinsurance amounts applicable under this part. No person is liable for payment of any amounts billed for such a service in violation of the previous sentence. If a practitioner or other person knowingly and willfully bills (or collects an amount) for such a service in violation of such sentence, the Secretary may apply sanctions against the practitioner or other person in the same manner as the Secretary may apply sanctions against a physician in accordance with subsection (j)(2) of this section in the same manner as such section applies with respect to a physician. Paragraph (4) of subsection (j) of this section shall apply in this subparagraph in the same manner as such paragraph applies to such section.
(C) A practitioner described in this subparagraph is any of the following:
(i) A physician assistant, nurse practitioner, or clinical nurse specialist (as defined in
(ii) A certified registered nurse anesthetist (as defined in
(iii) A certified nurse-midwife (as defined in
(iv) A clinical social worker (as defined in
(v) A clinical psychologist (as defined by the Secretary for purposes of
(D) For purposes of this paragraph, a service furnished by a practitioner described in subparagraph (C) includes any services and supplies furnished as incident to the service as would otherwise be covered under this part if furnished by a physician or as incident to a physician's service.
(c) Advances of funds to carrier; prompt payment of claims
(1) Any contract entered into with a carrier under this section shall provide for advances of funds to the carrier for the making of payments by it under this part, and shall provide for payment of the cost of administration of the carrier, as determined by the Secretary to be necessary and proper for carrying out the functions covered by the contract. The Secretary shall provide that in determining a carrier's necessary and proper cost of administration, the Secretary shall, with respect to each contract, take into account the amount that is reasonable and adequate to meet the costs which must be incurred by an efficiently and economically operated carrier in carrying out the terms of its contract. The Secretary shall cause to have published in the Federal Register, by not later than September 1 before each fiscal year, data, standards, and methodology to be used to establish budgets for carriers under this section for that fiscal year, and shall cause to be published in the Federal Register for public comment, at least 90 days before such data, standards, and methodology are published, the data, standards, and methodology proposed to be used.
(2)(A) Each contract under this section which provides for the disbursement of funds, as described in subsection (a)(1)(B) of this section, shall provide that payment shall be issued, mailed, or otherwise transmitted with respect to not less than 95 percent of all claims submitted under this part—
(i) which are clean claims, and
(ii) for which payment is not made on a periodic interim payment basis,
within the applicable number of calendar days after the date on which the claim is received.
(B) In this paragraph:
(i) The term "clean claim" means a claim that has no defect or impropriety (including any lack of any required substantiating documentation) or particular circumstance requiring special treatment that prevents timely payment from being made on the claim under this part.
(ii) The term "applicable number of calendar days" means—
(I) with respect to claims received in the 12-month period beginning October 1, 1986, 30 calendar days,
(II) with respect to claims received in the 12-month period beginning October 1, 1987, 26 calendar days (or 19 calendar days with respect to claims submitted by participating physicians),
(III) with respect to claims received in the 12-month period beginning October 1, 1988, 25 calendar days (or 18 calendar days with respect to claims submitted by participating physicians), and 5
(IV) with respect to claims received in the 12-month period beginning October 1, 1989, and claims received in any succeeding 12-month period ending on or before September 30, 1993, 24 calendar days (or 17 calendar days with respect to claims submitted by participating physicians).6
(V) with respect to claims received in the 12-month period beginning October 1, 1993, and claims received in any succeeding 12-month period, 30 calendar days.
(C) If payment is not issued, mailed, or otherwise transmitted within the applicable number of calendar days (as defined in clause (ii) of subparagraph (B)) after a clean claim (as defined in clause (i) of such subparagraph) is received, interest shall be paid at the rate used for purposes of
(3)(A) Each contract under this section which provides for the disbursement of funds, as described in subsection (a)(1)(B) of this section, shall provide that no payment shall be issued, mailed, or otherwise transmitted with respect to any claim submitted under this subchapter within the applicable number of calendar days after the date on which the claim is received.
(B) In this paragraph, the term "applicable number of calendar days" means—
(i) with respect to claims submitted electronically as prescribed by the Secretary, 13 days, and
(ii) with respect to claims submitted otherwise, 26 days.
(4) Neither a carrier nor the Secretary may impose a fee under this subchapter—
(A) for the filing of claims related to physicians' services,
(B) for an error in filing a claim relating to physicians' services or for such a claim which is denied,
(C) for any appeal under this subchapter with respect to physicians' services,
(D) for applying for (or obtaining) a unique identifier under subsection (r) of this section, or
(E) for responding to inquiries respecting physicians' services or for providing information with respect to medical review of such services.
(5) Each contract under this section which provides for the disbursement of funds, as described in subsection (a)(1)(B) of this section, shall require the carrier to meet criteria developed by the Secretary to measure the timeliness of carrier responses to requests for payment of items described in
(d) Surety bonds
Any contract with a carrier under this section may require such carrier or any of its officers or employees certifying payments or disbursing funds pursuant to the contract, or otherwise participating in carrying out the contract, to give surety bond to the United States in such amount as the Secretary may deem appropriate.
(e) Liability of certifying or disbursing officers or carriers
(1) No individual designated pursuant to a contract under this section as a certifying officer shall, in the absence of gross negligence or intent to defraud the United States, be liable with respect to any payments certified by him under this section.
(2) No disbursing officer shall, in the absence of gross negligence or intent to defraud the United States, be liable with respect to any payment by him under this section if it was based upon a voucher signed by a certifying officer designated as provided in paragraph (1) of this subsection.
(3) No such carrier shall be liable to the United States for any payments referred to in paragraph (1) or (2).
(f) "Carrier" defined
For purposes of this part, the term "carrier" means—
(1) with respect to providers of services and other persons, a voluntary association, corporation, partnership, or other nongovernmental organization which is lawfully engaged in providing, paying for, or reimbursing the cost of, health services under group insurance policies or contracts, medical or hospital service agreements, membership or subscription contracts, or similar group arrangements, in consideration of premiums or other periodic charges payable to the carrier, including a health benefits plan duly sponsored or underwritten by an employee organization; and
(2) with respect to providers of services only, any agency or organization (not described in paragraph (1)) with which an agreement is in effect under
(g) Authority of Railroad Retirement Board to enter into contracts with carriers
The Railroad Retirement Board shall, in accordance with such regulations as the Secretary may prescribe, contract with a carrier or carriers to perform the functions set out in this section with respect to individuals entitled to benefits as qualified railroad retirement beneficiaries pursuant to
(h) Participating physician or supplier; agreement with Secretary; publication of directories; availability; inclusion of program in explanation of benefits; payment of claims on assignment-related basis
(1) Any physician or supplier may voluntarily enter into an agreement with the Secretary to become a participating physician or supplier. For purposes of this section, the term "participating physician or supplier" means a physician or supplier (excluding any provider of services) who, before the beginning of any year beginning with 1984, enters into an agreement with the Secretary which provides that such physician or supplier will accept payment under this part on an assignment-related basis for all items and services furnished to individuals enrolled under this part during such year. In the case of a newly licensed physician or a physician who begins a practice in a new area, or in the case of a new supplier who begins a new business, or in such similar cases as the Secretary may specify, such physician or supplier may enter into such an agreement after the beginning of a year, for items and services furnished during the remainder of the year.
(2) Each carrier having an agreement with the Secretary under subsection (a) of this section shall maintain a toll-free telephone number or numbers at which individuals enrolled under this part may obtain the names, addresses, specialty, and telephone numbers of participating physicians and suppliers and may request a copy of an appropriate directory published under paragraph (4). Each such carrier shall, without charge, mail a copy of such directory upon such a request.
(3)(A) In any case in which a carrier having an agreement with the Secretary under subsection (a) of this section is able to develop a system for the electronic transmission to such carrier of bills for services, such carrier shall establish direct lines for the electronic receipt of claims from participating physicians and suppliers.
(B) The Secretary shall establish a procedure whereby an individual enrolled under this part may assign, in an appropriate manner on the form claiming a benefit under this part for an item or service furnished by a participating physician or supplier, the individual's rights of payment under a medicare supplemental policy (described in
(4) At the beginning of each year the Secretary shall publish directories (for appropriate local geographic areas) containing the name, address, and specialty of all participating physicians and suppliers (as defined in paragraph (1)) for that area for that year. Each directory shall be organized to make the most useful presentation of the information (as determined by the Secretary) for individuals enrolled under this part. Each participating physician directory for an area shall provide an alphabetical listing of all participating physicians practicing in the area and an alphabetical listing by locality and specialty of such physicians.
(5)(A) The Secretary shall promptly notify individuals enrolled under this part through an annual mailing of the participation program under this subsection and the publication and availability of the directories and shall make the appropriate area directory or directories available in each district and branch office of the Social Security Administration, in the offices of carriers, and to senior citizen organizations.
(B) The annual notice provided under subparagraph (A) shall include—
(i) a description of the participation program,
(ii) an explanation of the advantages to beneficiaries of obtaining covered services through a participating physician or supplier,
(iii) an explanation of the assistance offered by carriers in obtaining the names of participating physicians and suppliers, and
(iv) the toll-free telephone number under paragraph (2)(A) for inquiries concerning the program and for requests for free copies of appropriate directories.
(6) The Secretary shall provide that the directories shall be available for purchase by the public. The Secretary shall provide that each appropriate area directory is sent to each participating physician located in that area and that an appropriate number of copies of each such directory is sent to hospitals located in the area. Such copies shall be sent free of charge.
(7) The Secretary shall provide that each explanation of benefits provided under this part for services furnished in the United States, in conjunction with the payment of claims under
(A) a prominent reminder of the participating physician and supplier program established under this subsection (including the limitation on charges that may be imposed by such physicians and suppliers and a clear statement of any amounts charged for the particular items or services on the claim involved above the amount recognized under this part),
(B) the toll-free telephone number or numbers, maintained under paragraph (2), at which an individual enrolled under this part may obtain information on participating physicians and suppliers,
(C)(i) an offer of assistance to such an individual in obtaining the names of participating physicians of appropriate specialty and (ii) an offer to provide a free copy of the appropriate participating physician directory; and
(D) in the case of services for which the billed amount exceeds the limiting charge imposed under
(i) Definitions
For purposes of this subchapter:
(1) A claim is considered to be paid on an "assignment-related basis" if the claim is paid on the basis of an assignment described in subsection (b)(3)(B)(ii) of this section, in accordance with subsection (b)(6)(B) of this section, or under the procedure described in
(2) The term "participating physician" refers, with respect to the furnishing of services, to a physician who at the time of furnishing the services is a participating physician (under subsection (h)(1) of this section); the term "nonparticipating physician" refers, with respect to the furnishing of services, a 7 physician who at the time of furnishing the services is not a participating physician; and the term "nonparticipating supplier or other person" means a supplier or other person (excluding a provider of services) that is not a participating physician or supplier (as defined in subsection (h)(1) of this section).
(3) The term "percentage increase in the MEI" means, with respect to physicians' services furnished in a year, the percentage increase in the medicare economic index (referred to in the fourth sentence of subsection (b)(3) of this section) applicable to such services furnished as of the first day of that year.
(4) The term "primary care services" means physicians' services which constitute office medical services, emergency department services, home medical services, skilled nursing, intermediate care, and long-term care medical services, or nursing home, boarding home, domiciliary, or custodial care medical services.
(j) Monitoring of charges of nonparticipating physicians; sanctions; restitution
(1)(A) In the case of a physician who is not a participating physician for items and services furnished during a portion of the 30-month period beginning July 1, 1984, the Secretary shall monitor the physician's actual charges to individuals enrolled under this part for physicians' services during that portion of that period. If such physician knowingly and willfully bills individuals enrolled under this part for actual charges in excess of such physician's actual charges for the calendar quarter beginning on April 1, 1984, the Secretary may apply sanctions against such physician in accordance with paragraph (2).
(B)(i) During any period (on or after January 1, 1987, and before the date specified in clause (ii)), during which a physician is a nonparticipating physician, the Secretary shall monitor the actual charges of each such physician for physicians' services furnished to individuals enrolled under this part. If such physician knowingly and willfully bills on a repeated basis for such a service an actual charge in excess of the maximum allowable actual charge determined under subparagraph (C) for that service, the Secretary may apply sanctions against such physician in accordance with paragraph (2).
(ii) Clause (i) shall not apply to services furnished after December 31, 1990.
(C)(i) For a particular physicians' service furnished by a nonparticipating physician to individuals enrolled under this part during a year, for purposes of subparagraph (B), the maximum allowable actual charge is determined as follows: If the physician's maximum allowable actual charge for that service in the previous year was—
(I) less than 115 percent of the applicable percent (as defined in subsection (b)(4)(A)(iv) of this section) of the prevailing charge for the year and service involved, the maximum allowable actual charge for the year involved is the greater of the maximum allowable actual charge described in subclause (II) or the charge described in clause (ii), or
(II) equal to, or greater than, 115 percent of the applicable percent (as defined in subsection (b)(4)(A)(iv) of this section) of the prevailing charge for the year and service involved, the maximum allowable actual charge is 101 percent of the physician's maximum allowable actual charge for the service for the previous year.
(ii) For purposes of clause (i)(I), the charge described in this clause for a particular physicians' service furnished in a year is the maximum allowable actual charge for the service of the physician for the previous year plus the product of (I) the applicable fraction (as defined in clause (iii)) and (II) the amount by which 115 percent of the prevailing charge for the year involved for such service furnished by nonparticipating physicians, exceeds the physician's maximum allowable actual charge for the service for the previous year.
(iii) In clause (ii), the "applicable fraction" is—
(I) for 1987, ¼,
(II) for 1988, 1/3,
(III) for 1989, ½, and
(IV) for any subsequent year, 1.
(iv) For purposes of determining the maximum allowable actual charge under clauses (i) and (ii) for 1987, in the case of a physicians' service for which the physician has actual charges for the calendar quarter beginning on April 1, 1984, the "maximum allowable actual charge" for 1986 is the physician's actual charge for such service furnished during such quarter.
(v) For purposes of determining the maximum allowable actual charge under clauses (i) and (ii) for a year after 1986, in the case of a physicians' service for which the physician has no actual charges for the calendar quarter beginning on April 1, 1984, and for which a maximum allowable actual charge has not been previously established under this clause, the "maximum allowable actual charge" for the previous year shall be the 50th percentile of the customary charges for the service (weighted by frequency of the service) performed by nonparticipating physicians in the locality during the 12-month period ending June 30 of that previous year.
(vi) For purposes of this subparagraph, a "physician's actual charge" for a physicians' service furnished in a year or other period is the weighted average (or, at the option of the Secretary for a service furnished in the calendar quarter beginning April 1, 1984, the median) of the physician's charges for such service furnished in the year or other period.
(vii) In the case of a nonparticipating physician who was a participating physician during a previous period, for the purpose of computing the physician's maximum allowable actual charge during the physician's period of nonparticipation, the physician shall be deemed to have had a maximum allowable actual charge during the period of participation, and such deemed maximum allowable actual charge shall be determined according to clauses (i) through (vi).
(viii) Notwithstanding any other provision of this subparagraph, the maximum allowable actual charge for a particular physician's service furnished by a nonparticipating physician to individuals enrolled under this part during the 3-month period beginning on January 1, 1988, shall be the amount determined under this subparagraph for 1987. The maximum allowable actual charge for any such service otherwise determined under this subparagraph for 1988 shall take effect on April 1, 1988.
(ix) If there is a reduction under subsection (b)(13) of this section in the reasonable charge for medical direction furnished by a nonparticipating physician, the maximum allowable actual charge otherwise permitted under this subsection for such services shall be reduced in the same manner and in the same percentage as the reduction in such reasonable charge.
(D)(i) If an action described in clause (ii) results in a reduction in a reasonable charge for a physicians' service or item and a nonparticipating physician furnishes the service or item to an individual entitled to benefits under this part after the effective date of such action, the physician may not charge the individual more than 125 percent of the reduced payment allowance (as defined in clause (iii)) plus (for services or items furnished during the 12-month period (or 9-month period in the case of an action described in clause (ii)(II)) beginning on the effective date of the action) ½ of the amount by which the physician's maximum allowable actual charge for the service or item for the previous 12-month period exceeds such 125 percent level.
(ii) The first sentence of clause (i) shall apply to—
(I) an adjustment under subsection (b)(8)(B) of this section (relating to inherent reasonableness),
(II) a reduction under subsection (b)(10)(A) or (b)(14)(A) of this section (relating to certain overpriced procedures),
(III) a reduction under subsection (b)(11)(B) of this section (relating to certain cataract procedures),
(IV) a prevailing charge limit established under subsection (b)(11)(C)(i) or (b)(15)(A) of this section,
(V) a reasonable charge limit established under subsection (b)(11)(C)(ii) of this section, and
(VI) an adjustment under
(iii) In clause (i), the term "reduced payment allowance" means, with respect to an action—
(I) under subsection (b)(8)(B) of this section, the inherently reasonable charge established under subsection (b)(8) of this section;
(II) under subsection (b)(10)(A), (b)(11)(B), (b)(11)(C)(i), (b)(14)(A), or (b)(15)(A) of this section or under
(III) under subsection (b)(11)(C)(ii) of this section, the payment allowance established under such subsection.
(iv) If a physician knowingly and willfully bills in violation of clause (i) (whether or not such charge violates subparagraph (B)), the Secretary may apply sanctions against such physician in accordance with paragraph (2).
(v) Clause (i) shall not apply to items and services furnished after December 31, 1990.
(2) Subject to paragraph (3), the sanctions which the Secretary may apply under this paragraph are—
(A) excluding a physician from participation in the programs under this chapter for a period not to exceed 5 years, in accordance with the procedures of subsections (c), (f), and (g) of
(B) civil monetary penalties and assessments, in the same manner as such penalties and assessments are authorized under
or both. The provisions of
(3)(A) The Secretary may not exclude a physician pursuant to paragraph (2)(A) if such physician is a sole community physician or sole source of essential specialized services in a community.
(B) The Secretary shall take into account access of beneficiaries to physicians' services for which payment may be made under this part in determining whether to bar a physician from participation under paragraph (2)(A).
(4) The Secretary may, out of any civil monetary penalty or assessment collected from a physician pursuant to this subsection, make a payment to a beneficiary enrolled under this part in the nature of restitution for amounts paid by such beneficiary to such physician which was determined to be an excess charge under paragraph (1).
(k) Sanctions for billing for services of assistant at cataract operations
(1) If a physician knowingly and willfully presents or causes to be presented a claim or bills an individual enrolled under this part for charges for services as an assistant at surgery for which payment may not be made by reason of
(2) If a physician knowingly and willfully presents or causes to be presented a claim or bills an individual enrolled under this part for charges that includes a charge for an assistant at surgery for which payment may not be made by reason of
(l) Prohibition of unassigned billing of services determined to be medically unnecessary by carrier
(1)(A) Subject to subparagraph (C), if—
(i) a nonparticipating physician furnishes services to an individual enrolled for benefits under this part,
(ii) payment for such services is not accepted on an assignment-related basis,
(iii)(I) a carrier determines under this part or a peer review organization determines under part B of subchapter XI of this chapter that payment may not be made by reason of
(iv) the physician has collected any amounts for such services,
the physician shall refund on a timely basis to the individual (and shall be liable to the individual for) any amounts so collected.
(B) A refund under subparagraph (A) is considered to be on a timely basis only if—
(i) in the case of a physician who does not request reconsideration or seek appeal on a timely basis, the refund is made within 30 days after the date the physician receives a denial notice under paragraph (2), or
(ii) in the case in which such a reconsideration or appeal is taken, the refund is made within 15 days after the date the physician receives notice of an adverse determination on reconsideration or appeal.
(C) Subparagraph (A) shall not apply to the furnishing of a service by a physician to an individual in the case described in subparagraph (A)(iii)(I) if—
(i) the physician establishes that the physician did not know and could not reasonably have been expected to know that payment may not be made for the service by reason of
(ii) before the service was provided, the individual was informed that payment under this part may not be made for the specific service and the individual has agreed to pay for that service.
(2) Each carrier with a contract in effect under this section with respect to physicians and each peer review organization with a contract under part B of subchapter XI of this chapter shall send any notice of denial of payment for physicians' services based on
(3) If a physician knowingly and willfully fails to make refunds in violation of paragraph (1)(A), the Secretary may apply sanctions against such physician in accordance with subsection (j)(2) of this section.
(m) Disclosure of information of unassigned claims for certain physicians' services
(1) In the case of a nonparticipating physician who—
(A) performs an elective surgical procedure for an individual enrolled for benefits under this part and for which the physician's actual charge is at least $500, and
(B) does not accept payment for such procedure on an assignment-related basis,
the physician must disclose to the individual, in writing and in a form approved by the Secretary, the physician's estimated actual charge for the procedure, the estimated approved charge under this part for the procedure, the excess of the physician's actual charge over the approved charge, and the coinsurance amount applicable to the procedure. The written estimate may not be used as the basis for, or evidence in, a civil suit.
(2) A physician who fails to make a disclosure required under paragraph (1) with respect to a procedure shall refund on a timely basis to the individual (and shall be liable to the individual for) any amounts collected for the procedure in excess of the charges recognized and approved under this part.
(3) If a physician knowingly and willfully fails to comply with paragraph (2), the Secretary may apply sanctions against such physician in accordance with subsection (j)(2) of this section.
(4) The Secretary shall provide for such monitoring of requests for payment for physicians' services to which paragraph (1) applies as is necessary to assure compliance with paragraph (2).
(n) Elimination of markup for certain purchased services
(1) If a physician's bill or a request for payment for services billed by a physician includes a charge for a diagnostic test described in
(A) If the bill or request for payment indicates that the test was performed by a supplier, identifies the supplier, and indicates the amount the supplier charged the billing physician, payment for the test (less the applicable deductible and coinsurance amounts) shall be the actual acquisition costs (net of any discounts) or, if lower, the supplier's reasonable charge (or other applicable limit) for the test.
(B) If the bill or request for payment (i) does not indicate who performed the test, or (ii) indicates that the test was performed by a supplier but does not identify the supplier or include the amount charged by the supplier, no payment shall be made under this part.
(2) A physician may not bill an individual enrolled under this part—
(A) any amount other than the payment amount specified in paragraph (1)(A) and any applicable deductible and coinsurance for a diagnostic test for which payment is made pursuant to paragraph (1)(A), or
(B) any amount for a diagnostic test for which payment may not be made pursuant to paragraph (1)(B).
(3) If a physician knowingly and willfully in repeated cases bills one or more individuals in violation of paragraph (2), the Secretary may apply sanctions against such physician in accordance with subsection (j)(2) of this section.
(o) Repealed. Pub. L. 101–234, title II, §201(a), Dec. 13, 1989, 103 Stat. 1981
(p) Requiring submission of diagnostic information
(1) Each request for payment, or bill submitted, for an item or service furnished by a physician for which payment may be made under this part shall include the appropriate diagnosis code (or codes) as established by the Secretary for such item or service.
(2) In the case of a request for payment for an item or service furnished by a physician on an assignment-related basis which does not include the code (or codes) required under paragraph (1), payment may be denied under this part.
(3) In the case of a request for payment for an item or service furnished by a physician not submitted on an assignment-related basis and which does not include the code (or codes) required under paragraph (1)—
(A) if the physician knowingly and willfully fails to provide the code (or codes) promptly upon request of the Secretary or a carrier, the physician may be subject to a civil money penalty in an amount not to exceed $2,000, and
(B) if the physician knowingly, willfully, and in repeated cases fails, after being notified by the Secretary of the obligations and requirements of this subsection, to include the code (or codes) required under paragraph (1), the physician may be subject to the sanction described in subsection (j)(2)(A) of this section.
The provisions of
(q) Anesthesia services; counting actual time units
(1)(A) The Secretary, in consultation with groups representing physicians who furnish anesthesia services, shall establish by regulation a relative value guide for use in all carrier localities in making payment for physician anesthesia services furnished under this part. Such guide shall be designed so as to result in expenditures under this subchapter for such services in an amount that would not exceed the amount of such expenditures which would otherwise occur.
(B) For physician anesthesia services furnished under this part during 1991, the prevailing charge conversion factor used in a locality under this subsection shall, subject to clause (iv), be reduced to the adjusted prevailing charge conversion factor for the locality determined as follows:
(i) The Secretary shall estimate the national weighted average of the prevailing charge conversion factors used under this subsection for services furnished during 1990 after March 31, using the best available data.
(ii) The national weighted average estimated under clause (i) shall be reduced by 7 percent.
(iii) The adjusted prevailing charge conversion factor for a locality is the sum of—
(I) the product of (a) the portion of the reduced national weighted average prevailing charge conversion factor computed under clause (ii) which is attributable to physician work and (b) the geographic work index value for the locality (specified in Addendum C to the Model Fee Schedule for Physician Services (published on September 4, 1990, 55 Federal Register pp. 36238–36243)); and
(II) the product of (a) the remaining portion of the reduced national weighted average prevailing charge conversion factor computed under clause (ii) and (b) the geographic practice cost index value specified in subsection (b)(14)(C)(iv) of this section for the locality.
In applying this clause, 70 percent of the prevailing charge conversion factor shall be considered to be attributable to physician work.
(iv) The prevailing charge conversion factor to be applied to a locality under this subparagraph shall not be reduced by more than 15 percent below the prevailing charge conversion factor applied in the locality for the period during 1990 after March 31, but in no case shall the prevailing charge conversion factor be less than 60 percent of the national weighted average of the prevailing charge conversion factors (computed under clause (i)).
(2) For purposes of payment for anesthesia services (whether furnished by physicians or by certified registered nurse anesthetists) under this part, the time units shall be counted based on actual time rather than rounded to full time units.
(r) Establishment of physician identification system
The Secretary shall establish a system which provides for a unique identifier for each physician who furnishes services for which payment may be made under this subchapter.
(Aug. 14, 1935, ch. 531, title XVIII, §1842, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in subsec. (a), is classified to
The Omnibus Budget Reconciliation Act of 1990, referred to in subsec. (b)(14)(A)(ii), is
Part B of subchapter XI of this chapter, referred to in subsec. (l)(1)(A)(iii), (2), is classified to
Amendments
1994—Subsec. (b)(2)(A).
Subsec. (b)(2)(D).
Subsec. (b)(3)(G).
Subsec. (b)(3)(H).
Subsec. (b)(3)(I).
Subsec. (b)(6)(D).
Subsec. (b)(12)(C).
Subsec. (b)(16)(B)(iii).
Subsec. (b)(17).
Subsec. (b)(18).
Subsec. (c)(1).
Subsec. (c)(4).
Subsec. (c)(5).
Subsec. (h)(7)(C).
Subsec. (h)(7)(D).
Subsec. (q)(1).
Subsec. (q)(1)(B).
Subsec. (q)(1)(B)(iii).
1993—Subsec. (b)(4)(F).
Subsec. (b)(13)(A).
"(i) 10 percent, in the case of medical direction of 2 nurse anesthetists concurrently,
"(ii) 25 percent, in the case of medical direction of 3 nurse anesthetists concurrently, and
"(iii) 40 percent, in the case of medical direction of 4 nurse anesthetists concurrently."
Subsec. (b)(13)(B), (C).
Subsec. (c)(2)(B)(ii).
Subsec. (c)(3)(B).
"(i) with respect to claims received in the 3-month period beginning July 1, 1988, 10 days, and
"(ii) with respect to claims received in the 12-month period beginning October 1, 1988, 14 days."
Subsec. (i)(2).
1990—Subsec. (b)(2)(A).
Subsec. (b)(3)(G).
Subsec. (b)(4)(A)(vi).
Subsec. (b)(4)(B)(iv).
Subsec. (b)(4)(E)(iv)(I).
Subsec. (b)(4)(E)(v).
Subsec. (b)(4)(F).
Subsec. (b)(4)(F)(i).
Subsec. (b)(4)(F)(ii)(II).
Subsec. (b)(6)(C).
Subsec. (b)(6)(D).
Subsec. (b)(12)(A).
Subsec. (b)(12)(A)(ii)(II).
Subsec. (b)(12)(C).
Subsec. (b)(13)(A), (B).
Subsec. (b)(14)(A).
Subsec. (b)(14)(B)(iii)(I).
Subsec. (b)(14)(B)(iii)(II).
Subsec. (b)(14)(C)(i).
Subsec. (b)(14)(C)(iii).
Subsec. (b)(14)(C)(iv).
Subsec. (b)(16).
Subsec. (b)(18).
Subsec. (q)(1).
Subsec. (r).
1989—Subsec. (b)(2)(A).
Subsec. (b)(2)(C).
Subsec. (b)(3)(G).
Subsec. (b)(3)(I) to (K).
Subsec. (b)(3)(L).
Subsec. (b)(4)(A)(iv).
Subsec. (b)(4)(E)(iv).
Subsec. (b)(4)(F).
Subsec. (b)(6)(A)(ii).
Subsec. (b)(6)(C).
Subsec. (b)(12)(A).
Subsec. (b)(12)(A)(ii)(II).
Subsec. (b)(14).
Subsec. (b)(15).
Subsecs. (c)(1)(A), (2)(A), (3)(A), (4), (f)(3), (h)(1), (2), (4).
Subsec. (j)(1)(B)(ii).
Subsec. (j)(1)(C)(vii).
Subsec. (j)(1)(D)(ii)(II).
Subsec. (j)(1)(D)(ii)(IV).
Subsec. (j)(1)(D)(iii)(II).
Subsec. (j)(1)(D)(v).
Subsec. (j)(2).
Subsec. (o).
Subsec. (q).
1988—Subsec. (b)(2).
Subsec. (b)(2)(A).
Subsec. (b)(3).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(I).
Subsec. (b)(3)(J).
Subsec. (b)(3)(K).
Subsec. (b)(4)(A)(iv).
Subsec. (b)(4)(A)(iv)(II).
Subsec. (b)(4)(A)(vi).
Subsec. (b)(4)(A)(vii).
Subsec. (b)(4)(E).
Subsec. (b)(4)(F).
Subsec. (b)(4)(F)(ii)(I).
Subsec. (b)(4)(F)(iii).
Subsec. (b)(4)(G).
Subsec. (b)(7)(B)(iii).
Subsec. (b)(10)(A)(i).
Subsec. (b)(10)(A)(iii).
Subsec. (b)(10)(B).
Subsec. (b)(10)(D).
Subsec. (b)(11)(B)(i).
Subsec. (b)(11)(C)(i).
Subsec. (b)(11)(C)(ii).
Subsec. (b)(12)(C).
Subsec. (b)(13), (14).
Subsec. (c)(1)(A).
Subsec. (c)(1)(A)(ii).
Subsec. (c)(2)(A), (3)(A).
Subsec. (c)(4).
Subsec. (f)(3).
Subsec. (h)(1).
Subsec. (h)(2).
Subsec. (h)(3)(B).
Subsec. (h)(4).
Subsec. (h)(5).
Subsec. (h)(7).
Subsec. (h)(8).
Subsec. (i).
Subsec. (i)(2), (3).
Subsec. (i)(3).
Subsec. (i)(4).
Subsec. (j)(1)(C)(i).
Subsec. (j)(1)(C)(viii).
Subsec. (j)(1)(C)(ix).
Subsec. (j)(1)(D)(ii)(IV).
Subsec. (j)(1)(D)(ii)(V).
Subsec. (j)(1)(D)(iii).
Subsec. (j)(1)(D)(iv).
Subsec. (j)(2).
Subsec. (l)(1)(C)(i).
Subsec. (n)(1).
Subsec. (n)(1)(A).
Subsec. (n)(2)(A).
Subsec. (n)(3).
Subsec. (o).
Subsec. (o)(1)(A)(i).
Subsec. (o)(1)(B)(ii).
Subsec. (p).
1987—Subsec. (b)(2).
Subsec. (b)(3).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(C).
Subsec. (b)(4)(A)(iv).
Subsec. (b)(4)(A)(v).
Subsec. (b)(4)(A)(vi).
Subsec. (b)(4)(A)(vii).
Subsec. (b)(4)(B)(iii).
Subsec. (b)(4)(E).
Subsec. (b)(4)(F).
Subsec. (b)(4)(G).
Subsec. (b)(7)(B)(iii).
Subsec. (b)(10).
Subsec. (b)(11)(B)(i).
Subsec. (b)(11)(C).
"(ii) In clause (i), the term 'limiting charge' means, with respect to a service, 125 percent of the prevailing charge for the service after the reduction referred to in clause (i).
"(iii) If a physician knowingly and willfully imposes charges in violation of clause (i), the Secretary may apply sanctions against such physician in accordance with subsection (j)(2) of this section.
"(iv) This subparagraph shall not apply to services furnished after the earlier of (I) December 31, 1990, or (II) one-year after the date the Secretary reports to Congress, under
Subsec. (b)(11)(D).
Subsec. (b)(12)(C).
Subsec. (b)(14).
Subsec. (c)(1).
Subsec. (c)(3).
Subsec. (h)(3).
Subsec. (h)(5).
Subsec. (h)(7).
Subsec. (h)(8).
Subsec. (i).
Subsec. (i)(2), (3).
Subsec. (i)(4).
Subsec. (j)(1)(B)(i).
Subsec. (j)(1)(C)(i).
Subsec. (j)(1)(C)(v).
Subsec. (j)(1)(C)(vi).
Subsec. (j)(1)(C)(vii).
Subsec. (j)(1)(C)(viii).
Subsec. (j)(1)(C)(ix).
Subsec. (j)(1)(D).
Subsec. (j)(1)(D)(ii)(IV).
Subsec. (j)(1)(D)(ii)(V), (VI).
Subsec. (j)(1)(D)(iii).
Subsec. (j)(2).
Subsec. (j)(3)(A).
Subsec. (k)(1), (2).
Subsec. (l)(1)(A)(iii).
Subsec. (l)(1)(C).
Subsec. (l)(1)(C)(i).
Subsec. (n).
1986—Subsec. (b)(3).
Subsec. (b)(3)(C).
Subsec. (b)(3)(F).
Subsec. (b)(3)(G).
Subsec. (b)(3)(H).
Subsec. (b)(4)(A)(i), (ii).
Subsec. (b)(4)(A)(iii).
Subsec. (b)(4)(A)(iv), (v).
Subsec. (b)(4)(B).
Subsec. (b)(4)(C).
Subsec. (b)(4)(D)(i) to (iii).
Subsec. (b)(4)(D)(iv).
Subsec. (b)(4)(E).
Subsec. (b)(6).
Subsec. (b)(7)(B)(ii)(III).
Subsec. (b)(7)(B)(iii).
Subsec. (b)(8).
Subsec. (b)(9).
Subsec. (b)(10).
Subsec. (b)(11).
Subsec. (b)(12).
Subsec. (c).
Subsec. (h)(1).
Subsec. (h)(2).
Subsec. (h)(4).
Subsec. (h)(5).
Subsec. (h)(6).
Subsec. (h)(7), (8).
Subsec. (i)(1).
Subsec. (i)(2).
Subsec. (i)(3).
Subsec. (i)(4).
Subsec. (j)(1).
Subsec. (j)(2).
Subsec. (k).
Subsec. (l).
Subsec. (m).
1984—Subsec. (b)(2).
Subsec. (b)(3).
Subsec. (b)(3)(B)(ii)(II).
Subsec. (b)(3)(F).
Subsec. (b)(4), (5).
Subsec. (b)(6).
Subsec. (b)(7).
Subsec. (b)(7)(A).
Subsec. (b)(7)(A)(ii).
Subsec. (b)(7)(B)(i).
Subsec. (b)(7)(B)(ii).
Subsec. (b)(7)(B)(ii)(III).
Subsec. (b)(7)(B)(iii).
Subsec. (c).
Subsec. (h).
Subsecs. (i), (j).
1982—Subsec. (b)(3)(B)(ii)(II).
Subsec. (b)(3).
Subsec. (b)(6)(D).
1981—Subsec. (b)(3).
1980—Subsec. (b)(3).
Subsec. (b)(3)(F).
Subsec. (b)(6).
Subsec. (h).
1977—Subsec. (b)(3).
Subsec. (b)(5).
1976—Subsec. (b)(3).
1975—Subsec. (b)(3).
1974—Subsec. (g).
1972—Subsec. (a).
Subsec. (b)(3).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(C).
Subsec. (b)(5).
Subsec. (g).
1968—Subsec. (b)(3)(B).
Change of Name
Committee on Energy and Commerce of House of Representatives changed to Committee on Commerce of House of Representatives by House Resolution No. 6, One Hundred Fourth Congress, Jan. 4, 1995.
Effective Date of 1994 Amendment
Amendment by section 123(b)(1), (2)(B) of
Section 123(f)(3), (4) of
"(3)
"(4)
Section 125(b)(2) of
Amendment by section 126(a)(1), (c), (e), (g)(9) of
Section 126(h)(2) of
Section 135(b)(2) of
Amendment by section 151(b)(1)(B), (2)(B) of
Effective Date of 1993 Amendment
Section 13515(d) of
Amendment by section 13568(a), (b) of
Effective Date of 1990 Amendment
Section 4105(b)(3) of
Section 4106(d) of
"(1) The amendments made by subsection (a) [amending this section and provisions set out below] apply to services furnished after 1990, except that—
"(A) the provisions concerning the third and fourth years of practice apply only to physicians' services furnished after 1990 and 1991, respectively, and
"(B) the provisions concerning the second, third, and fourth years of practice apply only to services of a health care practitioner furnished after 1991, 1992, and 1993, respectively.
"(2) The amendments made by subsection (b) [amending this section and
Section 4108(b) of
Section 4110(b) of
Section 4118(a)(3) of
Section 4118(f)(2)(A) of
Section 4118(f)(2)(B) of
Amendment by section 4155(c) of
Effective Date of 1989 Amendments
Section 6102(e)(3) of
Section 6106(b) of
Section 6108(a)(2) of
"(A) Subject to subparagraph (B), the amendments made by paragraph (1) [amending this section] apply to services furnished in 1990 or 1991 which were subject to the first sentence of section 1842(b)(4)(F) of the Social Security Act [subsec. (b)(4)(F) of this section] in 1989 or 1990.
"(B) The amendments made by paragraph (1) shall not apply to services furnished in 1990 before April 1, 1990. With respect to physicians' services furnished during 1990 on and after April 1, such amendments shall be applied as though any reference, in the matter inserted by such amendments, to the 'first calendar year during which the preceding sentence no longer applies' were deemed a reference to the remainder of 1990."
Section 6108(b)(3) of
Section 6114(f) of
Amendment by section 6202(d)(2) of
Amendment by section 201(a) of
Section 301(e) of
"(1) the repeal of section 421 of MCCA [
"(2) the amendments made by subsection (b) [amending this section and
Effective Date of 1988 Amendments
Amendment by
Section 202(m) of
"(1) [Repealed. Prior to repeal by
"(2) [Repealed. Prior to repeal by
"(3) [Repealed. Prior to repeal by
"(4)
"(5) [Repealed. Prior to repeal by
[Amendment of section 202(m) of
Section 223(d)(2), (3) of
"(2) The amendments made by subsection (b) [amending this section] shall apply to annual notices beginning with 1989.
"(3) The amendments made by subsection (c) [amending this section] shall first apply to explanations of benefits provided for items and services furnished on or after January 1, 1989."
Except as specifically provided in section 411 of
Effective Date of 1987 Amendments
Amendment by section 4031(a)(2) of
Amendment by section 4035(a)(2) of
Section 4044(b) of
Section 4045(d) of
Section 4046(b) of
Section 4047(b) of
Section 4051(c) of
"(1) The amendment made by subsection (a) [amending this section] shall apply to diagnostic tests performed on or after April 1, 1988.
"(2) The Secretary of Health and Human Services shall complete the review and make an appropriate adjustment of prevailing charge levels under subsection (b) [set out below] for items and services furnished no later than January 1, 1989."
Section 4053(b), formerly §4052(b), of
Section 4054(c), formerly §4053(c), of
Amendment by section 4063(a) of
Section 4081(c)(1) of
Section 4082(e)(3) of
Section 4085(g)(2) of
Section 4085(i)(7) of
Amendment by section 4096(a)(1) of
Amendment by
Effective Date of 1986 Amendments
Section 1895(b)(16)(B) of
Amendment by section 1895(b)(14)(A), (15) of
Section 9307(c)(2) of
Amendment by section 9311(c) of
Amendment by section 9320(e)(3) of
Section 9331(a)(4) of
Section 9331(b)(4) of
Section 9331(c)(3)(B) of
Section 9332(a)(4)(A) of
Section 9332(b)(3) of
Section 9332(c)(2) of
Section 9332(d)(2) of
Section 9333(d) of
Section 9334(c) of
Amendment by section 9338(b), (c) of
Amendment by section 9341(a)(2) of
Section 9219(b)(1)(D) of
Section 9219(b)(2)(B) of
Section 9301(b)(4) of
Section 9301(c)(5) of
Section 9301(d)(4) of
Section 9306(b) of
Amendment by section 9307(c) of
Effective Date of 1984 Amendments
Amendment by
Amendment by section 2303(e) of
Section 2306(b)(2) of
Section 2307(a)(3) of
Amendment by section 2326(d)(2) of
Amendment by section 2354(b)(13), (14) of
Amendment by section 2663(j)(2)(F)(iv) of
Effective Date of 1982 Amendment
Section 104(b) of
Section 113(b)(1) of
Amendment by section 128(d)(1) of
Effective Date of 1980 Amendment
Section 918(a)(2) of
Section 946(c) of
Section 948(c)(2) of
Effective Date of 1977 Amendments
Amendment by
Amendment by
Effective Date of 1976 Amendment
Section 4 of
Effective Date of 1974 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by section 211(c)(3) of
Amendment by section 227(e)(3) of
Section 236(c) of
Section 258(b) of
Section 262(b) of
Amendment by section 263(d)(5) of
Amendment by section 281(d) of
Effective Date of 1968 Amendment
Section 125(b) of
Budget Neutrality Adjustment
Section 13515(b) of
"(1) The relative values established under section 1848(c) of such Act [
"(2) The amounts determined under section 1848(a)(2)(B)(ii)(I) of such Act.
"(3) The prevailing charges or fee schedule amounts to be applied under such part for services of a health care practitioner (as defined in section 1842(b)(4)(F)(ii)(I) of such Act [subsec. (b)(4)(F)(ii)(I) of this section], as in effect before the date of the enactment of this Act [Aug. 10, 1993])."
Procedure Codes
Section 4101(b)(2) of
"(A) The codes for the procedures specified in clause (ii) are as follows: Hospital inpatient medical services (HCPCS codes 90200 through 90292), consultations (HCPCS codes 90600 through 90654), other visits (HCPCS code 90699), preventive medicine visits (HCPCS codes 90750 through 90764), psychiatric services (HCPCS codes 90801 through 90862), emergency care facility services (HCPCS codes 99062 through 99065), and critical care services (HCPCS codes 99160 through 99174).
"(B) The codes for the procedures specified in clause (iii) are as follows: Partial mastectomy (HCPCS code 19160); tendon sheath injections and small joint arthrocentesis (HCPCS codes 20550, 20600, 20605, and 20610); femoral fracture and trochanteric fracture treatments (HCPCS codes 27230, 27232, 27234, 27238, 27240, 27242, 27246, and 27248); endotracheal intubation (HCPCS code 31500); thoracentesis (HCPCS code 32000); thoracostomy (HCPCS codes 32020, 32035, and 32036); aneurysm repair (HCPCS codes 35111); cystourethroscopy (HCPCS code 52340); transurethral fulguration and resection (HCPCS codes 52606 and 52620); tympanoplasty with mastoidectomy (HCPCS code 69645); and ophthalmoscopy (HCPCS codes 92250 and 92260)."
Study of Release of Prepayment Medical Review Screen Parameters
Section 4111 of
"(a)
"(b)
"(c)
Freeze in Charges for Parenteral and Enteral Nutrients, Supplies, and Equipment
Section 13541 of
Section 4152(d) of
Prohibition on Regulations Changing Coverage of Conventional Eyewear
Section 4153(b)(1) of
"(A) Notwithstanding any other provision of law (except as provided in subparagraph (B)) the Secretary of Health and Human Services (referred to in this subsection as the 'Secretary') may not issue any regulation that changes the coverage of conventional eyewear furnished to individuals (enrolled under part B of title XVIII of the Social Security Act [this part]) following cataract surgery with insertion of an intraocular lens.
"(B) Paragraph (1) shall not apply to any regulation issued for the sole purpose of implementing the amendments made by paragraph (2)."
Directory of Unique Physician Identifier Numbers
Section 4164(c) of
Treatment of Certain Eye Examination Visits as Primary Care Services
Section 6102(e)(10) of
Delay in Update Until April 1, 1990, and Reduction in Percentage Increase in Medicare Economic Index
Section 6107(a) of
"(1)
"(2)
"(3)
"(A) subject to the last sentence of this paragraph, each participation agreement in effect on December 31, 1989, under section 1842(h)(1) of the Social Security Act [subsec. (h)(1) of this section] shall remain in effect for the 3-month period beginning on January 1, 1990;
"(B) the effective period for such agreements under such section entered into for 1990 shall be the 9-month period beginning on April 1, 1990, and the Secretary of Health and Human Services shall provide an opportunity for physicians and suppliers to enroll as participating physicians and suppliers before April 1, 1990;
"(C) instead of publishing, under section 1842(h)(4) of the Social Security Act [subsec. (h)(4) of this section], at the beginning of 1990, directories of participating physicians and suppliers for 1990, the Secretary shall provide for such publication, at the beginning of the 9-month period beginning on April 1, 1990, of such directories of participating physicians and suppliers for such period; and
"(D) instead of providing to nonparticipating physicians under section 1842(b)(3)(G) of the Social Security Act [subsec. (b)(3)(G) of this section] at the beginning of 1990, a list of maximum allowable actual charges for 1990, the Secretary shall provide, at the beginning of the 9-month period beginning on April 1, 1990, such physicians such a list for such 9-month period.
An agreement with a participating physician or supplier described in subparagraph (A) in effect on December 31, 1989, under section 1842(h)(1) of the Social Security Act shall not remain in effect for the period described in subparagraph (A) if the participating physician or supplier requests on or before December 31, 1989, that the agreement be terminated."
State Demonstration Projects on Application of Limitation on Visits Per Month Per Resident on Aggregate Basis for a Team
Section 6114(e) of
Application of Different Performance Standards for Electronic System for Covered Outpatient Drugs
Section 202(e)(3)(B) of
Delay in Application of Coordination of Benefits With Private Health Insurance
Section 202(e)(4)(B) of
Extension of Physician Participation Agreements and Related Provisions
Section 4041(a)(2) of
"(A) subject to the last sentence of this paragraph, each agreement with a participating physician in effect on December 31, 1987, under section 1842(h)(1) of the Social Security Act [subsec. (h)(1) of this section] shall remain in effect for the 3-month period beginning on January 1, 1988;
"(B) the effective period for agreements under such section entered into for 1988 shall be the nine-month period beginning on April 1, 1988, and the Secretary shall provide an opportunity for physicians to enroll as participating physicians prior to April 1, 1988;
"(C) instead of publishing, under section 1842(h)(4) of the Social Security Act [subsec. (h)(4) of this section] at the beginning of 1988, directories of participating physicians for 1988, the Secretary shall provide for such publication, at the beginning of the 9-month period beginning on April 1, 1988, of such directories of participating physicians for such period; and
"(D) instead of providing to nonparticipating physicians, under section 1842(b)(3)(G) of the Social Security Act [subsec. (b)(3)(G) of this section] at the beginning of 1988, a list of maximum allowable actual charges for 1988, the Secretary shall provide, at the beginning of the 9-month period beginning on April 1, 1988, to such physicians such a list for such 9-month period.
An agreement with a participating physician in effect on December 31, 1987, under section 1842(h)(1) of the Social Security Act shall not remain in effect for the period described in subparagraph (A) if the participating physician requests on or before December 31, 1987, that the agreement be terminated."
Development of Uniform Relative Value Guide
Section 4048(b) of
[Section 4118(h) of
Study of Prevailing Charges for Anesthesia Services
Section 4048(c) of
GAO Studies
Section 4048(d) of
"(1) The Comptroller General shall conduct a study—
"(A) to determine the average anesthesia times reported for medicare reimbursement purposes,
"(B) to verify those times from patient medical records,
"(C) to compare anesthesia times to average surgical times, and
"(D) to determine whether the current payments for physician supervision of nurse anesthetists are excessive.
The Comptroller General shall report to Congress, by not later than January 1, 1989, on such study and in the report include recommendations regarding the appropriateness of the anesthesia times recognized by medicare for reimbursement purposes and recommendations regarding adjustments of payments for physician supervision of nurse anesthetists.
"(2) The Comptroller General shall conduct a study on the impact of the amendment made by subsection (a) [amending this section], and shall report to Congress on the results of such study by April 1, 1990."
Adjustment in Medicare Prevailing Charges
Section 4051(b) of
"(1)
"(2)
Adjustment for Maximum Allowable Actual Charge
Section 4054(b), formerly §4053(b), of
Physician Payment Studies; Definitions of Medical and Surgical Procedures
Section 4056(a), formerly §4055(a), of
"(1)
"(2)
"(A) ancillary services commonly performed in conjunction with a major procedure would be included with the major procedure;
"(B) pre- and post-procedure services would be included in the procedure; and
"(C) similar procedures would be listed together if the procedures are similar in resource requirements."
Payments for Durable Medical Equipment, Prosthetic Devices, Orthotics, and Prosthetics; 1-Year Freeze on Charge Limitations
Section 4062(a) of
"(1)
"(2)
Special Rule With Respect to Payment for Intraocular Lenses
Section 4063(d) of
Study on Cost Effectiveness of Hearing Prior to Hearing by Administrative Law Judge on Carrier Determinations; Report to Congress
Section 4082(d) of
Capacity To Set Geographic Payment Limits
Section 4085(e) of
Utilization Screens for Physician Services Provided to Patients in Rehabilitation Hospitals
Section 4114 of
Section 4085(h) of
"(1) The Secretary of Health and Human Services shall establish (in consultation with appropriate physician groups, including those representing rehabilitative medicine) a separate utilization screen for physician visits to patients in rehabilitation hospitals and rehabilitative units (and patients in long-term care hospitals receiving rehabilitation services) to be used by carriers under section 1842 of the Social Security Act [this section] in performing functions under subsection (a) of such section related to the utilization practices of physicians in such hospitals and units.
"(2) Not later than 12 months after the date of enactment of this Act [Dec. 22, 1987], the Secretary of Health and Human Services shall take appropriate steps to implement the utilization screen established under paragraph (1)."
Plan Amendments Not Required Until January 1, 1989
For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§1101–1147 and 1171–1177] or title XVIII [§§1800–1899A] of
Amendments in Contracts and Regulations
The Secretary of Health and Human Services to provide for such timely amendments to contracts under this section, and regulations, to such extent as may be necessary to implement
Medicare Economic Index
Section 9331(c)(1), (2), (4)–(6) of
"(1)
"(2)
"(4)
"(5)
"(6)
Development and Use of HCFA Common Procedure Coding System
Section 9331(d) of
"(1) Not later than July 1, 1989, the Secretary of Health and Human Services (in this subsection referred to as the 'Secretary'), after public notice and opportunity for public comment and after consulation [consultation] with appropriate medical and other experts, shall group the procedure codes contained in any HCFA Common Procedure Coding System for payment purposes to minimize inappropriate increases in the intensity or volume of services provided as a result of coding distinctions which do not reflect substantial differences in the services rendered.
"(2) Not later than January 1, 1990, each carrier with which the Secretary has entered into a contract under section 1842 of the Social Security Act [this section] shall make payments under part B of title XVIII of such Act [this part] based on the grouping of procedure codes effected under paragraph (1)."
Measuring Carrier Performance; Carrier Bonuses for Good Performance
Section 9332(a)(2), (3) of
Section 9332(a)(4)(B), (C) of
"(B)
"(C)
Review of Procedures
Section 9333(c) of
Ratification of Regulations
Section 9334(b) of
"(1)
"(2)
Payment for Parenteral and Enteral Nutrition Supplies and Equipment
Section 9340 of
"(1) for enteral nutrition nutrients, supplies, and equipment and parenteral nutrition supplies and equipment furnished on or after January 1, 1987, and
"(2) for parenteral nutrition nutrients furnished on or after October 1, 1987."
Reporting of OPD Services Using HCPCS
Section 9343(g) of
Period for Entering Into Participation Agreements
Section 9301(b)(3) of
Transitional Provisions for Medicare Part B Payments
Section 9301(d)(5) of
Computation of Customary Charges for Certain Former Hospital-Compensated Physicians
Section 9304(b) of
"(1) In applying section 1842(b) of the Social Security Act [subsec. (b) of this section] to payment for physicians' services performed during the 8-month period beginning May 1, 1986, in the case of a physician who at anytime during the period beginning on October 31, 1982, and ending on January 31, 1985, was a hospital-compensated physician (as defined in paragraph (3)) but who, as of February 1, 1985, was no longer a hospital-compensated physician, the physician's customary charges shall—
"(A) be based upon the physician's actual charges billed during the 12-month period ending on March 31, 1985, and
"(B) in the case of a physician who was not a participating physician (as defined in section 1842(h)(1) of the Social Security Act [subsec. (h)(1) of this section]) on September 30, 1985, and who is not such a physician on May 1, 1986, be deflated (to take into account the legislative freeze on actual charges for nonparticipating physicians' services) by multiplying the physician's customary charges by .85.
"(2) In applying section 1842(b) of the Social Security Act [subsec. (b) of this section] to payment for physicians' services performed during the 8-month period beginning May 1, 1986, in the case of a physician who during the period beginning on February 1, 1985, and ending on December 31, 1986, changes from being a hospital-compensated physician to not being a hospital-compensated physician, the physician's customary charges shall be determined in the same manner as if the physician were considered to be a new physician.
"(3) In this subsection, the term 'hospital-compensated physician' means, with respect to services furnished to patients of a hospital, a physician who is compensated by the hospital for the furnishing of physicians' services for which payment may be made under this part."
Extension of Medicare Physician Payment Provisions
Period of 15 months referred to in subsec. (j)(1) of this section for monitoring the charges of nonparticipating physicians to be deemed to include the period Oct. 1, 1985, to Mar. 14, 1986, see section 5(b) of
Simplification of Procedures With Respect to Claims and Payments for Clinical Diagnostic Laboratory Tests
Section 2303(h) of
Study of Amounts Billed for Physician Services and Paid by Carriers Under Subsection (b)(7) of This Section; Report to Congress
Section 2307(c) of
Replacement of Agency, Organization, or Carrier Processing Medicare Claims; Number of Agreements and Contracts Authorized for Fiscal Years 1985 Through 1993
For provision authorizing two agreements under
Rules and Regulations
Section 113(b)(2) of
Report on Reimbursement of Clinical Laboratories
Section 918(a)(3) of
Prevailing Charge Levels for Fiscal Year Beginning July 1, 1975
Section 101(b) of
Report by Health Insurance Benefits Advisory Council on Methods of Reimbursement of Physicians for Their Services
Section 224(b) of
Section Referred to in Other Sections
This section is referred to in
1 See References in Text note below.
2 So in original. Probably should be "clause".
3 So in original. Probably should be "clause".
5 So in original. The word "and" probably should not appear.
6 So in original. The period probably should be ", and".
7 So in original. Probably should be "to a".
§1395v. Agreements with States
(a) Duty of Secretary; enrollment of eligible individuals
The Secretary shall, at the request of a State made before January 1, 1970, or during 1981 or after 1988, enter into an agreement with such State pursuant to which all eligible individuals in either of the coverage groups described in subsection (b) of this section (as specified in the agreement) will be enrolled under the program established by this part.
(b) Coverage of groups to which applicable
An agreement entered into with any State pursuant to subsection (a) of this section may be applicable to either of the following coverage groups:
(1) individuals receiving money payments under the plan of such State approved under subchapter I of this chapter or subchapter XVI of this chapter; or
(2) individuals receiving money payments under all of the plans of such State approved under subchapters I, X, XIV, and XVI of this chapter, and part A of subchapter IV of this chapter.
Except as provided in subsection (g) of this section, there shall be excluded from any coverage group any individual who is entitled to monthly insurance benefits under subchapter II of this chapter or who is entitled to receive an annuity under the Railroad Retirement Act of 1974 [
(c) Eligible individuals
For purposes of this section, an individual shall be treated as an eligible individual only if he is an eligible individual (within the meaning of
(d) Monthly premiums; coverage periods
In the case of any individual enrolled pursuant to this section—
(1) the monthly premium to be paid by the State shall be determined under
(2) his coverage period shall begin on whichever of the following is the latest:
(A) July 1, 1966;
(B) the first day of the third month following the month in which the State agreement is entered into;
(C) the first day of the first month in which he is both an eligible individual and a member of a coverage group specified in the agreement under this section; or
(D) such date as may be specified in the agreement; and
(3) his coverage period attributable to the agreement with the State under this section shall end on the last day of whichever of the following first occurs:
(A) the month in which he is determined by the State agency to have become ineligible both for money payments of a kind specified in the agreement and (if there is in effect a modification entered into under subsection (h) of this section) for medical assistance, or
(B) the month preceding the first month for which he becomes entitled to monthly benefits under subchapter II of this chapter or to an annuity or pension under the Railroad Retirement Act of 1974 [
(e) Subsection (d)(3) terminations deemed resulting in section 1395p enrollment
Any individual whose coverage period attributable to the State agreement is terminated pursuant to subsection (d)(3) of this section shall be deemed for purposes of this part (including the continuation of his coverage period under this part) to have enrolled under
(f) "Carrier" as including State agency; provisions facilitating deductions, coinsurance, etc., and leading to economy and efficiency of operation
With respect to eligible individuals receiving money payments under the plan of a State approved under subchapter I, X, XIV, or XVI of this chapter, or part A of subchapter IV of this chapter, or eligible to receive medical assistance under the plan of such State approved under subchapter XIX of this chapter, if the agreement entered into under this section so provides, the term "carrier" as defined in
(g) Subsection (b) exclusions from coverage groups
(1) The Secretary shall, at the request of a State made before January 1, 1970, or during 1981 or after 1988, enter into a modification of an agreement entered into with such State pursuant to subsection (a) of this section under which the second sentence of subsection (b) of this section shall not apply with respect to such agreement.
(2) In the case of any individual who would (but for this subsection) be excluded from the applicable coverage group described in subsection (b) of this section by the second sentence of such subsection—
(A) subsections (c) and (d)(2) of this section shall be applied as if such subsections referred to the modification under this subsection (in lieu of the agreement under subsection (a) of this section), and
(B) subsection (d)(3)(B) of this section shall not apply so long as there is in effect a modification entered into by the State under this subsection.
(h) Modifications respecting subsection (b) coverage groups
(1) The Secretary shall, at the request of a State made before January 1, 1970, or during 1981 or after 1988, enter into a modification of an agreement entered into with such State pursuant to subsection (a) of this section under which the coverage group described in subsection (b) of this section and specified in such agreement is broadened to include (A) individuals who are eligible to receive medical assistance under the plan of such State approved under subchapter XIX of this chapter, or (B) qualified medicare beneficiaries (as defined in
(2) For purposes of this section, an individual shall be treated as eligible to receive medical assistance under the plan of the State approved under subchapter XIX of this chapter if, for the month in which the modification is entered into under this subsection or for any month thereafter, he has been determined to be eligible to receive medical assistance under such plan. In the case of any individual who would (but for this subsection) be excluded from the agreement, subsections (c) and (d)(2) of this section shall be applied as if they referred to the modification under this subsection (in lieu of the agreement under subsection (a) of this section), and subsection (d)(2)(C) of this section shall be applied (except in the case of qualified medicare beneficiaries, as defined in
(3) In this subsection, the term "qualified medicare beneficiary" also includes an individual described in
(i) Enrollment of qualified medicare beneficiaries
For provisions relating to enrollment of qualified medicare beneficiaries under part A of this subchapter, see
(Aug. 14, 1935, ch. 531, title XVIII, §1843, as added July 30, 1965,
References in Text
Part A of subchapter IV of this chapter, referred to in subsecs. (b)(2) and (f), is classified to
The Railroad Retirement Act of 1974, referred to in subsec. (d)(3)(B), is act Aug. 29, 1935, ch. 812, as amended generally by
Part A of this subchapter, referred to in subsec. (i), is classified to
Amendments
1990—Subsec. (h)(3).
1989—Subsec. (i).
1988—Subsecs. (a), (g)(1).
Subsec. (h)(1).
Subsec. (h)(2).
1984—Subsec. (d)(3)(B).
1983—Subsec. (d)(1).
1980—Subsec. (a).
Subsec. (e).
Subsec. (g)(1).
Subsec. (g)(2)(C).
Subsec. (h)(1).
1974—Subsec. (b).
1973—Subsec. (b).
1968—
Subsec. (a).
Subsec. (b)(2).
Subsec. (c).
Subsec. (d)(2)(D).
Subsec. (d)(3)(A).
Subsec. (f).
Subsec. (g)(1).
Subsec. (h).
1966—Subsec. (b).
Subsec. (g).
Effective Date of 1990 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendments
Amendment by
Section 301(e)(3) of
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1983 Amendment; Transitional Rule
Amendment by
Effective Date of 1980 Amendment
Section 947(d) of
Effective Date of 1974 Amendment
Amendment by
Effective Date of 1973 Amendment
Amendment by
Termination Period for Certain Individuals Covered Pursuant to State Agreements
Section 947(e) of
District of Columbia; Agreement of Commissioner With Secretary for Supplementary Medical Insurance
Section Referred to in Other Sections
This section is referred to in
§1395w. Appropriations to cover Government contributions and contingency reserve
(a) There are authorized to be appropriated from time to time, out of any moneys in the Treasury not otherwise appropriated, to the Federal Supplementary Medical Insurance Trust Fund—
(1)(A) a Government contribution equal to the aggregate premiums payable for a month for enrollees age 65 and over under this part and deposited in the Trust Fund, multiplied by the ratio of—
(i) twice the dollar amount of the actuarially adequate rate per enrollee age 65 and over as determined under
(ii) the dollar amount of the premium per enrollee for such month, plus
(B) a Government contribution equal to the aggregate premiums payable for a month for enrollees under age 65 under this part and deposited in the Trust Fund, multiplied by the ratio of—
(i) twice the dollar amount of the actuarially adequate rate per enrollee under age 65 as determined under
(ii) the dollar amount of the premium per enrollee for such month; plus
(2) such sums as the Secretary deems necessary to place the Trust Fund, at the end of any fiscal year occurring after June 30, 1967, in the same position in which it would have been at the end of such fiscal year if (A) a Government contribution representing the excess of the premiums deposited in the Trust Fund during the fiscal year ending June 30, 1967, over the Government contribution actually appropriated to the Trust Fund during such fiscal year had been appropriated to it on June 30, 1967, and (B) the Government contribution for premiums deposited in the Trust Fund after June 30, 1967, had been appropriated to it when such premiums were deposited.
(b) In order to assure prompt payment of benefits provided under this part and the administrative expenses thereunder during the early months of the program established by this part, and to provide a contingency reserve, there is also authorized to be appropriated, out of any moneys in the Treasury not otherwise appropriated, to remain available through the calendar year 1969 for repayable advances (without interest) to the Trust Fund, an amount equal to $18 multiplied by the number of individuals (as estimated by the Secretary) who could be covered in July 1966 by the insurance program established by this part if they had theretofore enrolled under this part.
(Aug. 14, 1935, ch. 531, title XVIII, §1844, as added July 30, 1965,
Amendments
1989—Subsec. (a).
1988—Subsec. (a).
1984—Subsec. (a)(1)(B)(ii).
1983—Subsec. (a)(1)(A)(i).
Subsec. (a)(1)(B)(i).
1982—Subsec. (a)(1)(A)(i), (B)(i).
1972—Subsec. (a)(1).
1968—Subsec. (a).
Subsec. (b).
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1983 Amendment; Transitional Rule
Amendment by
Effective Date of 1972 Amendment
Section 203(e) of
§1395w–1. Physician Payment Review Commission
(a) Establishment; membership; term of office
(1) The Director of the Congressional Office of Technology Assessment (hereinafter in this section referred to as the "Director" and the "Office", respectively) shall provide for the appointment of a Physician Payment Review Commission (hereinafter in this section referred to as the "Commission"), to be composed of individuals with national recognition for their expertise in health economics, physician reimbursement, medical practice, and other related fields appointed by the Director (without regard to the provisions of title 5 governing appointments in the competitive service).
(2) The Commission shall consist of 13 individuals. Members of the Commission shall first be appointed no later than May 1, 1986, for a term of three years, except that the Director may provide initially for such shorter terms as will insure that (on a continuing basis) the terms of no more than four members expire in any one year.
(3) The membership of the Commission shall include (but need not be limited to) physicians, other health professionals, individuals skilled in the conduct and interpretation of biomedical, health services, and health economics research, and representatives of consumers and the elderly.
(b) Recommendations to Congress
(1) The Commission shall make recommendations to the Congress, not later than March 31 of each year (beginning with 1987), regarding adjustments to the reasonable charge levels for physicians' services recognized under
(2) In making its recommendations, the Commission shall—
(A) assess the likely impact of different adjustments in payment rates, particularly their impact on physician participation in the participation program established under
(B) make recommendations on ways to increase physician participation in that participation program and the acceptance of payment under this part on an assignment-related basis;
(C) identify those procedures, involving the use of assistants at surgery, for which payment for those assistants should not be made under this subchapter without prior approval;
(D) identify those procedures for which an opinion of a second physician should be required before payment is made under this subchapter;
(E) consider policies for moderating the rate of increase in expenditures under this part and the rate of increase in utilization of services under this part;
(F) make recommendations regarding major issues in the implementation of the resource-based relative value scale established under
(G) make recommendations regarding further development of the volume performance standards established under
(H) consider policies to provide payment incentives to increase patient access to primary care and other physician services in large urban and rural areas, including policies regarding payments to physicians pursuant to subchapter XIX of this chapter;
(I) review and consider the number and practice specialties of physicians in training and payments under this subchapter for graduate medical education costs;
(J) make recommendations regarding issues relating to utilization review and quality of care, including the effectiveness of peer review procedures and other quality assurance programs applicable to physicians and providers under this subchapter and physician certification and licensing standards and procedures;
(K) make recommendations regarding options to help constrain the costs of health insurance to employers, including incentives under this subchapter;
(L) comment on the recommendations affecting physician payment under the medicare program that are included in the budget submitted by the President pursuant to
(M) make recommendations regarding medical malpractice liability reform and physician certification and licensing standards and procedures.
(c) Applicability of provisions relating to Prospective Payment Assessment Commission; collection and assessment of information
(1) The following provisions of
(A) Subparagraph (C) (relating to staffing and administration generally).
(B) Subparagraph (D) (relating to compensation of members).
(C) Subparagraph (F) (relating to access to information).
(D) Subparagraph (G) (relating to use of funds).
(E) Subparagraph (H) (relating to periodic GAO audits).
(F) Subparagraph (J) (relating to requests for appropriations).
(2) In order to carry out its functions, the Commission shall collect and assess information on medical and surgical procedures and services, including information on regional variations of medical practice. In collecting and assessing information, the Commission shall—
(A) 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,
(B) carry out, or award grants or contracts for, original research and experimentation, where existing information is inadequate for the development of useful and valid guidelines by the Commission, and
(C) adopt procedures allowing any interested party to submit information with respect to physicians' services (including new practices, such as the use of new technologies and treatment modalities), which information the Commission shall consider in making reports and recommendations to the Secretary and Congress.
(d) Authorization of appropriations
There are authorized to be appropriated such sums as may be necessary to carry out the provisions of this section. Such sums shall be payable from the Federal Supplementary Medical Insurance Trust Fund.
(e) Prompt submittal of data by Secretary
(1) Not later than December 31st of each year (beginning with 1988), the Secretary shall transmit to the Physician Payment Review Commission, to the Congressional Budget Office, and to the Congressional Research Service of the Library of Congress national data (known as the Part B Medicare Annual Data System) for the previous year respecting part B of this subchapter.
(2) The Secretary, in consultation with the Physician Payment Review Commission, the Congressional Budget Office, and the Congressional Research Service of the Library of Congress, shall establish and annually revise standards for the data reporting system described in paragraph (1).
(3) The Secretary shall also provide to the entities described in paragraph (1) additional data respecting the program under this part as may be reasonably requested by them on an agreed-upon schedule.
(4) The Secretary shall develop, in consultation with the Physician Payment Review Commission, the Congressional Budget Office, and the Congressional Research Service of the Library of Congress, a system for providing to each of such entities on a quarterly basis summary data on aggregate expenditures under this part by type of service and by type of provider. Such data shall be provided not later than 90 days after the end of each quarter (for quarters beginning with the calendar quarter ending on March 31, 1989).
(Aug. 14, 1935, ch. 531, title XVIII, §1845, as added and amended Apr. 7, 1986,
References in Text
The provisions of title 5 governing appointments in the competitive service, referred to in subsec. (a)(1), are classified generally to
Amendments
1994—Subsec. (e)(2) to (5).
1990—Subsec. (a)(3).
Subsec. (b)(2)(A).
Subsec. (b)(2)(B).
Subsec. (b)(2)(C).
Subsec. (b)(2)(D), (E).
Subsec. (b)(2)(F).
Subsec. (b)(2)(G) to (M).
Subsec. (b)(3).
Subsec. (c)(1)(D).
Subsecs. (e), (f).
1988—Subsec. (b)(2)(I).
Subsec. (f)(1).
Subsec. (f)(2).
1987—Subsec. (a)(1).
Subsec. (a)(3).
Subsec. (b)(1).
Subsec. (e)(4).
Subsec. (e)(4)(A)(i).
Subsec. (f).
1986—Subsec. (a)(2).
Subsec. (b)(3).
Subsec. (e).
Subsec. (e)(3).
Subsec. (e)(4).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1988 Amendments
Section 8425(b) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Amendment by section 4045(b) of
Section 4083(a)(2) of
Section 4083(c)(2) of
PHYSPRC Study of Payments for Assistants at Surgery
"(a)
"(1) the necessity and appropriateness of using an assistant at surgery;
"(2) the use of physician and non-physician assistants at surgery;
"(3) the appropriateness of providing for payments, and the appropriate level of payment, under title XVIII of the Social Security Act for assistants at surgery; and
"(4) the effect of the amendments made by section 9338 of the Omnibus Budget Reconciliation Act of 1986 [
"(b)
Expansion of Relative Value Scale (RVS) Study
Section 4056(b), formerly §4055(b), of
"(1)
"(2)
"(3)
Appointment of Additional Members
Section 9344(a)(2) of
Section Referred to in Other Sections
This section is referred to in
§1395w–2. Intermediate sanctions for providers or suppliers of clinical diagnostic laboratory tests
(a) If the Secretary determines that any provider or clinical laboratory approved for participation under this subchapter no longer substantially meets the conditions of participation or for coverage specified under this subchapter with respect to the provision of clinical diagnostic laboratory tests under this part, the Secretary may (for a period not to exceed one year) impose intermediate sanctions developed pursuant to subsection (b) of this section, in lieu of terminating immediately the provider agreement or cancelling immediately approval of the clinical laboratory.
(b)(1) The Secretary shall develop and implement—
(A) a range of intermediate sanctions to apply to providers or clinical laboratories under the conditions described in subsection (a), and
(B) appropriate procedures for appealing determinations relating to the imposition of such sanctions.
(2)(A) The intermediate sanctions developed under paragraph (1) shall include—
(i) directed plans of correction,
(ii) civil money penalties in an amount not to exceed $10,000 for each day of substantial noncompliance,
(iii) payment for the costs of onsite monitoring by an agency responsible for conducting surveys, and
(iv) suspension of all or part of the payments to which a provider or clinical laboratory would otherwise be entitled under this subchapter with respect to clinical diagnostic laboratory tests furnished on or after the date on which the Secretary determines that intermediate sanctions should be imposed pursuant to subsection (a) of this section.
The provisions of
(B) The sanctions specified in subparagraph (A) are in addition to sanctions otherwise available under State or Federal law.
(3) The Secretary shall develop and implement specific procedures with respect to when and how each of the intermediate sanctions developed under paragraph (1) is to be applied, the amounts of any penalties, and the severity of each of these penalties. Such procedures shall be designed so as to minimize the time between identification of violations and imposition of these sanctions and shall provide for the imposition of incrementally more severe penalties for repeated or uncorrected deficiencies.
(Aug. 14, 1935, ch. 531, title XVIII, §1846, as added Dec. 22, 1987,
Amendments
1990—
1989—
1988—
Subsec. (a).
Subsec. (b)(1)(A).
Subsec. (b)(2)(A).
Subsec. (b)(2)(A)(ii).
Subsec. (b)(2)(A)(iii).
Subsec. (b)(2)(A)(iv).
Subsec. (b)(3).
Effective Date of 1990 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendments
Amendment by
Amendment by section 203(e)(4) of
Except as specifically provided in section 411 of
Effective Date
Section 4064(d)(2) of
§1395w–3. Repealed. Pub. L. 101–234, title II, §201(a), Dec. 13, 1989, 103 Stat. 1981
Section, act Aug. 14, 1935, ch. 531, title XVIII, §1847, as added July 1, 1988,
Effective Date of Repeal
Repeal effective Jan. 1, 1990, see section 201(c) of
§1395w–4. Payment for physicians' services
(a) Payment based on fee schedule
(1) In general
Effective for all physicians' services (as defined in subsection (j)(3) of this section) furnished under this part during a year (beginning with 1992) for which payment is otherwise made on the basis of a reasonable charge or on the basis of a fee schedule under
(A) the actual charge for the service, or
(B) subject to the succeeding provisions of this subsection, the amount determined under the fee schedule established under subsection (b) of this section for services furnished during that year (in this subsection referred to as the "fee schedule amount").
(2) Transition to full fee schedule
(A) Limiting reductions and increases to 15 percent in 1992
(i) Limit on increase
In the case of a service in a fee schedule area (as defined in subsection (j)(2) of this section) for which the adjusted historical payment basis (as defined in subparagraph (D)) is less than 85 percent of the fee schedule amount for services furnished in 1992, there shall be substituted for the fee schedule amount an amount equal to the adjusted historical payment basis plus 15 percent of the fee schedule amount otherwise established (without regard to this paragraph).
(ii) Limit in reduction
In the case of a service in a fee schedule area for which the adjusted historical payment basis exceeds 115 percent of the fee schedule amount for services furnished in 1992, there shall be substituted for the fee schedule amount an amount equal to the adjusted historical payment basis minus 15 percent of the fee schedule amount otherwise established (without regard to this paragraph).
(B) Special rule for 1993, 1994, and 1995
If a physicians' service in a fee schedule area is subject to the provisions of subparagraph (A) in 1992, for physicians' services furnished in the area—
(i) during 1993, there shall be substituted for the fee schedule amount an amount equal to the sum of—
(I) 75 percent of the fee schedule amount determined under subparagraph (A), adjusted by the update established under subsection (d)(3) of this section for 1993, and
(II) 25 percent of the fee schedule amount determined under paragraph (1) for 1993 without regard to this paragraph;
(ii) during 1994, there shall be substituted for the fee schedule amount an amount equal to the sum of—
(I) 67 percent of the fee schedule amount determined under clause (i), adjusted by the update established under subsection (d)(3) of this section for 1994 and as adjusted under subsection (c)(2)(F)(ii) of this section and under section 13515(b) of the Omnibus Budget Reconciliation Act of 1993, and
(II) 33 percent of the fee schedule amount determined under paragraph (1) for 1994 without regard to this paragraph; and
(iii) during 1995, there shall be substituted for the fee schedule amount an amount equal to the sum of—
(I) 50 percent of the fee schedule amount determined under clause (ii) adjusted by the update established under subsection (d)(3) of this section for 1995, and
(II) 50 percent of the fee schedule amount determined under paragraph (1) for 1995 without regard to this paragraph.
(C) Special rule for anesthesia and radiology services
With respect to physicians' services which are anesthesia services, the Secretary shall provide for a transition in the same manner as a transition is provided for other services under subparagraph (B). With respect to radiology services, "109 percent" and "9 percent" shall be substituted for "115 percent" and "15 percent", respectively, in subparagraph (A)(ii).
(D) "Adjusted historical payment basis" defined
(i) In general
In this paragraph, the term "adjusted historical payment basis" means, with respect to a physicians' service furnished in a fee schedule area, the weighted average prevailing charge applied in the area for the service in 1991 (as determined by the Secretary without regard to physician specialty and as adjusted to reflect payments for services with customary charges below the prevailing charge or other payment limitations imposed by law or regulation) adjusted by the update established under subsection (d)(3) of this section for 1992.
(ii) Application to radiology services
In applying clause (i) in the case of physicians' services which are radiology services (including radiologist services, as defined in
(iii) Nuclear medicine services
In applying clause (i) in the case of physicians' services which are nuclear medicine services, there shall be substituted for the weighted average prevailing charge the amount provided under section 6105(b) of the Omnibus Budget Reconciliation Act of 1989.
(3) Incentives for participating physicians and suppliers
In applying paragraph (1)(B) in the case of a nonparticipating physician or a nonparticipating supplier or other person, the fee schedule amount shall be 95 percent of such amount otherwise applied under this subsection (without regard to this paragraph). In the case of physicians' services (including services which the Secretary excludes pursuant to subsection (j)(3) of this section) of a nonparticipating physician, supplier, or other person for which payment is made under this part on a basis other than the fee schedule amount, the payment shall be based on 95 percent of the payment basis for such services furnished by a participating physician, supplier, or other person.
(4) Special rule for medical direction
(A) In general
With respect to physicians' services furnished on or after January 1, 1994, and consisting of medical direction of two, three, or four concurrent anesthesia cases, the fee schedule amount to be applied shall be equal to one-half of the amount described in subparagraph (B).
(B) Amount
The amount described in this subparagraph, for a physician's medical direction of the performance of anesthesia services, is the following percentage of the fee schedule amount otherwise applicable under this section if the anesthesia services were personally performed by the physician alone:
(i) For services furnished during 1994, 120 percent.
(ii) For services furnished during 1995, 115 percent.
(iii) For services furnished during 1996, 110 percent.
(iv) For services furnished during 1997, 105 percent.
(v) For services furnished after 1997, 100 percent.
(b) Establishment of fee schedules
(1) In general
Before January 1 of each year beginning with 1992, the Secretary shall establish, by regulation, fee schedules that establish payment amounts for all physicians' services furnished in all fee schedule areas (as defined in subsection (j)(2) of this section) for the year. Except as provided in paragraph (2), each such payment amount for a service shall be equal to the product of—
(A) the relative value for the service (as determined in subsection (c)(2) of this section),
(B) the conversion factor (established under subsection (d) of this section) for the year, and
(C) the geographic adjustment factor (established under subsection (e)(2) of this section) for the service for the fee schedule area.
(2) Treatment of radiology services and anesthesia services
(A) Radiology services
With respect to radiology services (including radiologist services, as defined in
(B) Anesthesia services
In establishing the fee schedule for anesthesia services for which a relative value guide has been established under section 4048(b) of the Omnibus Budget Reconciliation Act of 1987, the Secretary shall use, to the extent practicable, such relative value guide, with appropriate adjustment of the conversion factor, in a manner to assure that the fee schedule amounts for anesthesia services are consistent with the fee schedule amounts for other services determined by the Secretary to be of comparable value. In applying the previous sentence, the Secretary shall adjust the conversion factor by geographic adjustment factors in the same manner as such adjustment is made under paragraph (1)(C).
(C) Consultation
The Secretary shall consult with the Physician Payment Review Commission and organizations representing physicians or suppliers who furnish radiology services and anesthesia services in applying subparagraphs (A) and (B).
(3) Treatment of interpretation of electrocardiograms
The Secretary—
(A) shall make separate payment under this section for the interpretation of electrocardiograms performed or ordered to be performed as part of or in conjunction with a visit to or a consultation with a physician, and
(B) shall adjust the relative values established for visits and consultations under subsection (c) of this section so as not to include relative value units for interpretations of electrocardiograms in the relative value for visits and consultations.
(c) Determination of relative values for physicians' services
(1) Division of physicians' services into components
In this section, with respect to a physicians' service:
(A) "Work component" defined
The term "work component" means the portion of the resources used in furnishing the service that reflects physician time and intensity in furnishing the service. Such portion shall—
(i) include activities before and after direct patient contact, and
(ii) be defined, with respect to surgical procedures, to reflect a global definition including pre-operative and post-operative physicians' services.
(B) "Practice expense component" defined
The term "practice expense component" means the portion of the resources used in furnishing the service that reflects the general categories of expenses (such as office rent and wages of personnel, but excluding malpractice expenses) comprising practice expenses.
(C) "Malpractice component" defined
The term "malpractice component" means the portion of the resources used in furnishing the service that reflects malpractice expenses in furnishing the service.
(2) Determination of relative values
(A) In general
(i) Combination of units for components
The Secretary shall develop a methodology for combining the work, practice expense, and malpractice relative value units, determined under subparagraph (C), for each service in a manner to produce a single relative value for that service. Such relative values are subject to adjustment under subparagraph (F)(i) and section 13515(b) of the Omnibus Budget Reconciliation Act of 1993.
(ii) Extrapolation
The Secretary may use extrapolation and other techniques to determine the number of relative value units for physicians' services for which specific data are not available and shall take into account recommendations of the Physician Payment Review Commission and the results of consultations with organizations representing physicians who provide such services.
(B) Periodic review and adjustments in relative values
(i) Periodic review
The Secretary, not less often than every 5 years, shall review the relative values established under this paragraph for all physicians' services.
(ii) Adjustments
(I) In general
The Secretary shall, to the extent the Secretary determines to be necessary and subject to subclause (II), adjust the number of such units to take into account changes in medical practice, coding changes, new data on relative value components, or the addition of new procedures. The Secretary shall publish an explanation of the basis for such adjustments.
(II) Limitation on annual adjustments
The adjustments under subclause (I) for a year may not cause the amount of expenditures under this part for the year to differ by more than $20,000,000 from the amount of expenditures under this part that would have been made if such adjustments had not been made.
(iii) Consultation
The Secretary, in making adjustments under clause (ii), shall consult with the Physician Payment Review Commission and organizations representing physicians.
(C) Computation of relative value units for components
For purposes of this section for each physicians' service—
(i) Work relative value units
The Secretary shall determine a number of work relative value units for the service based on the relative resources incorporating physician time and intensity required in furnishing the service.
(ii) Practice expense relative value units
The Secretary shall determine a number of practice expense relative value units for the service for years before 1998 equal to the product of—
(I) the base allowed charges (as defined in subparagraph (D)) for the service, and
(II) the practice expense percentage for the service (as determined under paragraph (3)(C)(ii)),
and for years beginning with 1998 based on the relative practice expense resources involved in furnishing the service.
(iii) Malpractice relative value units
The Secretary shall determine a number of malpractice relative value units equal to the product of—
(I) the base allowed charges (as defined in subparagraph (D)) for the service, and
(II) the malpractice percentage for the service (as determined under paragraph (3)(C)(iii)).
(D) "Base allowed charges" defined
In this paragraph, the term "base allowed charges" means, with respect to a physician's service, the national average allowed charges for the service under this part for services furnished during 1991, as estimated by the Secretary using the most recent data available.
(E) Reduction in practice expense relative value units for certain services
(i) In general
Subject to clause (ii), the Secretary shall reduce the practice expense relative value units applied to services described in clause (iii) furnished in—
(I) 1994, by 25 percent of the number by which the number of practice expense relative value units (determined for 1994 without regard to this subparagraph) exceeds the number of work relative value units determined for 1994,
(II) 1995, by an additional 25 percent of such excess, and
(III) 1996, by an additional 25 percent of such excess.
(ii) Floor on reductions
The practice expense relative value units for a physician's service shall not be reduced under this subparagraph to a number less than 128 percent of the number of work relative value units.
(iii) Services covered
For purposes of clause (i), the services described in this clause are physicians' services that are not described in clause (iv) and for which—
(I) there are work relative value units, and
(II) the number of practice expense relative value units (determined for 1994) exceeds 128 percent of the number of work relative value units (determined for such year).
(iv) Excluded services
For purposes of clause (iii), the services described in this clause are services which the Secretary determines at least 75 percent of which are provided under this subchapter in an office setting.
(F) Budget neutrality adjustments
The Secretary—
(i) shall reduce the relative values for all services (other than anesthesia services) established under this paragraph (and, in the case of anesthesia services, the conversion factor established by the Secretary for such services) by such percentage as the Secretary determines to be necessary so that, beginning in 1996, the amendment made by section 13514(a) of the Omnibus Budget Reconciliation Act of 1993 would not result in expenditures under this section that exceed the amount of such expenditures that would have been made if such amendment had not been made, and
(ii) shall reduce the amounts determined under subsection (a)(2)(B)(ii)(I) of this section by such percentage as the Secretary determines to be required to assure that, taking into account the reductions made under clause (i), the amendment made by section 13514(a) of the Omnibus Budget Reconciliation Act of 1993 would not result in expenditures under this section in 1994 that exceed the amount of such expenditures that would have been made if such amendment had not been made.
(3) Component percentages
For purposes of paragraph (2), the Secretary shall determine a work percentage, a practice expense percentage, and a malpractice percentage for each physician's service as follows:
(A) Division of services by specialty
For each physician's service or class of physicians' services, the Secretary shall determine the average percentage of each such service or class of services that is performed, nationwide, under this part by physicians in each of the different physician specialties (as identified by the Secretary).
(B) Division of specialty by component
The Secretary shall determine the average percentage division of resources, among the work component, the practice expense component, and the malpractice component, used by physicians in each of such specialties in furnishing physicians' services. Such percentages shall be based on national data that describe the elements of physician practice costs and revenues, by physician specialty. The Secretary may use extrapolation and other techniques to determine practice costs and revenues for specialties for which adequate data are not available.
(C) Determination of component percentages
(i) Work percentage
The work percentage for a service (or class of services) is equal to the sum (for all physician specialties) of—
(I) the average percentage division for the work component for each physician specialty (determined under subparagraph (B)), multiplied by
(II) the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.
(ii) Practice expense percentage
For years before 1998, the practice expense percentage for a service (or class of services) is equal to the sum (for all physician specialties) of—
(I) the average percentage division for the practice expense component for each physician specialty (determined under subparagraph (B)), multiplied by
(II) the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.
(iii) Malpractice percentage
The malpractice percentage for a service (or class of services) is equal to the sum (for all physician specialties) of—
(I) the average percentage division for the malpractice component for each physician specialty (determined under subparagraph (B)), multiplied by
(II) the proportion (determined under subparagraph (A)) of such service (or services) performed by physicians in that specialty.
(D) Periodic recomputation
The Secretary may, from time to time, provide for the recomputation of work percentages, practice expense percentages, and malpractice percentages determined under this paragraph.
(4) Ancillary policies
The Secretary may establish ancillary policies (with respect to the use of modifiers, local codes, and other matters) as may be necessary to implement this section.
(5) Coding
The Secretary shall establish a uniform procedure coding system for the coding of all physicians' services. The Secretary shall provide for an appropriate coding structure for visits and consultations. The Secretary may incorporate the use of time in the coding for visits and consultations. The Secretary, in establishing such coding system, shall consult with the Physician Payment Review Commission and other organizations representing physicians.
(6) No variation for specialists
The Secretary may not vary the conversion factor or the number of relative value units for a physicians' service based on whether the physician furnishing the service is a specialist or based on the type of specialty of the physician.
(d) Conversion factors
(1) Establishment
(A) In general
The conversion factor (or factors) for each year shall be the conversion factor (or factors) established under this subsection for the previous year (or, in the case of 1992, specified in subparagraph (B)) adjusted by the update or updates (established under paragraph (3)) for the year involved.
(B) Special provision for 1992
For purposes of subparagraph (A), the conversion factor specified in this subparagraph is a conversion factor (determined by the Secretary) which, if this section were to apply during 1991 using such conversion factor, would result in the same aggregate amount of payments under this part for physicians' services as the estimated aggregate amount of the payments under this part for such services in 1991.
(C) Publication
The Secretary shall cause to have published in the Federal Register, during the last 15 days of October of—
(i) 1991, the conversion factor which will apply to physicians' services for 1992, and the update (or updates) determined under paragraph (3) for 1992; and
(ii) each succeeding year, the conversion factor (or factors) which will apply to physicians' services for the following year and the update (or updates) determined under paragraph (3) for such year.
(2) Recommendation of update
(A) In general
Not later than April 15 of each year (beginning with 1991), the Secretary shall transmit to the Congress a report that includes a recommendation on the appropriate update (or updates) in the conversion factor (or factors) for all physicians' services (as defined in subsection (f)(5)(A) of this section) in the following year. The Secretary may recommend a uniform update or different updates for different categories or groups of services. In making the recommendation, the Secretary shall consider—
(i) the percentage change in the medicare economic index (described in the fourth sentence of
(ii) the percentage by which actual expenditures for all physicians' services and for the services involved under this part for the fiscal year ending in the year preceding the year in which such recommendation is made were greater or less than actual expenditures for such services in the fiscal year ending in the second preceding year;
(iii) the relationship between the percentage determined under clause (ii) for a fiscal year and the performance standard rate of increase (established under subsection (f)(2) of this section) for that fiscal year;
(iv) changes in volume or intensity of services;
(v) access to services; and
(vi) other factors that may contribute to changes in volume or intensity of services or access to services.
For purposes of making the comparison under clause (iii), the Secretary shall adjust the performance standard rate of increase for a fiscal year to reflect changes in the actual proportion of individuals who are enrolled under this part who are HMO enrollees (as defined in subsection (f)(5)(B) of this section) in that fiscal year compared with such proportion for the previous fiscal year.
(B) Additional considerations
In making recommendations under subparagraph (A), the Secretary may also consider—
(i) unexpected changes by physicians in response to the implementation of the fee schedule;
(ii) unexpected changes in outlay projections;
(iii) changes in the quality or appropriateness of care; and
(iv) any other relevant factors not measured in the resource-based payment methodology.
(C) Special rule for 1992 update
In considering the update for 1992, the Secretary shall make a separate determination of the percentage and relationship described in clauses (ii) and (iii) of subparagraph (A) with respect to the category of surgical services (as defined by the Secretary pursuant to subsection (j)(1) of this section).
(D) Explanation of update
The Secretary shall include in each report under subparagraph (A)—
(i) the update recommended for each category of physicians' services (established by the Secretary under subsection (j)(1) of this section) and for each of the following groups of physicians' services: nonsurgical services, visits, consultations, and emergency room services;
(ii) the rationale for the recommended update (or updates) for each category and group of services described in clause (i); and
(iii) the data and analyses underlying the update (or updates) recommended.
(E) Computation of budget-neutral adjustment
(i) In general
The Secretary shall include in the report made under subparagraph (A) in a year a statement of the percentage by which (I) the actual expenditures for physicians' services under this part (during the fiscal year ending in the preceding year, as set forth in the most recent annual report made pursuant to
(ii) Projected expenditures
For purposes of clause (i), the expenditures projected under this clause for a fiscal year is the actual expenditures for physicians' services made under this part in the second preceding fiscal year—
(I) increased by the weighted average percentage increase permitted under this part for payments for physicians' services in the preceding fiscal year;
(II) adjusted to reflect the percentage change in the average number of individuals enrolled under this part (who are not enrolled with a risk-sharing contract under
(III) adjusted to reflect the average annual percentage growth in the volume and intensity of physicians' services under this part for the five-fiscal-year period ending with the second preceding fiscal year; and
(IV) adjusted to reflect the percentage change in expenditures for physicians' services under this part in the preceding fiscal year (compared with the second preceding fiscal year) which result from changes in law or regulations.
(F) Commission review
The Physician Payment Review Commission shall review the report submitted under subparagraph (A) in a year and shall submit to the Congress, by not later than May 15 of the year, a report including its recommendations respecting the update (or updates) in the conversion factor (or factors) for the following year.
(3) Update
(A) Based on index
(i) In general
Unless Congress otherwise provides, subject to subparagraph (B), except as provided in clauses (iii) through (v), for purposes of this section the update for a year is equal to the Secretary's estimate of the percentage increase in the appropriate update index (as defined in clause (ii)) for the year.
(ii) "Appropriate update index" defined
In clause (i), the term "appropriate update index" means—
(I) for services for which prevailing charges in 1989 were subject to a limit under the fourth sentence of
(II) for other services, such index (such as the consumer price index) that was applicable under this part in 1989 to increases in the payment amounts recognized under this part with respect to such services.
(iii) Adjustment in percentage increase
In applying clause (i) for services furnished in 1992 for which the appropriate update index is the index described in clause (ii)(I), the percentage increase in the appropriate update index shall be reduced by 0.4 percentage points.
(iv) Adjustment in percentage increase for 1994
In applying clause (i) for services furnished in 1994, the percentage increase in the appropriate update index shall be reduced by—
(I) 3.6 percentage points for services included in the category of surgical services (as defined for purposes of subsection (j)(1) of this section), and
(II) 2.6 percentage points for other services.
(v) Adjustment in percentage increase for 1995
In applying clause (i) for services furnished in 1995, the percentage increase in the appropriate update index shall be reduced by 2.7 percentage points.
(vi) Exception for category of primary care services
Clauses (iv) and (v) shall not apply to services included in the category of primary care services (as defined for purposes of subsection (j)(1) of this section).
(B) Adjustment in update
(i) In general
The update for a category of physicians' services for a year provided under subparagraph (A) shall, subject to clause (ii), be increased or decreased by the same percentage by which (I) the percentage increase in the actual expenditures for services in such category in the second previous fiscal year over the third previous fiscal year, was less or greater, respectively, than (II) the performance standard rate of increase (established under subsection (f) of this section) for such category of services for the second previous fiscal year.
(ii) Restrictions on adjustment
The adjustment made under clause (i) for a year may not result in a decrease of more than—
(I) 2 percentage points for the update for 1992 or 1993,
(II) 2½ percentage points for the update for 1994, and
(III) 5 percentage points for the update for any succeeding year.
(e) Geographic adjustment factors
(1) Establishment of geographic indices
(A) In general
Subject to subparagraphs (B) and (C), the Secretary shall establish—
(i) an index which reflects the relative costs of the mix of goods and services comprising practice expenses (other than malpractice expenses) in the different fee schedule areas compared to the national average of such costs,
(ii) an index which reflects the relative costs of malpractice expenses in the different fee schedule areas compared to the national average of such costs, and
(iii) an index which reflects ¼ of the difference between the relative value of physicians' work effort in each of the different fee schedule areas and the national average of such work effort.
(B) Class-specific geographic cost-of-practice indices
The Secretary may establish more than one index under subparagraph (A)(i) in the case of classes of physicians' services, if, because of differences in the mix of goods and services comprising practice expenses for the different classes of services, the application of a single index under such clause to different classes of such services would be substantially inequitable.
(C) Periodic review and adjustments in geographic adjustment factors
The Secretary, not less often than every 3 years, shall, in consultation with appropriate representatives of physicians, review the indices established under subparagraph (A) and the geographic index values applied under this subsection for all fee schedule areas. Based on such review, the Secretary may revise such index and adjust such index values, except that, if more than 1 year has elasped 1 since the date of the last previous adjustment, the adjustment to be applied in the first year of the next adjustment shall be ½ of the adjustment that otherwise would be made.
(D) Use of recent data
In establishing indices and index values under this paragraph, the Secretary shall use the most recent data available relating to practice expenses, malpractice expenses, and physician work effort in different fee schedule areas.
(2) Computation of geographic adjustment factor
For purposes of subsection (b)(1)(C) of this section, for all physicians' services for each fee schedule area the Secretary shall establish a geographic adjustment factor equal to the sum of the geographic cost-of-practice adjustment factor (specified in paragraph (3)), the geographic malpractice adjustment factor (specified in paragraph (4)), and the geographic physician work adjustment factor (specified in paragraph (5)) for the service and the area.
(3) Geographic cost-of-practice adjustment factor
For purposes of paragraph (2), the "geographic cost-of-practice adjustment factor", for a service for a fee schedule area, is the product of—
(A) the proportion of the total relative value for the service that reflects the relative value units for the practice expense component, and
(B) the geographic cost-of-practice index value for the area for the service, based on the index established under paragraph (1)(A)(i) or (1)(B) (as the case may be).
(4) Geographic malpractice adjustment factor
For purposes of paragraph (2), the "geographic malpractice adjustment factor", for a service for a fee schedule area, is the product of—
(A) the proportion of the total relative value for the service that reflects the relative value units for the malpractice component, and
(B) the geographic malpractice index value for the area, based on the index established under paragraph (1)(A)(ii).
(5) Geographic physician work adjustment factor
For purposes of paragraph (2), the "geographic physician work adjustment factor", for a service for a fee schedule area, is the product of—
(A) the proportion of the total relative value for the service that reflects the relative value units for the work component, and
(B) the geographic physician work index value for the area, based on the index established under paragraph (1)(A)(iii).
(f) Medicare volume performance standard rates of increase
(1) Process for establishing medicare volume performance standard rates of increase
(A) Secretary's recommendation
By not later than April 15 of each year (beginning with 1990), the Secretary shall transmit to the Congress a recommendation on performance standard rates of increase for all physicians' services and for each category of such services for the fiscal year beginning in such year. In making the recommendation, the Secretary shall confer with organizations representing physicians and shall consider—
(i) inflation,
(ii) changes in numbers of enrollees (other than HMO enrollees) under this part,
(iii) changes in the age composition of enrollees (other than HMO enrollees) under this part,
(iv) changes in technology,
(v) evidence of inappropriate utilization of services,
(vi) evidence of lack of access to necessary physicians' services, and
(vii) such other factors as the Secretary considers appropriate.
(B) Commission review
The Physician Payment Review Commission shall review the recommendation transmitted during a year under subparagraph (A) and shall make its recommendation to Congress, by not later than May 15 of the year, respecting the performance standard rates of increase for the fiscal year beginning in that year.
(C) Publication of performance standard rates of increase
The Secretary shall cause to have published in the Federal Register, in the last 15 days of October of each year (beginning with 1991), the performance standard rates of increase for all physicians' services and for each category of physicians' services for the fiscal year beginning in that year. The Secretary shall cause to have published in the Federal Register, by not later than January 1, 1990, the performance standard rate of increase under subparagraph (D) for fiscal year 1990.
(D) Performance standard rate of increase for fiscal year 1990
The performance standard rate of increase for fiscal year 1990 is equal to the sum of—
(i) the Secretary's estimate of the weighted average percentage increase in the reasonable charges for physicians' services (as defined in subsection (f)(5)(A) of this section) under this part for portions of calendar years included in fiscal year 1990,
(ii) the Secretary's estimate of the percentage increase or decrease in the average number of individuals enrolled under this part (other than HMO enrollees) from fiscal year 1989 to fiscal year 1990,
(iii) the Secretary's estimate of the average annual percentage growth in volume and intensity of physicians' services under this part for the 5-fiscal-year period ending with fiscal year 1989 (based upon information contained in the most recent annual report made pursuant to
(iv) the Secretary's estimate of the percentage increase or decrease in expenditures for physicians' services (as defined in subsection (f)(5)(A) of this section) in fiscal year 1990 (compared with fiscal year 1989) which will result from changes in law or regulations and which is not taken into account in the percentage increase described in clause (i),
reduced by ½ percent.
(2) Specification of performance standard rates of increase for subsequent fiscal years
(A) In general
Unless Congress otherwise provides, subject to paragraph (4), the performance standard rate of increase, for all physicians' services and for each category of physicians' services, for a fiscal year (beginning with fiscal year 1991) shall be equal to the product of—
(i) 1 plus the Secretary's estimate of the weighted average percentage increase (divided by 100) in the fees for all physicians' services or for the category of physicians' services, respectively, under this part for portions of calendar years included in the fiscal year involved,
(ii) 1 plus the Secretary's estimate of the percentage increase or decrease (divided by 100) in the average number of individuals enrolled under this part (other than HMO enrollees) from the previous fiscal year to the fiscal year involved,
(iii) 1 plus the Secretary's estimate of the average annual percentage growth (divided by 100) in volume and intensity of all physicians' services or of the category of physicians' services, respectively, under this part for the 5-fiscal-year period ending with the preceding fiscal year (based upon information contained in the most recent annual report made pursuant to
(iv) 1 plus the Secretary's estimate of the percentage increase or decrease (divided by 100) in expenditures for all physicians' services or of the category of physicians' services, respectively, in the fiscal year (compared with the preceding fiscal year) which will result from changes in law or regulations including changes in law and regulations affecting the percentage increase described in clause (i) and which is not taken into account in the percentage increase described in clause (i),
minus 1, multiplied by 100, and reduced by the performance standard factor (specified in subparagraph (B)). In clause (i), the term "fees" means, with respect to 1991, reasonable charges and, with respect to any succeeding year, fee schedule amounts.
(B) Performance standard factor
For purposes of subparagraph (A), the performance standard factor—
(i) for 1991 is 1 percentage point,
(ii) for 1992 is 1½ percentage points,
(iii) for 1993 is 2 percentage points,
(iv) for 1994 is 3½ percentage points, and
(v) for each succeeding year is 4 percentage points.
(C) Performance standard rates of increase for fiscal year 1991
Notwithstanding subparagraph (A), the performance standard rate of increase for a category of physicians' services for fiscal year 1991 shall be the sum of—
(i) the Secretary's estimate of the percentage by which actual expenditures for the category of physicians' services under this part for fiscal year 1991 exceed actual expenditures for such category of services in fiscal year 1990 (determined without regard to the amendments made by the Omnibus Budget Reconciliation Act of 1990), and
(ii) the Secretary's estimate of the percentage increase or decrease in expenditures for the category of services in fiscal year 1991 (compared with fiscal year 1990) that will result from changes in law and regulations (including the Omnibus Budget Reconciliation Act of 1990), reduced by 2 percentage points.
(3) Quarterly reporting
The Secretary shall establish procedures for providing, on a quarterly basis to the Physician Payment Review Commission, the Congressional Budget Office, the Congressional Research Service, the Committees on Ways and Means and Energy and Commerce of the House of Representatives, and the Committee on Finance of the Senate, information on compliance with performance standard rates of increase established under this subsection.
(4) Separate group-specific performance standard rates of increase
(A) Implementation of plan
Subject to subparagraph (B), the Secretary shall, after completion of the study required under section 6102(e)(3) of the Omnibus Budget Reconciliation Act of 1989, but not before October 1, 1991, implement a plan under which qualified physician groups could elect annually separate performance standard rates of increase other than the performance standard rate of increase established for the year under paragraph (2) for such physicians. The Secretary shall develop criteria to determine which physician groups are eligible to elect to have applied to such groups separate performance standard rates of increase and the methods by which such group-specific performance standard rates of increase would be accomplished. The Secretary shall report to the Congress on the criteria and methods by April 15, 1991. The Physician Payment Review Commission shall review and comment on such recommendations by May 15, 1991. Before implementing group-specific performance standard rates of increase, the Secretary shall provide for notice and comment in the Federal Register and consult with organizations representing physicians.
(B) Approval
The Secretary may not implement the plan described in subparagraph (A), unless specifically approved by law.
(5) Definitions
In this subsection:
(A) Services included in physicians' services
The term "physicians' services" includes other items and services (such as clinical diagnostic laboratory tests and radiology services), specified by the Secretary, that are commonly performed or furnished by a physician or in a physician's office, but does not include services furnished to an HMO enrollee under a risk-sharing contract under
(B) HMO enrollee
The term "HMO enrollee" means, with respect to a fiscal year, an individual enrolled under this part who is enrolled with an entity under a risk-sharing contract under
(g) Limitation on beneficiary liability
(1) Limitation on actual charges
(A) In general
In the case of a nonparticipating physician or nonparticipating supplier or other person (as defined in
(i) Application of limiting charge
No person may bill or collect an actual charge for the service in excess of the limiting charge described in paragraph (2) for such service.
(ii) No liability for excess charges
No person is liable for payment of any amounts billed for the service in excess of such limiting charge.
(iii) Correction of excess charges
If such a physician, supplier, or other person bills, but does not collect, an actual charge for a service in violation of clause (i), the physician, supplier, or other person shall reduce on a timely basis the actual charge billed for the service to an amount not to exceed the limiting charge for the service.
(iv) Refund of excess collections
If such a physician, supplier, or other person collects an actual charge for a service in violation of clause (i), the physician, supplier, or other person shall provide on a timely basis a refund to the individual charged in the amount by which the amount collected exceeded the limiting charge for the service. The amount of such a refund shall be reduced to the extent the individual has an outstanding balance owed by the individual to the physician.
(B) Sanctions
If a physician, supplier, or other person—
(i) knowingly and willfully bills or collects for services in violation of subparagraph (A)(i) on a repeated basis, or
(ii) fails to comply with clause (iii) or (iv) of subparagraph (A) on a timely basis,
the Secretary may apply sanctions against the physician, supplier, or other person in accordance with paragraph (2) of
(C) Timely basis
For purposes of this paragraph, a correction of a bill for an excess charge or refund of an amount with respect to a violation of subparagraph (A)(i) in the case of a service is considered to be provided "on a timely basis", if the reduction or refund is made not later than 30 days after the date the physician, supplier, or other person is notified by the carrier under this part of such violation and of the requirements of subparagraph (A).
(2) "Limiting charge" defined
(A) For 1991
For physicians' services of a physician furnished during 1991, other than radiologist services subject to
(i) the maximum allowable actual charge (as determined under
(ii) the recognized payment amount for the service of the physician (as a nonparticipating physician) as of such date.
In the case of evaluation and management services (as specified in
(B) For 1992
For physicians' services furnished during 1992, other than radiologist services subject to
(i) the limiting charge (as determined under subparagraph (A) as of December 31, 1991) for the service, exceeds
(ii) the recognized payment amount for the service for nonparticipating physicians as of such date.
(C) After 1992
For physicians' services furnished in a year after 1992, the "limiting charge" shall be 115 percent of the recognized payment amount under this part for nonparticipating physicians or for nonparticipating suppliers or other persons.
(D) Recognized payment amount
In this section, the term "recognized payment amount" means, for services furnished on or after January 1, 1992, the fee schedule amount determined under subsection (a) of this section (or, if payment under this part is made on a basis other than the fee schedule under this section, 95 percent of the other payment basis), and, for services furnished during 1991, the applicable percentage (as defined in
(3) Limitation on charges for medicare beneficiaries eligible for medicaid benefits
(A) In general
Payment for physicians' services furnished on or after April 1, 1990, to an individual who is enrolled under this part and eligible for any medical assistance (including as a qualified medicare beneficiary, as defined in
(B) Penalty
A person may not bill for physicians' services subject to subparagraph (A) other than on an assignment-related basis. No person is liable for payment of any amounts billed for such a service in violation of the previous sentence. If a person knowingly and willfully bills for physicians' services in violation of the first sentence, the Secretary may apply sanctions against the person in accordance with
(4) Physician submission of claims
(A) In general
For services furnished on or after September 1, 1990, within 1 year after the date of providing a service for which payment is made under this part on a reasonable charge or fee schedule basis, a physician, supplier, or other person (or an employer or facility in the cases described in
(i) shall complete and submit a claim for such service on a standard claim form specified by the Secretary to the carrier on behalf of a beneficiary, and
(ii) may not impose any charge relating to completing and submitting such a form.
(B) Penalty
(i) With respect to an assigned claim wherever a physician, provider, supplier or other person (or an employer or facility in the cases described in
(ii) If a physician, supplier, or other person (or an employer or facility in the cases described in
(5) Electronic billing; direct deposit
The Secretary shall encourage and develop a system providing for expedited payment for claims submitted electronically. The Secretary shall also encourage and provide incentives allowing for direct deposit as payments for services furnished by participating physicians. The Secretary shall provide physicians with such technical information as necessary to enable such physicians to submit claims electronically. The Secretary shall submit a plan to Congress on this paragraph by May 1, 1990.
(6) Monitoring of charges
(A) In general
The Secretary shall monitor—
(i) the actual charges of nonparticipating physicians for physicians' services furnished on or after January 1, 1991, to individuals enrolled under this part, and
(ii) changes (by specialty, type of service, and geographic area) in (I) the proportion of expenditures for physicians' services provided under this part by participating physicians, (II) the proportion of expenditures for such services for which payment is made under this part on an assignment-related basis, and (III) the amounts charged above the recognized payment amounts under this part.
(B) Report
The Secretary shall, by not later than April 15 of each year (beginning in 1992), report to the Congress information on the extent to which actual charges exceed limiting charges, the number and types of services involved, and the average amount of excess charges and information regarding the changes described in subparagraph (A)(ii).
(C) Plan
If the Secretary finds that there has been a significant decrease in the proportions described in subclauses (I) and (II) of subparagraph (A)(ii) or an increase in the amounts described in subclause (III) of that subparagraph, the Secretary shall develop a plan to address such a problem and transmit to Congress recommendations regarding the plan. The Physician Payment Review Commission shall review the Secretary's plan and recommendations and transmit to Congress its comments regarding such plan and recommendations.
(7) Monitoring of utilization and access
(A) In general
The Secretary shall monitor—
(i) changes in the utilization of and access to services furnished under this part within geographic, population, and service related categories,
(ii) possible sources of inappropriate utilization of services furnished under this part which contribute to the overall level of expenditures under this part, and
(iii) factors underlying these changes and their interrelationships.
(B) Report
The Secretary shall by not later than April 15,2 of each year (beginning with 1991) report to the Congress on the changes described in subparagraph (A)(i) and shall include in the report an examination of the factors (including factors relating to different services and specific categories and groups of services and geographic and demographic variations in utilization) which may contribute to such changes.
(C) Recommendations
The Secretary shall include in each annual report under subparagraph (B) recommendations—
(i) addressing any identified patterns of inappropriate utilization,
(ii) on utilization review,
(iii) on physician education or patient education,
(iv) addressing any problems of beneficiary access to care made evident by the monitoring process, and
(v) on such other matters as the Secretary deems appropriate.
The Physician Payment Review Commission shall comment on the Secretary's recommendations and in developing its comments, the Commission shall convene and consult a panel of physician experts to evaluate the implications of medical utilization patterns for the quality of and access to patient care.
(h) Sending information to physicians
Before the beginning of each year (beginning with 1992), the Secretary shall send to each physician or nonparticipating supplier or other person furnishing physicians' services (as defined in subsection (j)(3) of this section) furnishing physicians' services under this part, for services commonly performed by the physician, supplier, or other person, information on fee schedule amounts that apply for the year in the fee schedule area for participating and non-participating physicians, and the maximum amount that may be charged consistent with subsection (g)(2) of this section. Such information shall be transmitted in conjunction with notices to physicians, suppliers, and other persons under
(i) Miscellaneous provisions
(1) Restriction on administrative and judicial review
There shall be no administrative or judicial review under
(A) the determination of the adjusted historical payment basis (as defined in subsection (a)(2)(D)(i) of this section),
(B) the determination of relative values and relative value units under subsection (c) of this section, including adjustments under subsection (c)(2)(F) of this section and section 13515(b) of the Omnibus Budget Reconciliation Act of 1993,
(C) the determination of conversion factors under subsection (d) of this section,
(D) the establishment of geographic adjustment factors under subsection (e) of this section, and
(E) the establishment of the system for the coding of physicians' services under this section.
(2) Assistants-at-surgery
(A) In general
Subject to subparagraph (B), in the case of a surgical service furnished by a physician, if payment is made separately under this part for the services of a physician serving as an assistant-at-surgery, the fee schedule amount shall not exceed 16 percent of the fee schedule amount otherwise determined under this section for the global surgical service involved.
(B) Denial of payment in certain cases
If the Secretary determines, based on the most recent data available, that for a surgical procedure (or class of surgical procedures) the national average percentage of such procedure performed under this part which involve the use of a physician as an assistant at surgery is less than 5 percent, no payment may be made under this part for services of an assistant at surgery involved in the procedure.
(3) No comparability adjustment
For physicians' services for which payment under this part is determined under this section—
(A) a carrier may not make any adjustment in the payment amount under
(B) no payment adjustment may be made under
(C)
(j) Definitions
In this section:
(1) Category
The term "category" means, with respect to physicians' services, surgical services, and all physicians' services other than surgical services (as defined by the Secretary and including anesthesia services), primary care services (as defined in
(2) Fee schedule area
The term "fee schedule area" means a locality used under
(3) Physicians' services
The term "physicians' services" includes items and services described in paragraphs (1), (2)(A), (2)(D), (2)(G), (3), and (4) of
(4) Practice expenses
The term "practice expenses" includes all expenses for furnishing physicians' services, excluding malpractice expenses, physician compensation, and other physician fringe benefits.
(Aug. 14, 1935, ch. 531, title XVIII, §1848, as added Dec. 19, 1989,
References in Text
Section 13515(b) of the Omnibus Budget Reconciliation Act of 1993, referred to in subsecs. (a)(2)(B)(ii)(I), (c)(2)(A)(i), and (i)(1)(B), is section 13515(b) of
Section 6105(b) of the Omnibus Budget Reconciliation Act of 1989, referred to in subsec. (a)(2)(D)(ii), (iii), is section 6105(b) of
Section 4048(b) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (b)(2)(B), is section 4048(b) of
Section 13514(a) of the Omnibus Budget Reconciliation Act of 1993, referred to in subsec. (c)(2)(F), is section 13514(a) of
The Omnibus Budget Reconciliation Act of 1990, referred to in subsec. (f)(2)(C)(i), (ii), is
Section 6102(e)(3) of the Omnibus Budget Reconciliation Act of 1989, referred to in subsec. (f)(4)(A), probably means section 6102(d)(3) of
Amendments
1994—Subsec. (a)(2)(D)(iii).
Subsec. (c)(2)(C)(ii).
Subsec. (c)(3)(C)(ii).
Subsec. (c)(4).
Subsec. (e)(1)(C).
Subsec. (e)(1)(D).
Subsec. (f)(2)(A)(i).
Subsec. (f)(2)(C).
Subsec. (g)(1).
Subsec. (g)(3)(B).
Subsec. (g)(6)(B).
Subsec. (i)(3).
1993—Subsec. (a)(2)(B)(ii)(I).
Subsec. (a)(3).
Subsec. (a)(4).
Subsec. (b)(3).
Subsec. (c)(2)(A)(i).
Subsec. (c)(2)(E).
Subsec. (c)(2)(F).
Subsec. (d)(3)(A)(i).
Subsec. (d)(3)(A)(iv) to (vi).
Subsec. (d)(3)(B)(ii).
Subsec. (f)(2)(B).
Subsec. (g)(1).
Subsec. (g)(2)(C).
Subsec. (g)(2)(D).
Subsec. (h).
Subsec. (i)(1)(B).
Subsec. (j)(1).
Subsec. (j)(3).
1990—Subsec. (a)(1).
Subsec. (a)(2)(C).
Subsec. (a)(2)(D)(ii).
Subsec. (a)(2)(D)(iii).
Subsec. (a)(4).
Subsec. (b)(3).
Subsec. (c)(1)(B).
Subsec. (c)(3).
Subsec. (c)(3)(C)(ii)(II), (iii)(II).
Subsec. (c)(4).
Subsec. (c)(5), (6).
Subsec. (d)(1)(A).
Subsec. (d)(1)(C)(i).
Subsec. (d)(1)(C)(ii).
Subsec. (d)(2)(A).
Subsec. (d)(2)(A)(ii).
Subsec. (d)(2)(E)(i).
Subsec. (d)(2)(E)(ii)(I).
Subsec. (d)(3)(A)(i).
Subsec. (d)(3)(A)(iii).
Subsec. (d)(3)(B)(i).
Subsec. (d)(3)(B)(ii).
Subsec. (e)(1)(A).
Subsec. (e)(1)(C).
Subsec. (f)(1)(C).
Subsec. (f)(1)(D)(i).
Subsec. (f)(2)(A).
Subsec. (f)(2)(A)(i).
Subsec. (f)(2)(A)(ii).
Subsec. (f)(2)(A)(iii).
Subsec. (f)(2)(A)(iv).
Subsec. (f)(2)(C).
Subsec. (f)(4)(A).
Subsec. (f)(4)(B).
Subsec. (g)(2)(A).
Subsec. (g)(2)(B).
Subsec. (i)(1)(A).
Subsec. (i)(2).
Subsec. (i)(3).
Subsec. (j)(1).
Change of Name
Committee on Energy and Commerce of House of Representatives changed to Committee on Commerce of House of Representatives by House Resolution No. 6, One Hundred Fourth Congress, Jan. 4, 1995.
Effective Date of 1994 Amendment
Amendment by section 123(a) of
Section 123(f)(5) of
Amendment by section 126(b)(6), (g)(2)(B), (5)–(7), (10)(A) of
Effective Date of 1993 Amendment
Section 13511(b) of
"(1) to volume performance standard rates of increase established under section 1848(f) of the Social Security Act [subsec. (f) of this section] for fiscal years before fiscal year 1994, and
"(2) to adjustment in updates in the conversion factors for physicians' services under section 1848(d)(3)(B) of such Act for physicians' services to be furnished in calendar years before 1996."
Section 13514(d) of
Amendment by section 13515(a)(1) of
Section 13517(c) of
Section 13518(c) of
Effective Date of 1990 Amendment
Amendment by section 4102(b), (g)(2) of
Amendment by section 4104(b)(2) of
Amendment by section 4106(b)(1) of
Section 4107(a)(2) of
Section 4107(c) of
Section 4109(b) of
Development of Resource-Based Methodology for Practice Expenses
Section 121(a) of
"(1)
"(2)
Application of Subsection (c)(2)(B)(ii)(II), (iii)
Section 121(b)(3) of
Report on Review Process
Section 122(c) of
"(1) the data necessary to review and revise the indices established under section 1848(e)(1)(A) of the Social Security Act [subsec. (e)(1)(A) of this section], including—
"(A) the shares allocated to physicians' work effort, practice expenses (other than malpractice expenses), and malpractice expenses;
"(B) the weights assigned to the input components of such shares; and
"(C) the index values assigned to such components;
"(2) any limitations on the availability of data necessary to review and revise such indices at least every three years;
"(3) ways of addressing such limitations, with particular attention to the development of alternative data sources for input components for which current index values are based on data collected less frequently than every three years; and
"(4) the costs of developing more accurate and timely data."
Relative Value for Pediatric Services
Section 124(a) of
Budget Neutrality Adjustment
For provisions requiring reduction of relative values established under subsec. (c) of this section and amounts determined under subsec. (a)(2)(B)(ii)(I) of this section for 1994 (to be applied for that year and subsequent years) in order to assure that the amendments to this section and
Section 13518(b) of
Ancillary Policies; Adjustment for Independent Laboratories Furnishing Physician Pathology Services
Section 4104(c) of
Computation of Conversion Factor for 1992
Section 4105(b)(2) of
Section 4106(c) of
Publication of Performance Standard Rates
Section 4105(d) of
Study of Regional Variations in Impact of Medicare Physician Payment Reform
Section 4115 of
"(a)
"(1) factors that may explain geographic variations in Medicare reasonable charges for physicians' services that are not attributable to variations in physician practice costs (including the supply of physicians in an area and area variations in the mix of services furnished);
"(2) the extent to which the geographic practice cost indices applied under the fee schedule established under section 1848 of the Social Security Act [this section] accurately reflect variations in practice costs and malpractice costs (and alternative sources of information upon which to base such indices);
"(3) the impact of the transition to a national, resource-based fee schedule for physicians' services under Medicare on access to physicians' services in areas that experience a disproportionately large reduction in payments for physicians' services under the fee schedule by reason of such variations; and
"(4) appropriate adjustments or modifications in the transition to, or manner of determining payments under, the fee schedule established under section 1848 of the Social Security Act, to compensate for such variations and ensure continued access to physicians' services for Medicare beneficiaries in such areas.
"(b)
Statewide Fee Schedule Areas for Physicians' Services
Section 4117 of
"(1) the adjusted historical payment basis (as defined in section 1848(a)(2)(D) of such Act (
"(2) the fee schedule amount (as referred to in section 1848(a) (
for physicians' services (as defined in section 1848(j)(3) of such Act (
Studies
Section 6102(d) of
"(1)
"(A) a study of alternative ways of paying, under section 1848 of the Social Security Act [this section], for the malpractice component for physicians' services, in a manner that would assure, to the extent practicable, payment for medicare's share of malpractice insurance premiums, and
"(B) a study to examine alternative resolution procedures for malpractice claims respecting professional services furnished under the medicare program.
The examination under subparagraph (B) shall include review of the feasibility of establishing procedures that involve no-fault payment or that involve mandatory arbitration. By not later than April 1, 1991, the Comptroller General shall submit a report to Congress on the results of the studies.
"(2)
"(3)
"(A) Geographic area (such as a region, State, or other area).
"(B) Specialty or group of specialties of physicians.
"(C) Type of services (such as primary care, services of hospital-based physicians, and other inpatient services).
Such study shall also include the scope of services included within, or excluded from, the rate of increase in expenditure system. By not later than July 1, 1990, the Secretary shall submit a report to Congress on such study and shall include in the report such recommendations respecting the feasibility of establishing separate performance standard rates of increase in expenditures as the Secretary deems appropriate.
"(4)
"(5)
"(A) the extent to which practice costs and malpractice costs vary by geographic locality (including region, State, Metropolitan Statistical Areas, or other areas and by specialty),
"(B) the extent to which available geographic practice-cost indices accurately reflect practice costs and malpractice costs in rural areas,
"(C) which geographic units would be most appropriate to use in measuring and adjusting practice costs and malpractice costs,
"(D) appropriate methods for allocating malpractice expenses to particular procedures which could be incorporated into the determination of relative values for particular procedures using a consensus panel and other appropriate methodologies,
"(E) the effect of alternative methods of allocating malpractice expenses on medicare expenditures by specialty, type of service, and by geographic area, and
"(F) the special circumstances of rural independent laboratories in determining the geographic cost-of-practice index.
By not later than July 1, 1991, the Commission shall submit a report to the Committees on Ways and Means and Energy and Commerce of the House of Representatives and the Committee on Finance of the Senate on the study and shall include in the report such recommendations as it deems appropriate.
"(6)
"(7)
"(8)
"(9)
[Section 126(h)(1) of
Distribution of Model Fee Schedule
Section 6102(e)(11) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be "elapsed".
2 So in original. The comma probably should not appear.
3 So in original. The word "a" probably should not appear.
4 So in original. Probably should be followed by a comma.
Part C—Miscellaneous Provisions
Part Referred to in Other Sections
This part is referred to in
§1395x. Definitions
For purposes of this subchapter—
(a) Spell of illness
The term "spell of illness" with respect to any individual means a period of consecutive days—
(1) beginning with the first day (not included in a previous spell of illness) (A) on which such individual is furnished inpatient hospital services, inpatient rural primary care hospital services or extended care services, and (B) which occurs in a month for which he is entitled to benefits under part A of this subchapter, and
(2) ending with the close of the first period of 60 consecutive days thereafter on each of which he is neither an inpatient of a hospital or rural primary care hospital nor an inpatient of a facility described in
(b) Inpatient hospital services
The term "inpatient hospital services" means the following items and services furnished to an inpatient of a hospital and (except as provided in paragraph (3)) by the hospital—
(1) bed and board;
(2) such nursing services and other related services, such use of hospital facilities, and such medical social services as are ordinarily furnished by the hospital for the care and treatment of inpatients, and such drugs, biologicals, supplies, appliances, and equipment, for use in the hospital, as are ordinarily furnished by such hospital for the care and treatment of inpatients; and
(3) such other diagnostic or therapeutic items or services, furnished by the hospital or by others under arrangements with them made by the hospital, as are ordinarily furnished to inpatients either by such hospital or by others under such arrangements;
excluding, however—
(4) medical or surgical services provided by a physician, resident, or intern, services described by clauses 1 (i) or (iii) of subsection (s)(2)(K) of this section, certified nurse-midwife services, qualified psychologist services, and services of a certified registered nurse anesthetist; and
(5) the services of a private-duty nurse or other private-duty attendant.
Paragraph (4) shall not apply to services provided in a hospital by—
(6) an intern or a resident-in-training under a teaching program approved by the Council on Medical Education of the American Medical Association or, in the case of an osteopathic hospital, approved by the Committee on Hospitals of the Bureau of Professional Education of the American Osteopathic Association, or, in the case of services in a hospital or osteopathic hospital by an intern or resident-in-training in the field of dentistry, approved by the Council on Dental Education of the American Dental Association, or in the case of services in a hospital or osteopathic hospital by an intern or resident-in-training in the field of podiatry, approved by the Council on Podiatric Medical Education of the American Podiatric Medical Association; or
(7) a physician where the hospital has a teaching program approved as specified in paragraph (6), if (A) the hospital elects to receive any payment due under this subchapter for reasonable costs of such services, and (B) all physicians in such hospital agree not to bill charges for professional services rendered in such hospital to individuals covered under the insurance program established by this subchapter.
(c) Inpatient psychiatric hospital services
The term "inpatient psychiatric hospital services" means inpatient hospital services furnished to an inpatient of a psychiatric hospital.
(d) Repealed. Pub. L. 98–369, div. B, title III, §2335(b)(1), July 18, 1984, 98 Stat. 1090
(e) Hospital
The term "hospital" (except for purposes of
(1) is primarily engaged in providing, by or under the supervision of physicians, to inpatients (A) diagnostic services and therapeutic services for medical diagnosis, treatment, and care of injured, disabled, or sick persons, or (B) rehabilitation services for the rehabilitation of injured, disabled, or sick persons;
(2) maintains clinical records on all patients;
(3) has bylaws in effect with respect to its staff of physicians;
(4) has a requirement that every patient with respect to whom payment may be made under this subchapter must be under the care of a physician, except that a patient receiving qualified psychologist services (as defined in subsection (ii) of this section) may be under the care of a clinical psychologist with respect to such services to the extent permitted under State law;
(5) provides 24-hour nursing service rendered or supervised by a registered professional nurse, and has a licensed practical nurse or registered professional nurse on duty at all times; except that until January 1, 1979, the Secretary is authorized to waive the requirement of this paragraph for any one-year period with respect to any institution, insofar as such requirement relates to the provision of twenty-four-hour nursing service rendered or supervised by a registered professional nurse (except that in any event a registered professional nurse must be present on the premises to render or supervise the nursing service provided, during at least the regular daytime shift), where immediately preceding such one-year period he finds that—
(A) such institution is located in a rural area and the supply of hospital services in such area is not sufficient to meet the needs of individuals residing therein,
(B) the failure of such institution to qualify as a hospital would seriously reduce the availability of such services to such individuals, and
(C) such institution has made and continues to make a good faith effort to comply with this paragraph, but such compliance is impeded by the lack of qualified nursing personnel in such area;
(6)(A) has in effect a hospital utilization review plan which meets the requirements of subsection (k) of this section and (B) has in place a discharge planning process that meets the requirements of subsection (ee) of this section;
(7) in the case of an institution in any State in which State or applicable local law provides for the licensing of hospitals, (A) is licensed pursuant to such law or (B) is approved, by the agency of such State or locality responsible for licensing hospitals, as meeting the standards established for such licensing;
(8) has in effect an overall plan and budget that meets the requirements of subsection (z) of this section; and
(9) meets such other requirements as the Secretary finds necessary in the interest of the health and safety of individuals who are furnished services in the institution.
For purposes of subsection (a)(2) of this section, such term includes any institution which meets the requirements of paragraph (1) of this subsection. For purposes of
(A) with respect to the requirements for nursing services applicable after December 31, 1978, such requirements shall provide for temporary waiver of the requirements, for such period as the Secretary deems appropriate, where (i) the facility's failure to fully comply with the requirements is attributable to a temporary shortage of qualified nursing personnel in the area in which the facility is located, (ii) a registered professional nurse is present on the premises to render or supervise the nursing service provided during at least the regular daytime shift, and (iii) the Secretary determines that the employment of such nursing personnel as are available to the facility during such temporary period will not adversely affect the health and safety of patients;
(B) with respect to the health and safety requirements promulgated under paragraph (9), such requirements shall be applied by the Secretary to a facility herein defined in such manner as to assure that personnel requirements take into account the availability of technical personnel and the educational opportunities for technical personnel in the area in which such facility is located, and the scope of services rendered by such facility; and the Secretary, by regulations, shall provide for the continued participation of such a facility where such personnel requirements are not fully met, for such period as the Secretary determines that (i) the facility is making good faith efforts to fully comply with the personnel requirements, (ii) the employment by the facility of such personnel as are available to the facility will not adversely affect the health and safety of patients, and (iii) if the Secretary has determined that because of the facility's waiver under this subparagraph the facility should limit its scope of services in order not to adversely affect the health and safety of the facility's patients, the facility is so limiting the scope of services it provides; and
(C) with respect to the fire and safety requirements promulgated under paragraph (9), the Secretary (i) may waive, for such period as he deems appropriate, specific provisions of such requirements which if rigidly applied would result in unreasonable hardship for such a facility and which, if not applied, would not jeopardize the health and safety of patients, and (ii) may accept a facility's compliance with all applicable State codes relating to fire and safety in lieu of compliance with the fire and safety requirements promulgated under paragraph (9), if he determines that such State has in effect fire and safety codes, imposed by State law, which adequately protect patients.
The term "hospital" does not include, unless the context otherwise requires, a rural primary care hospital (as defined in subsection (mm)(1) of this section).
(f) Psychiatric hospital
The term "psychiatric hospital" means an institution which—
(1) is primarily engaged in providing, by or under the supervision of a physician, psychiatric services for the diagnosis and treatment of mentally ill persons;
(2) satisfies the requirements of paragraphs (3) through (9) of subsection (e) of this section;
(3) maintains clinical records on all patients and maintains such records as the Secretary finds to be necessary to determine the degree and intensity of the treatment provided to individuals entitled to hospital insurance benefits under part A of this subchapter; and
(4) meets such staffing requirements as the Secretary finds necessary for the institution to carry out an active program of treatment for individuals who are furnished services in the institution.
In the case of an institution which satisfies paragraphs (1) and (2) of the preceding sentence and which contains a distinct part which also satisfies paragraphs (3) and (4) of such sentence, such distinct part shall be considered to be a "psychiatric hospital".
(g) Outpatient occupational therapy services
The term "outpatient occupational therapy services" has the meaning given the term "outpatient physical therapy services" in subsection (p) of this section, except that "occupational" shall be substituted for "physical" each place it appears therein.
(h) Extended care services
The term "extended care services" means the following items and services furnished to an inpatient of a skilled nursing facility and (except as provided in paragraphs (3) and (6)) by such skilled nursing facility—
(1) nursing care provided by or under the supervision of a registered professional nurse;
(2) bed and board in connection with the furnishing of such nursing care;
(3) physical or occupational therapy or speech-language pathology services furnished by the skilled nursing facility or by others under arrangements with them made by the facility;
(4) medical social services;
(5) such drugs, biologicals, supplies, appliances, and equipment, furnished for use in the skilled nursing facility, as are ordinarily furnished by such facility for the care and treatment of inpatients;
(6) medical services provided by an intern or resident-in-training of a hospital with which the facility has in effect a transfer agreement (meeting the requirements of subsection (l) of this section), under a teaching program of such hospital approved as provided in the last sentence of subsection (b) of this section, and other diagnostic or therapeutic services provided by a hospital with which the facility has such an agreement in effect; and
(7) such other services necessary to the health of the patients as are generally provided by skilled nursing facilities;
excluding, however, any item or service if it would not be included under subsection (b) of this section if furnished to an inpatient of a hospital.
(i) Post-hospital extended care services
The term "post-hospital extended care services" means extended care services furnished an individual after transfer from a hospital in which he was an inpatient for not less than 3 consecutive days before his discharge from the hospital in connection with such transfer. For purposes of the preceding sentence, items and services shall be deemed to have been furnished to an individual after transfer from a hospital, and he shall be deemed to have been an inpatient in the hospital immediately before transfer therefrom, if he is admitted to the skilled nursing facility (A) within 30 days after discharge from such hospital, or (B) within such time as it would be medically appropriate to begin an active course of treatment, in the case of an individual whose condition is such that skilled nursing facility care would not be medically appropriate within 30 days after discharge from a hospital; and an individual shall be deemed not to have been discharged from a skilled nursing facility if, within 30 days after discharge therefrom, he is admitted to such facility or any other skilled nursing facility.
(j) Skilled nursing facility
The term "skilled nursing facility" has the meaning given such term in
(k) Utilization review
A utilization review plan of a hospital or skilled nursing facility shall be considered sufficient if it is applicable to services furnished by the institution to individuals entitled to insurance benefits under this subchapter and if it provides—
(1) for the review, on a sample or other basis, of admissions to the institution, the duration of stays therein, and the professional services (including drugs and biologicals) furnished, (A) with respect to the medical necessity of the services, and (B) for the purpose of promoting the most efficient use of available health facilities and services;
(2) for such review to be made by either (A) a staff committee of the institution composed of two or more physicians (of which at least two must be physicians described in subsection (r)(1) of this section), with or without participation of other professional personnel, or (B) a group outside the institution which is similarly composed and (i) which is established by the local medical society and some or all of the hospitals and skilled nursing facilities in the locality, or (ii) if (and for as long as) there has not been established such a group which serves such institution, which is established in such other manner as may be approved by the Secretary;
(3) for such review, in each case of inpatient hospital services or extended care services furnished to such an individual during a continuous period of extended duration, as of such days of such period (which may differ for different classes of cases) as may be specified in regulations, with such review to be made as promptly as possible, after each day so specified, and in no event later than one week following such day; and
(4) for prompt notification to the institution, the individual, and his attending physician of any finding (made after opportunity for consultation to such attending physician) by the physician members of such committee or group that any further stay in the institution is not medically necessary.
The review committee must be composed as provided in clause (B) of paragraph (2) rather than as provided in clause (A) of such paragraph in the case of any hospital or skilled nursing facility where, because of the small size of the institution, or (in the case of a skilled nursing facility) because of lack of an organized medical staff, or for such other reason or reasons as may be included in regulations, it is impracticable for the institution to have a properly functioning staff committee for the purposes of this subsection. If the Secretary determines that the utilization review procedures established pursuant to subchapter XIX of this chapter are superior in their effectiveness to the procedures required under this section, he may, to the extent that he deems it appropriate, require for purposes of this subchapter that the procedures established pursuant to subchapter XIX of this chapter be utilized instead of the procedures required by this section.
(l) Agreements for transfer between skilled nursing facilities and hospitals
A hospital and a skilled nursing facility shall be considered to have a transfer agreement in effect if, by reason of a written agreement between them or (in case the two institutions are under common control) by reason of a written undertaking by the person or body which controls them, there is reasonable assurance that—
(1) transfer of patients will be effected between the hospital and the skilled nursing facility whenever such transfer is medically appropriate as determined by the attending physician; and
(2) there will be interchange of medical and other information necessary or useful in the care and treatment of individuals transferred between the institutions, or in determining whether such individuals can be adequately cared for otherwise than in either of such institutions.
Any skilled nursing facility which does not have such an agreement in effect, but which is found by a State agency (of the State in which such facility is situated) with which an agreement under
(m) Home health services
The term "home health services" means the following items and services furnished to an individual, who is under the care of a physician, by a home health agency or by others under arrangements with them made by such agency, under a plan (for furnishing such items and services to such individual) established and periodically reviewed by a physician, which items and services are, except as provided in paragraph (7), provided on a visiting basis in a place of residence used as such individual's home—
(1) part-time or intermittent nursing care provided by or under the supervision of a registered professional nurse;
(2) physical or occupational therapy or speech-language pathology services;
(3) medical social services under the direction of a physician;
(4) to the extent permitted in regulations, part-time or intermittent services of a home health aide who has successfully completed a training program approved by the Secretary;
(5) medical supplies (including catheters, catheter supplies, ostomy bags, and supplies related to ostomy care, and a covered osteoporosis drug (as defined in subsection (kk) of this section), but excluding other drugs and biologicals) and durable medical equipment while under such a plan;
(6) in the case of a home health agency which is affiliated or under common control with a hospital, medical services provided by an intern or resident-in-training of such hospital, under a teaching program of such hospital approved as provided in the last sentence of subsection (b) of this section; and
(7) any of the foregoing items and services which are provided on an outpatient basis, under arrangements made by the home health agency, at a hospital or skilled nursing facility, or at a rehabilitation center which meets such standards as may be prescribed in regulations, and—
(A) the furnishing of which involves the use of equipment of such a nature that the items and services cannot readily be made available to the individual in such place of residence, or
(B) which are furnished at such facility while he is there to receive any such item or service described in clause (A),
but not including transportation of the individual in connection with any such item or service;
excluding, however, any item or service if it would not be included under subsection (b) of this section if furnished to an inpatient of a hospital.
(n) Durable medical equipment
The term "durable medical equipment" includes iron lungs, oxygen tents, hospital beds, and wheelchairs (which may include a power-operated vehicle that may be appropriately used as a wheelchair, but only where the use of such a vehicle is determined to be necessary on the basis of the individual's medical and physical condition and the vehicle meets such safety requirements as the Secretary may prescribe) used in the patient's home (including an institution used as his home other than an institution that meets the requirements of subsection (e)(1) of this section or
(o) Home health agency
The term "home health agency" means a public agency or private organization, or a subdivision of such an agency or organization, which—
(1) is primarily engaged in providing skilled nursing services and other therapeutic services;
(2) has policies, established by a group of professional personnel (associated with the agency or organization), including one or more physicians and one or more registered professional nurses, to govern the services (referred to in paragraph (1)) which it provides, and provides for supervision of such services by a physician or registered professional nurse;
(3) maintains clinical records on all patients;
(4) in the case of an agency or organization in any State in which State or applicable local law provides for the licensing of agencies or organizations of this nature, (A) is licensed pursuant to such law, or (B) is approved, by the agency of such State or locality responsible for licensing agencies or organizations of this nature, as meeting the standards established for such licensing;
(5) has in effect an overall plan and budget that meets the requirements of subsection (z) of this section;
(6) meets the conditions of participation specified in
(7) meets such additional requirements (including conditions relating to bonding or establishing of escrow accounts as the Secretary finds necessary for the financial security of the program) as the Secretary finds necessary for the effective and efficient operation of the program;
except that for purposes of part A of this subchapter such term shall not include any agency or organization which is primarily for the care and treatment of mental diseases.
(p) Outpatient physical therapy services
The term "outpatient physical therapy services" means physical therapy services furnished by a provider of services, a clinic, rehabilitation agency, or a public health agency, or by others under an arrangement with, and under the supervision of, such provider, clinic, rehabilitation agency, or public health agency to an individual as an outpatient—
(1) who is under the care of a physician (as defined in paragraph (1) or (3) of subsection (r) of this section), and
(2) with respect to whom a plan prescribing the type, amount, and duration of physical therapy services that are to be furnished such individual has been established by a physician (as so defined) or by a qualified physical therapist and is periodically reviewed by a physician (as so defined);
excluding, however—
(3) any item or service if it would not be included under subsection (b) of this section if furnished to an inpatient of a hospital; and
(4) any such service—
(A) if furnished by a clinic or rehabilitation agency, or by others under arrangements with such clinic or agency, unless such clinic or rehabilitation agency—
(i) provides an adequate program of physical therapy services for outpatients and has the facilities and personnel required for such program or required for the supervision of such a program, in accordance with such requirements as the Secretary may specify,
(ii) has policies, established by a group of professional personnel, including one or more physicians (associated with the clinic or rehabilitation agency) and one or more qualified physical therapists, to govern the services (referred to in clause (i)) it provides,
(iii) maintains clinical records on all patients,
(iv) if such clinic or agency is situated in a State in which State or applicable local law provides for the licensing of institutions of this nature, (I) is licensed pursuant to such law, or (II) is approved by the agency of such State or locality responsible for licensing institutions of this nature, as meeting the standards established for such licensing; and
(v) meets such other conditions relating to the health and safety of individuals who are furnished services by such clinic or agency on an outpatient basis, as the Secretary may find necessary, or
(B) if furnished by a public health agency, unless such agency meets such other conditions relating to health and safety of individuals who are furnished services by such agency on an outpatient basis, as the Secretary may find necessary.
The term "outpatient physical therapy services" also includes physical therapy services furnished an individual by a physical therapist (in his office or in such individual's home) who meets licensing and other standards prescribed by the Secretary in regulations, otherwise than under an arrangement with and under the supervision of a provider of services, clinic, rehabilitation agency, or public health agency, if the furnishing of such services meets such conditions relating to health and safety as the Secretary may find necessary. In addition, such term includes physical therapy services which meet the requirements of the first sentence of this subsection except that they are furnished to an individual as an inpatient of a hospital or extended care facility. The term "outpatient physical therapy services" also includes speech-language pathology services furnished by a provider of services, a clinic, rehabilitation agency, or by a public health agency, or by others under an arrangement with, and under the supervision of, such provider, clinic, rehabilitation agency, or public health agency to an individual as an outpatient, subject to the conditions prescribed in this subsection. Nothing in this subsection shall be construed as requiring, with respect to outpatients who are not entitled to benefits under this subchapter, a physical therapist to provide outpatient physical therapy services only to outpatients who are under the care of a physician or pursuant to a plan of care established by a physician.
(q) Physicians' services
The term "physicians' services" means professional services performed by physicians, including surgery, consultation, and home, office, and institutional calls (but not including services described in subsection (b)(6) of this section).
(r) Physician
The term "physician", when used in connection with the performance of any function or action, means (1) a doctor of medicine or osteopathy legally authorized to practice medicine and surgery by the State in which he performs such function or action (including a physician within the meaning of
(s) Medical and other health services
The term "medical and other health services" means any of the following items or services:
(1) physicians' services;
(2)(A) services and supplies (including drugs and biologicals which cannot, as determined in accordance with regulations, be self-administered) furnished as an incident to a physician's professional service, of kinds which are commonly furnished in physicians' offices and are commonly either rendered without charge or included in the physicians' bills;
(B) hospital services (including drugs and biologicals which cannot, as determined in accordance with regulations, be self-administered) incident to physicians' services rendered to outpatients and partial hospitalization services incident to such services;
(C) diagnostic services which are—
(i) furnished to an individual as an outpatient by a hospital or by others under arrangements with them made by a hospital, and
(ii) ordinarily furnished by such hospital (or by others under such arrangements) to its outpatients for the purpose of diagnostic study;
(D) outpatient physical therapy services and outpatient occupational therapy services;
(E) rural health clinic services and Federally qualified health center services;
(F) home dialysis supplies and equipment, self-care home dialysis support services, and institutional dialysis services and supplies;
(G) antigens (subject to quantity limitations prescribed in regulations by the Secretary) prepared by a physician, as defined in subsection (r)(1) of this section, for a particular patient, including antigens so prepared which are forwarded to another qualified person (including a rural health clinic) for administration to such patient, from time to time, by or under the supervision of another such physician;
(H)(i) services furnished pursuant to a contract under
(ii) services furnished pursuant to a risk-sharing contract under
(I) blood clotting factors, for hemophilia patients competent to use such factors to control bleeding without medical or other supervision, and items related to the administration of such factors, subject to utilization controls deemed necessary by the Secretary for the efficient use of such factors;
(J) prescription drugs used in immunosuppressive therapy furnished, to an individual who receives an organ transplant for which payment is made under this subchapter, but only in the case of drugs furnished—
(i) before 1995, within 12 months after the date of the transplant procedure,
(ii) during 1995, within 18 months after the date of the transplant procedure,
(iii) during 1996, within 24 months after the date of the transplant procedure,
(iv) during 1997, within 30 months after the date of the transplant procedure, and
(v) during any year after 1997, within 36 months after the date of the transplant procedure;
(K)(i) services which would be physicians' services if furnished by a physician (as defined in subsection (r)(1) of this section) and which are performed by a physician assistant (as defined in subsection (aa)(5) of this section) under the supervision of a physician (as so defined) (I) in a hospital, skilled nursing facility, or nursing facility (as defined in
(ii) services which would be physicians' services if furnished by a physician (as defined in subsection (r)(1) of this section) and which are performed by a nurse practitioner (as defined in subsection (aa)(5) of this section) working in collaboration (as defined in subsection (aa)(6) of this section) with a physician (as defined in subsection (r)(1) of this section) in a skilled nursing facility or nursing facility (as defined in
(iii) services which would be physicians' services if furnished by a physician (as defined in subsection (r)(1) of this section) and which are performed by a nurse practitioner or clinical nurse specialist (as defined in subsection (aa)(5) of this section) working in collaboration (as defined in subsection (aa)(6) of this section) with a physician (as defined in subsection (r)(1) of this section) in a rural area (as defined in
(iv) such services and supplies furnished as an incident to services described in clause (i) or (ii) as would be covered under subparagraph (A) if furnished as an incident to a physician's professional service;
(L) certified nurse-midwife services;
(M) qualified psychologist services;
(N) clinical social worker services (as defined in subsection (hh)(2) of this section); and 2
(O) erythropoietin for dialysis patients competent to use such drug without medical or other supervision with respect to the administration of such drug, subject to methods and standards established by the Secretary by regulation for the safe and effective use of such drug, and items related to the administration of such drug; and
(P) Redesignated (O).
(Q) an oral drug (which is approved by the Federal Food and Drug Administration) prescribed for use as an anticancer chemotherapeutic agent for a given indication, and containing an active ingredient (or ingredients), which is the same indication and active ingredient (or ingredients) as a drug which the carrier determines would be covered pursuant to subparagraph (A) or (B) if the drug could not be self-administered;
(3) diagnostic X-ray tests (including tests under the supervision of a physician, furnished in a place of residence used as the patient's home, if the performance of such tests meets such conditions relating to health and safety as the Secretary may find necessary and including diagnostic mammography if conducted by a facility that has a certificate (or provisional certificate) issued under section 354 of the Public Health Service Act [
(4) X-ray, radium, and radioactive isotope therapy, including materials and services of technicians;
(5) surgical dressings, and splints, casts, and other devices used for reduction of fractures and dislocations;
(6) durable medical equipment;
(7) ambulance service where the use of other methods of transportation is contraindicated by the individual's condition, but only to the extent provided in regulations;
(8) prosthetic devices (other than dental) which replace all or part of an internal body organ (including colostomy bags and supplies directly related to colostomy care), including replacement of such devices, and including one pair of conventional eyeglasses or contact lenses furnished subsequent to each cataract surgery with insertion of an intraocular lens;
(9) leg, arm, back, and neck braces, and artificial legs, arms, and eyes, including replacements if required because of a change in the patient's physical condition;
(10)(A) pneumococcal vaccine and its administration and, subject to section 4071(b) of the Omnibus Budget Reconciliation Act of 1987, influenza vaccine and its administration; and
(B) hepatitis B vaccine and its administration, furnished to an individual who is at high or intermediate risk of contracting hepatitis B (as determined by the Secretary under regulations);
(11) services of a certified registered nurse anesthetist (as defined in subsection (bb) of this section);
(12) subject to section 4072(e) of the Omnibus Budget Reconciliation Act of 1987, extra-depth shoes with inserts or custom molded shoes with inserts for an individual with diabetes, if—
(A) the physician who is managing the individual's diabetic condition (i) documents that the individual has peripheral neuropathy with evidence of callus formation, a history of pre-ulcerative calluses, a history of previous ulceration, foot deformity, or previous amputation, or poor circulation, and (ii) certifies that the individual needs such shoes under a comprehensive plan of care related to the individual's diabetic condition;
(B) the particular type of shoes are prescribed by a podiatrist or other qualified physician (as established by the Secretary); and
(C) the shoes are fitted and furnished by a podiatrist or other qualified individual (such as a pedorthist or orthotist, as established by the Secretary) who is not the physician described in subparagraph (A) (unless the Secretary finds that the physician is the only such qualified individual in the area); and
(13) screening mammography (as defined in subsection (jj) of this section);
(14) screening pap smear.
No diagnostic tests performed in any laboratory, including a laboratory that is part of a rural health clinic, or a hospital (which, for purposes of this sentence, means an institution considered a hospital for purposes of
(15) if situated in any State in which State or applicable local law provides for licensing of establishments of this nature, (A) is licensed pursuant to such law, or (B) is approved, by the agency of such State or locality responsible for licensing establishments of this nature, as meeting the standards established for such licensing; and
(16)(A) meets the certification requirements under section 353 of the Public Health Service Act [
(B) meets such other conditions relating to the health and safety of individuals with respect to whom such tests are performed as the Secretary may find necessary.
There shall be excluded from the diagnostic services specified in paragraph (2)(C) any item or service (except services referred to in paragraph (1)) which would not be included under subsection (b) of this section if it were furnished to an inpatient of a hospital. None of the items and services referred to in the preceding paragraphs (other than paragraphs (1) and (2)(A)) of this subsection which are furnished to a patient of an institution which meets the definition of a hospital for purposes of
(t) Drugs and biologicals
(1) The term "drugs" and the term "biologicals", except for purposes of subsection (m)(5) of this section and paragraph (2), include only such drugs and biologicals, respectively, as are included (or approved for inclusion) in the United States Pharmacopoeia, the National Formulary, or the United States Homeopathic Pharmacopoeia, or in New Drugs or Accepted Dental Remedies (except for any drugs and biologicals unfavorably evaluated therein), or as are approved by the pharmacy and drug therapeutics committee (or equivalent committee) of the medical staff of the hospital furnishing such drugs and biologicals for use in such hospital.
(2)(A) For purposes of paragraph (1), the term "drugs" also includes any drugs or biologicals used in an anticancer chemotherapeutic regimen for a medically accepted indication (as described in subparagraph (B)).
(B) In subparagraph (A), the term "medically accepted indication", with respect to the use of a drug, includes any use which has been approved by the Food and Drug Administration for the drug, and includes another use of the drug if—
(i) the drug has been approved by the Food and Drug Administration; and
(ii)(I) such use is supported by one or more citations which are included (or approved for inclusion) in one or more of the following compendia: the American Hospital Formulary Service-Drug Information, the American Medical Association Drug Evaluations, the United States Pharmacopoeia-Drug Information, and other authoritative compendia as identified by the Secretary, unless the Secretary has determined that the use is not medically appropriate or the use is identified as not indicated in one or more such compendia, or
(II) the carrier involved determines, based upon guidance provided by the Secretary to carriers for determining accepted uses of drugs, that such use is medically accepted based on supportive clinical evidence in peer reviewed medical literature appearing in publications which have been identified for purposes of this subclause by the Secretary.
The Secretary may revise the list of compendia in clause (ii)(I) as is appropriate for identifying medically accepted indications for drugs.
(u) Provider of services
The term "provider of services" means a hospital, rural primary care hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, home health agency, hospice program, or, for purposes of section 1395f(g) and
(v) Reasonable costs
(1)(A) The reasonable cost of any services shall be the cost actually incurred, excluding therefrom any part of incurred cost found to be unnecessary in the efficient delivery of needed health services, and shall be determined in accordance with regulations establishing the method or methods to be used, and the items to be included, in determining such costs for various types or classes of institutions, agencies, and services; except that in any case to which paragraph (2) or (3) applies, the amount of the payment determined under such paragraph with respect to the services involved shall be considered the reasonable cost of such services. In prescribing the regulations referred to in the preceding sentence, the Secretary shall consider, among other things, the principles generally applied by national organizations or established prepayment organizations (which have developed such principles) in computing the amount of payment, to be made by persons other than the recipients of services, to providers of services on account of services furnished to such recipients by such providers. Such regulations may provide for determination of the costs of services on a per diem, per unit, per capita, or other basis, may provide for using different methods in different circumstances, may provide for the use of estimates of costs of particular items or services, may provide for the establishment of limits on the direct or indirect overall incurred costs or incurred costs of specific items or services or groups of items or services to be recognized as reasonable based on estimates of the costs necessary in the efficient delivery of needed health services to individuals covered by the insurance programs established under this subchapter, and may provide for the use of charges or a percentage of charges where this method reasonably reflects the costs. Such regulations shall (i) take into account both direct and indirect costs of providers of services (excluding therefrom any such costs, including standby costs, which are determined in accordance with regulations to be unnecessary in the efficient delivery of services covered by the insurance programs established under this subchapter) in order that, under the methods of determining costs, the necessary costs of efficiently delivering covered services to individuals covered by the insurance programs established by this subchapter will not be borne by individuals not so covered, and the costs with respect to individuals not so covered will not be borne by such insurance programs, and (ii) provide for the making of suitable retroactive corrective adjustments where, for a provider of services for any fiscal period, the aggregate reimbursement produced by the methods of determining costs proves to be either inadequate or excessive.
(B) In the case of extended care services, the regulations under subparagraph (A) shall not include provision for specific recognition of a return on equity capital.
(C) Where a hospital has an arrangement with a medical school under which the faculty of such school provides services at such hospital, an amount not in excess of the reasonable cost of such services to the medical school shall be included in determining the reasonable cost to the hospital of furnishing services—
(i) for which payment may be made under part A of this subchapter, but only if—
(I) payment for such services as furnished under such arrangement would be made under part A of this subchapter to the hospital had such services been furnished by the hospital, and
(II) such hospital pays to the medical school at least the reasonable cost of such services to the medical school, or
(ii) for which payment may be made under part B of this subchapter, but only if such hospital pays to the medical school at least the reasonable cost of such services to the medical school.
(D) Where (i) physicians furnish services which are either inpatient hospital services (including services in conjunction with the teaching programs of such hospital) by reason of paragraph (7) of subsection (b) of this section or for which entitlement exists by reason of clause (II) of
(E) Such regulations may, in the case of skilled nursing facilities in any State, provide for the use of rates, developed by the State in which such facilities are located, for the payment of the cost of skilled nursing facility services furnished under the State's plan approved under subchapter XIX of this chapter (and such rates may be increased by the Secretary on a class or size of institution or on a geographical basis by a percentage factor not in excess of 10 percent to take into account determinable items or services or other requirements under this subchapter not otherwise included in the computation of such State rates), if the Secretary finds that such rates are reasonably related to (but not necessarily limited to) analyses undertaken by such State of costs of care in comparable facilities in such State. Notwithstanding the previous sentence, such regulations with respect to skilled nursing facilities shall take into account (in a manner consistent with subparagraph (A) and based on patient-days of services furnished) the costs (including the costs of services required to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident eligible for benefits under this subchapter) of such facilities complying with the requirements of subsections (b), (c), and (d) of
(F) Such regulations shall require each provider of services (other than a fund) to make reports to the Secretary of information described in
(G)(i) In any case in which a hospital provides inpatient services to an individual that would constitute post-hospital extended care services if provided by a skilled nursing facility and a quality control and peer review organization (or, in the absence of such a qualified organization, the Secretary or such agent as the Secretary may designate) determines that inpatient hospital services for the individual are not medically necessary but post-hospital extended care services for the individual are medically necessary and such extended care services are not otherwise available to the individual (as determined in accordance with criteria established by the Secretary) at the time of such determination, payment for such services provided to the individual shall continue to be made under this subchapter at the payment rate described in clause (ii) during the period in which—
(I) such post-hospital extended care services for the individual are medically necessary and not otherwise available to the individual (as so determined),
(II) inpatient hospital services for the individual are not medically necessary, and
(III) the individual is entitled to have payment made for post-hospital extended care services under this subchapter,
except that if the Secretary determines that there is not an excess of hospital beds in such hospital and (subject to clause (iv)) there is not an excess of hospital beds in the area of such hospital, such payment shall be made (during such period) on the basis of the amount otherwise payable under part A with respect to inpatient hospital services.
(ii)(I) Except as provided in subclause (II), the payment rate referred to in clause (i) is a rate equal to the estimated adjusted State-wide average rate per patient-day paid for services provided in skilled nursing facilities under the State plan approved under subchapter XIX of this chapter for the State in which such hospital is located, or, if the State in which the hospital is located does not have a State plan approved under subchapter XIX of this chapter, the estimated adjusted State-wide average allowable costs per patient-day for extended care services under this subchapter in that State.
(II) If a hospital has a unit which is a skilled nursing facility, the payment rate referred to in clause (i) for the hospital is a rate equal to the lesser of the rate described in subclause (I) or the allowable costs in effect under this subchapter for extended care services provided to patients of such unit.
(iii) Any day on which an individual receives inpatient services for which payment is made under this subparagraph shall, for purposes of this chapter (other than this subparagraph), be deemed to be a day on which the individual received inpatient hospital services.
(iv) In determining under clause (i), in the case of a public hospital, whether or not there is an excess of hospital beds in the area of such hospital, such determination shall be made on the basis of only the public hospitals (including the hospital) which are in the area of the hospital and which are under common ownership with that hospital.
(H) In determining such reasonable cost with respect to home health agencies, the Secretary may not include—
(i) any costs incurred in connection with bonding or establishing an escrow account by any such agency as a result of the financial security requirement described in subsection (o)(7) of this section;
(ii) in the case of home health agencies to which the financial security requirement described in subsection (o)(7) of this section applies, any costs attributed to interest charged such an agency in connection with amounts borrowed by the agency to repay overpayments made under this subchapter to the agency, except that such costs may be included in reasonable cost if the Secretary determines that the agency was acting in good faith in borrowing the amounts;
(iii) in the case of contracts entered into by a home health agency after December 5, 1980, for the purpose of having services furnished for or on behalf of such agency, any cost incurred by such agency pursuant to any such contract which is entered into for a period exceeding five years; and
(iv) in the case of contracts entered into by a home health agency before December 5, 1980, for the purpose of having services furnished for or on behalf of such agency, any cost incurred by such agency pursuant to any such contract, which determines the amount payable by the home health agency on the basis of a percentage of the agency's reimbursement or claim for reimbursement for services furnished by the agency, to the extent that such cost exceeds the reasonable value of the services furnished on behalf of such agency.
(I) In determining such reasonable cost, the Secretary may not include any costs incurred by a provider with respect to any services furnished in connection with matters for which payment may be made under this subchapter and furnished pursuant to a contract between the provider and any of its subcontractors which is entered into after December 5, 1980, and the value or cost of which is $10,000 or more over a twelve-month period unless the contract contains a clause to the effect that—
(i) until the expiration of four years after the furnishing of such services pursuant to such contract, the subcontractor shall make available, upon written request by the Secretary, or upon request by the Comptroller General, or any of their duly authorized representatives, the contract, and books, documents and records of such subcontractor that are necessary to certify the nature and extent of such costs, and
(ii) if the subcontractor carries out any of the duties of the contract through a subcontract, with a value or cost of $10,000 or more over a twelve-month period, with a related organization, such subcontract shall contain a clause to the effect that until the expiration of four years after the furnishing of such services pursuant to such subcontract, the related organization shall make available, upon written request by the Secretary, or upon request by the Comptroller General, or any of their duly authorized representatives, the subcontract, and books, documents and records of such organization that are necessary to verify the nature and extent of such costs.
The Secretary shall prescribe in regulation 3 criteria and procedures which the Secretary shall use in obtaining access to books, documents, and records under clauses required in contracts and subcontracts under this subparagraph.
(J) Such regulations may not provide for any inpatient routine salary cost differential as a reimbursable cost for hospitals and skilled nursing facilities.
(K)(i) The Secretary shall issue regulations that provide, to the extent feasible, for the establishment of limitations on the amount of any costs or charges that shall be considered reasonable with respect to services provided on an outpatient basis by hospitals (other than bona fide emergency services as defined in clause (ii)) or clinics (other than rural health clinics), which are reimbursed on a cost basis or on the basis of cost related charges, and by physicians utilizing such outpatient facilities. Such limitations shall be reasonably related to the charges in the same area for similar services provided in physicians' offices. Such regulations shall provide for exceptions to such limitations in cases where similar services are not generally available in physicians' offices in the area to individuals entitled to benefits under this subchapter.
(ii) For purposes of clause (i), the term "bona fide emergency services" means services provided in a hospital emergency room after the sudden onset of a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that the absence of immediate medical attention could reasonably be expected to result in—
(I) placing the patient's health in serious jeopardy;
(II) serious impairment to bodily functions; or
(III) serious dysfunction of any bodily organ or part.
(L)(i) The Secretary, in determining the amount of the payments that may be made under this subchapter with respect to services furnished by home health agencies, may not recognize as reasonable (in the efficient delivery of such services) costs for the provision of such services by an agency to the extent these costs exceed (on the aggregate for the agency) for cost reporting periods beginning on or after—
(I) July 1, 1985, and before July 1, 1986, 120 percent,
(II) July 1, 1986, and before July 1, 1987, 115 percent, or
(III) July 1, 1987, 112 percent,
of the mean of the labor-related and nonlabor per visit costs for free standing home health agencies.
(ii) Effective for cost reporting periods beginning on or after July 1, 1986, such limitations shall be applied on an aggregate basis for the agency, rather than on a discipline specific basis. The Secretary may provide for such exemptions and exceptions to such limitation as he deems appropriate.
(iii) Not later than July 1, 1991, and annually thereafter (but not for cost reporting periods beginning on or after July 1, 1994, and before July 1, 1996), the Secretary shall establish limits under this subparagraph for cost reporting periods beginning on or after such date by utilizing the area wage index applicable under
(M) Such regulations shall provide that costs respecting care provided by a provider of services, pursuant to an assurance under title VI or XVI of the Public Health Service Act [
(N) In determining such reasonable costs, costs incurred for activities directly related to influencing employees respecting unionization may not be included.
(O)(i) In establishing an appropriate allowance for depreciation and for interest on capital indebtedness and (if applicable) a return on equity capital with respect to an asset of a hospital or skilled nursing facility which has undergone a change of ownership, such regulations shall provide, except as provided in clause (iv), that the valuation of the asset after such change of ownership shall be the lesser of the allowable acquisition cost of such asset to the owner of record as of July 18, 1984 (or, in the case of an asset not in existence as of such date, the first owner of record of the asset after such date), or the acquisition cost of such asset to the new owner.
(ii) Such regulations shall provide for recapture of depreciation in the same manner as provided under the regulations in effect on June 1, 1984.
(iii) Such regulations shall not recognize, as reasonable in the provision of health care services, costs (including legal fees, accounting and administrative costs, travel costs, and the costs of feasibility studies) attributable to the negotiation or settlement of the sale or purchase of any capital asset (by acquisition or merger) for which any payment has previously been made under this subchapter.
(iv) In the case of the transfer of a hospital from ownership by a State to ownership by a nonprofit corporation without monetary consideration, the basis for capital allowances to the new owner shall be the book value of the hospital to the State at the time of the transfer.
(P) If such regulations provide for the payment for a return on equity capital (other than with respect to costs of inpatient hospital services), the rate of return to be recognized, for determining the reasonable cost of services furnished in a cost reporting period, shall be equal to the average of the rates of interest, for each of the months any part of which is included in the period, on obligations issued for purchase by the Federal Hospital Insurance Trust Fund.
(Q) Except as otherwise explicitly authorized, the Secretary is not authorized to limit the rate of increase on allowable costs of approved medical educational activities.
(R) In determining such reasonable cost, costs incurred by a provider of services representing a beneficiary in an unsuccessful appeal of a determination described in
(S)(i) Such regulations shall not include provision for specific recognition of any return on equity capital with respect to hospital outpatient departments.
(ii)(I) Such regulations shall provide that, in determining the amount of the payments that may be made under this subchapter with respect to all the capital-related costs of outpatient hospital services, the Secretary shall reduce the amounts of such payments otherwise established under this subchapter by 15 percent for payments attributable to portions of cost reporting periods occurring during fiscal year 1990, by 15 percent for payments attributable to portions of cost reporting periods occurring during fiscal year 1991, and by 10 percent for payments attributable to portions of cost reporting periods occurring during fiscal years 1992 through 1998.
(II) The Secretary shall reduce the reasonable cost of outpatient hospital services (other than the capital-related costs of such services) otherwise determined pursuant to
(III) Subclauses (I) and (II) shall not apply to payments with respect to the costs of hospital outpatient services provided by any hospital that is a sole community hospital (as defined in
(IV) In applying subclauses (I) and (II) to services for which payment is made on the basis of a blend amount under
(2)(A) If the bed and board furnished as part of inpatient hospital services (including inpatient tuberculosis hospital services and inpatient psychiatric hospital services) or post-hospital extended care services is in accommodations more expensive than semi-private accommodations, the amount taken into account for purposes of payment under this subchapter with respect to such services may not exceed the amount that would be taken into account with respect to such services if furnished in such semi-private accommodations unless the more expensive accommodations were required for medical reasons.
(B) Where a provider of services which has an agreement in effect under this subchapter furnishes to an individual items or services which are in excess of or more expensive than the items or services with respect to which payment may be made under part A or part B of this subchapter, as the case may be, the Secretary shall take into account for purposes of payment to such provider of services only the items or services with respect to which such payment may be made.
(3) If the bed and board furnished as part of inpatient hospital services (including inpatient tuberculosis hospital services and inpatient psychiatric hospital services) or post-hospital extended care services is in accommodations other than, but not more expensive than, semi-private accommodations and the use of such other accommodations rather than semi-private accommodations was neither at the request of the patient nor for a reason which the Secretary determines is consistent with the purposes of this subchapter, the amount of the payment with respect to such bed and board under part A of this subchapter shall be the amount otherwise payable under this subchapter for such bed and board furnished in semi-private accommodations minus the difference between the charge customarily made by the hospital or skilled nursing facility for bed and board in semi-private accommodations and the charge customarily made by it for bed and board in the accommodations furnished.
(4) If a provider of services furnishes items or services to an individual which are in excess of or more expensive than the items or services determined to be necessary in the efficient delivery of needed health services and charges are imposed for such more expensive items or services under the authority granted in section 1395cc(a)(2)(B)(ii),6 of this title, the amount of payment with respect to such items or services otherwise due such provider in any fiscal period shall be reduced to the extent that such payment plus such charges exceed the cost actually incurred for such items or services in the fiscal period in which such charges are imposed.
(5)(A) Where physical therapy services, occupational therapy services, speech therapy services, or other therapy services or services of other health-related personnel (other than physicians) are furnished under an arrangement with a provider of services or other organization, specified in the first sentence of subsection (p) of this section (including through the operation of subsection (g) of this section) the amount included in any payment to such provider or other organization under this subchapter as the reasonable cost of such services (as furnished under such arrangements) shall not exceed an amount equal to the salary which would reasonably have been paid for such services (together with any additional costs that would have been incurred by the provider or other organization) to the person performing them if they had been performed in an employment relationship with such provider or other organization (rather than under such arrangement) plus the cost of such other expenses (including a reasonable allowance for traveltime and other reasonable types of expense related to any differences in acceptable methods of organization for the provision of such therapy) incurred by such person, as the Secretary may in regulations determine to be appropriate.
(B) Notwithstanding the provisions of subparagraph (A), if a provider of services or other organization specified in the first sentence of subsection (p) of this section requires the services of a therapist on a limited part-time basis, or only to perform intermittent services, the Secretary may make payment on the basis of a reasonable rate per unit of service, even though such rate is greater per unit of time than salary related amounts, where he finds that such greater payment is, in the aggregate, less than the amount that would have been paid if such organization had employed a therapist on a full- or part-time salary basis.
(6) For purposes of this subsection, the term, "semi-private accommodations" means two-bed, three-bed, or four-bed accommodations.
(7)(A) For limitation on Federal participation for capital expenditures which are out of conformity with a comprehensive plan of a State or areawide planning agency, see
(B) For further limitations on reasonable cost and determination of payment amounts for operating costs of inpatient hospital services and waivers for certain States, see
(C) For provisions restricting payment for provider-based physicians' services and for payments under certain percentage arrangements, see
(D) For further limitations on reasonable cost and determination of payment amounts for routine service costs of skilled nursing facilities, see
(w) Arrangements for certain services; payments pursuant to arrangements for utilization review activities
(1) The term "arrangements" is limited to arrangements under which receipt of payment by the hospital, rural primary care hospital, skilled nursing facility, home health agency, or hospice program (whether in its own right or as agent), with respect to services for which an individual is entitled to have payment made under this subchapter, discharges the liability of such individual or any other person to pay for the services.
(2) Utilization review activities conducted, in accordance with the requirements of the program established under part B of subchapter XI of this chapter with respect to services furnished by a hospital or rural primary care hospital to patients insured under part A of this subchapter or entitled to have payment made for such services under part B of this subchapter or under a State plan approved under subchapter XIX of this chapter, by a quality control and peer review organization designated for the area in which such hospital or rural primary care hospital is located shall be deemed to have been conducted pursuant to arrangements between such hospital or rural primary care hospital and such organization under which such hospital or rural primary care hospital is obligated to pay to such organization, as a condition of receiving payment for hospital or rural primary care hospital services so furnished under this part or under such a State plan, such amount as is reasonably incurred and requested (as determined under regulations of the Secretary) by such organization in conducting such review activities with respect to services furnished by such hospital or rural primary care hospital to such patients.
(x) State and United States
The terms "State" and "United States" have the meaning given to them by subsections (h) and (i), respectively, of
(y) Post-hospital extended care in Christian Science skilled nursing facilities
(1) The term "skilled nursing facility" also includes a Christian Science sanatorium operated, or listed and certified, by the First Church of Christ, Scientist, Boston, Massachusetts, but only (except for purposes of subsection (a)(2) of this section) with respect to items and services ordinarily furnished by such an institution to inpatients, and payment may be made with respect to services provided by or in such an institution only to such extent and under such conditions, limitations, and requirements (in addition to or in lieu of the conditions, limitations, and requirements otherwise applicable) as may be provided in regulations.
(2) Notwithstanding any other provision of this subchapter, payment under part A of this subchapter may not be made for services furnished an individual in a skilled nursing facility to which paragraph (1) applies unless such individual elects, in accordance with regulations, for a spell of illness to have such services treated as post-hospital extended care services for purposes of such part; and payment under part A of this subchapter may not be made for post-hospital extended care services—
(A) furnished an individual during such spell of illness in a skilled nursing facility to which paragraph (1) applies after—
(i) such services have been furnished to him in such a facility for 30 days during such spell, or
(ii) such services have been furnished to him during such spell in a skilled nursing facility to which such paragraph does not apply; or
(B) furnished an individual during such spell of illness in a skilled nursing facility to which paragraph (1) does not apply after such services have been furnished to him during such spell in a skilled nursing facility to which such paragraph applies.
(3) The amount payable under part A of this subchapter for post-hospital extended care services furnished an individual during any spell of illness in a skilled nursing facility to which paragraph (1) applies shall be reduced by a coinsurance amount equal to one-eighth of the inpatient hospital deductible for each day before the 31st day on which he is furnished such services in such a facility during such spell (and the reduction under this paragraph shall be in lieu of any reduction under
(4) For purposes of subsection (i) of this section, the determination of whether services furnished by or in an institution described in paragraph (1) constitute post-hospital extended care services shall be made in accordance with and subject to such conditions, limitations, and requirements as may be provided in regulations.
(z) Institutional planning
An overall plan and budget of a hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, or home health agency shall be considered sufficient if it—
(1) provides for an annual operating budget which includes all anticipated income and expenses related to items which would, under generally accepted accounting principles, be considered income and expense items (except that nothing in this paragraph shall require that there be prepared, in connection with any budget, an item-by-item identification of the components of each type of anticipated expenditure or income);
(2)(A) provides for a capital expenditures plan for at least a 3-year period (including the year to which the operating budget described in paragraph (1) is applicable) which includes and identifies in detail the anticipated sources of financing for, and the objectives of, each anticipated expenditure in excess of $600,000 (or such lesser amount as may be established by the State under
(B) provides that such plan is submitted to the agency designated under
(3) provides for review and updating at least annually; and
(4) is prepared, under the direction of the governing body of the institution or agency, by a committee consisting of representatives of the governing body, the administrative staff, and the medical staff (if any) of the institution or agency.
(aa) Rural health clinic services and Federally qualified health center services
(1) The term "rural health clinic services" means—
(A) physicians' services and such services and supplies as are covered under subsection (s)(2)(A) of this section if furnished as an incident to a physician's professional service and items and services described in subsection (s)(10) of this section,
(B) such services furnished by a physician assistant or a nurse practitioner (as defined in paragraph (5)), by a clinical psychologist (as defined by the Secretary) or by a clinical social worker (as defined in subsection (hh)(1) of this section),,7 and such services and supplies furnished as an incident to his service as would otherwise be covered if furnished by a physician or as an incident to a physician's service, and
(C) in the case of a rural health clinic located in an area in which there exists a shortage of home health agencies, part-time or intermittent nursing care and related medical supplies (other than drugs and biologicals) furnished by a registered professional nurse or licensed practical nurse to a homebound individual under a written plan of treatment (i) established and periodically reviewed by a physician described in paragraph (2)(B), or (ii) established by a nurse practitioner or physician assistant and periodically reviewed and approved by a physician described in paragraph (2)(B),
when furnished to an individual as an outpatient of a rural health clinic.
(2) The term "rural health clinic" means a facility which—
(A) is primarily engaged in furnishing to outpatients services described in subparagraphs (A) and (B) of paragraph (1);
(B) in the case of a facility which is not a physician-directed clinic, has an arrangement (consistent with the provisions of State and local law relative to the practice, performance, and delivery of health services) with one or more physicians (as defined in subsection (r)(1)) of this section under which provision is made for the periodic review by such physicians of covered services furnished by physician assistants and nurse practitioners, the supervision and guidance by such physicians of physician assistants and nurse practitioners, the preparation by such physicians of such medical orders for care and treatment of clinic patients as may be necessary, and the availability of such physicians for such referral of and consultation for patients as is necessary and for advice and assistance in the management of medical emergencies; and, in the case of a physician-directed clinic, has one or more of its staff physicians perform the activities accomplished through such an arrangement;
(C) maintains clinical records on all patients;
(D) has arrangements with one or more hospitals, having agreements in effect under
(E) has written policies, which are developed with the advice of (and with provision for review of such policies from time to time by) a group of professional personnel, including one or more physicians and one or more physician assistants or nurse practitioners, to govern those services described in paragraph (1) which it furnishes;
(F) has a physician, physician assistant, or nurse practitioner responsible for the execution of policies described in subparagraph (E) and relating to the provision of the clinic's services;
(G) directly provides routine diagnostic services, including clinical laboratory services, as prescribed in regulations by the Secretary, and has prompt access to additional diagnostic services from facilities meeting requirements under this subchapter;
(H) in compliance with State and Federal law, has available for administering to patients of the clinic at least such drugs and biologicals as are determined by the Secretary to be necessary for the treatment of emergency cases (as defined in regulations) and has appropriate procedures or arrangements for storing, administering, and dispensing any drugs and biologicals;
(I) has appropriate procedures for review of utilization of clinic services to the extent that the Secretary determines to be necessary and feasible;
(J) has a nurse practitioner, a physician assistant, or a certified nurse-midwife (as defined in subsection (gg) of this section) available to furnish patient care services not less than 50 percent of the time the clinic operates; and
(K) meets such other requirements as the Secretary may find necessary in the interest of the health and safety of the individuals who are furnished services by the clinic.
For the purposes of this subchapter, such term includes only a facility which (i) is located in an area that is not an urbanized area (as defined by the Bureau of the Census) and that is designated by the chief executive officer of the State and certified by the Secretary as an area with a shortage of personal health services, or that is designated by the Secretary either (I) as an area with a shortage of personal health services under section 330(b)(3) or 1302(7) of the Public Health Service Act [
(3) The term "Federally qualified health center services" means—
(A) services of the type described in subparagraphs (A) through (C) of paragraph (1), and
(B) preventive primary health services that a center is required to provide under sections 329, 330, and 340 of the Public Health Service Act [
when furnished to an individual as an outpatient of a Federally qualified health center and, for this purpose, any reference to a rural health clinic or a physician described in paragraph (2)(B) is deemed a reference to a Federally qualified health center or a physician at the center, respectively.
(4) The term "Federally qualified health center" means an entity which—
(A)(i) is receiving a grant under section 329, 330, or 340 of the Public Health Service Act [
(ii)(I) is receiving funding from such a grant under a contract with the recipient of such a grant, and (II) meets the requirements to receive a grant under section 329, 330, or 340 of such Act [
(B) based on the recommendation of the Health Resources and Services Administration within the Public Health Service, is determined by the Secretary to meet the requirements for receiving such a grant;
(C) was treated by the Secretary, for purposes of part B of this subchapter, as a comprehensive Federally funded health center as of January 1, 1990; or
(D) is an outpatient health program or facility operated by a tribe or tribal organization under the Indian Self-Determination Act [
(5) The term "physician assistant", the term "nurse practitioner", and the term "clinical nurse specialist" mean, for purposes of this subchapter, a physician assistant, nurse practitioner, or clinical nurse specialist who performs such services as such individual is legally authorized to perform (in the State in which the individual performs such services) in accordance with State law (or the State regulatory mechanism provided by State law), and who meets such training, education, and experience requirements (or any combination thereof) as the Secretary may prescribe in regulations.
(6) The term "collaboration" means a process in which a nurse practitioner works with a physician to deliver health care services within the scope of the practitioner's professional expertise, with medical direction and appropriate supervision as provided for in jointly developed guidelines or other mechanisms as defined by the law of the State in which the services are performed.
(7)(A) The Secretary shall waive for a 1-year period the requirements of paragraph (2) that a rural health clinic employ a physician assistant, nurse practitioner or certified nurse midwife or that such clinic require such providers to furnish services at least 50 percent of the time that the clinic operates for any facility that requests such waiver if the facility demonstrates that the facility has been unable, despite reasonable efforts, to hire a physician assistant, nurse practitioner, or certified nurse-midwife in the previous 90-day period.
(B) The Secretary may not grant such a waiver under subparagraph (A) to a facility if the request for the waiver is made less than 6 months after the date of the expiration of any previous such waiver for the facility.
(C) A waiver which is requested under this paragraph shall be deemed granted unless such request is denied by the Secretary within 60 days after the date such request is received.
(bb) Services of a certified registered nurse anesthetist
(1) The term "services of a certified registered nurse anesthetist" means anesthesia services and related care furnished by a certified registered nurse anesthetist (as defined in paragraph (2)) which the nurse anesthetist is legally authorized to perform as such by the State in which the services are furnished.
(2) The term "certified registered nurse anesthetist" means a certified registered nurse anesthetist licensed by the State who meets such education, training, and other requirements relating to anesthesia services and related care as the Secretary may prescribe. In prescribing such requirements the Secretary may use the same requirements as those established by a national organization for the certification of nurse anesthetists. Such term also includes, as prescribed by the Secretary, an anesthesiologist assistant.
(cc) Comprehensive outpatient rehabilitation facility services
(1) The term "comprehensive outpatient rehabilitation facility services" means the following items and services furnished by a physician or other qualified professional personnel (as defined in regulations by the Secretary) to an individual who is an outpatient of a comprehensive outpatient rehabilitation facility under a plan (for furnishing such items and services to such individual) established and periodically reviewed by a physician—
(A) physicians' services;
(B) physical therapy, occupational therapy, speech-language pathology services, and respiratory therapy;
(C) prosthetic and orthotic devices, including testing, fitting, or training in the use of prosthetic and orthotic devices;
(D) social and psychological services;
(E) nursing care provided by or under the supervision of a registered professional nurse;
(F) drugs and biologicals which cannot, as determined in accordance with regulations, be self-administered;
(G) supplies and durable medical equipment; and
(H) such other items and services as are medically necessary for the rehabilitation of the patient and are ordinarily furnished by comprehensive outpatient rehabilitation facilities,
excluding, however, any item or service if it would not be included under subsection (b) of this section if furnished to an inpatient of a hospital. In the case of physical therapy, occupational therapy, and speech pathology services, there shall be no requirement that the item or service be furnished at any single fixed location if the item or service is furnished pursuant to such plan and payments are not otherwise made for the item or service under this subchapter.
(2) The term "comprehensive outpatient rehabilitation facility" means a facility which—
(A) is primarily engaged in providing (by or under the supervision of physicians) diagnostic, therapeutic, and restorative services to outpatients for the rehabilitation of injured, disabled, or sick persons;
(B) provides at least the following comprehensive outpatient rehabilitation services: (i) physicians' services (rendered by physicians, as defined in subsection (r)(1) of this section, who are available at the facility on a full- or part-time basis); (ii) physical therapy; and (iii) social or psychological services;
(C) maintains clinical records on all patients;
(D) has policies established by a group of professional personnel (associated with the facility), including one or more physicians defined in subsection (r)(1) of this section to govern the comprehensive outpatient rehabilitation services it furnishes, and provides for the carrying out of such policies by a full- or part-time physician referred to in subparagraph (B)(i);
(E) has a requirement that every patient must be under the care of a physician;
(F) in the case of a facility in any State in which State or applicable local law provides for the licensing of facilities of this nature (i) is licensed pursuant to such law, or (ii) is approved by the agency of such State or locality, responsible for licensing facilities of this nature, as meeting the standards established for such licensing;
(G) has in effect a utilization review plan in accordance with regulations prescribed by the Secretary;
(H) has in effect an overall plan and budget that meets the requirements of subsection (z) of this section; and
(I) meets such other conditions of participation as the Secretary may find necessary in the interest of the health and safety of individuals who are furnished services by such facility, including conditions concerning qualifications of personnel in these facilities.
(dd) Hospice care; hospice program; definitions; certification; waiver by Secretary
(1) The term "hospice care" means the following items and services provided to a terminally ill individual by, or by others under arrangements made by, a hospice program under a written plan (for providing such care to such individual) established and periodically reviewed by the individual's attending physician and by the medical director (and by the interdisciplinary group described in paragraph (2)(B)) of the program—
(A) nursing care provided by or under the supervision of a registered professional nurse,
(B) physical or occupational therapy, or speech-language pathology services,
(C) medical social services under the direction of a physician,
(D)(i) services of a home health aide who has successfully completed a training program approved by the Secretary and (ii) homemaker services,
(E) medical supplies (including drugs and biologicals) and the use of medical appliances, while under such a plan,
(F) physicians' services,
(G) short-term inpatient care (including both respite care and procedures necessary for pain control and acute and chronic symptom management) in an inpatient facility meeting such conditions as the Secretary determines to be appropriate to provide such care, but such respite care may be provided only on an intermittent, nonroutine, and occasional basis and may not be provided consecutively over longer than five days, and
(H) counseling (including dietary counseling) with respect to care of the terminally ill individual and adjustment to his death.
The care and services described in subparagraphs (A) and (D) may be provided on a 24-hour, continuous basis only during periods of crisis (meeting criteria established by the Secretary) and only as necessary to maintain the terminally ill individual at home.
(2) The term "hospice program" means a public agency or private organization (or a subdivision thereof) which—
(A)(i) is primarily engaged in providing the care and services described in paragraph (1) and makes such services available (as needed) on a 24-hour basis and which also provides bereavement counseling for the immediate family of terminally ill individuals,
(ii) provides for such care and services in individuals' homes, on an outpatient basis, and on a short-term inpatient basis, directly or under arrangements made by the agency or organization, except that—
(I) the agency or organization must routinely provide directly substantially all of each of the services described in subparagraphs (A), (C), (F), and (H) of paragraph (1), except as otherwise provided in paragraph (5), and
(II) in the case of other services described in paragraph (1) which are not provided directly by the agency or organization, the agency or organization must maintain professional management responsibility for all such services furnished to an individual, regardless of the location or facility in which such services are furnished; and
(iii) provides assurances satisfactory to the Secretary that the aggregate number of days of inpatient care described in paragraph (1)(G) provided in any 12-month period to individuals who have an election in effect under
(B) has an interdisciplinary group of personnel which—
(i) includes at least—
(I) one physician (as defined in subsection (r)(1) of this section),
(II) one registered professional nurse, and
(III) one social worker,
employed by the agency or organization, and also includes at least one pastoral or other counselor,
(ii) provides (or supervises the provision of) the care and services described in paragraph (1), and
(iii) establishes the policies governing the provision of such care and services;
(C) maintains central clinical records on all patients;
(D) does not discontinue the hospice care it provides with respect to a patient because of the inability of the patient to pay for such care;
(E)(i) utilizes volunteers in its provision of care and services in accordance with standards set by the Secretary, which standards shall ensure a continuing level of effort to utilize such volunteers, and (ii) maintains records on the use of these volunteers and the cost savings and expansion of care and services achieved through the use of these volunteers;
(F) in the case of an agency or organization in any State in which State or applicable local law provides for the licensing of agencies or organizations of this nature, is licensed pursuant to such law; and
(G) meets such other requirements as the Secretary may find necessary in the interest of the health and safety of the individuals who are provided care and services by such agency or organization.
(3)(A) An individual is considered to be "terminally ill" if the individual has a medical prognosis that the individual's life expectancy is 6 months or less.
(B) The term "attending physician" means, with respect to an individual, the physician (as defined in subsection (r)(1) of this section), who may be employed by a hospice program, whom the individual identifies as having the most significant role in the determination and delivery of medical care to the individual at the time the individual makes an election to receive hospice care.
(4)(A) An entity which is certified as a provider of services other than a hospice program shall be considered, for purposes of certification as a hospice program, to have met any requirements under paragraph (2) which are also the same requirements for certification as such other type of provider. The Secretary shall coordinate surveys for determining certification under this subchapter so as to provide, to the extent feasible, for simultaneous surveys of an entity which seeks to be certified as a hospice program and as a provider of services of another type.
(B) Any entity which is certified as a hospice program and as a provider of another type shall have separate provider agreements under
(5)(A) The Secretary may waive the requirements of paragraph (2)(A)(ii)(I) for an agency or organization with respect to all or part of the nursing care described in paragraph (1)(A) if such agency or organization—
(i) is located in an area which is not an urbanized area (as defined by the Bureau of the Census);
(ii) was in operation on or before January 1, 1983; and
(iii) has demonstrated a good faith effort (as determined by the Secretary) to hire a sufficient number of nurses to provide such nursing care directly.
(B) Any waiver, which is in such form and containing such information as the Secretary may require and which is requested by an agency or organization under subparagraph (A), shall be deemed to be granted unless such request is denied by the Secretary within 60 days after the date such request is received by the Secretary. The granting of a waiver under subparagraph (A) shall not preclude the granting of any subsequent waiver request should such a waiver again become necessary.
(ee) Discharge planning process
(1) A discharge planning process of a hospital shall be considered sufficient if it is applicable to services furnished by the hospital to individuals entitled to benefits under this subchapter and if it meets the guidelines and standards established by the Secretary under paragraph (2).
(2) The Secretary shall develop guidelines and standards for the discharge planning process in order to ensure a timely and smooth transition to the most appropriate type of and setting for post-hospital or rehabilitative care. The guidelines and standards shall include the following:
(A) The hospital must identify, at an early stage of hospitalization, those patients who are likely to suffer adverse health consequences upon discharge in the absence of adequate discharge planning.
(B) Hospitals must provide a discharge planning evaluation for patients identified under subparagraph (A) and for other patients upon the request of the patient, patient's representative, or patient's physician.
(C) Any discharge planning evaluation must be made on a timely basis to ensure that appropriate arrangements for post-hospital care will be made before discharge and to avoid unnecessary delays in discharge.
(D) A discharge planning evaluation must include an evaluation of a patient's likely need for appropriate post-hospital services, including hospice services, and the availability of those services.
(E) The discharge planning evaluation must be included in the patient's medical record for use in establishing an appropriate discharge plan and the results of the evaluation must be discussed with the patient (or the patient's representative).
(F) Upon the request of a patient's physician, the hospital must arrange for the development and initial implementation of a discharge plan for the patient.
(G) Any discharge planning evaluation or discharge plan required under this paragraph must be developed by, or under the supervision of, a registered professional nurse, social worker, or other appropriately qualified personnel.
(ff) Partial hospitalization services
(1) The term "partial hospitalization services" means the items and services described in paragraph (2) prescribed by a physician and provided under a program described in paragraph (3) under the supervision of a physician pursuant to an individualized, written plan of treatment established and periodically reviewed by a physician (in consultation with appropriate staff participating in such program), which plan sets forth the physician's diagnosis, the type, amount, frequency, and duration of the items and services provided under the plan, and the goals for treatment under the plan.
(2) The items and services described in this paragraph are—
(A) individual and group therapy with physicians or psychologists (or other mental health professionals to the extent authorized under State law),
(B) occupational therapy requiring the skills of a qualified occupational therapist,
(C) services of social workers, trained psychiatric nurses, and other staff trained to work with psychiatric patients,
(D) drugs and biologicals furnished for therapeutic purposes (which cannot, as determined in accordance with regulations, be self-administered),
(E) individualized activity therapies that are not primarily recreational or diversionary,
(F) family counseling (the primary purpose of which is treatment of the individual's condition),
(G) patient training and education (to the extent that training and educational activities are closely and clearly related to individual's care and treatment),
(H) diagnostic services, and
(I) such other items and services as the Secretary may provide (but in no event to include meals and transportation);
that are reasonable and necessary for the diagnosis or active treatment of the individual's condition, reasonably expected to improve or maintain the individual's condition and functional level and to prevent relapse or hospitalization, and furnished pursuant to such guidelines relating to frequency and duration of services as the Secretary shall by regulation establish (taking into account accepted norms of medical practice and the reasonable expectation of patient improvement).
(3)(A) A program described in this paragraph is a program which is furnished by a hospital to its outpatients or by a community mental health center (as defined in subparagraph (B)), and which is a distinct and organized intensive ambulatory treatment service offering less than 24-hour-daily care.
(B) For purposes of subparagraph (A), the term "community mental health center" means an entity—
(i) providing the services described in section 1916(c)(4) of the Public Health Service Act [
(ii) meeting applicable licensing or certification requirements for community mental health centers in the State in which it is located.
(gg) Certified nurse-midwife services
(1) The term "certified nurse-midwife services" means such services furnished by a certified nurse-midwife (as defined in paragraph (2)) and such services and supplies furnished as an incident to the nurse-midwife's service which the certified nurse-midwife is legally authorized to perform under State law (or the State regulatory mechanism provided by State law) as would otherwise be covered if furnished by a physician or as an incident to a physicians' service.
(2) The term "certified nurse-midwife" means a registered nurse who has successfully completed a program of study and clinical experience meeting guidelines prescribed by the Secretary, or has been certified by an organization recognized by the Secretary.
(hh) Clinical social worker; clinical social worker services
(1) The term "clinical social worker" means an individual who—
(A) possesses a master's or doctor's degree in social work;
(B) after obtaining such degree has performed at least 2 years of supervised clinical social work; and
(C)(i) is licensed or certified as a clinical social worker by the State in which the services are performed, or
(ii) in the case of an individual in a State which does not provide for licensure or certification—
(I) has completed at least 2 years or 3,000 hours of post-master's degree supervised clinical social work practice under the supervision of a master's level social worker in an appropriate setting (as determined by the Secretary), and
(II) meets such other criteria as the Secretary establishes.
(2) The term "clinical social worker services" means services performed by a clinical social worker (as defined in paragraph (1)) for the diagnosis and treatment of mental illnesses (other than services furnished to an inpatient of a hospital 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) which the clinical social worker 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 as would otherwise be covered if furnished by a physician or as an incident to a physician's professional service.
(ii) Qualified psychologist services
The term "qualified psychologist services" means such services and such services and supplies furnished as an incident to his service furnished by a clinical psychologist (as defined by the Secretary) which the psychologist is legally authorized to perform under State law (or the State regulatory mechanism provided by State law) as would otherwise be covered if furnished by a physician or as an incident to a physician's service.
(jj) Screening mammography
The term "screening mammography" means a radiologic procedure provided to a woman for the purpose of early detection of breast cancer and includes a physician's interpretation of the results of the procedure.
(kk) Covered osteoporosis drug
The term "covered osteoporosis drug" means an injectable drug approved for the treatment of post-menopausal osteoporosis provided to an individual by a home health agency if, in accordance with regulations promulgated by the Secretary—
(1) the individual's attending physician certifies that the individual has suffered a bone fracture related to post-menopausal osteoporosis and that the individual is unable to learn the skills needed to self-administer such drug or is otherwise physically or mentally incapable of self-administering such drug; and
(2) the individual is confined to the individual's home (except when receiving items and services referred to in subsection (m)(7) of this section).
(ll) Speech-language pathology services; audiology services
(1) The term "speech-language pathology services" means such speech, language, and related function assessment and rehabilitation services furnished by a qualified speech-language pathologist as the speech-language pathologist is legally authorized to perform under State law (or the State regulatory mechanism provided by State law) as would otherwise be covered if furnished by a physician.
(2) The term "audiology services" means such hearing and balance assessment services furnished by a qualified audiologist as the audiologist is legally authorized to perform under State law (or the State regulatory mechanism provided by State law), as would otherwise be covered if furnished by a physician.
(3) In this subsection:
(A) The term "qualified speech-language pathologist" means an individual with a master's or doctoral degree in speech-language pathology who—
(i) is licensed as a speech-language pathologist by the State in which the individual furnishes such services, or
(ii) in the case of an individual who furnishes services in a State which does not license speech-language pathologists, has successfully completed 350 clock hours of supervised clinical practicum (or is in the process of accumulating such supervised clinical experience), performed not less than 9 months of supervised full-time speech-language pathology services after obtaining a master's or doctoral degree in speech-language pathology or a related field, and successfully completed a national examination in speech-language pathology approved by the Secretary.
(B) The term "qualified audiologist" means an individual with a master's or doctoral degree in audiology who—
(i) is licensed as an audiologist by the State in which the individual furnishes such services, or
(ii) in the case of an individual who furnishes services in a State which does not license audiologists, has successfully completed 350 clock hours of supervised clinical practicum (or is in the process of accumulating such supervised clinical experience), performed not less than 9 months of supervised full-time audiology services after obtaining a master's or doctoral degree in audiology or a related field, and successfully completed a national examination in audiology approved by the Secretary.
(mm) Rural primary care hospital; rural primary care hospital services
(1) The term "rural primary care hospital" means a facility designated by the Secretary as a rural primary care hospital under
(2) The term "inpatient rural primary care hospital services" means items and services, furnished to an inpatient of a rural primary care hospital by such a hospital, that would be inpatient hospital services if furnished to an inpatient of a hospital by a hospital.
(3) The term "outpatient rural primary care hospital services" means medical and other health services furnished by a rural primary care hospital.
(nn) Screening pap smear
The term "screening pap smear" means a diagnostic laboratory test consisting of a routine exfoliative cytology test (Papanicolaou test) provided to a woman for the purpose of early detection of cervical cancer and includes a physician's interpretation of the results of the test, if the individual involved has not had such a test during the preceding 3 years (or such shorter period as the Secretary may specify in the case of a woman who is at high risk of developing cervical cancer (as determined pursuant to factors identified by the Secretary)).
(Aug. 14, 1935, ch. 531, title XVIII, §1861, as added July 30, 1965,
Amendment of Subsection (v)(1)(L)(iii)
References in Text
Parts A and B of this subchapter, referred to in text, are classified to section 1395c et seq. and section 1395j et seq., respectively, of this title.
Section 4071(b) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (s)(10)(A), is section 4071(b) of
Section 4072(e) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (s)(12), is section 4072(e) of
The Public Health Service Act, referred to in subsec. (v)(1)(M), is act July 1, 1944, ch. 373,
Part B of subchapter XI of this chapter, referred to in subsec. (w)(2), is classified to
The Indian Self-Determination Act, referred to in subsec. (aa)(4)(D), is title I of
The Indian Health Care Improvement Act, referred to in subsec. (aa)(4)(D), is
Amendments
1994—Subsec. (a)(1).
Subsec. (a)(2).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (e)(4).
Subsec. (h)(3).
Subsec. (m)(2).
Subsec. (m)(5).
Subsec. (p).
Subsec. (s)(2)(K)(iii).
Subsec. (s)(2)(N).
Subsec. (s)(2)(O), (P).
Subsec. (s)(3).
Subsec. (aa)(2).
Subsec. (aa)(5).
Subsec. (cc)(1)(B).
Subsec. (dd)(1)(B).
Subsec. (ee)(2)(D).
Subsec. (jj).
Subsec. (kk).
Subsec. (ll).
1993—Subsec. (s)(2)(J).
Subsec. (s)(2)(P).
Subsec. (s)(2)(Q).
Subsec. (t).
Subsec. (v)(1)(B).
Subsec. (v)(1)(L)(ii).
Subsec. (v)(1)(L)(iii).
Subsec. (v)(1)(S)(ii)(I).
Subsec. (v)(1)(S)(ii)(II).
Subsec. (aa)(4)(D).
Subsec. (gg)(2).
1990—Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (n).
Subsec. (s)(2)(E).
Subsec. (s)(2)(H)(i).
Subsec. (s)(2)(K)(i).
Subsec. (s)(2)(K)(ii).
Subsec. (s)(2)(K)(iii).
Subsec. (s)(2)(K)(iv).
Subsec. (s)(2)(O).
Subsec. (s)(2)(P).
Subsec. (s)(8).
Subsec. (s)(13).
Subsec. (v)(1)(E).
Subsec. (v)(1)(L)(iii).
"(I) utilize a wage index that is based on verified wage data obtained from home health agencies, and
"(II) base such limits on the most recent verified wage data available, which data may be for cost reporting periods beginning no earlier than July 1, 1985.
In the case of a home health agency that refuses to provide data, or deliberately provides false data, respecting wages for purposes of this clause upon the request of the Secretary, the Secretary may withhold up to 5 percent of the amount of the payments otherwise payable to the agency under this subchapter until such date as the Secretary determines that such data has been satisfactorily provided."
Subsec. (v)(1)(S)(ii)(I).
Subsec. (v)(1)(S)(ii)(II).
Subsec. (v)(1)(S)(ii)(III).
Subsec. (v)(1)(S)(ii)(IV).
Subsec. (aa).
Subsec. (aa)(1)(B).
Subsec. (aa)(2).
Subsec. (aa)(3).
Subsec. (aa)(4) to (6).
Subsec. (aa)(7).
Subsec. (ff)(3).
Subsec. (jj).
1989—Subsec. (a).
Subsec. (e).
Subsec. (i).
Subsec. (m).
Subsec. (m)(5).
Subsec. (s).
Subsec. (s)(2)(H)(ii).
Subsec. (s)(2)(J).
Subsec. (s)(2)(K).
Subsec. (s)(2)(N).
Subsec. (s)(12).
Subsec. (s)(13).
Subsec. (s)(14).
Subsec. (s)(15).
Subsec. (s)(16).
Subsec. (t).
Subsec. (u).
Subsec. (v)(1)(G)(i).
Subsec. (v)(1)(S).
Subsec. (v)(2)(A), (3).
Subsec. (w)(1).
Subsec. (w)(2).
Subsec. (y).
Subsec. (aa)(1)(B).
Subsec. (aa)(2).
Subsec. (aa)(2)(J), (K).
Subsec. (aa)(4).
Subsec. (hh).
Subsec. (ii).
Subsecs. (jj) to (ll).
Subsec. (mm).
Subsec. (mm)(3).
Subsec. (nn).
1988—Subsec. (a).
Subsec. (a)(2).
Subsec. (e).
Subsec. (i).
Subsec. (m).
Subsec. (n).
Subsec. (p).
Subsec. (s).
Subsec. (s)(2)(H)(ii).
Subsec. (s)(2)(J).
Subsec. (s)(2)(K)(i).
Subsec. (s)(2)(K)(i)(I).
Subsec. (s)(2)(M).
Subsec. (s)(10)(A).
Subsec. (s)(12).
Subsec. (s)(13).
Subsec. (s)(14).
Subsec. (s)(15).
Subsec. (s)(16).
Subsec. (t).
Subsec. (u).
Subsec. (v)(1)(G)(i).
Subsec. (v)(1)(L)(iii).
Subsec. (v)(2)(A), (3).
Subsec. (y).
Subsec. (y)(1).
Subsec. (y)(2).
Subsec. (y)(3).
Subsec. (y)(4).
Subsec. (bb)(2).
Subsec. (ff).
Subsec. (ff)(3).
Subsec. (gg).
Subsec. (hh).
Subsec. (ii).
Subsec. (jj).
Subsec. (kk).
Subsec. (ll).
1987—Subsec. (a)(2).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (b)(6).
Subsec. (e)(4).
Subsec. (g).
Subsec. (j).
Subsec. (n).
Subsec. (o)(6).
Subsec. (r)(3).
Subsec. (s).
Subsec. (s)(2)(B).
Subsec. (s)(2)(H)(ii).
Subsec. (s)(2)(J).
Subsec. (s)(2)(K)(i).
Subsec. (s)(2)(L).
Subsec. (s)(2)(M).
Subsec. (s)(10)(A).
Subsec. (s)(12).
Subsec. (s)(13), (14).
Subsec. (s)(15).
Subsec. (s)(16).
Subsec. (v)(1)(E).
Subsec. (v)(1)(L)(iii).
Subsec. (v)(1)(S).
Subsec. (v)(5)(A).
Subsec. (aa)(1)(B).
Subsec. (bb).
Subsec. (bb)(2).
Subsec. (cc)(1).
Subsec. (ee).
Subsec. (ff).
Subsec. (gg).
Subsec. (hh).
Subsec. (ii).
1986—Subsec. (b)(4).
Subsec. (e)(6).
Subsec. (g).
Subsec. (n).
Subsec. (r)(4).
Subsec. (s)(2)(D).
Subsec. (s)(2)(J).
Subsec. (s)(2)(K).
Subsec. (s)(11) to (15).
Subsec. (v)(1)(B).
Subsec. (v)(1)(G)(i).
Subsec. (v)(1)(L).
"(I) July 1, 1985, and before July 1, 1986, 120 percent,
"(II) July 1, 1986, and before July 1, 1987, 115 percent, or
"(III) July 1, 1987, 112 percent,
of the mean of the labor-related and nonlabor per visit costs for free standing home health agencies.
"(ii) Effective for cost reporting periods beginning on or after July 1, 1986, such limitations shall be applied on an aggregate basis for the agency, rather than on a discipline specific basis, with appropriate adjustment for administrative and general costs of hospital-based agencies."
Subsec. (v)(1)(O)(i).
Subsec. (v)(1)(O)(iv).
Subsec. (v)(1)(P).
Subsec. (v)(1)(Q).
Subsec. (v)(1)(R).
Subsec. (v)(5)(A).
Subsec. (bb).
Subsec. (ee).
1984—Subsec. (d).
Subsec. (e).
Subsec. (f).
Subsec. (g).
Subsec. (j).
Subsec. (j)(2).
Subsec. (j)(13).
Subsec. (m)(5).
Subsec. (n).
Subsec. (p)(1).
Subsec. (p)(2).
Subsec. (r)(3).
Subsec. (s)(2)(H).
Subsec. (s)(2)(I).
Subsec. (s)(6).
Subsec. (s)(10).
Subsec. (u).
Subsec. (v)(1)(B).
Subsec. (v)(1)(C).
Subsec. (v)(1)(C)(i).
Subsec. (v)(1)(D).
Subsec. (v)(1)(E).
Subsec. (v)(1)(I)(i), (ii).
Subsec. (v)(1)(K).
Subsec. (v)(1)(O).
Subsec. (v)(3).
Subsec. (v)(7)(D).
Subsec. (z)(2).
Subsec. (aa)(2)(I).
Subsec. (cc)(1)(F).
Subsec. (cc)(1)(G).
Subsec. (cc)(2)(F).
Subsec. (dd)(2)(A)(ii)(I).
Subsec. (dd)(5).
1983—Subsec. (v)(1)(G)(i).
Subsec. (v)(2)(A).
Subsec. (v)(2)(B).
Subsec. (v)(3).
Subsec. (v)(7)(C).
Subsec. (z)(2).
1982—Subsec. (e)(C).
Subsec. (s)(2)(H).
Subsec. (u).
Subsec. (v)(1)(E).
Subsec. (v)(1)(G)(i).
Subsec. (v)(1)(H)(iii).
Subsec. (v)(1)(I).
Subsec. (v)(1)(J).
Subsec. (v)(1)(L).
Subsec. (v)(1)(M).
Subsec. (v)(1)(N).
Subsec. (v)(7).
Subsec. (v)(7)(C).
Subsec. (w)(1).
Subsec. (w)(2).
Subsec. (cc)(1).
Subsec. (dd).
1981—Subsec. (u).
Subsec. (v)(1)(G)(i).
Subsec. (v)(1)(G)(iv).
Subsec. (v)(1)(J).
Subsec. (v)(1)(K).
Subsec. (v)(1)(L).
Subsec. (w)(2).
Subsec. (bb).
1980—Subsec. (b)(7).
Subsec. (e).
Subsec. (i).
Subsec. (j)(13).
Subsec. (k)(2)(A).
Subsec. (m)(4).
Subsec. (n).
Subsec. (o).
Subsec. (o)(7).
Subsec. (r)(2).
Subsec. (r)(3).
Subsec. (r)(4).
Subsec. (s)(2)(G).
Subsec. (s)(10) to (14).
Subsec. (u).
Subsec. (v)(1)(G).
Subsec. (v)(1)(H).
Subsec. (v)(1)(I).
Subsec. (z).
Subsec. (aa)(1)(A).
Subsec. (bb).
Subsec. (cc).
1978—Subsec. (s)(2)(F).
1977—Subsec. (j)(11).
Subsec. (j)(13).
Subsec. (j)(14).
Subsec. (s).
Subsec. (s)(6).
Subsec. (v)(1)(F).
Subsec. (w)(2).
Subsec. (aa).
1975—Subsec. (e)(5).
Subsec. (j)(13).
Subsec. (w).
1972—Subsec. (a)(2).
Subsec. (b)(6).
Subsec. (b)(7).
Subsec. (e).
Subsec. (e)(8).
Subsec. (e)(9).
Subsecs. (f)(2), (g)(2).
Subsec. (h).
Subsec. (i).
Subsec. (j).
Subsec. (j)(10).
Subsec. (j)(11) to (13).
Subsec. (j)(15).
Subsec. (k).
Subsec. (l).
Subsec. (m)(7).
Subsec. (n).
Subsec. (o)(5), (6).
Subsec. (p).
Subsec. (q).
Subsec. (r).
Subsec. (s)(8).
Subsec. (u).
Subsec. (v)(1).
Subsec. (v)(3).
Subsec. (v)(4).
Subsec. (v)(5).
Subsec. (v)(6).
Subsec. (v)(7).
Subsecs. (w), (y).
Subsec. (z).
1971—Subsec. (e)(5).
1968—Subsec. (e).
Subsec. (p).
Subsec. (r)(3).
Subsec. (s).
Subsec. (s)(2)(A) to (C).
Subsec. (s)(2)(D).
Subsec. (s)(3).
Subsec. (s)(6).
Subsec. (s)(12), (13).
Subsec. (y)(3).
1966—Subsec. (v)(1).
Effective Date of 1994 Amendment
Section 107(b) of
Amendment by section 145(b) of
Section 146(c) of
Amendment by section 147(e)(1), (4), (5), (f)(3), (4)(A), (6)(A), (B), (E) of
Section 158(a)(2) of
Effective Date of 1993 Amendment
Section 13503(c)(2) of
Section 13553(c) of
Section 13554(b) of
Section 13556(b) of
Section 13564(b)(2) of
Section 13566(c) of
Effective Date of 1990 Amendment
Amendment by section 4008(h)(2)(A)(i) of
Amendment by section 4152(a)(2) of
Section 4153(b)(2)(C) of
Amendment by section 4155(a), (d) of
Amendment by section 4157(a) of
Amendment by section 4161(a)(1), (2), (5) of
Section 4161(b)(5) of
Amendment by section 4162(a) of
Amendment by section 4163(a) of
Section 4201(d)(3)[(4)] of
Section 4207(d)(4), formerly 4027(d)(3), of
Effective Date of 1989 Amendments
Amendment by section 6112(e)(1) of
Amendment by section 6113(a)–(b)(2) of
Amendment by section 6114(a), (d) of
Section 6115(d) of
Amendment by section 6131(a)(2) of
Section 6141(b) of
Section 6213(d) of
Amendment by section 101(a) of
Amendment by section 201(a) of
Effective Date of 1988 Amendment
Section 8423(b) of
Section 8424(b) of
Amendment by
Amendment by section 104(d)(4) of
Amendment by section 202(a) of
Amendment by section 203(b), (e)(1) of
Amendment by section 204(a) of
Amendment by section 205(b) of
Section 206(b) of
Except as specifically provided in section 411 of
Section 411(d)(1)(B)(ii) of
Effective Date of 1987 Amendment
Section 4009(e)(2) of
Section 4021(c) of
Section 4026(a)(2) of
Section 4064(e)(2) of
Section 4065(c) of
Section 4070(c)(2) of
"(A) The amendments made by subsection (b) [amending this section and
"(B) The Secretary of Health and Human Services shall implement the amendments made by subsection (b) so as to ensure that there is no additional cost to the medicare program by reason of such amendments."
Section 4071(b) of
"(1) The provisions of subsection (e) of section 4072 of this subpart [section 4072(e) of
"(2) In conducting the demonstration project pursuant to paragraph (1), in order to determine the cost effectiveness of including influenza vaccine in the medicare program, the Secretary of Health and Human Services is required to conduct a demonstration of the provision of influenza vaccine as a service for medicare beneficiaries and to expend $25,000,000 each year of the demonstration project for this purpose. In conducting this demonstration, the Secretary is authorized to purchase in bulk influenza vaccine and to distribute it in a manner to make it widely available to medicare beneficiaries, to develop projects to provide vaccine in the same manner as other covered medicare services in large scale demonstration projects, including statewide projects, and to engage in other appropriate use of moneys to provide influenza vaccine to medicare beneficiaries and evaluate the cost effectiveness of its use. In determining cost effectiveness, the Secretary shall consider the direct cost of the vaccine, the utilization of vaccine which might otherwise not have occurred, the costs of illnesses and nursing home days avoided, and other relevant factors, except that extended life for beneficiaries shall not be considered to reduce the cost effectiveness of the vaccine."
Section 4072(e) of
"(1) The amendments made by this section [amending this section and
"(2)(A) The Secretary of Health and Human Services (in this paragraph referred to as the 'Secretary'), shall establish a demonstration project to begin on October 1, 1988, to test the cost-effectiveness of furnishing therapeutic shoes under the medicare program to the extent provided under the amendments made by this section to a sample group of medicare beneficiaries.
"(B)(i) The demonstration project under subparagraph (A) shall be conducted for an initial period of 24 months. Not later than October 1, 1990, the Secretary shall report to the Congress on the results of such project. If the Secretary finds, on the basis of existing data, that furnishing therapeutic shoes under the medicare program to the extent provided under the amendments made by this section is cost-effective, the Secretary shall include such finding in such report, such project shall be discontinued, and the amendments made by this section shall become effective on November 1, 1990.
"(ii) If the Secretary determines that such finding cannot be made on the basis of existing data, such project shall continue for an additional 24 months. Not later than April 1, 1993, the Secretary shall submit a final report to the Congress on the results of such project. The amendments made by this section shall become effective on the first day of the first month to begin after such report is submitted to the Congress unless the report contains a finding by the Secretary that furnishing therapeutic shoes under the medicare program to the extent provided under the amendments made by this section is not cost-effective (in which case the amendments made by this section shall not become effective)."
[Amendments by section 4072 of
Amendment by section 4073(a), (c) of
Section 4074(c) of
Section 4075(b) of
Section 4076(b) of
Section 4077(a)(2) of
Amendment by section 4077(b)(1), (4) of
Amendment by section 4084(c)(1) of
Amendments by section 4201(a)(1), (b)(1), (d)(1), (2), (5) of
Effective Date of 1986 Amendments
Section 9305(c)(4) of
Section 9313(a)(3) of
Amendment by section 9320(b), (c), (f) of
Section 9335(c)(2) of
Section 9336(b) of
Amendment by section 9337(d) of
Section 9338(f) of
Section 9107(c)(2) of
Section 9110(b) of
Section 9202(i)(2) of
Amendment by section 9219(b)(1)(B) of
Section 9219(b)(3)(B) of
Effective Date of 1984 Amendments
Amendment by
Section 2314(c)(1), (2) of
"(1) Clause (i) of section 1861(v)(1)(O) of the Social Security Act [subsec. (v)(1)(O)(i) of this section] shall not apply to changes of ownership of assets pursuant to an enforceable agreement entered into before the date of the enactment of this Act [July 18, 1984].
"(2) Clause (iii) of section 1861(v)(1)(O) of such Act [subsec. (v)(1)(O)(iii) of this section] shall apply to costs incurred on or after the date of the enactment of this Act."
Section 2318(c) of
Amendment by section 2319(a) of
Amendment by section 2321(e) of
Section 2322(b) of
Amendment by section 2323(a) of
Section 2324(b) of
Amendment by section 2335(b) of
Section 2340(c) of
Amendment by section 2341(a), (c) of
Amendment by section 2342(a) of
Section 2343(c) of
Amendment by section 2354(b)(18)–(29) of
Effective Date of 1983 Amendments
Amendment by section 602(d) of
Amendment by
Effective Date of 1982 Amendment
Amendment by section 101(a)(2) of
Section 102(b) of
Section 103(b) of
Section 105(b) of
Section 106(b) of
Section 107(b) of
Amendment by section 109(b)(2) of
Section 109(c)(3) of
Amendment by section 122(d) of
Section 128(e) of
"(1) Any amendment to the Omnibus Budget Reconciliaton [Reconciliation] Act of 1981 [
"(2) Except as otherwise provided in this section, any amendment to the Social Security Act [this chapter] or the Internal Revenue Code of 1986 [formerly I.R.C. 1954] [Title 26, Internal Revenue Code] made by this section (other than subsection (d)) [amending this section and
"(3) The amendments made by subsection (d) [amending this section and
Amendment by section 148(b) of
Effective Date of 1981 Amendment
Section 2102(b)(1) of
Amendment by section 2121(c), (d) of
Section 2141(c) of
"(1) Subject to paragraph (2), the amendment made by subsection (a) [amending this section] shall apply to cost reporting periods ending after September 30, 1981.
"(2) In the case of a cost reporting period beginning before October 1, 1981, any reduction in payments resulting from the amendment made by subsection (a) shall be imposed only in proportion to the part of the period that occurs after September 30, 1981."
Section 2143(b) of
"(1) Subject to paragraph (2), the amendment made by subsection (a) [amending this section] shall apply to cost reporting periods ending after September 30, 1981.
"(2) In the case of a cost reporting period beginning before October 1, 1981, any reduction in payments resulting from the amendment made by subsection (a) shall be imposed only in proportion to the part of the period that occurs after September 30, 1981."
Section 2144(b) of
"(1) Subject to paragraph (2), the amendment made by subsection (a) [amending this section] shall apply to cost reporting periods ending after September 30, 1981.
"(2) In the case of a cost reporting period beginning before October 1, 1981, any reduction in payments resulting from the amendment made by subsection (a) shall be imposed only in proportion to the part of the period that occurs after September 30, 1981."
For effective date, savings, and transitional provisions relating to amendment by section 2193(c)(9) of
Effective Date of 1980 Amendments
Amendment by
Section 902(c) of
Section 930(s) of
"(1) the amendments made by this section [amending this section,
"(2) The Secretary of Health and Human Services shall take administrative action to assure that improvements, in accordance with the amendment made by subsection (n)(1) [amending this section], will be made not later than June 30, 1981."
Amendment by section 931(c), (d) of
Amendment by section 933(c)–(e) of
Amendment by section 936(a) of
Section 937(c) of
Section 938(b) of
Section 948(c)(1) of
Section 951(c) of
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1977 Amendments
Section 501(c) of
Amendment by
Amendment by section 3(a)(2) of
Amendment by section 19(b)(1) of
Section 21(c)(1) of
Effective Date of 1975 Amendment
Section 106(b) of
Section 112(d) of
Effective Date of 1972 Amendment
Amendment by section 211(b), (c)(2) of
Section 223(h) of
Section 227(g) of
Section 234(i) of
Section 246(c) of
Section 251(d) of
"(1) The amendments made by subsection (a) [amending this section and
"(2) The amendments made by subsection (b) [amending this section and
"(3) The amendments made by subsection (c) [amending this section] shall be effective with respect to accounting periods beginning after the month in which there are promulgated, by the Secretary of Health, Education, and Welfare, final regulations implementing the provisions of section 1861(v)(5) of the Social Security Act [subsec. (v)(5) of this section]."
Section 252(b) of
Amendment by section 256(b) of
Section 264(b) of
Section 273(b) of
Section 276(b) of
Amendment by section 283(a) of
Effective Date of 1968 Amendment
Section 127(c) of
Amendment by section 129(a), (b), (c)(9)(C), (10), (11) of
Amendment by section 132(a) of
Amendment by section 133(a), (b) of
Section 134(b) of
Amendment by section 143(a) of
Section 144(e) of
Effective Date of 1966 Amendment
Amendment by
Revisions of Coverage for Immunosuppressive Drug Therapy
Section 160(c) of
Freeze in Per Visit Cost Limits for Home Health Services
Section 13564(a)(1) of
Study and Report on Effects of Coverage of Osteoporosis Drugs
Section 4156(b) of
Productivity Screening Guidelines Application to Staff in Rural Health Clinics
Section 4161(b)(3) of
Development of Prospective Payment System for Home Health Services
Section 4207(c), formerly 4027(c), of
Application of Budget-Neutral Basis
Section 4207(d)(2), formerly 4027(d)(2), of
Transition Provisions for Determining Reasonable Costs for Home Health Agency Services
Section 4207(d)(3), formerly 4027(d)(3), of
Permitting Dentist To Serve as Hospital Medical Director
Section 6025 of
Recognition of Costs of Certain Hospital-Based Nursing Schools
Section 6205(a)(1)(A) of
[Section 6205(a)(2) of
Dissemination of Rural Health Clinic Information
Section 6213(e) of
Treatment of Certain Facilities as Rural Health Clinics
Section 6213(f) of
Continued Use of Home Health Wage Index in Effect Prior to July 1, 1989, Until After July 1, 1991
Section 6222 of
Payment for Medical Escort or Medical Attendant on Commercial Airliner Allowed
Section 8427 of
"(a)
"(b)
Skilled Nursing Facility; Access and Visitation Rights
Section 411(l)(2)(E) of
Moratorium on Prior Authorization for Home Health and Post-Hospital Extended Care Services
Section 4039(e) of
Delay in Publishing Regulations With Respect To Deeming Status of Entities
Section 4039(f) of
"(1) on any date prior to 6 months after the date on which the Secretary has published a proposed rule with respect to the deeming of the entity, and
"(2) until the Secretary publishes a final rule with respect to the deeming of the entity."
Development of Uniform Needs Assessment Instrument
Section 9305(h) of
"(1)
"(A) evaluates—
"(i) the functional capacity of an individual,
"(ii) the nursing and other care requirements of the individual to meet health care needs and to assist with functional incapacities, and
"(iii) the social and familial resources available to the individual to meet those requirements; and
"(B) can be used by discharge planners, hospitals, nursing facilities, other health care providers, and fiscal intermediaries in evaluating an individual's need for post-hospital extended care services, home health services, and long-term care services of a health-related or supportive nature.
The Secretary may develop more than one such instrument for use in different situations.
"(2)
"(3)
Prior and Concurrent Authorization Demonstration Project
Section 9305(k) of
Considerations in Establishing Limits on Payment for Home Health Services
Section 9315(b) of
"(1) base such limitations on the most recent data available, which data may be for cost reporting periods beginning no earlier than October 1, 1983; and
"(2) take into account the changes in costs of home health agencies for billing and verification procedures that result from the Secretary's changing the requirements for such procedures, to the extent the changes in costs are not reflected in such data.
Paragraph (2) shall apply to changes in requirements effected before, on, or after July 1, 1986."
Comptroller General Study and Report on Cost Limits for Home Health Services
Section 9315(c) of
Reduction in Payment To Avoid Duplicate Payment for Services of Physician Assistants
Section 9338(d) of
Study and Report on Payments for Physician Assistants
Section 9338(e) of
Cost Limits for Routine Services for Urban and Rural Hospital-Based Skilled Nursing Facilities; Cost Reporting Periods Beginning On or After October 1, 1982, and Prior to July 1, 1984
Section 2319(d) of
Study and Report Relating to Requirements That Core Services Be Furnished Directly by Hospices
Section 2343(d) of
Report on Effect of 1982 Amendment on Hospital-Based Skilled Nursing Facilities
Section 605(b) of
Section 2319(e) of
Elimination of Private Room Subsidy
Section 111 of
"(a) The Secretary of Health and Human Services shall, pursuant to section 1861(v)(2) of the Social Security Act [subsec. (v)(2) of this section], not allow as a reasonable cost the estimated amount by which the costs incurred by a hospital or skilled nursing facility for nonmedically necessary private accommodations for medicare beneficiaries exceeds the costs which would have been incurred by such hospital or facility for semiprivate accommodations.
"(b) The Secretary of Health and Human Services shall first issue such final regulations (whether on an interim or other basis) as may be necessary to implement subsection (a) by October 1, 1982. If such regulations are promulgated on an interim final basis, the Secretary shall take such steps as may be necessary to provide opportunity for public comment, and appropriate revision based thereon, so as to provide that such regulations are not on an interim basis later than January 31, 1983."
Regulations Regarding Access to Books and Records
Section 952(b) of
Compliance With the Life Safety Code or State Fire and Safety Code
Section 915(b) of
Section 106(c) of
Private, Nonprofit Health Care Clinics Qualifying, as of July 1, 1977, as Rural Health Clinics
Section 1(e) of
"(1) on July 1, 1977, was operating and located in an area which on that date (A) was not an urbanized area (as defined by the Bureau of the Census) and (B) had a supply of physicians insufficient to meet the needs of the area (as determined by the Secretary), and
"(2) meets the definition of a rural health clinic under section 1861(aa)(2) [subsec. (aa)(2) of this section] or section 1905(l) of the Social Security Act [
shall be considered, for the purposes of title XVIII or XIX, respectively, of the Social Security Act [this subchapter or subchapter XIX of this chapter], as satisfying the definition of a rural health clinic under such section."
Promulgation of Regulations Defining Costs Chargeable to Personal Funds of Patients in Skilled Nursing Facilities; Date of Issuance
Section 21(b) of
[Section 21(c)(2) of
Home Health Services; Grants for Establishment, Operation, Staffing, Etc., of Public and Nonprofit Private Agencies and Entities; Procedures; Payments; Authorization of Appropriations
Payment for Service of Physicians Rendered in a Teaching Hospital for Accounting Periods Beginning After June 30, 1975, and Prior to October 1, 1978; Studies, Reports, etc.; Effective Dates
Physical Therapy Services Requirements; Effective Date Postponement
Section 17(a) of
Payment for Durable Medical Equipment
Section 245(a)–(c) of
"(a) The Secretary is authorized to conduct reimbursement experiments designed to eliminate unreasonable expenses resulting from prolonged rentals of durable medical equipment described in section 1861(s)(6) of the Social Security Act [subsec. (s)(6) of this section].
"(b) Such experiment may be conducted in one or more geographic areas, as the Secretary deems appropriate, and may, pursuant to agreements with suppliers, provide for reimbursement for such equipment on a lump-sum basis whenever it is determined (in accordance with guidelines established by the Secretary) that a lump-sum payment would be more economical than the anticipated period of rental payments. Such experiments may also provide for incentives to beneficiaries (including waiver of the 20 percent coinsurance amount applicable under section 1833 of the Social Security Act [
"(c) The Secretary is authorized, at such time as he deems appropriate, to implement on a nationwide basis any such reimbursement procedures which he finds to be workable, desirable and economical and which are consistent with the purposes of this section."
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be "clause".
2 So in original. The word "and" probably should not appear.
3 So in original. Probably should be "regulations".
4 So in original. Probably should be followed by a closing parenthesis.
5 So in original. Probably should be "subclauses."
6 See References in Text note below.
§1395y. Exclusions from coverage and medicare as secondary payer
(a) Items or services specifically excluded
Notwithstanding any other provision of this subchapter, no payment may be made under part A or part B of this subchapter for any expenses incurred for items or services—
(1)(A) which, except for items and services described in a succeeding subparagraph, are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member,
(B) in the case of items and services described in
(C) in the case of hospice care, which are not reasonable and necessary for the palliation or management of terminal illness,
(D) in the case of clinical care items and services provided with the concurrence of the Secretary and with respect to research and experimentation conducted by, or under contract with, the Prospective Payment Assessment Commission or the Secretary, which are not reasonable and necessary to carry out the purposes of
(E) in the case of research conducted pursuant to
(F) in the case of screening mammography, which is performed more frequently than is covered under
(2) for which the individual furnished such items or services has no legal obligation to pay, and which no other person (by reason of such individual's membership in a prepayment plan or otherwise) has a legal obligation to provide or pay for, except in the case of Federally qualified health center services;
(3) which are paid for directly or indirectly by a governmental entity (other than under this chapter and other than under a health benefits or insurance plan established for employees of such an entity), except in the case of rural health clinic services, as defined in
(4) which are not provided within the United States (except for inpatient hospital services furnished outside the United States under the conditions described in
(5) which are required as a result of war, or of an act of war, occurring after the effective date of such individual's current coverage under such part;
(6) which constitute personal comfort items (except, in the case of hospice care, as is otherwise permitted under paragraph (1)(C));
(7) where such expenses are for routine physical checkups, eyeglasses (other than eyewear described in
(8) where such expenses are for orthopedic shoes or other supportive devices for the feet, other than shoes furnished pursuant to
(9) where such expenses are for custodial care (except, in the case of hospice care, as is otherwise permitted under paragraph (1)(C));
(10) where such expenses are for cosmetic surgery or are incurred in connection therewith, except as required for the prompt repair of accidental injury or for improvement of the functioning of a malformed body member;
(11) where such expenses constitute charges imposed by immediate relatives of such individual or members of his household;
(12) where such expenses are for services in connection with the care, treatment, filling, removal, or replacement of teeth or structures directly supporting teeth, except that payment may be made under part A of this subchapter in the case of inpatient hospital services in connection with the provision of such dental services if the individual, because of his underlying medical condition and clinical status or because of the severity of the dental procedure, requires hospitalization in connection with the provision of such services;
(13) where such expenses are for—
(A) the treatment of flat foot conditions and the prescription of supportive devices therefor,
(B) the treatment of subluxations of the foot, or
(C) routine foot care (including the cutting or removal of corns or calluses, the trimming of nails, and other routine hygienic care);
(14) which are other than physicians' services (as defined in regulations promulgated specifically for purposes of this paragraph), services described by
(15)(A) which are for services of an assistant at surgery in a cataract operation (including subsequent insertion of an intraocular lens) unless, before the surgery is performed, the appropriate utilization and quality control peer review organization (under part B of subchapter XI of this chapter) or a carrier under
(B) which are for services of an assistant at surgery to which
Paragraph (7) shall not apply to Federally qualified health center services described in
(b) Medicare as secondary payer
(1) Requirements of group health plans
(A) Working aged under group health plans
(i) In general
A group health plan—
(I) may not take into account that an individual (or the individual's spouse) who is covered under the plan by virtue of the individual's current employment status with an employer is entitled to benefits under this subchapter under
(II) shall provide that any individual age 65 or older (and the spouse age 65 or older of any individual) who has current employment status with an employer shall be entitled to the same benefits under the plan under the same conditions as any such individual (or spouse) under age 65.
(ii) Exclusion of group health plan of a small employer
Clause (i) shall not apply to a group health plan unless the plan is a plan of, or contributed to by, an employer that has 20 or more employees for each working day in each of 20 or more calendar weeks in the current calendar year or the preceding calendar year.
(iii) Exception for small employers in multiemployer or multiple employer group health plans
Clause (i) also shall not apply with respect to individuals enrolled in a multiemployer or multiple employer group health plan if the coverage of the individuals under the plan is by virtue of current employment status with an employer that does not have 20 or more individuals in current employment status for each working day in each of 20 or more calendar weeks in the current calendar year and the preceding calendar year; except that the exception provided in this clause shall only apply if the plan elects treatment under this clause.
(iv) Exception for individuals with end stage renal disease
Subparagraph (C) shall apply instead of clause (i) to an item or service furnished in a month to an individual if for the month the individual is, or (without regard to entitlement under
(v) "Group health plan" defined
In this subparagraph, and subparagraph (C), the term "group health plan" has the meaning given such term in section 5000(b)(1) of the Internal Revenue Code of 1986, without regard to section 5000(d) of such Code.
(B) Disabled individuals in large group health plans
(i) In general
A large group health plan (as defined in clause (iv)) may not take into account that an individual (or a member of the individual's family) who is covered under the plan by virtue of the individual's current employment status with an employer is entitled to benefits under this subchapter under
(ii) Exception for individuals with end stage renal disease
Subparagraph (C) shall apply instead of clause (i) to an item or service furnished in a month to an individual if for the month the individual is, or (without regard to entitlement under
(iii) Sunset
Clause (i) shall only apply to items and services furnished on or after January 1, 1987, and before October 1, 1998.
(iv) "Large group health plan" defined
In this subparagraph, the term "large group health plan" has the meaning given such term in section 5000(b)(2) of the Internal Revenue Code of 1986, without regard to section 5000(d) of such Code.
(C) Individuals with end stage renal disease
A group health plan (as defined in subparagraph (A)(v))—
(i) may not take into account that an individual is entitled to or eligible for benefits under this subchapter under
(ii) may not differentiate in the benefits it provides between individuals having end stage renal disease and other individuals covered by such plan on the basis of the existence of end stage renal disease, the need for renal dialysis, or in any other manner;
except that clause (ii) shall not prohibit a plan from paying benefits secondary to this subchapter when an individual is entitled to or eligible for benefits under this subchapter under
(D) Treatment of certain members of religious orders
In this subsection, an individual shall not be considered to be employed, or an employee, with respect to the performance of services as a member of a religious order which are considered employment only by virtue of an election made by the religious order under section 3121(r) of the Internal Revenue Code of 1986.
(E) General provisions
For purposes of this subsection:
(i) Aggregation rules
(I) All employers treated as a single employer under subsection (a) or (b) of section 52 of the Internal Revenue Code of 1986 shall be treated as a single employer.
(II) All employees of the members of an affiliated service group (as defined in section 414(m) of such Code) shall be treated as employed by a single employer.
(III) Leased employees (as defined in section 414(n)(2) of such Code) shall be treated as employees of the person for whom they perform services to the extent they are so treated under section 414(n) of such Code.
In applying sections of the Internal Revenue Code of 1986 under this clause, the Secretary shall rely upon regulations and decisions of the Secretary of the Treasury respecting such sections.
(ii) "Current employment status" defined
An individual has "current employment status" with an employer if the individual is an employee, is the employer, or is associated with the employer in a business relationship.
(iii) Treatment of self-employed persons as employers
The term "employer" includes a self-employed person.
(2) Medicare secondary payer
(A) In general
Payment under this subchapter may not be made, except as provided in subparagraph (B), with respect to any item or service to the extent that—
(i) payment has been made, or can reasonably be expected to be made, with respect to the item or service as required under paragraph (1), or
(ii) payment has been made, or can reasonably be expected to be made promptly (as determined in accordance with regulations) under a workmen's compensation law or plan of the United States or a State or under an automobile or liability insurance policy or plan (including a self-insured plan) or under no fault insurance.
In this subsection, the term "primary plan" means a group health plan or large group health plan, to the extent that clause (i) applies, and a workmen's compensation law or plan, an automobile or liability insurance policy or plan (including a self-insured plan) or no fault insurance, to the extent that clause (ii) applies.
(B) Conditional payment
(i) Repayment required
Any payment under this subchapter with respect to any item or service to which subparagraph (A) applies shall be conditioned on reimbursement to the appropriate Trust Fund established by this subchapter when notice or other information is received that payment for such item or service has been or could be made under such subparagraph. If reimbursement is not made to the appropriate Trust Fund before the expiration of the 60-day period that begins on the date such notice or other information is received, the Secretary may charge interest (beginning with the date on which the notice or other information is received) on the amount of the reimbursement until reimbursement is made (at a rate determined by the Secretary in accordance with regulations of the Secretary of the Treasury applicable to charges for late payments).
(ii) Action by United States
In order to recover payment under this subchapter for such an item or service, the United States may bring an action against any entity which is required or responsible under this subsection to pay with respect to such item or service (or any portion thereof) under a primary plan (and may, in accordance with paragraph (3)(A) collect double damages against that entity), or against any other entity (including any physician or provider) that has received payment from that entity with respect to the item or service, and may join or intervene in any action related to the events that gave rise to the need for the item or service.
(iii) Subrogation rights
The United States shall be subrogated (to the extent of payment made under this subchapter for such an item or service) to any right under this subsection of an individual or any other entity to payment with respect to such item or service under a primary plan.
(iv) Waiver of rights
The Secretary may waive (in whole or in part) the provisions of this subparagraph in the case of an individual claim if the Secretary determines that the waiver is in the best interests of the program established under this subchapter.
(C) Treatment of questionnaires
The Secretary may not fail to make payment under subparagraph (A) solely on the ground that an individual failed to complete a questionnaire concerning the existence of a primary plan.
(3) Enforcement
(A) Private cause of action
There is established a private cause of action for damages (which shall be in an amount double the amount otherwise provided) in the case of a primary plan which fails to provide for primary payment (or appropriate reimbursement) in accordance with such paragraphs (1) and (2)(A).
(B) Reference to excise tax with respect to nonconforming group health plans
For provision imposing an excise tax with respect to nonconforming group health plans, see section 5000 of the Internal Revenue Code of 1986.
(C) Prohibition of financial incentives not to enroll in a group health plan or a large group health plan
It is unlawful for an employer or other entity to offer any financial or other incentive for an individual entitled to benefits under this subchapter not to enroll (or to terminate enrollment) under a group health plan or a large group health plan which would (in the case of such enrollment) be a primary plan (as defined in paragraph (2)(A)). Any entity that violates the previous sentence is subject to a civil money penalty of not to exceed $5,000 for each such violation. The provisions of
(4) Coordination of benefits
Where payment for an item or service by a primary plan is less than the amount of the charge for such item or service and is not payment in full, payment may be made under this subchapter (without regard to deductibles and coinsurance under this subchapter) for the remainder of such charge, but—
(A) payment under this subchapter may not exceed an amount which would be payable under this subchapter for such item or service if paragraph (2)(A) did not apply; and
(B) payment under this subchapter, when combined with the amount payable under the primary plan, may not exceed—
(i) in the case of an item or service payment for which is determined under this subchapter on the basis of reasonable cost (or other cost-related basis) or under
(ii) in the case of an item or service for which payment is authorized under this subchapter on another basis—
(I) the amount which would be payable under the primary plan (without regard to deductibles and coinsurance under such plan), or
(II) the reasonable charge or other amount which would be payable under this subchapter (without regard to deductibles and coinsurance under this subchapter),
whichever is greater.
(5) Identification of secondary payer situations
(A) Requesting matching information
(i) Commissioner of Social Security
The Commissioner of Social Security shall, not less often than annually, transmit to the Secretary of the Treasury a list of the names and TINs of medicare beneficiaries (as defined in section 6103(l)(12) of the Internal Revenue Code of 1986) and request that the Secretary disclose to the Commissioner the information described in subparagraph (A) of such section.
(ii) Administrator
The Administrator of the Health Care Financing Administration shall request, not less often than annually, the Commissioner of the Social Security Administration to disclose to the Administrator the information described in subparagraph (B) of section 6103(l)(12) of the Internal Revenue Code of 1986.
(B) Disclosure to fiscal intermediaries and carriers
In addition to any other information provided under this subchapter to fiscal intermediaries and carriers, the Administrator shall disclose to such intermediaries and carriers (or to such a single intermediary or carrier as the Secretary may designate) the information received under—
(i) subparagraph (A), and
(ii)
for purposes of carrying out this subsection.
(C) Contacting employers
(i) In general
With respect to each individual (in this subparagraph referred to as an "employee") who was furnished a written statement under section 6051 of the Internal Revenue Code of 1986 by a qualified employer (as defined in section 6103(l)(12)(E)(iii) of such Code), as disclosed under subparagraph (B)(i), the appropriate fiscal intermediary or carrier shall contact the employer in order to determine during what period the employee or employee's spouse may be (or have been) covered under a group health plan of the employer and the nature of the coverage that is or was provided under the plan (including the name, address, and identifying number of the plan).
(ii) Employer response
Within 30 days of the date of receipt of the inquiry, the employer shall notify the intermediary or carrier making the inquiry as to the determinations described in clause (i). An employer (other than a Federal or other governmental entity) who willfully or repeatedly fails to provide timely and accurate notice in accordance with the previous sentence shall be subject to a civil money penalty of not to exceed $1,000 for each individual with respect to which such an inquiry is made. The provisions of
(iii) Sunset on requirement
Clause (ii) shall not apply to inquiries made after September 30, 1998.
(D) Obtaining information from beneficiaries
Before an individual applies for benefits under part A of this subchapter or enrolls under part B of this subchapter, the Administrator shall mail the individual a questionnaire to obtain information on whether the individual is covered under a primary plan and the nature of the coverage provided under the plan, including the name, address, and identifying number of the plan.
(6) Screening requirements for providers and suppliers
(A) In general
Notwithstanding any other provision of this subchapter, no payment may be made for any item or service furnished under part B of this subchapter unless the entity furnishing such item or service completes (to the best of its knowledge and on the basis of information obtained from the individual to whom the item or service is furnished) the portion of the claim form relating to the availability of other health benefit plans.
(B) Penalties
An entity that knowingly, willfully, and repeatedly fails to complete a claim form in accordance with subparagraph (A) or provides inaccurate information relating to the availability of other health benefit plans on a claim form under such subparagraph shall be subject to a civil money penalty of not to exceed $2,000 for each such incident. The provisions of
(c) Drug products
No payment may be made under part B of this subchapter for any expenses incurred for—
(1) a drug product—
(A) which is described in section 107(c)(3) of the Drug Amendments of 1962,
(B) which may be dispensed only upon prescription,
(C) for which the Secretary has issued a notice of an opportunity for a hearing under subsection (e) of
(D) for which the Secretary has not determined there is a compelling justification for its medical need; and
(2) any other drug product—
(A) which is identical, related, or similar (as determined in accordance with section 310.6 of title 21 of the Code of Federal Regulations) to a drug product described in paragraph (1), and
(B) for which the Secretary has not determined there is a compelling justification for its medical need,
until such time as the Secretary withdraws such proposed order.
(d) Repealed. Pub. L. 100–93, §8(c)(1)(A), Aug. 18, 1987, 101 Stat. 692
(e) Item or service by excluded individual or entity or at direction of excluded physician; limitation of liability of beneficiaries with respect to services furnished by excluded individuals and entities
(1) No payment may be made under this subchapter with respect to any item or service (other than an emergency item or service, not including items or services furnished in an emergency room of a hospital) furnished—
(A) by an individual or entity during the period when such individual or entity is excluded pursuant to
(B) at the medical direction or on the prescription of a physician during the period when he is excluded pursuant to
(2) Where an individual eligible for benefits under this subchapter submits a claim for payment for items or services furnished by an individual or entity excluded from participation in the programs under this subchapter, pursuant to section 1320a–7, 1320a–7a, 1320c–5, 1320c–9 (as in effect on September 2, 1982), 1395u(j)(2), 1395y(d) (as in effect on August 18, 1987), or 1395cc of this title, and such beneficiary did not know or have reason to know that such individual or entity was so excluded, then, to the extent permitted by this subchapter, and notwithstanding such exclusion, payment shall be made for such items or services. In each such case the Secretary shall notify the beneficiary of the exclusion of the individual or entity furnishing the items or services. Payment shall not be made for items or services furnished by an excluded individual or entity to a beneficiary after a reasonable time (as determined by the Secretary in regulations) after the Secretary has notified the beneficiary of the exclusion of that individual or entity.
(f) Utilization guidelines for provision of home health services
The Secretary shall establish utilization guidelines for the determination of whether or not payment may be made, consistent with paragraph (1)(A) of subsection (a) of this section, under part A or part B of this subchapter for expenses incurred with respect to the provision of home health services, and shall provide for the implementation of such guidelines through a process of selective postpayment coverage review by intermediaries or otherwise.
(g) Contracts with utilization and quality control peer review organizations
The Secretary shall, in making the determinations under paragraphs (1) and (9) of subsection (a) of this section, and for the purposes of promoting the effective, efficient, and economical delivery of health care services, and of promoting the quality of services of the type for which payment may be made under this subchapter, enter into contracts with utilization and quality control peer review organizations pursuant to part B of subchapter XI of this chapter.
(h) Registry of cardiac pacemaker devices and leads; testing of devices and leads; withholding of payment
(1)(A) The Secretary shall, through the Commissioner of the Food and Drug Administration, provide for a registry of all cardiac pacemaker devices and pacemaker leads for which payment was made under this subchapter.
(B) Such registry shall include the manufacturer, model, and serial number of each such device or lead, the name of the recipient of such device or lead, the date and location of the implantation or removal of the device or lead, the name of the physician implanting or removing such device or lead, the name of the hospital or other provider billing for such procedure, any express or implied warranties associated with such device or lead under contract or State law (and any amount paid to a provider under any such warranty), and such other information as the Secretary deems to be appropriate.
(C) Each physician and provider of services performing the implantation or replacement of pacemaker devices and leads for which payment is made or requested to be made under this subchapter shall, in accordance with regulations of the Secretary, submit information respecting such implantation or replacement for the registry.
(D) Such registry shall be for the purposes of assisting the Secretary in determining when payments may properly be made under this subchapter, in tracing the performance of cardiac pacemaker devices and leads, in determining when inspection by the manufacturer of such a device or lead may be necessary under paragraph (3), in determining the amount subject to repayment under paragraph (2)(C), and in carrying out studies with respect to the use of such devices and leads. In carrying out any such study, the Secretary may not reveal any specific information which identifies any pacemaker device or lead recipient by name (or which would otherwise identify a specific recipient).
(E) Any person or organization may provide information to the registry with respect to cardiac pacemaker devices and leads other than those for which payment is made under this subchapter.
(2) The Secretary may, by regulation, require each provider of services—
(A) to return, to the manufacturer of the device or lead for testing under paragraph (3), any cardiac pacemaker device or lead which is removed from a patient and payment for the implantation or replacement of which was made or requested by such provider under this subchapter,
(B) not to charge any beneficiary for replacement of such a device or lead if the device or lead has not been returned in accordance with subparagraph (A), and
(C) to make repayment to the Secretary of amounts paid under this subchapter to the provider with respect to any cardiac pacemaker device or lead which has been replaced by the manufacturer, or for which the manufacturer has made payment to the provider, under an express or implied warranty.
(3) The Secretary may, by regulation, require the manufacturer of a cardiac pacemaker device or lead (A) to test or analyze each pacemaker device or lead for which payment is made or requested under this subchapter and which is returned to the manufacturer by a provider of services under paragraph (2), and (B) to provide the results of such test or analysis to that provider, together with information and documentation with respect to any warranties covering such device or lead. In any case where the Secretary has reason to believe, based upon information in the pacemaker registry or otherwise available to him, that replacement of a cardiac pacemaker device or lead for which payment is or may be requested under this subchapter is related to the malfunction of a device or lead, the Secretary may require that personnel of the Food and Drug Administration be present at the testing of such device by the manufacturer, to determine whether such device was functioning properly.
(4) The Secretary may deny payment under this subchapter, in whole or in part and for such period of time as the Secretary determines to be appropriate, with respect to the implantation or replacement of a pacemaker device or lead of a manufacturer performed by a physician and provider of services after the Secretary determines (in accordance with the procedures established under subsections (c), (f), and (g) of
(A) the physician or provider of services has failed to submit information to the registry as required under paragraph (1)(C),
(B) the provider of services has failed to return devices and leads as required under paragraph (2)(A), has improperly charged beneficiaries as prohibited under paragraph (2)(B), or has failed to make repayment to the Secretary as required under paragraph (2)(C), or
(C) the manufacturer of the device or lead has failed to perform and to report on the testing of devices and leads returned to it as required under paragraph (3).
(i) Awards and contracts for original research and experimentation of new and existing medical procedures; conditions
In order to supplement the activities of the Prospective Payment Assessment Commission under
(1) such procedure is not of sufficient commercial value to justify research and experimentation by a commercial organization;
(2) research and experimentation with respect to such procedure is not of a type that may appropriately be carried out by an institute, division, or bureau of the National Institutes of Health; and
(3) such procedure has the potential to be more cost-effective in the treatment of a condition than procedures currently in use with respect to such condition.
(Aug. 14, 1935, ch. 531, title XVIII, §1862, as added July 30, 1965,
References in Text
Parts A and B of this subchapter, referred to in text, are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Part B of subchapter XI of this chapter, referred to in subsecs. (a)(15) and (g), is classified to
The Internal Revenue Code of 1986, referred to in subsec. (b), is classified generally to Title 26, Internal Revenue Code.
Section 107(c)(3) of the Drug Amendments of 1962, referred to in subsec. (c)(1)(A), is section 107(c)(3) of
Amendments
1994—Subsec. (a)(1)(F).
Subsec. (a)(14).
Subsec. (a)(15).
Subsec. (a)(16).
Subsec. (b)(1)(A)(i)(II).
Subsec. (b)(1)(A)(ii).
Subsec. (b)(1)(A)(v).
Subsec. (b)(1)(C).
Subsec. (b)(2)(B)(i).
Subsec. (b)(2)(C).
Subsec. (b)(3)(C).
Subsec. (b)(5)(C)(i).
Subsec. (b)(5)(D).
Subsec. (b)(6).
1993—Subsec. (b)(1)(A)(i).
"(I) may not take into account, for any item or service furnished to an individual 65 years of age or older at the time the individual is covered under the plan by reason of the current employment of the individual (or the individual's spouse), that the individual is entitled to benefits under this subchapter under
"(II) shall provide that any employee age 65 or older, and any employee's spouse age 65 or older, shall be entitled to the same benefits under the plan under the same conditions as any employee, and the spouse of such employee, under age 65."
Subsec. (b)(1)(A)(ii).
Subsec. (b)(1)(A)(iii).
Subsec. (b)(1)(A)(iv).
Subsec. (b)(1)(A)(v).
Subsec. (b)(1)(B).
Subsec. (b)(1)(B)(i).
Subsec. (b)(1)(B)(ii).
Subsec. (b)(1)(B)(iii).
Subsec. (b)(1)(B)(iv).
Subsec. (b)(1)(C).
Subsec. (b)(1)(E).
Subsec. (b)(5)(B).
Subsec. (b)(5)(C)(i).
Subsec. (b)(5)(C)(iii).
1990—Subsec. (a).
Subsec. (a)(1)(A).
Subsec. (a)(1)(F).
Subsec. (a)(2).
Subsec. (a)(3).
Subsec. (a)(7).
Subsec. (a)(14).
Subsec. (a)(15).
Subsec. (b)(1)(B)(iii).
Subsec. (b)(1)(C).
Subsec. (b)(1)(C)(i).
"(I) the month in which a regular course of renal dialysis is initiated, or
"(II) in the case of an individual who receives a kidney transplant, the first month in which he would be eligible for benefits under part A of this subchapter (if he had filed an application for such benefits) under the provisions of
Subsec. (b)(3)(C).
Subsec. (b)(5)(C)(iii).
1989—
Subsec. (a)(1)(A).
Subsec. (a)(1)(E).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G), (6), (7).
Subsec. (a)(14).
Subsec. (b).
Subsec. (b)(1)(D).
Subsec. (b)(5).
Subsec. (c).
Subsec. (e)(1).
1988—Subsec. (a)(1)(A).
Subsec. (a)(1)(F).
Subsec. (a)(1)(G).
Subsec. (a)(6).
Subsec. (a)(7).
Subsec. (a)(15).
Subsec. (c).
Subsec. (e)(1).
Subsec. (e)(2).
1987—Subsec. (a)(1)(A).
Subsec. (a)(8).
Subsec. (a)(14).
Subsec. (b)(2)(A)(ii).
Subsec. (b)(4)(B)(i).
Subsec. (d).
Subsec. (e) [formerly §1395aaa].
Subsec. (h)(1)(B).
Subsec. (h)(1)(D).
Subsec. (h)(2)(C).
Subsec. (h)(4).
Subsec. (h)(4)(B).
1986—Subsec. (a)(1)(E).
Subsec. (a)(14).
Subsec. (a)(15).
Subsec. (a)(16).
Subsec. (b)(2)(A).
Subsec. (b)(3)(A)(i).
Subsec. (b)(3)(A)(iii).
Subsec. (b)(3)(A)(iv).
Subsec. (b)(4).
Subsec. (b)(5).
1984—Subsec. (a)(12).
Subsec. (b)(1).
Subsec. (b)(2)(B).
Subsec. (b)(3)(A)(i).
Subsec. (b)(3)(A)(ii).
Subsec. (b)(3)(A)(iii).
Subsec. (h).
Subsec. (i).
1983—Subsec. (a)(1)(A).
Subsec. (a)(1)(D).
Subsec. (a)(14).
Subsec. (b)(3)(A)(i).
1982—Subsec. (a)(1).
Subsec. (a)(6).
Subsec. (a)(7).
Subsec. (a)(9).
Subsec. (b)(1).
Subsec. (b)(2)(A).
Subsec. (b)(2)(B).
Subsec. (b)(3).
Subsec. (d)(1)(C).
Subsec. (f).
Subsec. (g).
1981—Subsec. (b).
Subsec. (c).
Subsec. (f).
1980—Subsec. (a)(1).
Subsec. (a)(7).
Subsec. (a)(12).
Subsec. (a)(13)(C).
Subsec. (b).
Subsec. (d)(4).
Subsec. (e).
1977—Subsec. (a)(3).
Subsec. (d)(1)(B).
Subsec. (d)(1)(C).
Subsec. (d)(4).
Subsec. (e).
1975—Subsec. (c).
1974—Subsec. (c).
1973—Subsec. (a)(12).
1972—Subsec. (a)(4).
Subsec. (a)(12).
Subsec. (c).
Subsec. (d).
1968—Subsec. (a)(7).
Subsec. (a)(13).
Effective Date of 1994 Amendment
Amendment by section 145(c)(1) of
Amendment by section 147(e)(6) of
Section 151(a)(2)(B) of
Section 151(b)(3)(C) of
Section 151(c)(1), (9) of
Section 151(c)(4) of
Section 151(c)(5), (6) of
Amendment by section 156(a)(2)(D) of
Section 157(b)(8) of
Effective Date of 1993 Amendment
Section 151(c)(10) of
Amendment by section 13561(d)(1) of
Section 13561(e)(1)(D) of
Amendment by section 13581(b)(1) of
Effective Date of 1990 Amendment
Amendment by section 4153(b)(2)(B) of
Amendment by section 4157(c)(1) of
Amendment by section 4161(a)(3)(C) of
Amendment by section 4163(d)(2)(A)(i)–(iii), (B) of
Section 4163(d)(3) of
Section 4204(g)(2) of
Effective Date of 1989 Amendments
Amendment by section 6115(b) of
Amendment by section 6202(b)(1) of
Section 6202(e)(2) of
Amendment by
Effective Date of 1988 Amendments
Amendment by
Amendment by section 202(d) of
Amendment by section 204(d)(2) of
Amendment by section 205(e)(1) of
Except as specifically provided in section 411 of
Section 411(f)(4)(D)(ii) of
Effective Date of 1987 Amendments
Section 4009(j)(6) of
Section 4034(b) of
Section 4036(a)(2) of
Section 4039(c)(2) of
For effective date of amendment by section 4072(c) of
Amendment by
Effective Date of 1986 Amendments
Section 9319(f) of
"(1) Except as provided in paragraph (2), the amendments made by this section [enacting
"(2) The amendments made by subsection (c) [amending
Amendment by section 9320(h)(1) of
Amendment by section 9343(c)(1) of
Section 9201(d)(1) of
Amendment by section 9307(a) of
Effective Date of 1984 Amendment
Section 2301(c)(1) of
Amendment by section 2304(c) of
Section 2313(e) of
Section 2344(d) of
Amendment by section 2354(b)(30), (31) of
Effective Date of 1983 Amendments
Amendment by section 601(f) of
Amendment by
Effective Date of 1982 Amendment
Amendment by section 116(b) of
Amendment by section 122(f), (g)(1) of
Amendment by section 128(a)(2)–(4) of
Amendment by sections 142 and 148(a) of
Effective Date of 1981 Amendment
Section 2103(a)(2) of
Section 2146(c)(1) of
Effective Date of 1980 Amendments
Amendment by
Amendment by section 936(c) of
Section 939(b) of
Effective Date of 1977 Amendments
Amendment by
Section 13(c) of
Effective Date of 1973 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by section 211(c)(1) of
Amendment by section 256(c) of
Effective Date of 1968 Amendment
Amendment by section 127(b) of
Distribution of Questionnaire by Contractor
Section 151(a)(1)(B) of
Retroactive Exemption for Certain Situations Involving Religious Orders
Section 13561(f) of
GAO Study of Extension of Secondary Payer Period
Section 4203(c)(2) of
"(A) The Comptroller General shall conduct a study of the impact of the second sentence of section 1862(b)(1)(C) of the Social Security Act [subsec. (b)(1)(C) of this section], and shall include in such report information relating to—
"(i) the number (and geographic distribution) of such individuals for whom medicare is secondary;
"(ii) the amount of savings to the medicare program achieved annually by reason of the application of such sentence;
"(iii) the effect on access to employment, and employment-based health insurance, for such individuals and their family members (including coverage by employment-based health insurance of cost-sharing requirements under medicare after such employment-based insurance becomes secondary);
"(iv) the effect on the amount paid for each dialysis treatment under employment-based health insurance;
"(v) the effect on cost-sharing requirements under employment-based health insurance (and on out-of-pocket expenses of such individuals) during the period for which medicare is secondary; and
"(vi) the appropriateness of applying the provisions of section 1862(b)(1)(C) of such Act [subsec. (b)(1)(C) of this section] to all group health plans, without regard to the number of employees covered by such plans.
"(B) The Comptroller General shall submit a preliminary report on the study conducted under subparagraph (A) to the Committees on Ways and Means and Energy and Commerce [Committee on Energy and Commerce now Committee on Commerce] of the House of Representatives and the Committee on Finance of the Senate not later than January 1, 1993, and a final report on such study not later than January 1, 1995."
[Section 151(c)(7) of
Deadline for First Transmittal and Request of Matching Information
Section 6202(a)(2)(B) of
"(i) transmit to the Secretary of the Treasury information under paragraph (5)(A)(i) of section 1862(b) of the Social Security Act [subsec. (b)(5)(A)(i) of this section] (as inserted by subparagraph (A)), and
"(ii) request from the Secretary disclosure of information described in section 6013(l)(12)(A) of the Internal Revenue Code of 1986 [
by not later than 14 days after the date of the enactment of this Act [Dec. 19, 1989]."
Designation of Pediatric Hospitals as Meeting Certification as Heart Transplant Facility
Section 4009(b) of
"(1) the hospital's pediatric heart transplant program is operated jointly by the hospital and another facility that meets such criteria,
"(2) the unified program shares the same transplant surgeons and quality assurance program (including oversight committee, patient protocol, and patient selection criteria), and
"(3) the hospital demonstrates to the satisfaction of the Secretary that it is able to provide the specialized facilities, services, and personnel that are required by pediatric heart transplant patients."
Approval of Surgical Assistants for Procedures Performed April 1, 1986, to December 15, 1986
Section 1895(b)(16)(C) of
Extending Waiver of Liability Provisions to Hospice Programs
Section 9305(f) of
"(1)
"(2)
[Section 4008(a)(3) of
Study of Impact on Disabled Beneficiaries and Family of Amendments Relating to Large Group Health Plans and Medicare as Secondary Payer
Section 9319(e) of
Reinstatement of Waiver of Liability Presumption
Section 9126(c) of
Home Health Waiver of Liability
Section 9205 of
[Section 158(b)(2) of
Recommendations and Guidelines for Elimination of Assistants at Surgery; Report to Congress
Section 9307(d) of
Pacemaker Reimbursement Review and Reform; Promulgation of Regulations; Effective Date of Pacemaker Registration
Section 2304(d) of
Payment for Debridement of Mycotic Toenails
Section 2325 of
Interim Waiver in Certain Cases of Billing Rule for Items and Services Other Than Physicians' Services
Section 602(k) of
"(1) The Secretary of Health and Human Services may, for any cost reporting period beginning prior to October 1, 1986, waive the requirements of sections 1862(a)(14) and 1866(a)(1)(H) of the Social Security Act [subsec. (a)(14) of this section and
"(2) In the case of a hospital which is receiving payments pursuant to a waiver under paragraph (1), payment of the adjustment for indirect costs of approved educational activities shall be made as if the hospital were receiving under part A of title XVIII of the Social Security Act all the payments which are made under part B of such title solely by reason of such waiver.
"(3) Any waiver granted under paragraph (1) shall provide that, with respect to those items and services billed under part B of title XVIII of the Social Security Act solely by reason of such waiver—
"(A) payment under such part shall be equal to 100 percent of the reasonable charge or other applicable payment base for the items and services; and
"(B) the entity furnishing the items and services must agree to accept the amount paid pursuant to subparagraph (A) as the full charge for the items and services."
[Section 9112(b) of
["(1) Section 602(k)(2) of the Social Security Amendments of 1983 (as added by subsection (a)) [set out above] shall apply to cost reporting periods beginning on or after January 1, 1986.
["(2) Section 602(k)(3) of the Social Security Amendments of 1983 (as added by subsection (a)) [set out above] shall apply to items and services furnished after the end of the 10-day period beginning on the date of the enactment of this Act [Apr. 7, 1986]."]
Prohibition of Payment for Ineffective Drugs
Section 115(b) of
Establishment and Implementation of Guidelines
Section 2152(b) of
Report to Congressional Committees on Implementation of Certification Requirements Relating to Modification of Health Benefits Plan or Program; Failure To Submit Report
Section 4(b) of
Section Referred to in Other Sections
This section is referred to in
2 So in original. The comma probably should not appear.
§1395z. Consultation with State agencies and other organizations to develop conditions of participation for providers of services
In carrying out his functions, relating to determination of conditions of participation by providers of services, under subsections (e)(9), (f)(4), (j)(15),1 (o)(6), (cc)(2)(I), and 2 (dd)(2), and (mm)(1) of
(Aug. 14, 1935, ch. 531, title XVIII, §1863, as added July 30, 1965,
References in Text
Subsection (j) of
Amendments
1994—
1990—
1989—
1988—
1984—
1982—
1980—
1972—
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1990 Amendment
Amendment by
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendment
Amendment by section 203(e)(2) of
Amendment by section 204(c)(1) of
Effective Date of 1984 Amendment
Amendment by section 2335(c) of
Amendment by section 2349(b)(1) of
Amendment by section 2354(b)(32) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendment
Amendment by section 933(f) of
Effective Date of 1972 Amendment
Amendment by
Termination of Advisory Councils
Advisory councils in existence on Jan. 5, 1973, to terminate not later than the expiration of the 2-year period following Jan. 5, 1973, unless, in the case of a council established by the President or an officer of the Federal Government, such council is renewed by appropriate action prior to the expiration of such 2-year period, or in the case of a council established by the Congress, its duration is otherwise provided by law. See sections 3(2) and 14 of
Section Referred to in Other Sections
This section is referred to in
1 See References in Text note below.
2 So in original. The word "and" probably should not appear.
§1395aa. Agreements with States
(a) Use of State agencies to determine compliance by providers of services with conditions of participation
The Secretary shall make an agreement with any State which is able and willing to do so under which the services of the State health agency or other appropriate State agency (or the appropriate local agencies) will be utilized by him for the purpose of determining whether an institution therein is a hospital or skilled nursing facility, or whether an agency therein is a home health agency, or whether an agency is a hospice program or whether a facility therein is a rural health clinic as defined in
(b) Payment in advance or by way of reimbursement to State for performance of functions of subsection (a)
The Secretary shall pay any such State, in advance or by way of reimbursement, as may be provided in the agreement with it (and may make adjustments in such payments on account of overpayments or underpayments previously made), for the reasonable cost of performing the functions specified in subsection (a) of this section, and for the Federal Hospital Insurance Trust Fund's fair share of the costs attributable to the planning and other efforts directed toward coordination of activities in carrying out its agreement and other activities related to the provision of services similar to those for which payment may be made under part A of this subchapter, or related to the facilities and personnel required for the provision of such services, or related to improving the quality of such services.
(c) Use of State or local agencies to survey hospitals
The Secretary is authorized to enter into an agreement with any State under which the appropriate State or local agency which performs the certification function described in subsection (a) of this section will survey, on a selective sample basis (or where the Secretary finds that a survey is appropriate because of substantial allegations of the existence of a significant deficiency or deficiencies which would, if found to be present, adversely affect health and safety of patients), hospitals which have an agreement with the Secretary under
(d) Fulfillment of requirements by States
The Secretary may not enter an agreement under this section with a State with respect to determining whether an institution therein is a skilled nursing facility unless the State meets the requirements specified in
(e) Prohibition of user fees for survey and certification
Notwithstanding any other provision of law, the Secretary may not impose, or require a State to impose, any fee on any facility or entity subject to a determination under subsection (a) of this section, or any renal dialysis facility subject to the requirements of
(Aug. 14, 1935, ch. 531, title XVIII, §1864, as added July 30, 1965,
References in Text
Part A of this subchapter, referred to in subsec. (b), is classified to
Amendments
1994—Subsec. (a).
Subsec. (e).
1990—Subsec. (a).
Subsec. (e).
1989—Subsec. (a).
1988—Subsec. (a).
1987—Subsec. (a).
Subsec. (d).
1986—Subsec. (a).
1984—Subsec. (c).
1982—Subsec. (a).
1980—Subsec. (a).
1977—Subsec. (a).
1972—Subsec. (a).
Subsec. (c).
1968—Subsec. (a).
Effective Date of 1994 Amendment
Amendment by section 145(c)(3) of
Effective Date of 1990 Amendment
Section 4154(d)(2) of
Amendment by section 4163(c)(2) of
Effective Date of 1989 Amendments
Amendment by section 6115(c) of
Amendment by
Effective Date of 1988 Amendments
Amendment by
Amendment by section 203(e)(3) of
Amendment by section 204(c)(2), (d)(3) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4025(c), formerly §4025(b), of
For effective date of amendment by section 4072(d) of
Amendments by sections 4201(a)(2), (d)(4) and 4202(a)(1), (c) of
Amendment by section 4203(a)(1) of
Effective Date of 1986 Amendment
Amendment by
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendments
Amendment by
For effective date of amendment by section 933(g) of
Effective Date of 1977 Amendment
Amendment by
Effective Date of 1972 Amendment
Section 299D(c) of
Effective Date of 1968 Amendment
Amendment by section 133(f) of
Section 228(b) of
Use of State or Local Agencies in Evaluating Laboratories
Section 160(a)(2) of
Nurse Aid Training and Competency Evaluation, Failure by State To Meet Guidelines
Section 4008(h)(1)(A) of
Section Referred to in Other Sections
This section is referred to in
§1395bb. Effect of accreditation
(a) Except as provided in subsection (b) of this section and the second sentence of
(1) an institution is accredited as a hospital by the Joint Commission on Accreditation of Hospitals, and
(2)(A) such institution authorizes the Commission to release to the Secretary upon his request (or such State agency as the Secretary may designate) a copy of the most current accreditation survey of such institution made by such Commission, together with any other information directly related to the survey as the Secretary may require (including corrective action plans),1
(B) such Commission releases such a copy and any such information to the Secretary,
then, such institution shall be deemed to meet the requirements of the numbered paragraphs of
(3) paragraph (6) thereof, and
(4) any standard, promulgated by the Secretary pursuant to paragraph (9) thereof, which is higher than the requirements prescribed for accreditation by such Commission.
If such Commission, as a condition for accreditation of a hospital, requires a utilization review plan (or imposes another requirement which serves substantially the same purpose), requires a discharge planning process (or imposes another requirement which serves substantially the same purpose), or imposes a standard which the Secretary determines is at least equivalent to the standard promulgated by the Secretary as described in paragraph (4) of this subsection, the Secretary is authorized to find that all institutions so accredited by such Commission comply also with clause (A) or (B) of
(b) Notwithstanding any other provision of this subchapter, if the Secretary finds that a hospital has significant deficiencies (as defined in regulations pertaining to health and safety), the hospital shall, after the date of notice of such finding to the hospital and for such period as may be prescribed in regulations, be deemed not to meet the requirements of the numbered paragraphs of
(Aug. 14, 1935, ch. 531, title XVIII, §1865, as added July 30, 1965,
Amendments
1994—Subsec. (a).
1990—Subsec. (a).
1989—Subsec. (a).
Subsec. (a)(2).
Subsec. (b).
1988—Subsec. (a).
1987—Subsec. (a).
1986—Subsec. (a).
1984—Subsec. (a).
1982—Subsec. (a).
Subsec. (b).
1972—
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1990 Amendment
Amendment by
Effective Date of 1989 Amendments
Section 6019(d) of
"(1) Except as provided in paragraph (2), the amendments made by this section [amending this section] shall take effect on the date of the enactment of this Act [Dec. 19, 1989].
"(2) The amendments made by subsection (a) [amending this section] shall take effect 6 months after the date of the enactment of this Act."
Amendment by section 6115(c) of
Amendment by
Effective Date of 1988 Amendments
Amendment by
Amendment by section 204(c)(3), (d)(3) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Amendment by section 4025(b) of
For effective date of amendment by section 4072(d) of
Effective Date of 1986 Amendment
Amendment by section 9305(c)(3) of
Amendment by section 9320(h)(3) of
Effective Date of 1984 Amendment
Section 2345(b) of
Section 2346(b) of
Effective Date of 1982 Amendment
Amendment by section 122(g)(4) of
Amendment by section 128(d)(3) of
Effective Date of 1972 Amendment
Amendment by section 234(h) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be followed by "and".
§1395cc. Agreements with providers of services
(a) Filing of agreements; eligibility for payment; charges with respect to items and services
(1) Any provider of services (except a fund designated for purposes of section 1395f(g) and
(A) not to charge, except as provided in paragraph (2), any individual or any other person for items or services for which such individual is entitled to have payment made under this subchapter (or for which he would be so entitled if such provider of services had complied with the procedural and other requirements under or pursuant to this subchapter or for which such provider is paid pursuant to the provisions of
(B) not to charge any individual or any other person for items or services for which such individual is not entitled to have payment made under this subchapter because payment for expenses incurred for such items or services may not be made by reason of the provisions of paragraph (1) or (9) of
(C) to make adequate provision for return (or other disposition, in accordance with regulations) of any moneys incorrectly collected from such individual or other person,
(D) to promptly notify the Secretary of its employment of an individual who, at any time during the year preceding such employment, was employed in a managerial, accounting, auditing, or similar capacity (as determined by the Secretary by regulation) by an agency or organization which serves as a fiscal intermediary or carrier (for purposes of part A or part B, or both, of this subchapter) with respect to the provider,
(E) to release data with respect to patients of such provider upon request to an organization having a contract with the Secretary under part B of subchapter XI of this chapter as may be necessary (i) to allow such organization to carry out its functions under such contract, or (ii) to allow such organization to carry out similar review functions under any contract the organization may have with a private or public agency paying for health care in the same area with respect to patients who authorize release of such data for such purposes,
(F)(i) in the case of hospitals which provide inpatient hospital services for which payment may be made under subsection (b), (c), or (d) of
(ii) in the case of hospitals, rural primary care hospitals, skilled nursing facilities, and home health agencies, to maintain an agreement with a utilization and quality control peer review organization (which has a contract with the Secretary under part B of subchapter XI of this chapter for the area in which the hospital, facility, or agency is located) to perform the functions described in paragraph (3)(A),
(G) in the case of hospitals which provide inpatient hospital services for which payment may be made under subsection (b) or (d) of
(H) in the case of hospitals which provide services for which payment may be made under this subchapter and in the case of rural primary care hospitals which provide rural primary care hospital services, to have all items and services (other than physicians' services as defined in regulations for purposes of
(I) in the case of a hospital or rural primary care hospital—
(i) to adopt and enforce a policy to ensure compliance with the requirements of
(ii) to maintain medical and other records related to individuals transferred to or from the hospital for a period of five years from the date of the transfer, and
(iii) to maintain a list of physicians who are on call for duty after the initial examination to provide treatment necessary to stabilize an individual with an emergency medical condition; 1
(J) in the case of hospitals which provide inpatient hospital services for which payment may be made under this subchapter, to be a participating provider of medical care under any health plan contracted for under
(K) not to charge any individual or any other person for items or services for which payment under this subchapter is denied under
(L) in the case of hospitals which provide inpatient hospital services for which payment may be made under this subchapter, to be a participating provider of medical care under
(M) in the case of hospitals, to provide to each individual who is entitled to benefits under part A of this subchapter (or to a person acting on the individual's behalf), at or about the time of the individual's admission as an inpatient to the hospital, a written statement (containing such language as the Secretary prescribes consistent with this paragraph) which explains—
(i) the individual's rights to benefits for inpatient hospital services and for post-hospital services under this subchapter,
(ii) the circumstances under which such an individual will and will not be liable for charges for continued stay in the hospital,
(iii) the individual's right to appeal denials of benefits for continued inpatient hospital services, including the practical steps to initiate such an appeal, and
(iv) the individual's liability for payment for services if such a denial of benefits is upheld on appeal,
and which provides such additional information as the Secretary may specify,
(N) in the case of hospitals and rural primary care hospitals—
(i) to make available to its patients the directory or directories of participating physicians (published under
(ii) if hospital personnel (including staff of any emergency or outpatient department) refer a patient to a nonparticipating physician for further medical care on an outpatient basis, the personnel must inform the patient that the physician is a nonparticipating physician and, whenever practicable, must identify at least one qualified participating physician who is listed in such a directory and from whom the patient may receive the necessary services,
(iii) to post conspicuously in any emergency department a sign (in a form specified by the Secretary) specifying rights of individuals under
(iv) to post conspicuously (in a form specified by the Secretary) information indicating whether or not the hospital participates in the medicaid program under a State plan approved under subchapter XIX of this chapter, and 2
(O) in the case of hospitals and skilled nursing facilities, to accept as payment in full for inpatient hospital and extended care services that are covered under this subchapter and are furnished to any individual enrolled with an eligible organization (i) with a risk-sharing contract under
(P) in the case of home health agencies which provide home health services to individuals entitled to benefits under this subchapter who require catheters, catheter supplies, ostomy bags, and supplies related to ostomy care (described in
(Q) in the case of hospitals, skilled nursing facilities, home health agencies, and hospice programs, to comply with the requirement of subsection (f) of this section (relating to maintaining written policies and procedures respecting advance directives).
In the case of a hospital which has an agreement in effect with an organization described in subparagraph (F), which organization's contract with the Secretary under part B of subchapter XI of this chapter is terminated on or after October 1, 1984, the hospital shall not be determined to be out of compliance with the requirement of such subparagraph during the six month period beginning on the date of the termination of that contract.
(2)(A) A provider of services may charge such individual or other person (i) the amount of any deduction or coinsurance amount imposed pursuant to section 1395e(a)(1), (a)(3), or (a)(4), section 1395l(b), or
(B) Where a provider of services has furnished, at the request of such individual, items or services which are in excess of or more expensive than the items or services with respect to which payment may be made under this subchapter, such provider of services may also charge such individual or other person for such more expensive items or services to the extent that the amount customarily charged by it for the items or services furnished at such request exceeds the amount customarily charged by it for the items or services with respect to which payment may be made under this subchapter.
(C) A provider of services may in accordance with its customary practice also appropriately charge any such individual for any whole blood (or equivalent quantities of packed red blood cells, as defined under regulations) furnished him with respect to which a deductible is imposed under
(D) Where a provider of services customarily furnishes items or services which are in excess of or more expensive than the items or services with respect to which payment may be made under this subchapter, such provider, notwithstanding the preceding provisions of this paragraph, may not, under the authority of subparagraph (B)(ii) of this paragraph, charge any individual or other person any amount for such items or services in excess of the amount of the payment which may otherwise be made for such items or services under this subchapter if the admitting physician has a direct or indirect financial interest in such provider.
(3)(A) Under the agreement required under paragraph (1)(F)(ii), the peer review organization must perform functions (other than those covered under an agreement under paragraph (1)(F)(i)) under the third sentence of
(B) For purposes of payment under this subchapter, the cost of such an agreement to the hospital, rural primary care hospital, facility, or agency shall be considered a cost incurred by such hospital, rural primary care hospital, facility, or agency in providing covered services under this subchapter and shall be paid directly by the Secretary to the peer review organization on behalf of such hospital, rural primary care hospital, facility, or agency in accordance with a schedule established by the Secretary.
(C) Such payments—
(i) shall be transferred in appropriate proportions from the Federal Hospital Insurance Trust Fund and from the Federal Supplementary Medical Insurance Trust Fund, without regard to amounts appropriated in advance in appropriation Acts, in the same manner as transfers are made for payment for services provided directly to beneficiaries, and
(ii) shall not be less in the aggregate for a fiscal year—
(I) in the case of hospitals, than the amount specified in paragraph (1)(F)(i)(III), and
(II) in the case of facilities, rural primary care hospitals, and agencies, than the amounts the Secretary determines to be sufficient to cover the costs of such organizations' conducting the activities described in subparagraph (A) with respect to such facilities, rural primary care hospitals, or agencies under part B of subchapter XI of this chapter.
(b) Termination or nonrenewal of agreements
(1) A provider of services may terminate an agreement with the Secretary under this section at such time and upon such notice to the Secretary and the public as may be provided in regulations, except that notice of more than six months shall not be required.
(2) The Secretary may refuse to enter into an agreement under this section or, upon such reasonable notice to the provider and the public as may be specified in regulations, may refuse to renew or may terminate such an agreement after the Secretary—
(A) has determined that the provider fails to comply substantially with the provisions of the agreement, with the provisions of this subchapter and regulations thereunder, or with a corrective action required under
(B) has determined that the provider fails substantially to meet the applicable provisions of
(C) has excluded the provider from participation in a program under this subchapter pursuant to
(3) A termination of an agreement or a refusal to renew an agreement under this subsection shall become effective on the same date and in the same manner as an exclusion from participation under the programs under this subchapter becomes effective under
(c) Refiling after termination or nonrenewal; agreements with skilled nursing facilities
(1) Where the Secretary has terminated or has refused to renew an agreement under this subchapter with a provider of services, such provider may not file another agreement under this subchapter unless the Secretary finds that the reason for the termination or nonrenewal has been removed and that there is reasonable assurance that it will not recur.
(2) Where the Secretary has terminated or has refused to renew an agreement under this subchapter with a provider of services, the Secretary shall promptly notify each State agency which administers or supervises the administration of a State plan approved under subchapter XIX of this chapter of such termination or nonrenewal.
(d) Decision to withhold payment for failure to review long-stay cases
If the Secretary finds that there is a substantial failure to make timely review in accordance with
(e) "Provider of services" defined
For purposes of this section, the term "provider of services" shall include—
(1) a clinic, rehabilitation agency, or public health agency if, in the case of a clinic or rehabilitation agency, such clinic or agency meets the requirements of
(2) a community mental health center (as defined in
(f) Maintenance of written policies and procedures
(1) For purposes of subsection (a)(1)(Q) of this section and
(A) to provide written information to each such individual concerning—
(i) an individual's rights under State law (whether statutory or as recognized by the courts of the State) to make decisions concerning such medical care, including the right to accept or refuse medical or surgical treatment and the right to formulate advance directives (as defined in paragraph (3)), and
(ii) the written policies of the provider or organization respecting the implementation of such rights;
(B) to document in the individual's medical record whether or not the individual has executed an advance directive;
(C) not to condition the provision of care or otherwise discriminate against an individual based on whether or not the individual has executed an advance directive;
(D) to ensure compliance with requirements of State law (whether statutory or as recognized by the courts of the State) respecting advance directives at facilities of the provider or organization; and
(E) to provide (individually or with others) for education for staff and the community on issues concerning advance directives.
Subparagraph (C) shall not be construed as requiring the provision of care which conflicts with an advance directive.
(2) The written information described in paragraph (1)(A) shall be provided to an adult individual—
(A) in the case of a hospital, at the time of the individual's admission as an inpatient,
(B) in the case of a skilled nursing facility, at the time of the individual's admission as a resident,
(C) in the case of a home health agency, in advance of the individual coming under the care of the agency,
(D) in the case of a hospice program, at the time of initial receipt of hospice care by the individual from the program, and
(E) in the case of an eligible organization (as defined in
(3) In this subsection, the term "advance directive" means a written instruction, such as a living will or durable power of attorney for health care, recognized under State law (whether statutory or as recognized by the courts of the State) and relating to the provision of such care when the individual is incapacitated.
(g) Penalties for improper billing
Except as permitted under subsection (a)(2) of this section, any person who knowingly and willfully presents, or causes to be presented, a bill or request for payment inconsistent with an arrangement under subsection (a)(1)(H) of this section or in violation of the requirement for such an arrangement, is subject to a civil money penalty of not to exceed $2,000. The provisions of
(h) Dissatisfaction with determination of Secretary; appeal by institutions or agencies; single notice and hearing
(1) Except as provided in paragraph (2), an institution or agency dissatisfied with a determination by the Secretary that it is not a provider of services or with a determination described in subsection (b)(2) of this section shall be entitled to a hearing thereon by the Secretary (after reasonable notice) to the same extent as is provided in
(2) An institution or agency is not entitled to separate notice and opportunity for a hearing under both
(i) Intermediate sanctions for psychiatric hospitals
(1) If the Secretary determines that a psychiatric hospital which has an agreement in effect under this section no longer meets the requirements for a psychiatric hospital under this subchapter and further finds that the hospital's deficiencies—
(A) immediately jeopardize the health and safety of its patients, the Secretary shall terminate such agreement; or
(B) do not immediately jeopardize the health and safety of its patients, the Secretary may terminate such agreement, or provide that no payment will be made under this subchapter with respect to any individual admitted to such hospital after the effective date of the finding, or both.
(2) If a psychiatric hospital, found to have deficiencies described in paragraph (1)(B), has not complied with the requirements of this subchapter—
(A) within 3 months after the date the hospital is found to be out of compliance with such requirements, the Secretary shall provide that no payment will be made under this subchapter with respect to any individual admitted to such hospital after the end of such 3-month period, or
(B) within 6 months after the date the hospital is found to be out of compliance with such requirements, no payment may be made under this subchapter with respect to any individual in the hospital until the Secretary finds that the hospital is in compliance with the requirements of this subchapter.
(Aug. 14, 1935, ch. 531, title XVIII, §1866, as added July 30, 1965,
References in Text
Parts A and B of this subchapter, referred to in subsec. (a), are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Part B of subchapter XI of this chapter, referred to in subsec. (a)(1), (3)(C)(ii)(II), is classified to
Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (a)(1)(O)(i), is section 222(a) of
Amendments
1994—Subsec. (a)(1)(H).
Subsec. (a)(2)(A).
Subsec. (d).
Subsec. (f)(1).
Subsec. (h)(1).
1991—Subsec. (a)(1)(J).
Subsec. (a)(1)(L).
1990—Subsec. (a)(1)(F)(i).
Subsec. (a)(1)(F)(ii).
Subsec. (a)(1)(H).
Subsec. (a)(1)(I)(i).
Subsec. (a)(1)(P).
Subsec. (a)(1)(Q).
Subsec. (e).
Subsec. (f).
1989—Subsec. (a)(1)(F)(i)(III).
Subsec. (a)(1)(F)(ii).
Subsec. (a)(1)(H).
Subsec. (a)(1)(I).
Subsec. (a)(1)(N).
Subsec. (a)(1)(N)(iii), (iv).
Subsec. (a)(1)(P).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B).
Subsec. (a)(3)(A), (B).
Subsec. (a)(3)(C)(ii)(II).
Subsec. (d).
Subsec. (i).
1988—Subsec. (a)(1)(M).
Subsec. (a)(1)(N).
Subsec. (a)(1)(O).
Subsec. (a)(2)(A).
Subsec. (a)(3)(C)(ii).
Subsec. (d).
Subsec. (f).
Subsec. (g).
1987—Subsec. (a)(1)(F)(i)(III).
Subsec. (a)(1)(O).
Subsec. (a)(2)(A).
Subsec. (a)(3).
Subsec. (a)(3)(C)(ii).
Subsec. (a)(4).
Subsec. (b).
Subsec. (c)(1).
Subsec. (c)(2).
Subsec. (c)(3).
Subsec. (g).
Subsec. (h).
1986—Subsec. (a)(1)(F).
Subsec. (a)(1)(H).
Subsec. (a)(1)(I).
Subsec. (a)(1)(J).
Subsec. (a)(1)(K).
Subsec. (a)(1)(L).
Subsec. (a)(1)(M).
Subsec. (a)(1)(N).
Subsec. (a)(2)(A).
Subsec. (a)(4).
Subsec. (e).
Subsec. (g).
1984—Subsec. (a)(1)(E).
Subsec. (a)(1)(F).
Subsec. (a)(2)(A).
Subsec. (b)(3).
Subsec. (b)(4).
Subsec. (d).
1983—Subsec. (a)(1).
Subsec. (a)(1)(F).
Subsec. (a)(1)(F) to (H).
Subsec. (a)(2)(A).
Subsec. (a)(2)(B)(ii).
1982—Subsec. (a)(1)(B).
Subsec. (a)(1)(E).
Subsec. (a)(2)(A).
Subsec. (b).
Subsec. (b)(4)(A).
1981—Subsec. (a)(1).
1980—Subsec. (a)(2)(A).
Subsec. (c)(3).
Subsec. (f).
1978—Subsec. (a)(2)(A).
Subsec. (a)(3).
Subsec. (b)(2)(G).
1977—Subsec. (a)(1)(D).
Subsec. (b)(2)(C).
Subsec. (b)(2)(F).
Subsec. (c)(2).
1972—Subsec. (a)(1).
Subsec. (a)(2)(B).
Subsec. (a)(2)(C).
Subsec. (a)(2)(D).
Subsec. (b).
Subsec. (c).
Subsec. (d).
1968—Subsec. (a)(2)(A).
Subsec. (a)(2)(C).
Subsec. (e).
Effective Date of 1994 Amendments
Section 106(b)(2) of
Amendment by section 147(e)(7) of
Amendment by section 156(a)(2)(E) of
Amendment by
Effective Date of 1990 Amendment
Section 4008(b)(4) of
Section 4153(d)(2) of
Amendment by section 4157(c)(2) of
Amendment by section 4162(b)(2) of
Amendment by section 4206(a) of
Effective Date of 1989 Amendments
Section 6018(b) of
Amendment by section 6112(e)(3) of
Amendment by section 101(a) of
Amendment by section 201(a) of
Effective Date of 1988 Amendments
Amendment by section 608(d)(3)(F), (19)(A) of
Amendment by section 104(d)(5) of
Amendment by section 202(h)(1) of
Except as specifically provided in section 411 of
Section 411(c)(2)(A)(ii) of
Effective Date of 1987 Amendments
Amendment by section 4012(a) of
Amendment by section 4062(d)(4) of
Section 4085(i)(17) of
Section 4097(c) of
Amendment by section 4212(e)(4) of
Amendment by
Effective Date of 1986 Amendments
Section 233(b) of
Amendment by
Section 9305(b)(2) of
Amendment by section 9320(h)(2) of
Section 9332(e)(2) of
Amendment by section 9337(c)(2) of
Amendment by section 9343(c)(2), (3) of
Section 9353(e)(3)(A) of
Amendment by section 9121(a) of
Section 9122(b) of
Section 9402(c)(1) of
Amendment by section 9403(b) of
Effective Date of 1984 Amendment
Amendment by section 2303(f) of
Amendment by section 2315(d) of
Amendment by section 2321(c) of
Amendment by section 2323(b)(3) of
Amendment by section 2335(d) of
Amendment by section 2347(a) of
Section 2348(b) of
Amendment by section 2354(b)(33), (34) of
Effective Date of 1983 Amendments
Section 602(l) of
Amendment by section 602(f)(2) of
Subsec. (a)(1)(F) to (H) of this section, as added by section 602(f)(1)(C) of
Amendment by section 309(a)(5) of
Amendment by section 309(b)(11) of
Effective Date of 1982 Amendment
Amendment by section 122(g)(5), (6) of
Amendment by section 128(a)(5) of
Amendment by section 128(d)(4) of
Amendment by section 144 of
Effective Date of 1980 Amendment
Amendment by
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1977 Amendments
Section 2(f) of
"(1) The amendments made by this section [amending this section and
"(2) In the case of a State plan for medical assistance under title XIX of the Social Security Act [subchapter XIX of this chapter] which the Secretary determines requires State legislation in order for the plan to meet the additional requirements imposed by the amendments made by this section, the State plan shall not be regarded as failing to comply with the requirements of such title [subchapter] solely on the basis of its failure to meet these additional requirements 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 [Dec. 13, 1977]."
Amendment by section 3(b) of
Amendment by section 8(b) of
Amendment by section 13(b)(3) of
Section 15(b) of
Effective Date of 1972 Amendment
Amendment by section 223(e), (g) of
Amendment by section 227(d)(2) of
Section 249A(e) of
Amendment by section 281(c) of
Effective Date of 1968 Amendment
Amendment by section 129(c)(12) of
Amendment by section 133(c) of
Amendment by section 135(b) of
Effect on State Law
Section 4206(c) of
Reports to Congress on Number of Hospitals Terminating or Not Renewing Provider Agreements
Section 233(c) of
"(1) The Secretary of Health and Human Services shall periodically submit to the Congress a report on the number of hospitals that have terminated or failed to renew an agreement under section 1866 of the Social Security Act [this section] as a result of the additional conditions imposed under the amendments made by subsection (a) [amending this section].
"(2) Not later than October 1, 1987, the Administrator of Veterans' Affairs shall submit to the Committees on Veterans' Affairs of the Senate and House of Representatives a report regarding implementation of this section [amending this section]. Thereafter, the Administrator shall notify such committees if any hospital terminates or fails to renew an agreement described in paragraph (1) for the reasons described in that paragraph."
Section 9122(d) of
Delay in Implementation of Requirement That Hospitals Maintain Agreements With Utilization and Quality Control Peer Review Organization
Section 2347(b) of
Interim Waiver in Certain Cases of Billing Rule for Items and Services Other Than Physicians' Services
For authority to waive the requirements of subsec. (a)(1)(H) of this section for any cost period prior to Oct. 1, 1986, where immediate compliance would threaten the stability of patient care, see section 602(k) of
Private Sector Review Initiative
Section 119 of
"(a) The Secretary of Health and Human Services shall undertake an initiative to improve medical review by intermediaries and carriers under title XVIII of the Social Security Act [this subchapter] and to encourage similar review efforts by private insurers and other private entities. The initiative shall include the development of specific standards for measuring the performance of such intermediaries and carriers with respect to the identification and reduction of unnecessary utilization of health services.
"(b) Where such review activity results in the denial of payment to providers of services under title XVIII of the Social Security Act [this subchapter], such providers shall be prohibited, in accordance with sections 1866 and 1879 of such title [this section and
Agreements Filed and Accepted Prior to Oct. 30, 1972, Deemed To Be for Specified Term Ending Dec. 31, 1973
Section 249A(f) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. The semicolon probably should be a comma.
2 So in original. The word "and" probably should not appear.
3 So in original. The semicolon probably should be a comma.
§1395dd. Examination and treatment for emergency medical conditions and women in labor
(a) Medical screening requirement
In the case of a hospital that has a hospital emergency department, if any individual (whether or not eligible for benefits under this subchapter) comes to the emergency department and a request is made on the individual's behalf for examination or treatment for a medical condition, the hospital must provide for an appropriate medical screening examination within the capability of the hospital's emergency department, including ancillary services routinely available to the emergency department, to determine whether or not an emergency medical condition (within the meaning of subsection (e)(1) of this section) exists.
(b) Necessary stabilizing treatment for emergency medical conditions and labor
(1) In general
If any individual (whether or not eligible for benefits under this subchapter) comes to a hospital and the hospital determines that the individual has an emergency medical condition, the hospital must provide either—
(A) within the staff and facilities available at the hospital, for such further medical examination and such treatment as may be required to stabilize the medical condition, or
(B) for transfer of the individual to another medical facility in accordance with subsection (c) of this section.
(2) Refusal to consent to treatment
A hospital is deemed to meet the requirement of paragraph (1)(A) with respect to an individual if the hospital offers the individual the further medical examination and treatment described in that paragraph and informs the individual (or a person acting on the individual's behalf) of the risks and benefits to the individual of such examination and treatment, but the individual (or a person acting on the individual's behalf) refuses to consent to the examination and treatment. The hospital shall take all reasonable steps to secure the individual's (or person's) written informed consent to refuse such examination and treatment.
(3) Refusal to consent to transfer
A hospital is deemed to meet the requirement of paragraph (1) with respect to an individual if the hospital offers to transfer the individual to another medical facility in accordance with subsection (c) of this section and informs the individual (or a person acting on the individual's behalf) of the risks and benefits to the individual of such transfer, but the individual (or a person acting on the individual's behalf) refuses to consent to the transfer. The hospital shall take all reasonable steps to secure the individual's (or person's) written informed consent to refuse such transfer.
(c) Restricting transfers until individual stabilized
(1) Rule
If an individual at a hospital has an emergency medical condition which has not been stabilized (within the meaning of subsection (e)(3)(B) of this section), the hospital may not transfer the individual unless—
(A)(i) the individual (or a legally responsible person acting on the individual's behalf) after being informed of the hospital's obligations under this section and of the risk of transfer, in writing requests transfer to another medical facility,
(ii) a physician (within the meaning of
(iii) if a physician is not physically present in the emergency department at the time an individual is transferred, a qualified medical person (as defined by the Secretary in regulations) has signed a certification described in clause (ii) after a physician (as defined in
(B) the transfer is an appropriate transfer (within the meaning of paragraph (2)) to that facility.
A certification described in clause (ii) or (iii) of subparagraph (A) shall include a summary of the risks and benefits upon which the certification is based.
(2) Appropriate transfer
An appropriate transfer to a medical facility is a transfer—
(A) in which the transferring hospital provides the medical treatment within its capacity which minimizes the risks to the individual's health and, in the case of a woman in labor, the health of the unborn child;
(B) in which the receiving facility—
(i) has available space and qualified personnel for the treatment of the individual, and
(ii) has agreed to accept transfer of the individual and to provide appropriate medical treatment;
(C) in which the transferring hospital sends to the receiving facility all medical records (or copies thereof), related to the emergency condition for which the individual has presented, available at the time of the transfer, including records related to the individual's emergency medical condition, observations of signs or symptoms, preliminary diagnosis, treatment provided, results of any tests and the informed written consent or certification (or copy thereof) provided under paragraph (1)(A), and the name and address of any on-call physician (described in subsection (d)(1)(C) of this section) who has refused or failed to appear within a reasonable time to provide necessary stabilizing treatment;
(D) in which the transfer is effected through qualified personnel and transportation equipment, as required including the use of necessary and medically appropriate life support measures during the transfer; and
(E) which meets such other requirements as the Secretary may find necessary in the interest of the health and safety of individuals transferred.
(d) Enforcement
(1) Civil money penalties
(A) A participating hospital that negligently violates a requirement of this section is subject to a civil money penalty of not more than $50,000 (or not more than $25,000 in the case of a hospital with less than 100 beds) for each such violation. The provisions of
(B) Subject to subparagraph (C), any physician who is responsible for the examination, treatment, or transfer of an individual in a participating hospital, including a physician on-call for the care of such an individual, and who negligently violates a requirement of this section, including a physician who—
(i) signs a certification under subsection (c)(1)(A) of this section that the medical benefits reasonably to be expected from a transfer to another facility outweigh the risks associated with the transfer, if the physician knew or should have known that the benefits did not outweigh the risks, or
(ii) misrepresents an individual's condition or other information, including a hospital's obligations under this section,
is subject to a civil money penalty of not more than $50,000 for each such violation and, if the violation is is 2 gross and flagrant or is repeated, to exclusion from participation in this subchapter and State health care programs. The provisions of
(C) If, after an initial examination, a physician determines that the individual requires the services of a physician listed by the hospital on its list of on-call physicians (required to be maintained under
(2) Civil enforcement
(A) Personal harm
Any individual who suffers personal harm as a direct result of a participating hospital's violation of a requirement of this section may, in a civil action against the participating hospital, obtain those damages available for personal injury under the law of the State in which the hospital is located, and such equitable relief as is appropriate.
(B) Financial loss to other medical facility
Any medical facility that suffers a financial loss as a direct result of a participating hospital's violation of a requirement of this section may, in a civil action against the participating hospital, obtain those damages available for financial loss, under the law of the State in which the hospital is located, and such equitable relief as is appropriate.
(C) Limitations on actions
No action may be brought under this paragraph more than two years after the date of the violation with respect to which the action is brought.
(3) Consultation with peer review organizations
In considering allegations of violations of the requirements of this section in imposing sanctions under paragraph (1), the Secretary shall request the appropriate utilization and quality control peer review organization (with a contract under part B of subchapter XI of this chapter) to assess whether the individual involved had an emergency medical condition which had not been stabilized, and provide a report on its findings. Except in the case in which a delay would jeopardize the health or safety of individuals, the Secretary shall request such a review before effecting a sanction under paragraph (1) and shall provide a period of at least 60 days for such review.
(e) Definitions
In this section:
(1) The term "emergency medical condition" means—
(A) a medical condition manifesting itself by acute symptoms of sufficient severity (including severe pain) such that the absence of immediate medical attention could reasonably be expected to result in—
(i) placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy,
(ii) serious impairment to bodily functions, or
(iii) serious dysfunction of any bodily organ or part; or
(B) with respect to a pregnant women 3 who is having contractions—
(i) that there is inadequate time to effect a safe transfer to another hospital before delivery, or
(ii) that transfer may pose a threat to the health or safety of the woman or the unborn child.
(2) The term "participating hospital" means hospital that has entered into a provider agreement under
(3)(A) The term "to stabilize" means, with respect to an emergency medical condition described in paragraph (1)(A), to provide such medical treatment of the condition as may be necessary to assure, within reasonable medical probability, that no material deterioration of the condition is likely to result from or occur during the transfer of the individual from a facility, or, with respect to an emergency medical condition described in paragraph (1)(B), to deliver (including the placenta).
(B) The term "stabilized" means, with respect to an emergency medical condition described in paragraph (1)(A), that no material deterioration of the condition is likely, within reasonable medical probability, to result from or occur during the transfer of the individual from a facility, or, with respect to an emergency medical condition described in paragraph (1)(B), that the woman has delivered (including the placenta).
(4) The term "transfer" means the movement (including the discharge) of an individual outside a hospital's facilities at the direction of any person employed by (or affiliated or associated, directly or indirectly, with) the hospital, but does not include such a movement of an individual who (A) has been declared dead, or (B) leaves the facility without the permission of any such person.
(5) The term "hospital" includes a rural primary care hospital (as defined in
(f) Preemption
The provisions of this section do not preempt any State or local law requirement, except to the extent that the requirement directly conflicts with a requirement of this section.
(g) Nondiscrimination
A participating hospital that has specialized capabilities or facilities (such as burn units, shock-trauma units, neonatal intensive care units, or (with respect to rural areas) regional referral centers as identified by the Secretary in regulation) shall not refuse to accept an appropriate transfer of an individual who requires such specialized capabilities or facilities if the hospital has the capacity to treat the individual.
(h) No delay in examination or treatment
A participating hospital may not delay provision of an appropriate medical screening examination required under subsection (a) of this section or further medical examination and treatment required under subsection (b) of this section in order to inquire about the individual's method of payment or insurance status.
(i) Whistleblower protections
A participating hospital may not penalize or take adverse action against a qualified medical person described in subsection (c)(1)(A)(iii) of this section or a physician because the person or physician refuses to authorize the transfer of an individual with an emergency medical condition that has not been stabilized or against any hospital employee because the employee reports a violation of a requirement of this section.
(Aug. 14, 1935, ch. 531, title XVIII, §1867, as added Apr. 7, 1986,
References in Text
Part B of subchapter XI of this chapter, referred to in subsec. (d)(3), is classified to
Prior Provisions
A prior section 1395dd, act Aug. 14, 1935, ch. 531, title XVIII, §1867, as added July 30, 1965,
Amendments
1994—Subsec. (d)(3).
1990—Subsec. (c)(2)(C).
Subsec. (d)(1).
"(A) termination of its provider agreement under this subchapter in accordance with
"(B) at the option of the Secretary, suspension of such agreement for such period of time as the Secretary determines to be appropriate, upon reasonable notice to the hospital and to the public."
Subsec. (d)(1)(B).
Subsec. (d)(2).
Subsec. (d)(2)(A).
Subsec. (d)(3).
Subsec. (i).
1989—
Subsec. (a).
Subsec. (b).
Subsec. (b)(1).
Subsec. (b)(1)(A).
Subsec. (b)(2).
Subsec. (b)(3).
Subsec. (c).
Subsec. (c)(1).
Subsec. (c)(1)(A)(i).
Subsec. (c)(1)(A)(ii).
Subsec. (c)(1)(A)(iii).
Subsec. (c)(2)(A).
Subsec. (c)(2)(B).
Subsec. (c)(2)(C).
Subsec. (c)(2)(D).
Subsec. (c)(2)(E).
Subsec. (d)(2)(B).
Subsec. (d)(2)(C).
"(i) is employed by, or under contract with, the participating hospital, and
"(ii) acting as such an employee or under such a contract, has professional responsibility for the provision of examinations or treatments for the individual, or transfers of the individual, with respect to which the violation occurred."
Subsec. (e)(1).
"(A) placing the patient's health in serious jeopardy,
"(B) serious impairment to bodily functions, or
"(C) serious dysfunction of any bodily organ or part."
Subsec. (e)(2).
Subsec. (e)(3).
Subsec. (e)(4).
Subsec. (e)(4)(A).
Subsec. (e)(4)(B).
Subsec. (e)(5).
Subsec. (e)(6).
Subsecs. (g) to (i).
1988—Subsec. (d)(1).
Subsec. (d)(2).
1987—Subsec. (d)(1).
Subsec. (d)(2).
1986—Subsec. (b)(2), (3).
Subsec. (e)(3).
Effective Date of 1990 Amendment
Amendment by section 4008(b)(1)–(3)(A) of
Amendment by section 4207(a)(1)(A) of
Section 4207(a)(4), formerly 4027(a)(4), of
Effective Date of 1989 Amendment
Section 6211(i) of
Effective Date of 1988 Amendments
Amendment by
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4009(a)(2), formerly §4009(a)(3), of
Effective Date of 1986 Amendment
Amendment by
Effective Date
Section 9121(c) of
Inspector General Study of Prohibition on Hospital Employment of Physicians
Section 4008(c) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be followed by a comma.
3 So in original. Probably should be "woman".
§1395ee. Practicing Physicians Advisory Council
(a) Appointment
The Secretary shall appoint, based upon nominations submitted by medical organizations representing physicians, a Practicing Physicians Advisory Council (in this section referred to as the "Council") to be composed of 15 physicians, each of whom has submitted at least 250 claims for physicians' services under this subchapter in the previous year. At least 11 of the members of the Council shall be physicians described in
(b) Meetings
The Council shall meet once during each calendar quarter to discuss certain proposed changes in regulations and carrier manual instructions related to physician services identified by the Secretary. To the extent feasible and consistent with statutory deadlines, such consultation shall occur before the publication of such proposed changes.
(c) Reimbursement of expenses
Members of the Council shall be entitled to receive reimbursement of expenses and per diem in lieu of subsistence in the same manner as other members of advisory councils appointed by the Secretary are provided such reimbursement and per diem under this subchapter.
(Aug. 14, 1935, ch. 531, title XVIII, §1868, as added Nov. 5, 1990,
Prior Provisions
A prior section 1395ee, act Aug. 14, 1935, ch. 531, title XVIII, §1868, as added July 30, 1965,
Termination of Advisory Councils
Advisory councils established after Jan. 5, 1973, to terminate not later than the expiration of the 2-year period beginning on the date of their establishment, unless, in the case of a council established by the President or an officer of the Federal Government, such council is renewed by appropriate action prior to the expiration of such 2-year period, or in the case of a council established by Congress, its duration is otherwise provided by law. See sections 3(2) and 14 of
§1395ff. Determinations of Secretary
(a) Entitlement to and amount of benefits
The determination of whether an individual is entitled to benefits under part A or part B of this subchapter, and the determination of the amount of benefits under part A or part B of this subchapter, and any other determination with respect to a claim for benefits under part A of this subchapter or a claim for benefits with respect to home health services under part B of this subchapter shall be made by the Secretary in accordance with regulations prescribed by him.
(b) Appeal by individuals; provider representation of beneficiaries
(1) Any individual dissatisfied with any determination under subsection (a) of this section as to—
(A) whether he meets the conditions of section 426 or
(B) whether he is eligible to enroll and has enrolled pursuant to the provisions of part B of this subchapter or
(C) the amount of benefits under part A or part B of this subchapter (including a determination where such amount is determined to be zero), or
(D) any other denial (other than under part B of subchapter XI of this chapter) of a claim for benefits under part A of this subchapter or a claim for benefits with respect to home health services under part B of this subchapter,
shall be entitled to a hearing thereon by the Secretary to the same extent as is provided in
(2) Notwithstanding paragraph (1)(C) and (1)(D), in the case of a claim arising—
(A) under part A of this subchapter, a hearing shall not be available to an individual under paragraph (1)(C) and (1)(D) if the amount in controversy is less than $100 and judicial review shall not be available to the individual under that paragraph if the amount in controversy is less than $1,000; or
(B) under part B of this subchapter, a hearing shall not be available to an individual under paragraph (1)(C) and (1)(D) if the amount in controversy is less than $500 and judicial review shall not be available to the individual under that paragraph if the aggregate amount in controversy is less than $1,000.
In determining the amount in controversy, the Secretary, under regulations, shall allow two or more claims to be aggregated if the claims involve the delivery of similar or related services to the same individual or involve common issues of law and fact arising from services furnished to two or more individuals.
(3) Review of any national coverage determination under
(A) Such a determination shall not be reviewed by any administrative law judge.
(B) Such a determination shall not be held unlawful or set aside on the ground that a requirement of
(C) In any case in which a court determines that the record is incomplete or otherwise lacks adequate information to support the validity of the determination, it shall remand the matter to the Secretary for additional proceedings to supplement the record and the court may not determine that an item or service is covered except upon review of the supplemented record.
(4) A regulation or instruction which relates to a method for determining the amount of payment under part B of this subchapter and which was initially issued before January 1, 1981, shall not be subject to judicial review.
(5) In an administrative hearing pursuant to paragraph (1), where the moving party alleges that there are no material issues of fact in dispute, the administrative law judge shall make an expedited determination as to whether any such facts are in dispute and, if not, shall determine the case expeditiously.
(Aug. 14, 1935, ch. 531, title XVIII, §1869, as added July 30, 1965,
References in Text
Parts A and B of this subchapter, referred to in subsecs. (a) and (b), are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Part B of subchapter XI of this chapter, referred to in subsec. (b)(1)(D), is classified to
Amendments
1994—Subsec. (b)(1).
1987—Subsec. (a).
Subsec. (b)(2).
Subsec. (b)(3)(B).
Subsec. (b)(5).
Subsec. (c).
1986—Subsec. (a).
Subsec. (b)(1).
Subsec. (b)(1)(C).
Subsec. (b)(1)(D).
Subsec. (b)(2).
Subsec. (b)(3), (4).
1984—Subsec. (b)(1)(B).
1972—Subsec. (b).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1987 Amendments
Section 4082(e)(1), (2) of
"(1) The amendment made by subsection (a) [amending this section] shall take effect on the date of the enactment of this Act [Dec. 22, 1987].
"(2) The amendment made by subsection (b) [amending this section] shall apply to requests for hearings filed after the end of the 60-day period beginning on the date of the enactment of this Act."
Amendment by
Effective Date of 1986 Amendment
Section 9313(b)(2) of
Section 9341(b) of
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1972 Amendment
Section 299O(b) of
"(1) The provisions of subparagraphs (A) and (B) of section 1869(b)(1) of the Social Security Act [subsec. (b)(1)(A), (B) of this section], as amended by subsection (a) of this section, shall be effective on the date of enactment of this Act [Oct. 30, 1972].
"(2) The provisions of paragraph (2) and subparagraph (C) of paragraph (1) of section 1869(b) of the Social Security Act [subsec. (b)(1)(C) and (b)(2) of this section], as amended by subsection (a) of this section, shall be effective with respect to any claims under part A of title XVIII of such Act [part A of this subchapter], filed—
"(A) in or after the month in which this Act is enacted [Oct. 1972], or
"(B) before the month in which this Act is enacted [Oct. 1972], but only if a civil action with respect to a final decision of the Secretary of Health, Education, and Welfare on such claim has not been commenced under such section 1869(b) [subsec. (b) of this section] before such month."
Study of Aggregation Rule for Claims for Similar Physicians' Services
Medicare Hearings and Appeals
Section 4037 of
"(a)
"(b)
"(1) The Secretary of Health and Human Services and the Comptroller General of the United States shall each conduct a study on holding hearings under section 1869(b)(1) of the Social Security Act [subsec. (b)(1) of this section] by telephone and shall each report the results of the study not later than 6 months after the date of enactment of this Act [Dec. 22, 1987].
"(2) The studies under paragraph (1) shall focus on whether telephone hearings allow for a full and fair evidentiary hearing, in general, or with respect to any particular category of claims and shall examine the possible improvements to the hearing process (such as cost-effectiveness, convenience to the claimant, and reduction in time under the process) resulting from the use of such hearings as compared to the adoption of other changes to the process (such as expansions in staff and resources)."
Section Referred to in Other Sections
This section is referred to in
§1395gg. Overpayment on behalf of individuals and settlement of claims for benefits on behalf of deceased individuals
(a) Payments to providers of services or other person regarded as payment to individuals
Any payment under this subchapter to any provider of services or other person with respect to any items or services furnished any individual shall be regarded as a payment to such individual.
(b) Incorrect payments on behalf of individuals; payment adjustment
Where—
(1) more than the correct amount is paid under this subchapter to a provider of services or other person for items or services furnished an individual and the Secretary determines (A) that, within such period as he may specify, the excess over the correct amount cannot be recouped from such provider of services or other person, or (B) that such provider of services or other person was without fault with respect to the payment of such excess over the correct amount, or
(2) any payment has been made under
proper adjustments shall be made, under regulations prescribed (after consultation with the Railroad Retirement Board) by the Secretary, by decreasing subsequent payments—
(3) to which such individual is entitled under subchapter II of this chapter or under the Railroad Retirement Act of 1974 [
(4) if such individual dies before such adjustment has been completed, to which any other individual is entitled under subchapter II of this chapter or under the Railroad Retirement Act of 1974 [
As soon as practicable after any adjustment under paragraph (3) or (4) is determined to be necessary, the Secretary, for purposes of this section,
(c) Exception to subsection (b) payment adjustment
There shall be no adjustment as provided in subsection (b) of this section (nor shall there be recovery) in any case where the incorrect payment has been made (including payments under
(d) Liability of certifying or disbursing officer for failure to recoup
No certifying or disbursing officer shall be held liable for any amount certified or paid by him to any provider of services or other person where the adjustment or recovery of such amount is waived under subsection (c) of this section or where adjustment under subsection (b) of this section is not completed prior to the death of all persons against whose benefits such adjustment is authorized.
(e) Settlement of claims for benefits under this subchapter on behalf of deceased individuals
If an individual, who received services for which payment may be made to such individual under this subchapter, dies, and payment for such services was made (other than under this subchapter), and the individual died before any payment due him under this subchapter with respect to such services was completed, payment of the amount due (including the amount of any unnegotiated checks) shall be made—
(1) if the payment for such services was made (before or after such individual's death) by a person other than the deceased individual, to the person or persons determined by the Secretary under regulations to have paid for such services, or if the payment for such services was made by the deceased individual before his death, to the legal representative of the estate of such deceased individual, if any;
(2) if there is no person who meets the requirements of paragraph (1), to the person, if any, who is determined by the Secretary to be the surviving spouse of the deceased individual and who was either living in the same household with the deceased at the time of his death or was, for the month in which the deceased individual died, entitled to a monthly benefit on the basis of the same wages and self-employment income as was the deceased individual;
(3) if there is no person who meets the requirements of paragraph (1) or (2), or if the person who meets such requirements dies before the payment due him under this subchapter is completed, to the child or children, if any, of the deceased individual who were, for the month in which the deceased individual died, entitled to monthly benefits on the basis of the same wages and self-employment income as was the deceased individual (and, in case there is more than one such child, in equal parts to each such child);
(4) if there is no person who meets the requirements of paragraph (1), (2), or (3), or if each person who meets such requirements dies before the payment due him under this subchapter is completed, to the parent or parents, if any, of the deceased individual who were, for the month in which the deceased individual died, entitled to monthly benefits on the basis of the same wages and self-employment income as was the deceased individual (and, in case there is more than one such parent, in equal parts to each such parent);
(5) if there is no person who meets the requirements of paragraph (1), (2), (3), or (4), or if each person who meets such requirements dies before the payment due him under this subchapter is completed, to the person, if any, determined by the Secretary to be the surviving spouse of the deceased individual;
(6) if there is no person who meets the requirements of paragraph (1), (2), (3), (4), or (5), or if each person who meets such requirements dies before the payment due him under this subchapter is completed, to the person or persons, if any, determined by the Secretary to be the child or children of the deceased individual (and, in case there is more than one such child, in equal parts to each such child);
(7) if there is no person who meets the requirements of paragraph (1), (2), (3), (4), (5), or (6), or if each person who meets such requirements dies before the payment due him under this subchapter is completed, to the parent or parents, if any, of the deceased individual (and, in case there is more than one such parent, in equal parts to each such parent); or
(8) if there is no person who meets the requirements of paragraph (1), (2), (3), (4), (5), (6), or (7), or if each person who meets such requirements dies before the payment due him under this subchapter is completed, to the legal representatives of the estate of the deceased individual, if any.
(f) Settlement of claims for section 1395k benefits on behalf of deceased individuals
If an individual who received medical and other health services for which payment may be made under
(1) if the person or persons who furnished the services agree to the terms of assignment specified in
(2) if the person or persons who furnished the services do not agree to the terms of assignment specified in
but only in such amount and subject to such conditions as would be applicable if the individual who received the services had not died.
(g) Refund of premiums for deceased individuals
If an individual, who is enrolled under
(Aug. 14, 1935, ch. 531, title XVIII, §1870, as added July 30, 1965,
References in Text
The Railroad Retirement Act of 1974, referred to in subsec. (b), is act Aug. 29, 1935, ch. 812, as amended generally by
Amendments
1988—
Subsec. (f)(1), (2).
1987—
Subsec. (f)(1), (2).
1982—Subsec. (c).
1980—Subsec. (f).
1974—Subsec. (b).
1972—Subsec. (b).
Subsec. (c).
Subsec. (g).
1968—
Subsecs. (e), (f).
Effective Date of 1988 Amendment
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Amendment by section 4096(a)(2) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendment
Section 954(b) of
Effective Date of 1974 Amendment
Amendment by
Effective Date of 1972 Amendment
Section 261(b) of
Section 281(g) of
Waiver of Liability Limiting Recoupment in Certain Cases
Section Referred to in Other Sections
This section is referred to in
§1395hh. Regulations
(a) Authority to prescribe regulations; ineffectiveness of substantive rules not promulgated by regulation
(1) The Secretary shall prescribe such regulations as may be necessary to carry out the administration of the insurance programs under this subchapter. When used in this subchapter, the term "regulations" means, unless the context otherwise requires, regulations prescribed by the Secretary.
(2) No rule, requirement, or other statement of policy (other than a national coverage determination) that establishes or changes a substantive legal standard governing the scope of benefits, the payment for services, or the eligibility of individuals, entities, or organizations to furnish or receive services or benefits under this subchapter shall take effect unless it is promulgated by the Secretary by regulation under paragraph (1).
(b) Notice of proposed regulations; public comment
(1) Except as provided in paragraph (2), before issuing in final form any regulation under subsection (a) of this section, the Secretary shall provide for notice of the proposed regulation in the Federal Register and a period of not less than 60 days for public comment thereon.
(2) Paragraph (1) shall not apply where—
(A) a statute specifically permits a regulation to be issued in interim final form or otherwise with a shorter period for public comment,
(B) a statute establishes a specific deadline for the implementation of a provision and the deadline is less than 150 days after the date of the enactment of the statute in which the deadline is contained, or
(C) subsection (b) of
(c) Publication of certain rules; public inspection; changes in data collection and retrieval
(1) The Secretary shall publish in the Federal Register, not less frequently than every 3 months, a list of all manual instructions, interpretative rules, statements of policy, and guidelines of general applicability which—
(A) are promulgated to carry out this subchapter, but
(B) are not published pursuant to subsection (a)(1) of this section and have not been previously published in a list under this subsection.
(2) Effective June 1, 1988, each fiscal intermediary and carrier administering claims for extended care, post-hospital extended care, home health care, and durable medical equipment benefits under this subchapter shall make available to the public all interpretative materials, guidelines, and clarifications of policies which relate to payments for such benefits.
(3) The Secretary shall to the extent feasible make such changes in automated data collection and retrieval by the Secretary and fiscal intermediaries with agreements under
(Aug. 14, 1935, ch. 531, title XVIII, §1871, as added July 30, 1965,
Amendments
1987—Subsec. (a).
Subsec. (c).
1986—
Effective Date of 1987 Amendment
Amendment by
Effective Date of 1986 Amendment
Section 9321(e)(3)(A) of
Regulations
Section 4039(g) of title IV of
Section Referred to in Other Sections
This section is referred to in
§1395ii. Application of certain provisions of subchapter II
The provisions of
(Aug. 14, 1935, ch. 531, title XVIII, §1872, as added July 30, 1965,
Amendments
1994—
1984—
1972—
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by
§1395jj. Designation of organization or publication by name
Designation in this subchapter, by name, of any nongovernmental organization or publication shall not be affected by change of name of such organization or publication, and shall apply to any successor organization or publication which the Secretary finds serves the purpose for which such designation is made.
(Aug. 14, 1935, ch. 531, title XVIII, §1873, as added July 30, 1965,
§1395kk. Administration of insurance programs
(a) Functions of Secretary; performance directly or by contract
Except as otherwise provided in this subchapter and in the Railroad Retirement Act of 1974 [
(b) Contracts to secure special data, actuarial information, etc.
The Secretary may contract with any person, agency, or institution to secure on a reimbursable basis such special data, actuarial information, and other information as may be necessary in the carrying out of his functions under this subchapter.
(c) Oaths and affirmations
In the course of any hearing, investigation, or other proceeding that he is authorized to conduct under this subchapter, the Secretary may administer oaths and affirmations.
(Aug. 14, 1935, ch. 531, title XVIII, §1874, as added July 30, 1965,
References in Text
The Railroad Retirement Act of 1974, referred to in subsec. (a), is act Aug. 29, 1935, ch. 812, as amended generally by
Amendments
1974—Subsec. (a).
1972—Subsec. (c).
1965—Subsec. (a).
Effective Date of 1974 Amendment
Amendment by
Effective Date of 1965 Amendment
Amendment by
Section Referred to in Other Sections
This section is referred to in title 45 section 231f.
§1395ll. Studies and recommendations
(a) Health care of the aged and disabled
The Secretary shall carry on studies and develop recommendations to be submitted from time to time to the Congress relating to health care of the aged and the disabled, including studies and recommendations concerning (1) the adequacy of existing personnel and facilities for health care for purposes of the programs under parts A and B of this subchapter; (2) methods for encouraging the further development of efficient and economical forms of health care which are a constructive alternative to inpatient hospital care; and (3) the effects of the deductibles and coinsurance provisions upon beneficiaries, persons who provide health services, and the financing of the program.
(b) Operation and administration of insurance programs
The Secretary shall make a continuing study of the operation and administration of the insurance programs under parts A and B of this subchapter (including a validation of the accreditation process of the Joint Commission on Accreditation of Hospitals, the operation and administration of health maintenance organizations authorized by section 226 of the Social Security Amendments of 1972 [
(Aug. 14, 1935, ch. 531, title XVIII, §1875, as added July 30, 1965,
References in Text
Parts A and B of this subchapter, referred to in text, are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Section 226 of the Social Security Amendments of 1972, referred to in subsec. (b), is section 226 of
Section 402 of the Social Security Amendments of 1967, referred to in subsec. (b), is section 402 of
Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (b), is section 222(a) of
Amendments
1989—Subsec. (c).
Subsec. (c)(7).
1988—Subsec. (c)(3).
"(A) from the Federal Hospital Insurance Trust Fund $4,000,000 for fiscal year 1987 and $5,000,000 for each of fiscal years 1988 and 1989, and
"(B) from the Federal Supplementary Medical Insurance Trust Fund $2,000,000 for fiscal year 1987 and $2,500,000 for each of fiscal years 1988 and 1989."
1987—Subsec. (c)(3)(B).
1986—Subsec. (c).
1984—Subsec. (b).
1972—Subsec. (a).
Subsec. (b).
1968—Subsec. (b).
Effective Date of 1989 Amendment
Section 6103(b)(3)(A) of
Effective Date of 1984 Amendment
Amendment by
Effective Date of 1972 Amendment
Amendment by section 226(d) of
Study of Adult Day Care Services
Study To Develop a Strategy for Quality Review and Assurance
Section 9313(d) of
Special Treatment of States Formerly Under Waiver
For treatment of hospitals in States which have had a waiver approved under this section, upon termination of waiver, see section 9202(j) of
Drug Detoxification Medicare Coverage and Facility Incentives
Legislative Recommendations Regarding Reimbursement for Optometrists' Services
Demonstration Projects, Studies, and Reports: Nutritional Therapy, Second Opinion Cost-Sharing, Services of Registered Dietitians, Services of Clinical Social Workers, Orthopedic Shoes, Respiratory Therapy Services, and Foot Conditions; Grants, Payments, and Expenditures
Demonstration Project Relating to the Terminally Ill
Report to Congress With Respect to Urban or Rural Comprehensive Mental Health Centers and Centers for Treatment of Alcoholism and Drug Abuse; Submission No Later Than June 13, 1978
Study and Review by Comptroller General of Administrative Structure for Processing Medicare Claims; Report to Congress
Report by Secretary of Health, Education, and Welfare on Delivery of Home Health and Other In-Home Services; Contents; Consultation Requirements; Submission to Congress
Section Referred to in Other Sections
This section is referred to in title 45 section 231f.
§1395mm. Payments to health maintenance organizations and competitive medical plans
(a) Rates and adjustments
(1)(A) The Secretary shall annually determine, and shall announce (in a manner intended to provide notice to interested parties) not later than September 7 before the calendar year concerned—
(i) a per capita rate of payment for each class of individuals who are enrolled under this section with an eligible organization which has entered into a risk-sharing contract and who are entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter, and
(ii) a per capita rate of payment for each class of individuals who are so enrolled with such an organization and who are enrolled under part B of this subchapter only.
For purposes of this section, the term "risk-sharing contract" means a contract entered into under subsection (g) of this section and the term "reasonable cost reimbursement contract" means a contract entered into under subsection (h) of this section.
(B) The Secretary shall define appropriate classes of members, based on age, disability status, and such other factors as the Secretary determines to be appropriate, so as to ensure actuarial equivalence. The Secretary may add to, modify, or substitute for such classes, if such changes will improve the determination of actuarial equivalence.
(C) The annual per capita rate of payment for each such class shall be equal to 95 percent of the adjusted average per capita cost (as defined in paragraph (4)) for that class.
(D) In the case of an eligible organization with a risk-sharing contract, the Secretary shall make monthly payments in advance and in accordance with the rate determined under subparagraph (C) and except as provided in subsection (g)(2) of this section, to the organization for each individual enrolled with the organization under this section.
(E)(i) The amount of payment under this paragraph may be retroactively adjusted to take into account any difference between the actual number of individuals enrolled in the plan under this section and the number of such individuals estimated to be so enrolled in determining the amount of the advance payment.
(ii)(I) Subject to subclause (II), the Secretary may make retroactive adjustments under clause (i) to take into account individuals enrolled during the period beginning on the date on which the individual enrolls with an eligible organization (which has a risk-sharing contract under this section) under a health benefit plan operated, sponsored, or contributed to by the individual's employer or former employer (or the employer or former employer of the individual's spouse) and ending on the date on which the individual is enrolled in the plan under this section, except that for purposes of making such retroactive adjustments under this clause, such period may not exceed 90 days.
(II) No adjustment may be made under subclause (I) with respect to any individual who does not certify that the organization provided the individual with the explanation described in subsection (c)(3)(E) of this section at the time the individual enrolled with the organization.
(F)(i) At least 45 days before making the announcement under subparagraph (A) for a year (beginning with the announcement for 1991), the Secretary shall provide for notice to eligible organizations of proposed changes to be made in the methodology or benefit coverage assumptions from the methodology and assumptions used in the previous announcement and shall provide such organizations an opportunity to comment on such proposed changes.
(ii) In each announcement made under subparagraph (A) for a year (beginning with the announcement for 1991), the Secretary shall include an explanation of the assumptions (including any benefit coverage assumptions) and changes in methodology used in the announcement in sufficient detail so that eligible organizations can compute per capita rates of payment for classes of individuals located in each county (or equivalent area) which is in whole or in part within the service area of such an organization.
(2) With respect to any eligible organization which has entered into a reasonable cost reimbursement contract, payments shall be made to such plan in accordance with subsection (h)(2) of this section rather than paragraph (1).
(3) Subject to subsections (c)(2)(B)(ii) and (c)(7) of this section, payments under a contract to an eligible organization under paragraph (1) or (2) shall be instead of the amounts which (in the absence of the contract) would be otherwise payable, pursuant to
(4) For purposes of this section, the term "adjusted average per capita cost" means the average per capita amount that the Secretary estimates in advance (on the basis of actual experience, or retrospective actuarial equivalent based upon an adequate sample and other information and data, in a geographic area served by an eligible organization or in a similar area, with appropriate adjustments to assure actuarial equivalence) would be payable in any contract year for services covered under parts A and B of this subchapter, or part B only, and types of expenses otherwise reimbursable under parts A and B of this subchapter, or part B only (including administrative costs incurred by organizations described in
(5) The payment to an eligible organization under this section for individuals enrolled under this section with the organization and entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter shall be made from the Federal Hospital Insurance Trust Fund and the Federal Supplementary Medical Insurance Trust Fund. The portion of that payment to the organization for a month to be paid by each trust fund shall be determined as follows:
(A) In regard to expenditures by eligible organizations having risk-sharing contracts, the allocation shall be determined each year by the Secretary based on the relative weight that benefits from each fund contribute to the adjusted average per capita cost.
(B) In regard to expenditures by eligible organizations operating under a reasonable cost reimbursement contract, the initial allocation shall be based on the plan's most recent budget, such allocation to be adjusted, as needed, after cost settlement to reflect the distribution of actual expenditures.
The remainder of that payment shall be paid by the former trust fund.
(6) Subject to subsections (c)(2)(B)(ii) and (c)(7) of this section, if an individual is enrolled under this section with an eligible organization having a risk-sharing contract, only the eligible organization shall be entitled to receive payments from the Secretary under this subchapter for services furnished to the individual.
(b) Definitions; requirements
For purposes of this section, the term "eligible organization" means a public or private entity (which may be a health maintenance organization or a competitive medical plan), organized under the laws of any State, which—
(1) is a qualified health maintenance organization (as defined in
(2) meets the following requirements:
(A) The entity provides to enrolled members at least the following health care services:
(i) Physicians' services performed by physicians (as defined in
(ii) Inpatient hospital services.
(iii) Laboratory, X-ray, emergency, and preventive services.
(iv) Out-of-area coverage.
(B) The entity is compensated (except for deductibles, coinsurance, and copayments) for the provision of health care services to enrolled members by a payment which is paid on a periodic basis without regard to the date the health care services are provided and which is fixed without regard to the frequency, extent, or kind of health care service actually provided to a member.
(C) The entity provides physicians' services primarily (i) directly through physicians who are either employees or partners of such organization, or (ii) through contracts with individual physicians or one or more groups of physicians (organized on a group practice or individual practice basis).
(D) The entity assumes full financial risk on a prospective basis for the provision of the health care services listed in subparagraph (A), except that such entity may—
(i) obtain insurance or make other arrangements for the cost of providing to any enrolled member health care services listed in subparagraph (A) the aggregate value of which exceeds $5,000 in any year,
(ii) obtain insurance or make other arrangements for the cost of health care service listed in subparagraph (A) provided to its enrolled members other than through the entity because medical necessity required their provision before they could be secured through the entity,
(iii) obtain insurance or make other arrangements for not more than 90 percent of the amount by which its costs for any of its fiscal years exceed 115 percent of its income for such fiscal year, and
(iv) make arrangements with physicians or other health professionals, health care institutions, or any combination of such individuals or institutions to assume all or part of the financial risk on a prospective basis for the provision of basic health services by the physicians or other health professionals or through the institutions.
(E) The entity has made adequate provision against the risk of insolvency, which provision is satisfactory to the Secretary.
Paragraph (2)(A)(ii) shall not apply to an entity which had contracted with a single State agency administering a State plan approved under subchapter XIX of this chapter for the provision of services (other than inpatient hospital services) to individuals eligible for such services under such State plan on a prepaid risk basis prior to 1970.
(c) Enrollment in plan; duties of organization to enrollees
(1) The Secretary may not enter into a contract under this section with an eligible organization unless it meets the requirements of this subsection and subsection (e) of this section with respect to members enrolled under this section.
(2)(A) The organization must provide to members enrolled under this section, through providers and other persons that meet the applicable requirements of this subchapter and part A of subchapter XI of this chapter—
(i) only those services covered under parts A and B of this subchapter, for those members entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter, or
(ii) only those services covered under part B of this subchapter, for those members enrolled only under such part,
which are available to individuals residing in the geographic area served by the organization, except that (I) the organization may provide such members with such additional health care services as the members may elect, at their option, to have covered, and (II) in the case of an organization with a risk-sharing contract, the organization may provide such members with such additional health care services as the Secretary may approve. The Secretary shall approve any such additional health care services which the organization proposes to offer to such members, unless the Secretary determines that including such additional services will substantially discourage enrollment by covered individuals with the organization.
(B) If there is a national coverage determination made in the period beginning on the date of an announcement under subsection (a)(1)(A) of this section and ending on the date of the next announcement under such subsection that the Secretary projects will result in a signifcant 1 change in the costs to the organization of providing the benefits that are the subject of such national coverage determination and that was not incorporated in the determination of the per capita rate of payment included in the announcement made at the beginning of such period—
(i) such determination shall not apply to risk-sharing contracts under this section until the first contract year that begins after the end of such period; and
(ii) if such coverage determination provides for coverage of additional benefits or under additional circumstances, subsection (a)(3) of this section shall not apply to payment for such additional benefits or benefits provided under such additional circumstances until the first contract year that begins after the end of such period,
unless otherwise required by law.
(3)(A)(i) Each eligible organization must have an open enrollment period, for the enrollment of individuals under this section, of at least 30 days duration every year and including the period or periods specified under clause (ii), and must provide that at any time during which enrollments are accepted, the organization will accept up to the limits of its capacity (as determined by the Secretary) and without restrictions, except as may be authorized in regulations, individuals who are eligible to enroll under subsection (d) of this section in the order in which they apply for enrollment, unless to do so would result in failure to meet the requirements of subsection (f) of this section or would result in the enrollment of enrollees substantially nonrepresentative, as determined in accordance with regulations of the Secretary, of the population in the geographic area served by the organization.
(ii)(I) If a risk-sharing contract under this section is not renewed or is otherwise terminated, eligible organizations with risk-sharing contracts under this section and serving a part of the same service area as under the terminated contract are required to have an open enrollment period for individuals who were enrolled under the terminated contract as of the date of notice of such termination. If a risk-sharing contract under this section is renewed in a manner that discontinues coverage for individuals residing in part of the service area, eligible organizations with risk-sharing contracts under this section and enrolling individuals residing in that part of the service area are required to have an open enrollment period for individuals residing in the part of the service area who were enrolled under the contract as of the date of notice of such discontinued coverage.
(II) The open enrollment periods required under subclause (I) shall be for 30 days and shall begin 30 days after the date that the Secretary provides notice of such requirement.
(III) Enrollment under this clause shall be effective 30 days after the end of the open enrollment period, or, if the Secretary determines that such date is not feasible, such other date as the Secretary specifies.
(B) An individual may enroll under this section with an eligible organization in such manner as may be prescribed in regulations and may terminate his enrollment with the eligible organization as of the beginning of the first calendar month following the date on which the request is made for such termination (or, in the case of financial insolvency of the organization, as may be prescribed by regulations) or, in the case of such an organization with a reasonable cost reimbursement contract, as may be prescribed by regulations. In the case of an individual's termination of enrollment, the organization shall provide the individual with a copy of the written request for termination of enrollment and a written explanation of the period (ending on the effective date of the termination) during which the individual continues to be enrolled with the organization and may not receive benefits under this subchapter other than through the organization.
(C) The Secretary may prescribe the procedures and conditions under which an eligible organization that has entered into a contract with the Secretary under this subsection may inform individuals eligible to enroll under this section with the organization about the organization, or may enroll such individuals with the organization. No brochures, application forms, or other promotional or informational material may be distributed by an organization to (or for the use of) individuals eligible to enroll with the organization under this section unless (i) at least 45 days before its distribution, the organization has submitted the material to the Secretary for review and (ii) the Secretary has not disapproved the distribution of the material. The Secretary shall review all such material submitted and shall disapprove such material if the Secretary determines, in the Secretary's discretion, that the material is materially inaccurate or misleading or otherwise makes a material misrepresentation.
(D) The organization must provide assurances to the Secretary that it will not expel or refuse to re-enroll any such individual because of the individual's health status or requirements for health care services, and that it will notify each such individual of such fact at the time of the individual's enrollment.
(E) Each eligible organization shall provide each enrollee, at the time of enrollment and not less frequently than annually thereafter, an explanation of the enrollee's rights under this section, including an explanation of—
(i) the enrollee's rights to benefits from the organization,
(ii) the restrictions on payments under this subchapter for services furnished other than by or through the organization,
(iii) out-of-area coverage provided by the organization,
(iv) the organization's coverage of emergency services and urgently needed care, and
(v) appeal rights of enrollees.
(F) Each eligible organization that provides items and services pursuant to a contract under this section shall provide assurances to the Secretary that in the event the organization ceases to provide such items and services, the organization shall provide or arrange for supplemental coverage of benefits under this subchapter related to a pre-existing condition with respect to any exclusion period, to all individuals enrolled with the entity who receive benefits under this subchapter, for the lesser of six months or the duration of such period.
(G)(i) Each eligible organization having a risk-sharing contract under this section shall notify individuals eligible to enroll with the organization under this section and individuals enrolled with the organization under this section that—
(I) the organization is authorized by law to terminate or refuse to renew the contract, and
(II) termination or nonrenewal of the contract may result in termination of the enrollments of individuals enrolled with the organization under this section.
(ii) The notice required by clause (i) shall be included in—
(I) any marketing materials described in subparagraph (C) that are distributed by an eligible organization to individuals eligible to enroll under this section with the organization, and
(II) any explanation provided to enrollees by the organization pursuant to subparagraph (E).
(4) The organization must—
(A) make the services described in paragraph (2) (and such other health care services as such individuals have contracted for) (i) available and accessible to each such individual, within the area served by the organization, with reasonable promptness and in a manner which assures continuity, and (ii) when medically necessary, available and accessible twenty-four hours a day and seven days a week, and
(B) provide for reimbursement with respect to services which are described in subparagraph (A) and which are provided to such an individual other than through the organization, if (i) the services were medically necessary and immediately required because of an unforeseen illness, injury, or condition and (ii) it was not reasonable given the circumstances to obtain the services through the organization.
(5)(A) The organization must provide meaningful procedures for hearing and resolving grievances between the organization (including any entity or individual through which the organization provides health care services) and members enrolled with the organization under this section.
(B) A member enrolled with an eligible organization under this section who is dissatisfied by reason of his failure to receive any health service to which he believes he is entitled and at no greater charge than he believes he is required to pay is entitled, if the amount in controversy is $100 or more, to a hearing before the Secretary to the same extent as is provided in
(6) The organization must have arrangements, established in accordance with regulations of the Secretary, for an ongoing quality assurance program for health care services it provides to such individuals, which program (A) stresses health outcomes and (B) provides review by physicians and other health care professionals of the process followed in the provision of such health care services.
(7) A risk-sharing contract under this section shall provide that in the case of an individual who is receiving inpatient hospital services from a subsection (d) hospital (as defined in
(A) enrollment with an eligible organization under this section—
(i) payment for such services until the date of the individual's discharge shall be made under this subchapter as if the individual were not enrolled with the organization,
(ii) the organization shall not be financially responsible for payment for such services until the date after the date of the individual's discharge, and
(iii) the organization shall nonetheless be paid the full amount otherwise payable to the organization under this section; or
(B) termination of enrollment with an eligible organization under this section—
(i) the organization shall be financially responsible for payment for such services after such date and until the date of the individual's discharge,
(ii) payment for such services during the stay shall not be made under
(iii) the organization shall not receive any payment with respect to the individual under this section during the period the individual is not enrolled.
(8) A contract under this section shall provide that the eligible organization shall meet the requirement of
(d) Right to enroll with contracting organization in geographic area
Subject to the provisions of subsection (c)(3) of this section, every individual entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter or enrolled under part B of this subchapter only (other than an individual medically determined to have end-stage renal disease) shall be eligible to enroll under this section with any eligible organization with which the Secretary has entered into a contract under this section and which serves the geographic area in which the individual resides.
(e) Limitation on charges; election of coverage; "adjusted community rate" defined; workmen's compensation and insurance benefits
(1) In no case may—
(A) the portion of an eligible organization's premium rate and the actuarial value of its deductibles, coinsurance, and copayments charged (with respect to services covered under parts A and B of this subchapter) to individuals who are enrolled under this section with the organization and who are entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter, or
(B) the portion of its premium rate and the actuarial value of its deductibles, coinsurance, and copayments charged (with respect to services covered under part B of this subchapter) to individuals who are enrolled under this section with the organization and enrolled under part B of this subchapter only
exceed the actuarial value of the coinsurance and deductibles that would be applicable on the average to individuals enrolled under this section with the organization (or, if the Secretary finds that adequate data are not available to determine that actuarial value, the actuarial value of the coinsurance and deductibles applicable on the average to individuals in the area, in the State, or in the United States, eligible to enroll under this section with the organization, or other appropriate data) and entitled to benefits under part A of this subchapter and enrolled under part B of this subchapter, or enrolled under part B only, respectively, if they were not members of an eligible organization.
(2) If the eligible organization provides to its members enrolled under this section services in addition to services covered under parts A and B of this subchapter, election of coverage for such additional services (unless such services have been approved by the Secretary under subsection (c)(2) of this section) shall be optional for such members and such organization shall furnish such members with information on the portion of its premium rate or other charges applicable to such additional services. In no case may the sum of—
(A) the portion of such organization's premium rate charged, with respect to such additional services, to members enrolled under this section, and
(B) the actuarial value of its deductibles, coinsurance, and copayments charged, with respect to such services to such members
exceed the adjusted community rate for such services.
(3) For purposes of this section, the term "adjusted community rate" for a service or services means, at the election of an eligible organization, either—
(A) the rate of payment for that service or services which the Secretary annually determines would apply to a member enrolled under this section with an eligible organization if the rate of payment were determined under a "community rating system" (as defined in
(B) such portion of the weighted aggregate premium, which the Secretary annually estimates would apply to a member enrolled under this section with the eligible organization, as the Secretary annually estimates is attributable to that service or services,
but adjusted for differences between the utilization characteristics of the members enrolled with the eligible organization under this section and the utilization characteristics of the other members of the organization (or, if the Secretary finds that adequate data are not available to adjust for those differences, the differences between the utilization characteristics of members in other eligible organizations, or individuals in the area, in the State, or in the United States, eligible to enroll under this section with an eligible organization and the utilization characteristics of the rest of the population in the area, in the State, or in the United States, respectively).
(4) Notwithstanding any other provision of law, the eligible organization may (in the case of the provision of services to a member enrolled under this section for an illness or injury for which the member is entitled to benefits under a workmen's compensation law or plan of the United States or a State, under an automobile or liability insurance policy or plan, including a self-insured plan, or under no fault insurance) charge or authorize the provider of such services to charge, in accordance with the charges allowed under such law or policy—
(A) the insurance carrier, employer, or other entity which under such law, plan, or policy is to pay for the provision of such services, or
(B) such member to the extent that the member has been paid under such law, plan, or policy for such services.
(f) Membership requirements
(1) Each eligible organization with which the Secretary enters into a contract under this section shall have, for the duration of such contract, an enrolled membership at least one-half of which consists of individuals who are not entitled to benefits under this subchapter or under a State plan approved under subchapter XIX of this chapter.
(2) The Secretary may modify or waive the requirement imposed by paragraph (1) only—
(A) to the extent that more than 50 percent of the population of the area served by the organization consists of individuals who are entitled to benefits under this subchapter or under a State plan approved under subchapter XIX of this chapter, or
(B) in the case of an eligible organization that is owned and operated by a governmental entity, only with respect to a period of three years beginning on the date the organization first enters into a contract under this section, and only if the organization has taken and is making reasonable efforts to enroll individuals who are not entitled to benefits under this subchapter or under a State plan approved under subchapter XIX of this chapter.
(3) If the Secretary determines that an eligible organization has failed to comply with the requirements of this subsection, the Secretary may provide for the suspension of enrollment of individuals under this section or of payment to the organization under this section for individuals newly enrolled with the organization, after the date the Secretary notifies the organization of such noncompliance.
(g) Risk-sharing contract
(1) The Secretary may enter a risk-sharing contract with any eligible organization, as defined in subsection (b) of this section, which has at least 5,000 members, except that the Secretary may enter into such a contract with an eligible organization that has fewer members if the organization primarily serves members residing outside of urbanized areas.
(2) Each risk-sharing contract shall provide that—
(A) if the adjusted community rate, as defined in subsection (e)(3) of this section, for services under parts A and B of this subchapter (as reduced for the actuarial value of the coinsurance and deductibles under those parts) for members enrolled under this section with the organization and entitled to benefits under part A of this subchapter and enrolled in part B of this subchapter, or
(B) if the adjusted community rate for services under part B of this subchapter (as reduced for the actuarial value of the coinsurance and deductibles under that part) for members enrolled under this section with the organization and entitled to benefits under part B of this subchapter only
is less than the average of the per capita rates of payment to be made under subsection (a)(1) of this section at the beginning of an annual contract period for members enrolled under this section with the organization and entitled to benefits under part A of this subchapter and enrolled in part B of this subchapter, or enrolled in part B of this subchapter only, respectively, the eligible organization shall provide to members enrolled under a risk-sharing contract under this section with the organization and entitled to benefits under part A of this subchapter and enrolled in part B of this subchapter, or enrolled in part B of this subchapter only, respectively, the additional benefits described in paragraph (3) which are selected by the eligible organization and which the Secretary finds are at least equal in value to the difference between that average per capita payment and the adjusted community rate (as so reduced); except that this paragraph shall not apply with respect to any organization which elects to receive a lesser payment to the extent that there is no longer a difference between the average per capita payment and adjusted community rate (as so reduced) and except that an organization (with the approval of the Secretary) may provide that a part of the value of such additional benefits be withheld and reserved by the Secretary as provided in paragraph (5). If the Secretary finds that there is insufficient enrollment experience to determine an average of the per capita rates of payment to be made under subsection (a)(1) of this section at the beginning of a contract period, the Secretary may determine such an average based on the enrollment experience of other contracts entered into under this section.
(3) The additional benefits referred to in paragraph (2) are—
(A) the reduction of the premium rate or other charges made with respect to services furnished by the organization to members enrolled under this section, or
(B) the provision of additional health benefits,
or both.
(4) Repealed.
(5) An organization having a risk-sharing contract under this section may (with the approval of the Secretary) provide that a part of the value of additional benefits otherwise required to be provided by reason of paragraph (2) be withheld and reserved in the Federal Hospital Insurance Trust Fund and in the Federal Supplementary Medical Insurance Trust Fund (in such proportions as the Secretary determines to be appropriate) by the Secretary for subsequent annual contract periods, to the extent required to stabilize and prevent undue fluctuations in the additional benefits offered in those subsequent periods by the organization in accordance with paragraph (3). Any of such value of additional benefits which is not provided to members of the organization in accordance with paragraph (3) prior to the end of such period, shall revert for the use of such trust funds.
(6)(A) A risk-sharing contract under this section shall require the eligible organization to provide prompt payment (consistent with the provisions of
(B) In the case of an eligible organization which the Secretary determines, after notice and opportunity for a hearing, has failed to make payments of amounts in compliance with subparagraph (A), the Secretary may provide for direct payment of the amounts owed to providers and suppliers for such covered services furnished to individuals enrolled under this section under the contract. If the Secretary provides for such direct payments, the Secretary shall provide for an appropriate reduction in the amount of payments otherwise made to the organization under this section to reflect the amount of the Secretary's payments (and costs incurred by the Secretary in making such payments).
(h) Reasonable cost reimbursement contract; requirements
(1) If—
(A) the Secretary is not satisfied that an eligible organization has the capacity to bear the risk of potential losses under a risk-sharing contract under this section, or
(B) the eligible organization so elects or has an insufficient number of members to be eligible to enter into a risk-sharing contract under subsection (g)(1) of this section,
the Secretary may, if he is otherwise satisfied that the eligible organization is able to perform its contractual obligations effectively and efficiently, enter into a contract with such organization pursuant to which such organization is reimbursed on the basis of its reasonable cost (as defined in
(2) A reasonable cost reimbursement contract under this subsection may, at the option of such organization, provide that the Secretary—
(A) will reimburse hospitals and skilled nursing facilities either for the reasonable cost (as determined under
(B) will deduct the amount of such reimbursement from payment which would otherwise be made to such organization.
If such an eligible organization pays a hospital or skilled nursing facility directly, the amount paid shall not exceed the reasonable cost of the services (as determined under
(3) Payments made to an organization with a reasonable cost reimbursement contract shall be subject to appropriate retroactive corrective adjustment at the end of each contract year so as to assure that such organization is paid for the reasonable cost actually incurred (excluding any part of incurred cost found to be unnecessary in the efficient delivery of health services) or the amounts otherwise determined under
(4) Any reasonable cost reimbursement contract with an eligible organization under this subsection shall provide that the Secretary shall require, at such time following the expiration of each accounting period of the eligible organization (and in such form and in such detail) as he may prescribe—
(A) that the organization report to him in an independently certified financial statement its per capita incurred cost based on the types of components of expenses otherwise reimbursable under this subchapter for providing services described in subsection (a)(1) of this section, including therein, in accordance with accounting procedures prescribed by the Secretary, its methods of allocating costs between individuals enrolled under this section and other individuals enrolled with such organization;
(B) that failure to report such information as may be required may be deemed to constitute evidence of likely overpayment on the basis of which appropriate collection action may be taken;
(C) that in any case in which an eligible organization is related to another organization by common ownership or control, a consolidated financial statement shall be filed and that the allowable costs for such organization may not include costs for the types of expense otherwise reimbursable under this subchapter, in excess of those which would be determined to be reasonable in accordance with regulations (providing for limiting reimbursement to costs rather than charges to the eligible organization by related organizations and owners) issued by the Secretary; and
(D) that in any case in which compensation is paid by an eligible organization substantially in excess of what is normally paid for similar services by similar practitioners (regardless of method of compensation), such compensation may as appropriate be considered to constitute a distribution of profits.
(i) Duration, termination, effective date, and terms of contract; powers and duties of Secretary
(1) Each contract under this section shall be for a term of at least one year, as determined by the Secretary, and may be made automatically renewable from term to term in the absence of notice by either party of intention to terminate at the end of the current term; except that the Secretary may terminate any such contract at any time (after such reasonable notice and opportunity for hearing to the eligible organization involved as he may provide in regulations), if he finds that the organization—
(A) has failed substantially to carry out the contract,
(B) is carrying out the contract in a manner inconsistent with the efficient and effective administration of this section, or
(C) no longer substantially meets the applicable conditions of subsections (b), (c), (e), and (f) of this section.
(2) The effective date of any contract executed pursuant to this section shall be specified in the contract.
(3) Each contract under this section—
(A) shall provide that the Secretary, or any person or organization designated by him—
(i) shall have the right to inspect or otherwise evaluate (I) the quality, appropriateness, and timeliness of services performed under the contract and (II) the facilities of the organization when there is reasonable evidence of some need for such inspection, and
(ii) shall have the right to audit and inspect any books and records of the eligible organization that pertain (I) to the ability of the organization to bear the risk of potential financial losses, or (II) to services performed or determinations of amounts payable under the contract;
(B) shall require the organization with a risk-sharing contract to provide (and pay for) written notice in advance of the contract's termination, as well as a description of alternatives for obtaining benefits under this subchapter, to each individual enrolled under this section with the organization; and
(C)(i) shall require the organization to comply with subsections (a) and (c) of
(ii) shall require the organization to provide and supply information (described in
(iii) shall require the organization to notify the Secretary of loans and other special financial arrangements which are made between the organization and subcontractors, affiliates, and related parties; and
(D) shall contain such other terms and conditions not inconsistent with this section (including requiring the organization to provide the Secretary with such information) as the Secretary may find necessary and appropriate.
(4) The Secretary may not enter into a risk-sharing contract with an eligible organization if a previous risk-sharing contract with that organization under this section was terminated at the request of the organization within the preceding five-year period, except in circumstances which warrant special consideration, as determined by the Secretary.
(5) The authority vested in the Secretary by this section may be performed without regard to such provisions of law or regulations relating to the making, performance, amendment, or modification of contracts of the United States as the Secretary may determine to be inconsistent with the furtherance of the purpose of this subchapter.
(6)(A) If the Secretary determines that an eligible organization with a contract under this section—
(i) fails substantially to provide medically necessary items and services that are required (under law or under the contract) to be provided to an individual covered under the contract, if the failure has adversely affected (or has substantial likelihood of adversely affecting) the individual;
(ii) imposes premiums on individuals enrolled under this section in excess of the premiums permitted;
(iii) acts to expel or to refuse to re-enroll an individual in violation of the provisions of this section;
(iv) engages in any practice that would reasonably be expected to have the effect of denying or discouraging enrollment (except as permitted by this section) by eligible individuals with the organization whose medical condition or history indicates a need for substantial future medical services;
(v) misrepresents or falsifies information that is furnished—
(I) to the Secretary under this section, or
(II) to an individual or to any other entity under this section;
(vi) fails to comply with the requirements of subsection (g)(6)(A) of this section or paragraph (8); or
(vii) in the case of a risk-sharing contract, employs or contracts with any individual or entity that is excluded from participation under this subchapter under
the Secretary may provide, in addition to any other remedies authorized by law, for any of the remedies described in subparagraph (B).
(B) The remedies described in this subparagraph are—
(i) civil money penalties of not more than $25,000 for each determination under subparagraph (A) or, with respect to a determination under clause (iv) or (v)(I) of such subparagraph, of not more than $100,000 for each such determination, plus, with respect to a determination under subparagraph (A)(ii), double the excess amount charged in violation of such subparagraph (and the excess amount charged shall be deducted from the penalty and returned to the individual concerned), and plus, with respect to a determination under subparagraph (A)(iv), $15,000 for each individual not enrolled as a result of the practice involved,
(ii) suspension of enrollment of individuals under this section after the date the Secretary notifies the organization of a determination under subparagraph (A) and until the Secretary is satisfied that the basis for such determination has been corrected and is not likely to recur, or
(iii) suspension of payment to the organization under this section for individuals enrolled after the date the Secretary notifies the organization of a determination under subparagraph (A) and until the Secretary is satisfied that the basis for such determination has been corrected and is not likely to recur.
The provisions of
(7)(A) Each risk-sharing contract with an eligible organization under this section shall provide that the organization will maintain an agreement with a utilization and quality control peer review organization (which has a contract with the Secretary under part B of subchapter XI of this chapter for the area in which the eligible organization is located) or with an entity selected by the Secretary under
(B) For purposes of payment under this subchapter, the cost of such agreement to the eligible organization shall be considered a cost incurred by a provider of services in providing covered services under this subchapter and shall be paid directly by the Secretary to the review organization on behalf of such eligible organization in accordance with a schedule established by the Secretary.
(C) Such payments—
(i) shall be transferred in appropriate proportions from the Federal Hospital Insurance Trust Fund and from the Supplementary Medical Insurance Trust Fund, without regard to amounts appropriated in advance in appropriation Acts, in the same manner as transfers are made for payment for services provided directly to beneficiaries, and
(ii) shall not be less in the aggregate for such organizations for a fiscal year than the amounts the Secretary determines to be sufficient to cover the costs of such organizations' conducting activities described in subparagraph (A) with respect to such eligible organizations under part B of subchapter XI of this chapter.
(8)(A) Each contract with an eligible organization under this section shall provide that the organization may not operate any physician incentive plan (as defined in subparagraph (B)) unless the following requirements are met:
(i) No specific payment is made directly or indirectly under the plan to a physician or physician group as an inducement to reduce or limit medically necessary services provided with respect to a specific individual enrolled with the organization.
(ii) If the plan places a physician or physician group at substantial financial risk (as determined by the Secretary) for services not provided by the physician or physician group, the organization—
(I) provides stop-loss protection for the physician or group that is adequate and appropriate, based on standards developed by the Secretary that take into account the number of physicians placed at such substantial financial risk in the group or under the plan and the number of individuals enrolled with the organization who receive services from the physician or the physician group, and
(II) conducts periodic surveys of both individuals enrolled and individuals previously enrolled with the organization to determine the degree of access of such individuals to services provided by the organization and satisfaction with the quality of such services.
(iii) The organization provides the Secretary with descriptive information regarding the plan, sufficient to permit the Secretary to determine whether the plan is in compliance with the requirements of this subparagraph.
(B) In this paragraph, the term "physician incentive plan" means any compensation arrangement between an eligible organization and a physician or physician group that may directly or indirectly have the effect of reducing or limiting services provided with respect to individuals enrolled with the organization.
(j) Payment in full and limitation on actual charges; physicians, providers of services, or renal dialysis facilities not under contract with organization
(1)(A) In the case of physicians' services or renal dialysis services described in paragraph (2) which are furnished by a participating physician or provider of services or renal dialysis facility to an individual enrolled with an eligible organization under this section and enrolled under part B of this subchapter, the applicable participation agreement is deemed to provide that the physician or provider of services or renal dialysis facility will accept as payment in full from the eligible organization the amount that would be payable to the physician or provider of services or renal dialysis facility under part B of this subchapter and from the individual under such part, if the individual were not enrolled with an eligible organization under this section.
(B) In the case of physicians' services described in paragraph (2) which are furnished by a nonparticipating physician, the limitations on actual charges for such services otherwise applicable under part B of this subchapter (to services furnished by individuals not enrolled with an eligible organization under this section) shall apply in the same manner as such limitations apply to services furnished to individuals not enrolled with such an organization.
(2) The physicians' services or renal dialysis services described in this paragraph are physicians' services or renal dialysis services which are furnished to an enrollee of an eligible organization under this setion 3 by a physician, provider of services, or renal dialysis facility who is not under a contract with the organization.
(Aug. 14, 1935, ch. 531, title XVIII, §1876, as added and amended Oct. 30, 1972,
References in Text
Parts A and B of this subchapter, referred to in text, are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Parts A and B of subchapter XI of this chapter, referred to in subsecs. (c)(2) and (i)(7)(A), (B)(ii), are classified to sections 1301 et seq. and 1320c et seq., respectively, of this title.
Amendments
1994—Subsec. (a)(1)(E)(ii)(I).
Subsec. (a)(3).
Subsec. (c)(5)(B).
1990—Subsec. (a)(1)(E).
Subsec. (a)(6).
Subsec. (c)(2).
Subsec. (c)(8).
Subsec. (i)(6)(A)(vi).
Subsec. (i)(8).
Subsec. (j)(1)(A).
Subsec. (j)(2).
"(A) are emergency services or out-of-area coverage (described in clauses (iii) and (iv) of subsection (b)(2)(A) of this section), and
"(B) are furnished to an enrollee of an eligible organization under this section by a person who is not under a contract with the organization."
1989—Subsec. (a)(1)(F).
Subsec. (a)(5).
Subsec. (c)(3)(A)(i).
Subsec. (c)(3)(A)(ii).
Subsecs. (e)(1), (g)(3)(A).
Subsec. (g)(5).
Subsec. (i)(6)(A)(vii).
Subsec. (j).
1988—Subsec. (a)(5).
"(A) the product of (i) the number of such individuals for the month who have attained age 65, and (ii) the monthly actuarial rate for supplementary medical insurance for the month as determined under
"(B) the product of (i) the number of such individuals for the month who have not attained age 65, and (ii) the monthly actuarial rate for supplementary medical insurance for the month as determined under
Subsec. (c)(3)(F).
Subsec. (e)(1).
Subsec. (f)(3).
"(A) An eligible organization described in subparagraph (B) may elect, for purposes of enrollment and residency requirements under this section and for determining the compliance of a subdivision, subsidiary, or affiliate described in subparagraph (B)(iii) with the requirement of paragraph (1) for the period before October 1, 1992, to have members described in subparagraph (B)(iii) who receive services through the subdivision, subsidiary, or affiliate considered to be members of the parent organization.
"(B) An eligible organization described in this subparagraph is an eligible organization which—
"(i) is described in
"(ii) has members who have a collectively bargained contractual right to obtain health benefits from the organization;
"(iii) elects to provide benefits under a risk-sharing contract to individuals residing in a service area, who have a collectively bargained contractual right to obtain benefits from the organization, through a subdivision, subsidiary, or affiliate which itself is an eligible organization serving the area and which is owned or controlled by the parent eligible organization; and
"(iv) has assumed any risk of insolvency and quality assurance with respect to individuals receiving benefits through such a subdivision, subsidiary, or affiliate."
Subsec. (f)(3)(A).
Subsec. (f)(4).
Subsec. (g)(3)(A).
Subsec. (g)(5).
Subsec. (i)(6)(A).
Subsec. (i)(6)(B).
Subsec. (i)(6)(B)(i).
Subsec. (i)(7)(A).
Subsec. (i)(7)(B).
1987—Subsec. (c)(3)(F).
Subsec. (c)(3)(G).
Subsec. (f)(3), (4).
Subsec. (g)(4).
"(A) will reimburse hospitals and skilled nursing facilities either for payment amounts determined in accordance with
"(B) will deduct the amount of such reimbursement for payment which would otherwise be made to such organization."
Subsec. (g)(5).
Subsec. (i)(6).
"(6)(A) Any eligible organization with a risk-sharing contract under this section that fails substantially to provide medically necessary items and services that are required (under law or such contract) to be provided to individuals covered under such contract, if the failure has adversely affected (or has a substantial likelihood of adversely affecting) these individuals, is subject to a civil money penalty of not more than $10,000 for each such failure.
"(B) The provisions of
Subsec. (i)(7)(A).
Subsec. (i)(7)(B).
1986—Subsec. (a)(1)(A).
Subsec. (a)(3).
Subsec. (a)(6).
Subsec. (c)(3)(B).
Subsec. (c)(3)(C).
Subsec. (c)(7).
Subsec. (c)(3)(E).
Subsec. (f)(2).
"(A) special circumstances warrant such modification or waiver, and
"(B) the eligible organization has taken and is making reasonable efforts to enroll individuals who are not entitled to benefits under this subchapter or under a State plan approved under subchapter XIX of this chapter."
Subsec. (f)(3).
Subsec. (g)(6).
Subsec. (i)(1)(C).
Subsec. (i)(3)(C).
Subsec. (i)(6).
Subsec. (i)(7).
1984—Subsec. (b)(2)(D).
Subsec. (c)(3)(A).
Subsec. (c)(4)(A)(i).
Subsec. (g)(2).
Subsec. (g)(4)(A).
Subsec. (g)(5).
1983—Subsec. (a)(5)(A)(ii), (B)(ii).
Subsec. (g)(1).
Subsec. (g)(4).
1982—
1978—Subsec. (b)(2)(B).
1976—Subsec. (b).
Subsec. (h).
Subsec. (i)(6)(B).
Subsec. (k).
1973—Subsec. (a)(3)(A)(ii).
Subsec. (g)(2).
1972—Subsec. (i).
Effective Date of 1994 Amendments
Amendment by
Amendment by
Effective Date of 1990 Amendment
Section 4204(a)(4) of
Section 4204(c)(3) of
Section 4204(d)(2) of
Section 4204(e)(2) of
Amendment by section 4206(b)(1) of
Effective Date of 1989 Amendments
Section 6206(b)(2) of
Section 6212(b)(2) of
Section 6212(c)(3) of
Section 6411(d)(4)(B) of
Amendment by section 201(a) of
Amendment by section 202(a) of
Effective Date of 1988 Amendments
Section 8412(b) of
Amendment by
Amendment by section 202(f) of
Amendment by section 211(c)(3) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4011(a)(2) of
Section 4011(b)(2) of
Section 4012(d) of
Section 4013(b) of
Effective Date of 1986 Amendments
Section 1895(b)(11)(B) of
Section 9312(b)(2) of
Section 9312(c)(3) of
"(A)
"(B)
"(C)
"(i) as of the date of the enactment of this Act, has been granted, under paragraph (2) of section 1876(f) of the Social Security Act [subsec. (f)(2) of this section], a modification or waiver of the requirement imposed by paragraph (1) of that section, but
"(ii) does not meet the requirement for such modification or waiver under the amendment made by paragraph (1) of this subsection,
the organization shall make, and continue to make, reasonable efforts to meet scheduled enrollment goals, consistent with a schedule of compliance approved by the Secretary of Health and Human Services. If the Secretary determines that the organization has complied, or made significant progress towards compliance, with such schedule of compliance, the Secretary may extend such waiver. If the Secretary determines that the organization has not complied with such schedule, the Secretary may provide for a sanction described in section 1876(f)(3) of the Social Security Act [subsec. (f)(3) of this section] (as amended by this section) effective with respect to individuals enrolling with the organization after the date the Secretary notifies the organization of such noncompliance.
"(D)
"(i) before January 1, 1996, section 1876(f) of the Social Security Act [subsec. (f) of this section] shall not apply to the organization;
"(ii) beginning on January 1, 1990, the Secretary of Health and Human Services shall conduct an annual review of the organization to determine the organization's compliance with the quality assurance requirements of section 1876(c)(6) of such Act [subsec. (c)(6) of this section]; and
"(iii) after January 1, 1990, if the organization receives an unfavorable review under clause (ii), the Secretary, after notice to the organization of the unfavorable review and an opportunity to correct any deficiencies identified during the review, may provide for the sanction described in section 1876(f)(3) of such Act [subsec. (f)(3) of this section] effective with respect to individuals enrolling with the organization after the date the Secretary notifies the organization that the organization is not in compliance with the requirements of section 1876(c)(6) of such Act."
Section 9312(d)(2) of
Section 9312(e)(2) of
Section 9353(e)(3)(B) of
Section 9211(e) of
"(1)
"(2)
"(3)
"(B) Such amendment also shall not apply so as to require the submission of material which is distributed before July 1, 1986.
"(C) Such amendment shall also not apply to material which the Secretary determines has been prepared before the date of the enactment of this Act [Apr. 7, 1986] and for which a commitment for distribution has been made, if the application of such amendment would constitute a hardship for the organization involved.
"(4)
"(5)
Effective Date of 1984 Amendment
Section 2350(d) of
Amendment by section 2354(b)(37), (38) of
Effective Date of 1983 Amendments; Transitional Rule
Amendment by section 602(g) of
Amendment by section 606(a)(3)(H) of
Amendment by section 309(b)(12) of
Effective Date of 1982 Amendment
Section 114(c) of
"(1) Subject to paragraph (2), the amendment made by subsection (a) [amending this section] shall apply with respect to services furnished on or after the initial effective date (as defined in paragraph (4)), except that such amendment shall not apply—
"(A) with respect to services furnished by an eligible organization to any individual who is enrolled with that organization under an existing cost contract (as defined in paragraph (3)(A)) and entitled to benefits under part A, or enrolled in part B, of title XVIII of the Social Security Act [this subchapter] at the time the organization first enters into a new risk-sharing contract (as defined in paragraph (3)(D)) unless—
"(i) the individual requests at any time that the amendment apply, or
"(ii) the Secretary determines at any time that the amendment should apply to all members of the organization because of administrative costs or other administrative burdens involved and so informs in advance each affected member of the eligible organization;
"(B) with respect to services furnished by an eligible organization during the five-year period beginning on the initial effective date, if—
"(i) the organization has an existing risk-sharing contract (as defined in paragraph (3)(B)) on the initial effective date, or
"(ii) on the date of the enactment of this Act [Sept. 3, 1982] the organization was furnishing services pursuant to an existing demonstration project (as defined in paragraph (3)(C)), such demonstration project is concluded before the initial effective date, and before such initial effective date the organization enters into an existing risk-sharing contract,
unless the organization requests that the amendment apply earlier; or
"(C) with respect to services furnished by an eligible organization during the period of an existing demonstration project if on the initial effective date the organization was furnishing services pursuant to the project and if the project concludes after such date.
"(2)(A) In the case of an eligible organization which has in effect an existing cost contract (as defined in paragraph (3)(A)) on the initial effective date, the organization may receive payment under a new risk-sharing contract with respect to a current, nonrisk medicare enrollee (as defined in subparagraph (C)) only to the extent that the organization enrolls, for each such enrollee, two new medicare enrollees (as defined in subparagraph (D)). The selection of those current nonrisk medicare enrollees with respect to whom payment may be so received under a new risk-sharing contract shall be made in a nonbiased manner.
"(B) Subparagraph (A) shall not be construed to prevent an eligible organization from providing for enrollment, on a basis described in subsection (a)(6) of section 1876 of the Social Security Act [subsec. (a)(6) of this section] (as amended by this Act [
"(i) payment to the organization with respect to such enrollees shall only be made in accordance with the terms of a reasonable cost reimbursement contract, and
"(ii) no payment may be made under section 1876 of such Act [this section] with respect to such enrollees for any such additional benefits.
Individuals enrolled with the organization under this subparagraph shall be considered to be individuals enrolled with the organization for the purpose of meeting the requirement of section 1876(g)(2) of the Social Security Act [subsec. (g)(2) of this section] (as amended by this Act [
"(C) For purposes of this paragraph, the term 'current, nonrisk medicare enrollee' means, with respect to an organization, an individual who on the initial effective date—
"(i) is enrolled with that organization under an existing cost contract, and
"(ii) is entitled to benefits under part A and enrolled under part B, or enrolled in part B, of title XVIII of the Social Security Act [this subchapter].
"(D) For purposes of this paragraph, the term 'new medicare enrollee' means, with respect to an organization, an individual who—
"(i) is enrolled with the organization after the date the organization first enters into a new risk-sharing contract,
"(ii) at the time of such enrollment is entitled to benefits under part A, or enrolled in part B, of title XVIII of the Social Security Act [this subchapter], and
"(iii) was not enrolled with the organization at the time the individual became entitled to benefits under part A, or to enroll in part B, of such title [this subchapter].
"(E) The preceding provisions of this paragraph shall not to [sic] apply to payments made for current, nonrisk medicare enrollees for months beginning with April 1987.
"(3) For purposes of this subsection:
"(A) The term 'existing cost contract' means a contract which is entered into under section 1876 of the Social Security Act [this section], as in effect before the initial effective date, or reimbursement on a reasonable cost basis under section 1833(a)(1)(A) of such Act [
"(B) The term 'existing risk-sharing contract' means a contract entered into under section 1876(i)(2)(A) of the Social Security Act [subsec. (i)(2)(A) of this section], as in effect before the initial effective date.
"(C) The term 'existing demonstration project' means a demonstration project under section 402(a) of the Social Security Amendments of 1967 [
"(D) The term 'new risk-sharing contract' means a contract entered into under section 1876(g) of the Social Security Act [subsec. (g) of this section], as amended by this Act [
"(E) The term 'reasonable cost reimbursement contract' means a contract entered into under section 1876(h) of such Act [subsec. (h) of this section], as amended by this Act, or reimbursement on a reasonable cost basis under section 1833(a)(1)(A) of such Act [
"(4) As used in this section, the term 'initial effective date' means—
"(A) the first day of the thirteenth month which begins after the date of the enactment of this Act [Sept. 3, 1982], or
"(B) the first day of the first month [Feb. 1, 1985] after the month in which the Secretary of Health and Human Services notifies the Committee on Finance of the Senate and the Committees on Ways and Means and on Energy and Commerce of the House of Representatives that he is reasonably certain that the methodology to make appropriate adjustments (referred to in section 1876(a)(4) of the Social Security Act [subsec. (a)(4) of this section], as amended by this Act [
whichever is later."
Effective Date of 1978 Amendment
Amendment by
Effective Date of 1976 Amendment
Section 201(e) of
Effective Date of 1973 Amendment
Section 18(z–3)(3) of
Effective Date
Section 226(f) of
Requirements With Respect to Actuarial Equivalence of AAPCC
Section 4204(b) of
"(1)(A) Not later than October 1, 1995, the Secretary of Health and Human Services (in this subsection referred to as the 'Secretary') shall submit a proposal to the Congress that provides for revisions to the payment method to be applied in years beginning with 1997 for organizations with a risk-sharing contract under section 1876(g) of the Social Security Act [subsec. (g) of this section].
"(B) In proposing the revisions required under subparagraph (A), the Secretary shall consider—
"(i) the difference in costs associated with medicare beneficiaries with differing health status and demographic characteristics; and
"(ii) the effects of using alternative geographic classifications on the determinations of costs associated with beneficiaries residing in different areas.
"(2) Not later than 3 months after the date of submittal of the proposal under paragraph (1), the Comptroller General shall review the proposal and shall report to Congress on the appropriateness of the proposed modifications."
Study of Chiropractic Services
Section 4204(f) of
Effect on State Law
Conscientious objections of health care provider under State law unaffected by enactment of subsec. (c)(8) of this section, see section 4206(c) of
Notice of Methodology Used in Making Announcements Under Subsection (a)(1)(A)
Section 6206(a)(2) of
Adjustment of Contracts With Prepaid Health Plans
Section 203(b) of
"(1) with eligible organizations under section 1876 of the Social Security Act [this section], or
"(2) with health maintenance organizations under section 1876(i)(2)(A) of such Act [subsec. (i)(2)(A) of this section] (as in effect before February 1, 1985), under section 402(a) of the Social Security Amendments of 1967 [
Adjustment of Contracts With Prepaid Health Plans
Section 222 of
"(1) modify contracts under section 1876 of the Social Security Act [this section], for portions of contract years occurring after December 31, 1988, to take into account the amendments made by this Act [see Short Title of 1988 Amendment note under
"(2) require such organizations and organizations paid under section 1833(a)(1)(A) of such Act [
The Secretary shall also provide for appropriate modifications of contracts with health maintenance organizations under section 1876(i)(2)(A) of the Social Security Act [subsec. (i)(2)(A) of this section] (as in effect before February 1, 1985), under section 402(a) of the Social Security Amendments of 1967 [
Provision of Medicare DRG Rates for Certain Payments and Data on Inpatient Cost Pass-Through Items
Section 4012(c) of
Medicare Payment Demonstration Projects
Section 4015 of
"(a)
"(1) The Secretary of Health and Human Services (in this subsection referred to as the 'Secretary') may provide for capitation demonstration projects (in this subsection referred to as 'projects') with an entity which is an eligible organization with a contract with the Secretary under section 1876 of the Social Security Act [this section] or which meets the restrictions and requirements of this subsection. The Secretary may not approve a project unless it meets the requirements of this subsection.
"(2) The Secretary may not conduct more than 3 projects and may not expend, from funds under title XVIII of the Social Security Act [this subchapter], more than $600,000,000 in any fiscal year for all such projects.
"(3) The per capita rate of payment under a project—
"(A) may be based on the adjusted average per capita cost (as defined in section 1876(a)(4) of the Social Security Act [subsec. (a)(4) of this section]) determined only with respect to the group of individuals involved (rather than with respect to medicare beneficiaries generally), but
"(B) the rate of payment may not exceed the lesser of—
"(i) 95 percent of the adjusted average per capita cost described in subparagraph (A), or
"(ii)(I) in the 4th year or 5th year of a project, 115 percent of the adjusted average per capita cost (as defined in section 1876(a)(4) of such Act [subsec. (a)(4) of this section]) for classes of individuals described in section 1876(a)(1)(B) of that Act [subsec. (a)(1)(B) of this section], or
"(II) in any subsequent year of a project, 95 percent of the adjusted average per capita cost (as defined in section 1876(a)(4) [subsec. (a)(4) of this section]) for such classes.
"(4) If the payment amounts made to a project are greater than the costs of the project (as determined by the Secretary or, if applicable, on the basis of adjusted community rates described in section 1876(e)(3) of the Social Security Act [subsec. (e)(3) of this section]), the project—
"(A) may retain the surplus, but not to exceed 5 percent of the average adjusted per capita cost determined in accordance with paragraph (3)(A), and
"(B) with respect to any additional surplus not retained by the project, shall apply such surplus to additional benefits for individuals served by the project or return such surplus to the Secretary.
"(5) Enrollment under the project shall be voluntary. Individuals enrolled with the project may terminate such enrollment as of the beginning of the first calendar month following the date on which the request is made for such termination. Upon such termination, such individuals shall retain the same rights to other health benefits that such individuals would have had if they had never enrolled with the project without any exclusion or waiting period for pre-existing conditions.
"(6) The requirements of—
"(A) subsection (c)(3)(C) (relating to dissemination of information),
"(B) subsection (c)(3)(E) (annual statement of rights),
"(C) subsection (c)(5) (grievance procedures),
"(D) subsection (c)(6) (on-going quality),
"(E) subsection (g)(6) (relating to prompt payment of claims),
"(F) subsection (i)(3)(A) and (B) (relating to access to information and termination notices),
"(G) subsection (i)(6) (relating to providing necessary services), and
"(H) subsection (i)(7) (relating to agreements with peer review organizations),
of section 1876 of the Social Security Act [this section] shall apply to a project in the same manner as they apply to eligible organizations with risk-sharing contracts under such section.
"(7) The benefits provided under a project must be at least actuarially equivalent to the combination of the benefits available under title XVIII of the Social Security Act [this subchapter] and the benefits available through any alternative plans in which the individual can enroll through the employer. The project shall guarantee the actuarial value of benefits available under the employer plan for the duration of the project.
"(8) A project shall comply with all applicable State laws.
"(9) The Secretary may not authorize a project unless the entity offering the project demonstrates to the satisfaction of the Secretary that it has the necessary financial reserves to pay for any liability for benefits under the project (including those liabilities for health benefits under medicare and any supplemental benefits).
"(10) The Comptroller General shall monitor projects under this subsection and shall report periodically (not less often than once every year) to the Committee on Finance of the Senate and the Committee on Energy and Commerce [now Committee on Commerce] and Committee on Ways and Means of the House of Representatives on the status of such projects and the effect on such projects of the requirements of this section and shall submit a final report to each such committee on the results of such projects.
"(b)
"(1) The Secretary of Health and Human Services (in this subsection referred to as the 'Secretary') is specifically authorized to conduct demonstration projects under this subsection for the purpose of testing alternative payment methodologies pertaining to capitation payments under title XVIII of the Social Security Act [this subchapter], including—
"(A) computing adjustments to the average per capita cost under section 1876 of such Act [this section] on the basis of health status or prior utilization of services, and
"(B) accounting for geographic variations in cost in the adjusted average per capita costs applicable to an eligible organization under such section which differs from payments currently provided on a county-by-county basis.
"(2) No project may be conducted under this subsection—
"(A) with an entity which is not an eligible organization (as defined in section 1876(b) of the Social Security Act [subsec. (b) of this section]), and
"(B) unless the project meets all the requirements of subsections (c) and (i)(3) of section 1876 of such Act [subsecs. (c) and (i)(3) of this section].
"(3) There are authorized to be appropriated to carry out projects under this subsection $5,000,000 in each of fiscal years 1989 and 1990.
"(c)
GAO Study and Reports on Medicare Capitation
Section 4017 of
Demonstration Projects To Provide Payment on a Prepaid, Capitated Basis for Community Nursing and Ambulatory Care Furnished to Medicare Beneficiaries
Section 4079 of
"(a)
"(b)
"(1) The term 'community nursing and ambulatory care' means the following services:
"(A) Part-time or intermittent nursing care furnished by or under the supervision of registered professional nurses.
"(B) Physical, occupational, or speech therapy.
"(C) Social and related services supportive of a plan of ambulatory care.
"(D) Part-time or intermittent services of a home health aide.
"(E) Medical supplies (other than drugs and biologicals) and durable medical equipment while under a plan of care.
"(F) Medical and other health services described in paragraphs (2)(H)(ii) and (5) through (9) of section 1861(s) of the Social Security Act [section 1395x(s)(2)(H)(ii), (5)–(9) of this title].
"(G) Rural health clinic services described in section 1861(aa)(1)(C) of such Act [
"(H) Certain other related services listed in section 1915(c)(4)(B) of such Act [
"(2) The term 'eligible organization' means a public or private entity, organized under the laws of any State, which meets the following requirements:
"(A) The entity (or a division or part of such entity) is primarily engaged in the direct provision of community nursing and ambulatory care.
"(B) The entity provides directly, or through arrangements with other qualified personnel, the services described in paragraph (1).
"(C) The entity provides that all nursing care (including services of home health aids) is furnished by or under the supervision of a registered nurse.
"(D) The entity provides that all services are furnished by qualified staff and are coordinated by a registered professional nurse.
"(E) The entity has policies governing the furnishing of community nursing and ambulatory care that are developed by registered professional nurses in cooperation with (as appropriate) other professionals.
"(F) The entity maintains clinical records on all patients.
"(G) The entity has protocols and procedures to assure, when appropriate, timely referral to or consultation with other health care providers or professionals.
"(H) The entity complies with applicable State and local laws governing the provision of community nursing and ambulatory care to patients.
"(I) The requirements of subparagraphs (B), (D), and (E) of section 1876(b)(2) of the Social Security Act [
"(c)
"(1) The Secretary may not enter into an agreement with an eligible organization to conduct a demonstration project under this section unless the organization meets the requirements of this subsection and subsection (e) with respect to members enrolled with the organization under this section.
"(2) The organization shall have an open enrollment period for the enrollment of individuals under this section. The duration of such period of enrollment and any other requirement pertaining to enrollment or termination of enrollment shall be specified in the agreement with the organization.
"(3) The organization must provide to members enrolled with the organization under this section, through providers and other persons that meet the applicable requirements of titles XVIII and XIX of the Social Security Act [this subchapter and subchapter XIX of this chapter], community nursing and ambulatory care (as defined in subsection (b)(1)) which is generally available to individuals residing in the geographic area served by the organization, except that the organization may provide such members with such additional health care services as the members may elect, at their option, to have covered.
"(4) The organization must make community nursing and ambulatory care (and such other health care services as such individuals have contracted for) available and accessible to each individual enrolled with the organization under this section, within the area served by the organization, with reasonable promptness and in a manner which assures continuity.
"(5) Section 1876(c)(5) of the Social Security Act [subsec. (c)(5) of this section] shall apply to organizations under this section in the same manner as it applies to organizations under section 1876 of such Act.
"(6) The organization must have arrangements, established in accordance with regulations of the Secretary, for an ongoing quality assurance program for health care services it provides to such individuals under the demonstration project conducted under this section, which program (A) stresses health outcomes and (B) provides review by health care professionals of the process followed in the provision of such health care services.
"(7) Under a demonstration project under this section—
"(A) the Secretary could require the organization to provide financial or other assurances (including financial risk-sharing) that minimize the inappropriate substitution of other services under title XVIII of such Act [this subchapter] for community nursing services; and
"(B) if the Secretary determines that the organization has failed to perform in accordance with the requirements of the project (including meeting financial responsibility requirements under the project, any pattern of disproportionate or inappropriate institutionalization) the Secretary shall, after notice, terminate the project.
"(d)
"(1) The Secretary shall determine for each 12-month period in which a demonstration project is conducted under this section, and shall announce (in a manner intended to provide notice to interested parties) not later than three months before the beginning of such period, with respect to each eligible organization conducting a demonstration project under this section, a per capita rate of payment for each class of individuals who are enrolled with such organization who are entitled to benefits under part A and enrolled under part B of title XVIII of the Social Security Act [part A and part B of this subchapter].
"(2)(A) Except as provided in paragraph (3), the per capita rate of payment under paragraph (1) shall be determined in accordance with this paragraph.
"(B) The Secretary shall define appropriate classes of members, based on age, disability status, and such other factors as the Secretary determines to be appropriate, so as to ensure actuarial equivalence. The Secretary may add to, modify, or substitute for such classes, if such changes will improve the determination of actuarial equivalence.
"(C) The per capita rate of payment under paragraph (1) for each such class shall be equal to 95 percent of the adjusted average per capita cost (as defined in subparagraph (D)) for that class.
"(D) For purposes of subparagraph (C), the term 'adjusted average per capita cost' means the average per capita amount that the Secretary estimates in advance (on the basis of actual experience, or retrospective actuarial equivalent based upon an adequate sample and other information and data, in a geographic area served by an eligible organization or in a similar area, with appropriate adjustments to assure actuarial equivalence) would be payable in any contract year for those services covered under parts A and B of title XVIII of the Social Security Act [parts A and B of this subchapter] and types of expenses otherwise reimbursable under such parts A and B which are described in subparagraphs (A) through (G) of subsection (b)(1) (including administrative costs incurred by organizations described in sections 1816 and 1842 of such Act [
"(3) The Secretary shall, in consultation with providers, health policy experts, and consumer groups develop capitation-based reimbursement rates for such classes of individuals entitled to benefits under part A and enrolled under part B of the Social Security Act [probably means parts A and B of title XVIII of that Act, this subchapter] as the Secretary shall determine. Such rates shall be applied in determining per capita rates of payment under paragraph (1) with respect to at least one eligible organization conducting a demonstration project under this section.
"(4)(A) In the case of an eligible organization conducting a demonstration project under this section, the Secretary shall make monthly payments in advance and in accordance with the rate determined under paragraph (2) or (3), except as provided in subsection (e)(3)(B), to the organization for each individual enrolled with the organization.
"(B) The amount of payment under paragraph (2) or (3) may be retroactively adjusted to take into account any difference between the actual number of individuals enrolled in the plan under this section and the number of such individuals estimated to be so enrolled in determining the amount of the advance payment.
"(5) The payment to an eligible organization under this section for individuals enrolled under this section with the organization and entitled to benefits under part A and enrolled under part B of the Social Security Act shall be made from the Federal Hospital Insurance Trust Fund and the Federal Supplementary Medical Insurance Trust Fund established under such Act [this chapter] in such proportions from each such trust fund as the Secretary deems to be fair and equitable taking into consideration benefits attributable to such parts A and B, respectively.
"(6) During any period in which an individual is enrolled with an eligible organization conducting a demonstration project under this section, only the eligible organization (and no other individual or person) shall be entitled to receive payments from the Secretary under this title [probably means title XVIII of the Social Security Act, this subchapter] for community nursing and ambulatory care (as defined in subsection (b)(1)) furnished to the individual.
"(e)
"(1) In no case may the portion of an eligible organization's premium rate and the actuarial value of its deductibles, coinsurance, and copayments charged (with respect to community nursing and ambulatory care) to individuals who are enrolled under this section with the organization, exceed the actuarial value of the coinsurance and deductibles that would be applicable on the average to individuals enrolled under this section with the organization (or, if the Secretary finds that adequate data are not available to determine that actuarial value, the actuarial value of the coinsurance and deductibles applicable on the average to individuals in the area, in the State, or in the United States, eligible to enroll under this section with the organization, or other appropriate data) and entitled to benefits under part A and enrolled under part B of the Social Security Act [probably means parts A and B of title XVIII of that Act, this subchapter], if they were not members of an eligible organization.
"(2) If the eligible organization provides to its members enrolled under this section services in addition to community nursing and ambulatory care, election of coverage for such additional services shall be optional for such members and such organization shall furnish such members with information on the portion of its premium rate or other charges applicable to such additional services. In no case may the sum of—
"(A) the portion of such organization's premium rate charged, with respect to such additional services, to members enrolled under this section, and
"(B) the actuarial value of its deductibles, coinsurance, and copayments charged, with respect to such services to such members
exceed the adjusted community rate for such services (as defined in section 1876(e)(3) of the Social Security Act [subsec. (e)(3) of this section]).
"(3)(A) Subject to subparagraphs (B) and (C), each agreement to conduct a demonstration project under this section shall provide that if—
"(i) the adjusted community rate, referred to in paragraph (2), for community nursing and ambulatory care covered under parts A and B of title XVIII of the Social Security Act [parts A and B of this subchapter] (as reduced for the actuarial value of the coinsurance and deductibles under those parts) for members enrolled under this section with the organization,
is less than
"(ii) the average of the per capita rates of payment to be made under subsection (d)(1) at the beginning of the 12-month period (as determined on such basis as the Secretary determines appropriate) described in such subsection for members enrolled under this section with the organization,
the eligible organization shall provide to such members the additional benefits described in section 1876(g)(3) of the Social Security Act [subsec. (g)(3) of this section] which are selected by the eligible organization and which the Secretary finds are at least equal in value to the difference between that average per capita payment and the adjusted community rate (as so reduced).
"(B) Subparagraph (A) shall not apply with respect to any organization which elects to receive a lesser payment to the extent that there is no longer a difference between the average per capita payment and adjusted community rate (as so reduced).
"(C) An organization conducting a demonstration project under this section may provide (with the approval of the Secretary) that a part of the value of such additional benefits under subparagraph (A) be withheld and reserved by the Secretary as provided in section 1876(g)(5) of the Social Security Act [subsec. (g)(5) of this section].
"(4) The provisions of paragraphs (3), (5), and (6) of section 1876(g) of the Social Security Act [subsec. (g)(3), (5), and (6) of this section] shall apply in the same manner to agreements under this section as they apply to risk-sharing contracts under section 1876 of such Act, and, for this purpose, any reference in such paragraphs to paragraph (2) is deemed a reference to paragraph (3) of this subsection.
"(5) Section 1876(e)(4) of the Social Security Act [subsec. (e)(4) of this section] shall apply to eligible organizations under this section in the same manner as it applies to eligible organizations under section 1876 of such Act.
"(f)
"(g)
Study of AAPCC and ACR
Section 9312(g) of
Allowing Medicare Beneficiaries To Disenroll at Local Social Security Offices
Section 9312(h) of
Use of Reserve Funds
Section 9312(i) of
Phase-in of Enrollment Period by Secretary
Section 2350(a)(2) of
Stabilization Fund; Establishment Limitation; Uses; Report to Congress
Section 2350(b)(3), (4) of
Study of Additional Benefits Selected by Eligible Organizations
Section 114(d) of
Study Evaluating the Extent of, and Reasons for, Termination by Medicare Beneficiaries of Membership in Organizations With Contracts Under This Section
Section 114(e) of
Reimbursement for Services
Section 226(b) of
"(1) Notwithstanding the provisions of section 1814 and section 1833 of the Social Security Act [
"(2) With respect to individuals who are members of organizations which have entered into a risk-sharing contract with the Secretary pursuant to subsection (i)(2)(A) [of this section] prior to July 1, 1973, and who, although eligible to have payment made pursuant to section 1876 of such Act [this section] for services rendered to them, chose (in accordance with regulations) not to have such payment made pursuant to such section, the Secretary shall, for a period not to exceed three years commencing on July 1, 1973, pay to such organization on the basis of an interim per capita rate, determined in accordance with the provisions of section 1876(a)(2) of such Act [subsec. (a)(2) of this section], with appropriate actuarial adjustments to reflect the difference in utilization of out-of-plan services, which would have been considered sufficiently reasonable and necessary under the rules of the health maintenance organization to be provided by that organization, between such individuals and individuals who are enrolled with such organization pursuant to section 1876 of such Act [this section]. Payments under this paragraph shall be subject to retroactive adjustment at the end of each contract year as provided in paragraph (3).
"(3) If the Secretary determines that the per capita cost of any such organization in any contract year for providing services to individuals described in paragraph (2), when combined with the cost of the Federal Hospital Insurance Trust Fund and the Federal Supplementary Medical Insurance Trust Fund in such year for providing out-of-plan services to such individuals, is less than or greater than the adjusted average per capita cost (as defined in section 1876(a)(3) of such Act) [subsec. (a)(3) of this section] of providing such services, the resulting savings shall be apportioned between such organization and such Trust Funds, or the resulting losses shall be absorbed by such organization, in the manner prescribed in section 1876(a)(3) of such Act [subsec. (a)(3) of this section]."
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be "significant".
2 See References in Text note below.
3 So in original. Probably should be "section".
§1395nn. Limitation on certain physician referrals
(a) Prohibition of certain referrals
(1) In general
Except as provided in subsection (b) of this section, if a physician (or an immediate family member of such physician) has a financial relationship with an entity specified in paragraph (2), then—
(A) the physician may not make a referral to the entity for the furnishing of designated health services for which payment otherwise may be made under this subchapter, and
(B) the entity may not present or cause to be presented a claim under this subchapter or bill to any individual, third party payor, or other entity for designated health services furnished pursuant to a referral prohibited under subparagraph (A).
(2) Financial relationship specified
For purposes of this section, a financial relationship of a physician (or an immediate family member of such physician) with an entity specified in this paragraph is—
(A) except as provided in subsections (c) and (d) of this section, an ownership or investment interest in the entity, or
(B) except as provided in subsection (e) of this section, a compensation arrangement (as defined in subsection (h)(1) of this section) between the physician (or an immediate family member of such physician) and the entity.
An ownership or investment interest described in subparagraph (A) may be through equity, debt, or other means and includes an interest in an entity that holds an ownership or investment interest in any entity providing the designated health service.
(b) General exceptions to both ownership and compensation arrangement prohibitions
Subsection (a)(1) of this section shall not apply in the following cases:
(1) Physicians' services
In the case of physicians' services (as defined in
(2) In-office ancillary services
In the case of services (other than durable medical equipment (excluding infusion pumps) and parenteral and enteral nutrients, equipment, and supplies)—
(A) that are furnished—
(i) personally by the referring physician, personally by a physician who is a member of the same group practice as the referring physician, or personally by individuals who are directly supervised by the physician or by another physician in the group practice, and
(ii)(I) in a building in which the referring physician (or another physician who is a member of the same group practice) furnishes physicians' services unrelated to the furnishing of designated health services, or
(II) in the case of a referring physician who is a member of a group practice, in another building which is used by the group practice—
(aa) for the provision of some or all of the group's clinical laboratory services, or
(bb) for the centralized provision of the group's designated health services (other than clinical laboratory services),
unless the Secretary determines other terms and conditions under which the provision of such services does not present a risk of program or patient abuse, and
(B) that are billed by the physician performing or supervising the services, by a group practice of which such physician is a member under a billing number assigned to the group practice, or by an entity that is wholly owned by such physician or such group practice,
if the ownership or investment interest in such services meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(3) Prepaid plans
In the case of services furnished by an organization—
(A) with a contract under
(B) described in
(C) receiving payments on a prepaid basis, under a demonstration project under
(D) that is a qualified health maintenance organization (within the meaning of
(4) Other permissible exceptions
In the case of any other financial relationship which the Secretary determines, and specifies in regulations, does not pose a risk of program or patient abuse.
(c) General exception related only to ownership or investment prohibition for ownership in publicly traded securities and mutual funds
Ownership of the following shall not be considered to be an ownership or investment interest described in subsection (a)(2)(A) of this section:
(1) Ownership of investment securities (including shares or bonds, debentures, notes, or other debt instruments) which may be purchased on terms generally available to the public and which are—
(A)(i) securities listed on the New York Stock Exchange, the American Stock Exchange, or any regional exchange in which quotations are published on a daily basis, or foreign securities listed on a recognized foreign, national, or regional exchange in which quotations are published on a daily basis, or
(ii) traded under an automated interdealer quotation system operated by the National Association of Securities Dealers, and
(B) in a corporation that had, at the end of the corporation's most recent fiscal year, or on average during the previous 3 fiscal years, stockholder equity exceeding $75,000,000.
(2) Ownership of shares in a regulated investment company as defined in section 851(a) of the Internal Revenue Code of 1986, if such company had, at the end of the company's most recent fiscal year, or on average during the previous 3 fiscal years, total assets exceeding $75,000,000.
(d) Additional exceptions related only to ownership or investment prohibition
The following, if not otherwise excepted under subsection (b) of this section, shall not be considered to be an ownership or investment interest described in subsection (a)(2)(A) of this section:
(1) Hospitals in Puerto Rico
In the case of designated health services provided by a hospital located in Puerto Rico.
(2) Rural provider
In the case of designated health services furnished in a rural area (as defined in
(3) Hospital ownership
In the case of designated health services provided by a hospital (other than a hospital described in paragraph (1)) if—
(A) the referring physician is authorized to perform services at the hospital, and
(B) the ownership or investment interest is in the hospital itself (and not merely in a subdivision of the hospital).
(e) Exceptions relating to other compensation arrangements
The following shall not be considered to be a compensation arrangement described in subsection (a)(2)(B) of this section:
(1) Rental of office space; rental of equipment
(A) Office space
Payments made by a lessee to a lessor for the use of premises if—
(i) the lease is set out in writing, signed by the parties, and specifies the premises covered by the lease,
(ii) the space rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee, except that the lessee may make payments for the use of space consisting of common areas if such payments do not exceed the lessee's pro rata share of expenses for such space based upon the ratio of the space used exclusively by the lessee to the total amount of space (other than common areas) occupied by all persons using such common areas,
(iii) the lease provides for a term of rental or lease for at least 1 year,
(iv) the rental charges over the term of the lease are set in advance, are consistent with fair market value, and are not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties,
(v) the lease would be commercially reasonable even if no referrals were made between the parties, and
(vi) the lease meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(B) Equipment
Payments made by a lessee of equipment to the lessor of the equipment for the use of the equipment if—
(i) the lease is set out in writing, signed by the parties, and specifies the equipment covered by the lease,
(ii) the equipment rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee,
(iii) the lease provides for a term of rental or lease of at least 1 year,
(iv) the rental charges over the term of the lease are set in advance, are consistent with fair market value, and are not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties,
(v) the lease would be commercially reasonable even if no referrals were made between the parties, and
(vi) the lease meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(2) Bona fide employment relationships
Any amount paid by an employer to a physician (or an immediate family member of such physician) who has a bona fide employment relationship with the employer for the provision of services if—
(A) the employment is for identifiable services,
(B) the amount of the remuneration under the employment—
(i) is consistent with the fair market value of the services, and
(ii) is not determined in a manner that takes into account (directly or indirectly) the volume or value of any referrals by the referring physician,
(C) the remuneration is provided pursuant to an agreement which would be commercially reasonable even if no referrals were made to the employer, and
(D) the employment meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
Subparagraph (B)(ii) shall not prohibit the payment of remuneration in the form of a productivity bonus based on services performed personally by the physician (or an immediate family member of such physician).
(3) Personal service arrangements
(A) In general
Remuneration from an entity under an arrangement (including remuneration for specific physicians' services furnished to a nonprofit blood center) if—
(i) the arrangement is set out in writing, signed by the parties, and specifies the services covered by the arrangement,
(ii) the arrangement covers all of the services to be provided by the physician (or an immediate family member of such physician) to the entity,
(iii) the aggregate services contracted for do not exceed those that are reasonable and necessary for the legitimate business purposes of the arrangement,
(iv) the term of the arrangement is for at least 1 year,
(v) the compensation to be paid over the term of the arrangement is set in advance, does not exceed fair market value, and except in the case of a physician incentive plan described in subparagraph (B), is not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties,
(vi) the services to be performed under the arrangement do not involve the counseling or promotion or a business arrangement or other activity that violates any State or Federal law, and
(vii) the arrangement meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(B) Physician incentive plan exception
(i) In general
In the case of a physician incentive plan (as defined in clause (ii)) between a physician and an entity, the compensation may be determined in a manner (through a withhold, capitation, bonus, or otherwise) that takes into account directly or indirectly the volume or value of any referrals or other business generated between the parties, if the plan meets the following requirements:
(I) No specific payment is made directly or indirectly under the plan to a physician or a physician group as an inducement to reduce or limit medically necessary services provided with respect to a specific individual enrolled with the entity.
(II) In the case of a plan that places a physician or a physician group at substantial financial risk as determined by the Secretary pursuant to
(III) Upon request by the Secretary, the entity provides the Secretary with access to descriptive information regarding the plan, in order to permit the Secretary to determine whether the plan is in compliance with the requirements of this clause.
(ii) "Physician incentive plan" defined
For purposes of this subparagraph, the term "physician incentive plan" means any compensation arrangement between an entity and a physician or physician group that may directly or indirectly have the effect of reducing or limiting services provided with respect to individuals enrolled with the entity.
(4) Remuneration unrelated to the provision of designated health services
In the case of remuneration which is provided by a hospital to a physician if such remuneration does not relate to the provision of designated health services.
(5) Physician recruitment
In the case of remuneration which is provided by a hospital to a physician to induce the physician to relocate to the geographic area served by the hospital in order to be a member of the medical staff of the hospital, if—
(A) the physician is not required to refer patients to the hospital,
(B) the amount of the remuneration under the arrangement is not determined in a manner that takes into account (directly or indirectly) the volume or value of any referrals by the referring physician, and
(C) the arrangement meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(6) Isolated transactions
In the case of an isolated financial transaction, such as a one-time sale of property or practice, if—
(A) the requirements described in subparagraphs (B) and (C) of paragraph (2) are met with respect to the entity in the same manner as they apply to an employer, and
(B) the transaction meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(7) Certain group practice arrangements with a hospital
(A) 1 In general
An arrangement between a hospital and a group under which designated health services are provided by the group but are billed by the hospital if—
(i) with respect to services provided to an inpatient of the hospital, the arrangement is pursuant to the provision of inpatient hospital services under
(ii) the arrangement began before December 19, 1989, and has continued in effect without interruption since such date,
(iii) with respect to the designated health services covered under the arrangement, substantially all of such services furnished to patients of the hospital are furnished by the group under the arrangement,
(iv) the arrangement is pursuant to an agreement that is set out in writing and that specifies the services to be provided by the parties and the compensation for services provided under the agreement,
(v) the compensation paid over the term of the agreement is consistent with fair market value and the compensation per unit of services is fixed in advance and is not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties,
(vi) the compensation is provided pursuant to an agreement which would be commercially reasonable even if no referrals were made to the entity, and
(vii) the arrangement between the parties meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(8) Payments by a physician for items and services
Payments made by a physician—
(A) to a laboratory in exchange for the provision of clinical laboratory services, or
(B) to an entity as compensation for other items or services if the items or services are furnished at a price that is consistent with fair market value.
(f) Reporting requirements
Each entity providing covered items or services for which payment may be made under this subchapter shall provide the Secretary with the information concerning the entity's ownership, investment, and compensation arrangements, including—
(1) the covered items and services provided by the entity, and
(2) the names and unique physician identification numbers of all physicians with an ownership or investment interest (as described in subsection (a)(2)(A) of this section), or with a compensation arrangement (as described in subsection (a)(2)(B) of this section), in the entity, or whose immediate relatives have such an ownership or investment interest or who have such a compensation relationship with the entity.
Such information shall be provided in such form, manner, and at such times as the Secretary shall specify. The requirement of this subsection shall not apply to designated health services provided outside the United States or to entities which the Secretary determines provides 2 services for which payment may be made under this subchapter very infrequently.
(g) Sanctions
(1) Denial of payment
No payment may be made under this subchapter for a designated health service which is provided in violation of subsection (a)(1) of this section.
(2) Requiring refunds for certain claims
If a person collects any amounts that were billed in violation of subsection (a)(1) of this section, the person shall be liable to the individual for, and shall refund on a timely basis to the individual, any amounts so collected.
(3) Civil money penalty and exclusion for improper claims
Any person that presents or causes to be presented a bill or a claim for a service that such person knows or should know is for a service for which payment may not be made under paragraph (1) or for which a refund has not been made under paragraph (2) shall be subject to a civil money penalty of not more than $15,000 for each such service. The provisions of
(4) Civil money penalty and exclusion for circumvention schemes
Any physician or other entity that enters into an arrangement or scheme (such as a cross-referral arrangement) which the physician or entity knows or should know has a principal purpose of assuring referrals by the physician to a particular entity which, if the physician directly made referrals to such entity, would be in violation of this section, shall be subject to a civil money penalty of not more than $100,000 for each such arrangement or scheme. The provisions of
(5) Failure to report information
Any person who is required, but fails, to meet a reporting requirement of subsection (f) of this section is subject to a civil money penalty of not more than $10,000 for each day for which reporting is required to have been made. The provisions of
(h) Definitions and special rules
For purposes of this section:
(1) Compensation arrangement; remuneration
(A) The term "compensation arrangement" means any arrangement involving any remuneration between a physician (or an immediate family member of such physician) and an entity other than an arrangement involving only remuneration described in subparagraph (C).
(B) The term "remuneration" includes any remuneration, directly or indirectly, overtly or covertly, in cash or in kind.
(C) Remuneration described in this subparagraph is any remuneration consisting of any of the following:
(i) The forgiveness of amounts owed for inaccurate tests or procedures, mistakenly performed tests or procedures, or the correction of minor billing errors.
(ii) The provision of items, devices, or supplies that are used solely to—
(I) collect, transport, process, or store specimens for the entity providing the item, device, or supply, or
(II) order or communicate the results of tests or procedures for such entity.
(iii) A payment made by an insurer or a self-insured plan to a physician to satisfy a claim, submitted on a fee for service basis, for the furnishing of health services by that physician to an individual who is covered by a policy with the insurer or by the self-insured plan, if—
(I) the health services are not furnished, and the payment is not made, pursuant to a contract or other arrangement between the insurer or the plan and the physician,
(II) the payment is made to the physician on behalf of the covered individual and would otherwise be made directly to such individual,
(III) the amount of the payment is set in advance, does not exceed fair market value, and is not determined in a manner that takes into account directly or indirectly the volume or value of any referrals, and
(IV) the payment meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse.
(2) Employee
An individual is considered to be "employed by" or an "employee" of an entity if the individual would be considered to be an employee of the entity under the usual common law rules applicable in determining the employer-employee relationship (as applied for purposes of section 3121(d)(2) of the Internal Revenue Code of 1986).
(3) Fair market value
The term "fair market value" means the value in arms length transactions, consistent with the general market value, and, with respect to rentals or leases, the value of rental property for general commercial purposes (not taking into account its intended use) and, in the case of a lease of space, not adjusted to reflect the additional value the prospective lessee or lessor would attribute to the proximity or convenience to the lessor where the lessor is a potential source of patient referrals to the lessee.
(4) Group practice
(A) Definition of group practice
The term "group practice" means a group of 2 or more physicians legally organized as a partnership, professional corporation, foundation, not-for-profit corporation, faculty practice plan, or similar association—
(i) in which each physician who is a member of the group provides substantially the full range of services which the physician routinely provides, including medical care, consultation, diagnosis, or treatment, through the joint use of shared office space, facilities, equipment and personnel,
(ii) for which substantially all of the services of the physicians who are members of the group are provided through the group and are billed under a billing number assigned to the group and amounts so received are treated as receipts of the group,
(iii) in which the overhead expenses of and the income from the practice are distributed in accordance with methods previously determined,
(iv) except as provided in subparagraph (B)(i), in which no physician who is a member of the group directly or indirectly receives compensation based on the volume or value of referrals by the physician,
(v) in which members of the group personally conduct no less than 75 percent of the physician-patient encounters of the group practice, and
(vi) which meets such other standards as the Secretary may impose by regulation.
(B) Special rules
(i) Profits and productivity bonuses
A physician in a group practice may be paid a share of overall profits of the group, or a productivity bonus based on services personally performed or services incident to such personally performed services, so long as the share or bonus is not determined in any manner which is directly related to the volume or value of referrals by such physician.
(ii) Faculty practice plans
In the case of a faculty practice plan associated with a hospital, institution of higher education, or medical school with an approved medical residency training program in which physician members may provide a variety of different specialty services and provide professional services both within and outside the group, as well as perform other tasks such as research, subparagraph (A) shall be applied only with respect to the services provided within the faculty practice plan.
(5) Referral; referring physician
(A) Physicians' services
Except as provided in subparagraph (C), in the case of an item or service for which payment may be made under part B of this subchapter, the request by a physician for the item or service, including the request by a physician for a consultation with another physician (and any test or procedure ordered by, or to be performed by (or under the supervision of) that other physician), constitutes a "referral" by a "referring physician".
(B) Other items
Except as provided in subparagraph (C), the request or establishment of a plan of care by a physician which includes the provision of the designated health service constitutes a "referral" by a "referring physician".
(C) Clarification respecting certain services integral to a consultation by certain specialists
A request by a pathologist for clinical diagnostic laboratory tests and pathological examination services, a request by a radiologist for diagnostic radiology services, and a request by a radiation oncologist for radiation therapy, if such services are furnished by (or under the supervision of) such pathologist, radiologist, or radiation oncologist pursuant to a consultation requested by another physician does not constitute a "referral" by a "referring physician".
(6) Designated health services
The term "designated health services" means any of the following items or services:
(A) Clinical laboratory services.
(B) Physical therapy services.
(C) Occupational therapy services.
(D) Radiology services, including magnetic resonance imaging, computerized axial tomography scans, and ultrasound services.
(E) Radiation therapy services and supplies.
(F) Durable medical equipment and supplies.
(G) Parenteral and enteral nutrients, equipment, and supplies.
(H) Prosthetics, orthotics, and prosthetic devices and supplies.
(I) Home health services.
(J) Outpatient prescription drugs.
(K) Inpatient and outpatient hospital services.
(Aug. 14, 1935, ch. 531, title XVIII, §1877, as added Dec. 19, 1989,
References in Text
Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (b)(3)(C), is section 222(a) of
The Internal Revenue Code, referred to in subsecs. (c)(2) and (h)(2), is classified generally to Title 26, Internal Revenue Code.
Part B of this subchapter, referred to in subsec. (h)(5)(A), is classified to
Prior Provisions
A prior section 1395nn, act Aug. 14, 1935, ch. 531, title XVIII, §1877, as added and amended Oct. 30, 1972,
Amendments
1994—Subsec. (f).
Subsec. (f)(2).
Subsec. (h)(6).
1993—Subsecs. (a) to (e).
Subsec. (f).
Subsec. (g)(1).
Subsec. (h).
1990—Subsec. (b)(4), (5).
Subsec. (f).
Subsec. (f)(2).
Subsec. (g)(5).
Subsec. (h)(6).
Subsec. (h)(7).
Effective Date of 1994 Amendment
Section 152(d)(1) of
Effective Date of 1993 Amendment
Section 13562(b) of
"(1)
"(A) made on or after January 1, 1992, in the case of clinical laboratory services, and
"(B) made after December 31, 1994, in the case of other designated health services.
"(2)
"(A) the second sentence of subsection (a)(2), and subsections (b)(2)(B) and (d)(2), of section 1877 of the Social Security Act [subsecs. (a)(2), (b)(2)(B), and (d)(2) of this section] (as in effect on the day before the date of the enactment of this Act [Aug. 10, 1993]) shall apply instead of the corresponding provisions in section 1877 (as amended by this Act);
"(B) section 1877(b)(4) of the Social Security Act [subsec. (b)(4) of this section] (as in effect on the day before the date of the enactment of this Act) shall apply;
"(C) the requirements of section 1877(c)(2) of the Social Security Act [subsec. (c)(2) of this section] (as amended by this Act) shall not apply to any securities of a corporation that meets the requirements of section 1877(c)(2) of the Social Security Act (as in effect on the day before the date of the enactment of this Act);
"(D) section 1877(e)(3) of the Social Security Act [subsec. (e)(3) of this section] (as amended by this Act) shall apply, except that it shall not apply to any arrangement that meets the requirements of subsection (e)(2) or subsection (e)(3) of section 1877 of the Social Security Act (as in effect on the day before the date of the enactment of this Act);
"(E) the requirements of clauses (iv) and (v) of section 1877(h)(4)(A), and of clause (i) of section 1877(h)(4)(B), of the Social Security Act [subsec. (h)(4)(A)(iv), (v), (B)(i) of this section] (as amended by this Act) shall not apply; and
"(F) section 1877(h)(4)(B) of the Social Security Act [subsec. (h)(4)(B) of this section] (as in effect on the day before the date of the enactment of this Act) shall apply instead of section 1877(h)(4)(A)(ii) of such Act (as amended by this Act)."
[Section 152(d)(2) of
Effective Date of 1990 Amendment
Section 4207(e)(5), formerly 4027(e)(5), of
Effective Date
Section 6204(c) of
"(1) Except as provided in paragraph (2), the amendments made by this section [enacting this section and amending
"(2) The reporting requirement of section 1877(f) of the Social Security Act [subsec. (f) of this section] shall take effect on October 1, 1990."
Deadline for Certain Regulations
Section 6204(d) of
GAO Study of Ownership by Referring Physicians
Section 6204(e) of
Statistical Summary of Comparative Utilization
Section 6204(f) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. No subpar. (B) has been enacted.
2 So in original. Probably should be "provide".
§1395oo. Provider Reimbursement Review Board
(a) Establishment
Any provider of services which has filed a required cost report within the time specified in regulations may obtain a hearing with respect to such cost report by a Provider Reimbursement Review Board (hereinafter referred to as the "Board") which shall be established by the Secretary in accordance with subsection (h) of this section and (except as provided in subsection (g)(2) of this section) any hospital which receives payments in amounts computed under subsection (b) or (d) of
(1) such provider—
(A)(i) is dissatisfied with a final determination of the organization serving as its fiscal intermediary pursuant to
(ii) is dissatisfied with a final determination of the Secretary as to the amount of the payment under subsection (b) or (d) of
(B) has not received such final determination from such intermediary on a timely basis after filing such report, where such report complied with the rules and regulations of the Secretary relating to such report, or
(C) has not received such final determination on a timely basis after filing a supplementary cost report, where such cost report did not so comply and such supplementary cost report did so comply,
(2) the amount in controversy is $10,000 or more, and
(3) such provider files a request for a hearing within 180 days after notice of the intermediary's final determination under paragraph (1)(A)(i), or with respect to appeals under paragraph (1)(A)(ii), 180 days after notice of the Secretary's final determination, or with respect to appeals pursuant to paragraph (1) (B) or (C), within 180 days after notice of such determination would have been received if such determination had been made on a timely basis.
(b) Appeals by groups
The provisions of subsection (a) of this section shall apply to any group of providers of services if each provider of services in such group would, upon the filing of an appeal (but without regard to the $10,000 limitation), be entitled to such a hearing, but only if the matters in controversy involve a common question of fact or interpretation of law or regulations and the amount in controversy is, in the aggregate, $50,000 or more.
(c) Right to counsel; rules of evidence
At such hearing, the provider of services shall have the right to be represented by counsel, to introduce evidence, and to examine and cross-examine witnesses. Evidence may be received at any such hearing even though inadmissible under rules of evidence applicable to court procedure.
(d) Decisions of Board
A decision by the Board shall be based upon the record made at such hearing, which shall include the evidence considered by the intermediary and such other evidence as may be obtained or received by the Board, and shall be supported by substantial evidence when the record is viewed as a whole. The Board shall have the power to affirm, modify, or reverse a final determination of the fiscal intermediary with respect to a cost report and to make any other revisions on matters covered by such cost report (including revisions adverse to the provider of services) even though such matters were not considered by the intermediary in making such final determination.
(e) Rules and regulations
The Board shall have full power and authority to make rules and establish procedures, not inconsistent with the provisions of this subchapter or regulations of the Secretary, which are necessary or appropriate to carry out the provisions of this section. In the course of any hearing the Board may administer oaths and affirmations. The provisions of subsections (d) and (e) of
(f) Finality of decision; judicial review; determinations of Board authority; jurisdiction; venue; interest on amount in controversy
(1) A decision of the Board shall be final unless the Secretary, on his own motion, and within 60 days after the provider of services is notified of the Board's decision, reverses, affirms, or modifies the Board's decision. Providers shall have the right to obtain judicial review of any final decision of the Board, or of any reversal, affirmance, or modification by the Secretary, by a civil action commenced within 60 days of the date on which notice of any final decision by the Board or of any reversal, affirmance, or modification by the Secretary is received. Providers shall also have the right to obtain judicial review of any action of the fiscal intermediary which involves a question of law or regulations relevant to the matters in controversy whenever the Board determines (on its own motion or at the request of a provider of services as described in the following sentence) that it is without authority to decide the question, by a civil action commenced within sixty days of the date on which notification of such determination is received. If a provider of services may obtain a hearing under subsection (a) of this section and has filed a request for such a hearing, such provider may file a request for a determination by the Board of its authority to decide the question of law or regulations relevant to the matters in controversy (accompanied by such documents and materials as the Board shall require for purposes of rendering such determination). The Board shall render such determination in writing within thirty days after the Board receives the request and such accompanying documents and materials, and the determination shall be considered a final decision and not subject to review by the Secretary. If the Board fails to render such determination within such period, the provider may bring a civil action (within sixty days of the end of such period) with respect to the matter in controversy contained in such request for a hearing. Such action shall be brought in the district court of the United States for the judicial district in which the provider is located (or, in an action brought jointly by several providers, the judicial district in which the greatest number of such providers are located) or in the District Court for the District of Columbia and shall be tried pursuant to the applicable provisions under
(2) Where a provider seeks judicial review pursuant to paragraph (1), the amount in controversy shall be subject to annual interest beginning on the first day of the first month beginning after the 180-day period as determined pursuant to subsection (a)(3) of this section and equal to the rate of interest on obligations issued for purchase by the Federal Hospital Insurance Trust Fund for the month in which the civil action authorized under paragraph (1) is commenced, to be awarded by the reviewing court in favor of the prevailing party.
(3) No interest awarded pursuant to paragraph (2) shall be deemed income or cost for the purposes of determining reimbursement due providers under this chapter.
(g) Certain findings not reviewable
(1) The finding of a fiscal intermediary that no payment may be made under this subchapter for any expenses incurred for items or services furnished to an individual because such items or services are listed in
(2) The determinations and other decisions described in
(h) Composition and compensation
The Board shall be composed of five members appointed by the Secretary without regard to the provisions of title 5 governing appointments in the competitive services. Two of such members shall be representative of providers of services. All of the members of the Board shall be persons knowledgeable in the field of payment of providers of services, and at least one of them shall be a certified public accountant. Members of the Board shall be entitled to receive compensation at rates fixed by the Secretary, but not exceeding the rate specified (at the time the service involved is rendered by such members) for grade GS–18 in
(i) Technical and clerical assistance
The Board is authorized to engage such technical assistance as may be required to carry out its functions, and the Secretary shall, in addition, make available to the Board such secretarial, clerical, and other assistance as the Board may require to carry out its functions.
(j) "Provider of services" defined
In this section, the term "provider of services" includes a rural health clinic and a Federally qualified health center.
(Aug. 14, 1935, ch. 531, title XVIII, §1878, as added Oct. 30, 1972,
References in Text
The provisions of title 5 governing appointments in the competitive service, referred to in subsec. (h), are classified to
Amendments
1993—Subsec. (f)(2).
1990—Subsec. (j).
1984—Subsec. (c).
Subsec. (e).
Subsec. (f)(1).
1983—Subsec. (a).
Subsec. (a)(1)(A).
Subsec. (a)(3).
Subsec. (f)(1).
Subsec. (g).
Subsec. (h).
1980—Subsec. (f)(1).
1974—Subsec. (f).
Effective Date of 1993 Amendment
Amendment by
Effective Date of 1990 Amendment
Amendment by section 4161(a)(6) of
Amendment by section 4161(b)(4) of
Effective Date of 1984 Amendment
Section 2351(a)(2) of
Section 2351(b)(2) of
Amendment by section 2354(b)(39), (40) of
Effective Date of 1983 Amendment
Amendment by
Effective Date of 1974 Amendment
Section 3(b) of
Effective Date
Section 243(c) of
References in Other Laws to GS–16, 17, or 18 Pay Rates
References in laws to the rates of pay for GS–16, 17, or 18, or to maximum rates of pay under the General Schedule, to be considered references to rates payable under specified sections of Title 5, Government Organization and Employees, see section 529 [title I, §101(c)(1)] of
Review of Provider Reimbursement Review Board Decisions
Section 2351(c) of
"(1) the amendments made by section 602(h)(2)(A) of that Act [amending this section] shall be effective with respect to any appeal or action brought on or after April 20, 1983; and
"(2) the amendments made by section 602(h)(2)(B) of that Act [amending this section] shall be effective with respect to any appeal or action brought on or after the date of the enactment of this Act [July 18, 1984]."
Section Referred to in Other Sections
This section is referred to in
§1395pp. Limitation on liability where claims are disallowed
(a) Conditions prerequisite to payment for items and services notwithstanding determination of disallowance
Where—
(1) a determination is made that, by reason of section 1395y(a)(1) or (9) of this title or by reason of a coverage denial described in subsection (g) of this section, payment may not be made under part A or part B of this subchapter for any expenses incurred for items or services furnished an individual by a provider of services or by another person pursuant to an assignment under
(2) both such individual and such provider of services or such other person, as the case may be, did not know, and could not reasonably have been expected to know, that payment would not be made for such items or services under such part A or part B of this subchapter,
then to the extent permitted by this subchapter, payment shall, notwithstanding such determination, be made for such items or services (and for such period of time as the Secretary finds will carry out the objectives of this subchapter), as though section 1395y(a)(1) and
(b) Knowledge of person or provider that payment could not be made; indemnification of individual
In any case in which the provisions of paragraphs (1) and (2) of subsection (a) of this section are met, except that such provider or such other person, as the case may be, knew, or could be expected to know, that payment for such services or items could not be made under such part A or part B of this subchapter, then the Secretary shall, upon proper application filed within such time as may be prescribed in regulations, indemnify the individual (referred to in such paragraphs) for any payments received from such individual by such provider or such other person, as the case may be, for such items or services. Any payments made by the Secretary as indemnification shall be deemed to have been made to such provider or such other person, as the case may be, and shall be treated as overpayments, recoverable from such provider or such other person, as the case may be, under applicable provisions of law. In each such case the Secretary shall notify such individual of the conditions under which indemnification is made and in the case of comparable situations arising thereafter with respect to such individual, he shall, by reason of such notice (or similar notices provided before the enactment of this section), be deemed to have knowledge that payment cannot be made for such items or services. No item or service for which an individual is indemnified under this subsection shall be taken into account in applying any limitation on the amount of items and services for which payment may be made to or on behalf of the individual under this subchapter.
(c) Knowledge of both provider and individual to whom items or services were furnished that payment could not be made
No payments shall be made under this subchapter in any cases in which the provisions of paragraph (1) of subsection (a) of this section are met, but both the individual to whom the items or services were furnished and the provider of service or other person, as the case may be, who furnished the items or services knew, or could reasonably have been expected to know, that payment could not be made for items or services under part A or part B of this subchapter by reason of section 1395y(a)(1) or (a)(9) of this title or by reason of a coverage denial described in subsection (g) of this section.
(d) Exercise of rights
In any case arising under subsection (b) of this section (but without regard to whether payments have been made by the individual to the provider or other person) or subsection (c) of this section, the provider or other person shall have the same rights that an individual has under
(e) Payment where beneficiary not at fault
Where payment for inpatient hospital services or extended care services may not be made under part A of this subchapter on behalf of an individual entitled to benefits under such part solely because of an unintentional, inadvertent, or erroneous action with respect to the transfer of such individual from a hospital or skilled nursing facility that meets the requirements of section 1395x(e) or (j) of this title by such a provider of services acting in good faith in accordance with the advice of a utilization review committee, quality control and peer review organization, or fiscal intermediary, or on the basis of a clearly erroneous administrative decision by a provider of services, the Secretary shall take such action with respect to the payment of such benefits as he determines may be necessary to correct the effects of such unintentional, inadvertent, or erroneous action.
(f) Presumption with respect to coverage denial; rebuttal; requirements; "fiscal intermediary" defined
(1) A home health agency which meets the applicable requirements of paragraphs (3) and (4) shall be presumed to meet the requirement of subsection (a)(2) of this section.
(2) The presumption of paragraph (1) with respect to specific services may be rebutted by actual or imputed knowledge of the facts described in subsection (a)(2) of this section, including any of the following:
(A) Notice by the fiscal intermediary of the fact that payment may not be made under this subchapter with respect to the services.
(B) It is clear and obvious that the provider should have known at the time the services were furnished that they were excluded from coverage.
(3) The requirements of this paragraph are as follows:
(A) The agency complies with requirements of the Secretary under this subchapter respecting timely submittal of bills for payment and medical documentation.
(B) The agency program has reasonable procedures to notify promptly each patient (and the patient's physician) where it is determined that a patient is being or will be furnished items or services which are excluded from coverage under this subchapter.
(4)(A) The requirement of this paragraph is that, on the basis of bills submitted by a home health agency during the previous quarter, the rate of denial of bills for the agency by reason of a coverage denial described in subsection (g) of this section does not exceed 2.5 percent, computed based on visits for home health services billed.
(B) For purposes of determining the rate of denial of bills for a home health agency under subparagraph (A), a bill shall not be considered to be denied until the expiration of the 60-day period that begins on the date such bill is denied by the fiscal intermediary, or, with respect to such a denial for which the agency requests reconsideration, until the fiscal intermediary issues a decision denying payment for such bill.
(5) In this subsection, the term "fiscal intermediary" means, with respect to a home health agency, an agency or organization with an agreement under
(6) The Secretary shall monitor the proportion of denied bills submitted by home health agencies for which reconsideration is requested, and shall notify Congress if the proportion of denials reversed upon reconsideration increases significantly.
(g) Coverage denial defined
The coverage denial described in this subsection is, with respect to the provision of home health services to an individual, a failure to meet the requirements of
(1) is or was not confined to his home, or
(2) does or did not need skilled nursing care on an intermittent basis.
(h) Supplier responsibility for items furnished on assignment basis
If a supplier of medical equipment and supplies (as defined in
(1) furnishes an item or service to a beneficiary for which no payment may be made by reason of
(2) furnishes an item or service to a beneficiary for which payment is denied in advance under
(3) furnishes an item or service to a beneficiary for which no payment may be made by reason of
any expenses incurred for items and services furnished to an individual by such a supplier on an assignment-related basis shall be the responsibility of such supplier. The individual shall have no financial responsibility for such expenses and the supplier shall refund on a timely basis to the individual (and shall be liable to the individual for) any amounts collected from the individual for such items or services. The provisions of
(Aug. 14, 1935, ch. 531, title XVIII, §1879, as added Oct. 30, 1972,
References in Text
Parts A and B of this subchapter, referred to in text, are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Amendments
1994—Subsec. (h).
1989—Subsec. (f)(1).
Subsec. (f)(4).
Subsec. (f)(6).
1987—Subsec. (b).
1986—Subsec. (a).
Subsec. (c).
Subsec. (d).
Subsecs. (f), (g).
1982—Subsec. (a).
Subsec. (e).
1980—Subsec. (e).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1989 Amendment
Section 6214(c) of
Effective Date of 1987 Amendment
Amendment by
Effective Date of 1986 Amendment
Section 9305(g)(3) of
Amendment by section 9341(a)(3) of
Effective Date of 1982 Amendment
Amendment by
Effective Date of 1980 Amendment
Section 956(b) of
Effective Date
Section 213(b) of
Reports to Congress on Denials of Bills for Payment
Section 9305(g)(2) of
Section Referred to in Other Sections
This section is referred to in
§1395qq. Indian health service facilities
(a) Eligibility for payments; conditions and requirements
A hospital or skilled nursing facility of the Indian Health Service, whether operated by such Service or by an Indian tribe or tribal organization (as those terms are defined in
(b) Eligibility based on submission of plan to achieve compliance with conditions and requirements; twelve-month period
Notwithstanding subsection (a) of this section, a hospital or skilled nursing facility of the Indian Health Service which does not meet all of the conditions and requirements of this subchapter which are applicable generally to hospitals or skilled nursing facilities (as the case may be), but which submits to the Secretary within six months after September 30, 1976, an acceptable plan for achieving compliance with such conditions and requirements, shall be deemed to meet such conditions and requirements (and to be eligible for payments under this subchapter), without regard to the extent of its actual compliance with such conditions and requirements, during the first 12 months after the month in which such plan is submitted.
(c) Payments into special fund for improvements to achieve compliance with conditions and requirements; certification of compliance by Secretary
Notwithstanding any other provision of this subchapter, payments to which any hospital or skilled nursing facility of the Indian Health Service is entitled by reason of this section shall be placed in a special fund to be held by the Secretary and used by him (to such extent or in such amounts as are provided in appropriation Acts) exclusively for the purpose of making any improvements in the hospitals and skilled nursing facilities of such Service which may be necessary to achieve compliance with the applicable conditions and requirements of this subchapter. The preceding sentence shall cease to apply when the Secretary determines and certifies that substantially all of the hospitals and skilled nursing facilities of such Service in the United States are in compliance with such conditions and requirements.
(d) Report by Secretary; status of facilities in complying with conditions and requirements
The annual report of the Secretary which is required by
(Aug. 14, 1935, ch. 531, title XVIII, §1880, as added Sept. 30, 1976,
Amendments
1992—Subsec. (d).
Demonstration Program for Direct Billing of Medicare, Medicaid, and Other Third Party Payors
Medicare Payments Not Considered in Determining Appropriations for Indian Health Care
Section 401(c) of
Preference in Services for Indians With Medicare Coverage Not Authorized
Section 401(d) of
Section Referred to in Other Sections
This section is referred to in
§1395rr. End stage renal disease program
(a) Type, duration, and scope of benefits
The benefits provided by parts A and B of this subchapter shall include benefits for individuals who have been determined to have end stage renal disease as provided in
(b) Payments with respect to services; dialysis; regulations; physicians' services; target reimbursement rates; home dialysis supplies and equipment; self-care home dialysis support services; self-care dialysis units; hepatitis B vaccine
(1) Payments under this subchapter with respect to services, in addition to services for which payment would otherwise be made under this subchapter, furnished to individuals who have been determined to have end stage renal disease shall include (A) payments on behalf of such individuals to providers of services and renal dialysis facilities which meet such requirements as the Secretary shall by regulation prescribe for institutional dialysis services and supplies (including self-dialysis services in a self-care dialysis unit maintained by the provider or facility), transplantation services, self-care home dialysis support services which are furnished by the provider or facility, and routine professional services performed by a physician during a maintenance dialysis episode if payments for his other professional services furnished to an individual who has end stage renal disease are made on the basis specified in paragraph (3)(A) of this subsection, (B) payments to or on behalf of such individuals for home dialysis supplies and equipment, and (C) payments to a supplier of home dialysis supplies and equipment that is not a provider of services, a renal dialysis facility, or a physician for self-administered erythropoietin as described in section 1395x(s)(2)(P) 1 of this title if the Secretary finds that the patient receiving such drug from such a supplier can safely and effectively administer the drug (in accordance with the applicable methods and standards established by the Secretary pursuant to such section). The requirements prescribed by the Secretary under subparagraph (A) shall include requirements for a minimum utilization rate for transplantations.
(2)(A) With respect to payments for dialysis services furnished by providers of services and renal dialysis facilities to individuals determined to have end stage renal disease for which payments may be made under part B of this subchapter, such payments (unless otherwise provided in this section) shall be equal to 80 percent of the amounts determined in accordance with subparagraph (B); and with respect to payments for services for which payments may be made under part A of this subchapter, the amounts of such payments (which amounts shall not exceed, in respect to costs in procuring organs attributable to payments made to an organ procurement agency or histocompatibility laboratory, the costs incurred by that agency or laboratory) shall be determined in accordance with
(B) The Secretary shall prescribe in regulations any methods and procedures to (i) determine the costs incurred by providers of services and renal dialysis facilities in furnishing covered services to individuals determined to have end stage renal disease, and (ii) determine, on a cost-related basis or other economical and equitable basis (including any basis authorized under
(C) Such regulations, in the case of services furnished by proprietary providers and facilities (other than hospital outpatient departments) may include, if the Secretary finds it feasible and appropriate, provision for recognition of a reasonable rate of return on equity capital, providing such rate of return does not exceed the rate of return stipulated in
(D) For purposes of
(3) With respect to payments for physicians' services furnished to individuals determined to have end stage renal disease, the Secretary shall pay 80 percent of the amounts calculated for such services—
(A) on a reasonable charge basis (but may, in such case, make payment on the basis of the prevailing charges of other physicians for comparable services or, for services furnished on or after January 1, 1992, on the basis described in
(B) on a comprehensive monthly fee or other basis (which effectively encourages the efficient delivery of dialysis services and provides incentives for the increased use of home dialysis) for an aggregate of services provided over a period of time (as defined in regulations).
(4)(A) Pursuant to agreements with approved providers of services and renal dialysis facilities, the Secretary may make payments to such providers and facilities for the cost of home dialysis supplies and equipment and self-care home dialysis support services furnished to patients whose self-care home dialysis is under the direct supervision of such provider or facility, on the basis of a target reimbursement rate (as defined in paragraph (6)) or on the basis of a method established under paragraph (7).
(B) The Secretary shall make payments to a supplier of home dialysis supplies and equipment furnished to a patient whose self-care home dialysis is not under the direct supervision of an approved provider of services or renal dialysis facility only in accordance with a written agreement under which—
(i) the patient certifies that the supplier is the sole provider of such supplies and equipment to the patient,
(ii) the supplier agrees to receive payment for the cost of such supplies and equipment only on an assignment-related basis, and
(iii) the supplier certifies that it has entered into a written agreement with an approved provider of services or renal dialysis facility under which such provider or facility agrees to furnish to such patient all self-care home dialysis support services and all other necessary dialysis services and supplies, including institutional dialysis services and supplies and emergency services.
(5) An agreement under paragraph (4) shall require, in accordance with regulations prescribed by the Secretary, that the provider or facility will—
(A) assume full responsibility for directly obtaining or arranging for the provision of—
(i) such medically necessary dialysis equipment as is prescribed by the attending physician;
(ii) dialysis equipment maintenance and repair services;
(iii) the purchase and delivery of all necessary medical supplies; and
(iv) where necessary, the services of trained home dialysis aides;
(B) perform all such administrative functions and maintain such information and records as the Secretary may require to verify the transactions and arrangements described in subparagraph (A);
(C) submit such cost reports, data, and information as the Secretary may require with respect to the costs incurred for equipment, supplies, and services furnished to the facility's home dialysis patient population; and
(D) provide for full access for the Secretary to all such records, data, and information as he may require to perform his functions under this section.
(6) The Secretary shall establish, for each calendar year, commencing with January 1, 1979, a target reimbursement rate for home dialysis which shall be adjusted for regional variations in the cost of providing home dialysis. In establishing such a rate, the Secretary shall include—
(A) the Secretary's estimate of the cost of providing medically necessary home dialysis supplies and equipment;
(B) an allowance, in an amount determined by the Secretary, to cover the cost of providing personnel to aid in home dialysis; and
(C) an allowance, in an amount determined by the Secretary, to cover administrative costs and to provide an incentive for the efficient delivery of home dialysis;
but in no event (except as may be provided in regulations under paragraph (7)) shall such target rate exceed 75 percent of the national average payment, adjusted for regional variations, for maintenance dialysis services furnished in approved providers and facilities during the preceding fiscal year. Any such target rate so established shall be utilized, without renegotiation of the rate, throughout the calendar year for which it is established. During the last quarter of each calendar year, the Secretary shall establish a home dialysis target reimbursement rate for the next calendar year based on the most recent data available to the Secretary at the time. In establishing any rate under this paragraph, the Secretary may utilize a competitive-bid procedure, a prenegotiated rate procedure, or any other procedure (including methods established under paragraph (7)) which the Secretary determines is appropriate and feasible in order to carry out this paragraph in an effective and efficient manner.
(7) The Secretary shall provide by regulation for a method (or methods) for determining prospectively the amounts of payments to be made for dialysis services furnished by providers of services and renal dialysis facilities to individuals in a facility and to such individuals at home. Such method (or methods) shall provide for the prospective determination of a rate (or rates) for each mode of care based on a single composite weighted formula (which takes into account the mix of patients who receive dialysis services at a facility or at home and the relative costs of providing such services in such settings) for hospital-based facilities and such a single composite weighted formula for other renal dialysis facilities, or based on such other method or combination of methods which differentiate between hospital-based facilities and other renal dialysis facilities and which the Secretary determines, after detailed analysis, will more effectively encourage the more efficient delivery of dialysis services and will provide greater incentives for increased use of home dialysis than through the single composite weighted formulas. The amount of a payment made under any method other than a method based on a single composite weighted formula may not exceed the amount (or, in the case of continuous cycling peritoneal dialysis, 130 percent of the amount) of the median payment that would have been made under the formula for hospital-based facilities. The Secretary shall provide for such exceptions to such methods as may be warranted by unusual circumstances (including the special circumstances of sole facilities located in isolated, rural areas and of pediatric facilities). Each application for such an exception shall be deemed to be approved unless the Secretary disapproves it by not later than 60 working days after the date the application is filed. The Secretary may provide that such method will serve in lieu of any target reimbursement rate that would otherwise be established under paragraph (6). The Secretary shall reduce the amount of each composite rate payment under this paragraph for each treatment by 50 cents (subject to such adjustments as may be required to reflect modes of dialysis other than hemodialysis) and provide for payment of such amount to the organizations (designated under subsection (c)(1)(A) of this section) for such organizations' necessary and proper administrative costs incurred in carrying out the responsibilities described in subsection (c)(2) of this section. The Secretary shall provide that amounts paid under the previous sentence shall be distributed to the organizations described in subsection (c)(1)(A) of this section to ensure equitable treatment of all such network organizations. The Secretary in distributing any such payments to network organizations shall take into account—
(A) the geographic size of the network area;
(B) the number of providers of end stage renal disease services in the network area;
(C) the number of individuals who are entitled to end stage renal disease services in the network area; and
(D) the proportion of the aggregate administrative funds collected in the network area.
(8) For purposes of this subchapter, the term "home dialysis supplies and equipment" means medically necessary supplies and equipment (including supportive equipment) required by an individual suffering from end stage renal disease in connection with renal dialysis carried out in his home (as defined in regulations), including obtaining, installing, and maintaining such equipment.
(9) For purposes of this subchapter, the term "self-care home dialysis support services", to the extent permitted in regulation, means—
(A) periodic monitoring of the patient's home adaptation, including visits by qualified provider or facility personnel (as defined in regulations), so long as this is done in accordance with a plan prepared and periodically reviewed by a professional team (as defined in regulations) including the individual's physician;
(B) installation and maintenance of dialysis equipment;
(C) testing and appropriate treatment of the water; and
(D) such additional supportive services as the Secretary finds appropriate and desirable.
(10) For purposes of this subchapter, the term "self-care dialysis unit" means a renal dialysis facility or a distinct part of such facility or of a provider of services, which has been approved by the Secretary to make self-dialysis services, as defined by the Secretary in regulations, available to individuals who have been trained for self-dialysis. A self-care dialysis unit must, at a minimum, furnish the services, equipment and supplies needed for self-care dialysis, have patient-staff ratios which are appropriate to self-dialysis (allowing for such appropriate lesser degree of ongoing medical supervision and assistance of ancillary personnel than is required for full care maintenance dialysis), and meet such other requirements as the Secretary may prescribe with respect to the quality and cost-effectiveness of services.
(11)(A) Hepatitis B vaccine and its administration, when provided to a patient determined to have end stage renal disease, shall not be included as dialysis services for purposes of payment under any prospective payment amount or comprehensive fee established under this section. Payment for such vaccine and its administration shall be made separately in accordance with
(B) Erythropoietin, when provided to a patient determined to have end stage renal disease, shall not be included as a dialysis service for purposes of payment under any prospective payment amount or comprehensive fee established under this section, and payment for such item shall be made separately—
(i) in the case of erythropoietin provided by a physician, in accordance with
(ii) in the case of erythropoietin provided by a provider of services, renal dialysis facility, or other supplier of home dialysis supplies and equipment—
(I) for erythropoietin provided during 1994, in an amount equal to $10 per thousand units (rounded to the nearest 100 units), and
(II) for erythropoietin provided during a subsequent year, in an amount determined to be appropriate by the Secretary, except that such amount may not exceed the amount determined under this clause for the previous year increased by the percentage increase (if any) in the implicit price deflator for gross national product (as published by the Department of Commerce) for the second quarter of the preceding year over the implicit price deflator for the second quarter of the second preceding year.
(C) The amount payable to a supplier of home dialysis supplies and equipment that is not a provider of services, a renal dialysis facility, or a physician for erythropoietin shall be determined in the same manner as the amount payable to a renal dialysis facility for such item.
(c) Renal disease network areas; coordinating councils, executive committees, and medical review boards; national end stage renal disease medical information system; functions of network organizations
(1)(A)(i) For the purpose of assuring effective and efficient administration of the benefits provided under this section, the Secretary shall, in accordance with such criteria as he finds necessary to assure the performance of the responsibilities and functions specified in paragraph (2)—
(I) establish at least 17 end stage renal disease network areas, and
(II) for each such area, designate a network administrative organization which, in accordance with regulations of the Secretary, shall establish (aa) a network council of renal dialysis and transplant facilities located in the area and (bb) a medical review board, which has a membership including at least one patient representative and physicians, nurses, and social workers engaged in treatment relating to end stage renal disease.
The Secretary shall publish in the Federal Register a description of the geographic area that he determines, after consultation with appropriate professional and patient organizations, constitutes each network area and the criteria on the basis of which such determination is made.
(ii)(I) In order to determine whether the Secretary should enter into, continue, or terminate an agreement with a network administrative organization designated for an area established under clause (i), the Secretary shall develop and publish in the Federal Register standards, criteria, and procedures to evaluate an applicant organization's capabilities to perform (and, in the case of an organization with which such an agreement is in effect, actual performance of) the responsibilities described in paragraph (2). The Secretary shall evaluate each applicant based on quality and scope of services and may not accord more than 20 percent of the weight of the evaluation to the element of price.
(II) An agreement with a network administrative organization may be terminated by the Secretary only if he finds, after applying such standards and criteria, that the organization has failed to perform its prescribed responsibilities effectively and efficiently. If such an agreement is to be terminated, the Secretary shall select a successor to the agreement on the basis of competitive bidding and in a manner that provides an orderly transition.
(B) At least one patient representative shall serve as a member of each network council and each medical review board.
(C) The Secretary shall, in regulations, prescribe requirements with respect to membership in network organizations by individuals (and the relatives of such individuals) (i) who have an ownership or control interest in a facility or provider which furnishes services referred to in
(2) The network organizations of each network shall be responsible, in addition to such other duties and functions as may be prescribed by the Secretary, for—
(A) encouraging, consistent with sound medical practice, the use of those treatment settings most compatible with the successful rehabilitation of the patient and the participation of patients, providers of services, and renal disease facilities in vocational rehabilitation programs;
(B) developing criteria and standards relating to the quality and appropriateness of patient care and with respect to working with patients, facilities, and providers in encouraging participation in vocational rehabilitation programs; and network goals with respect to the placement of patients in self-care settings and undergoing or preparing for transplantation;
(C) evaluating the procedure by which facilities and providers in the network assess the appropriateness of patients for proposed treatment modalities;
(D) implementing a procedure for evaluating and resolving patient grievances;
(E) conducting on-site reviews of facilities and providers as necessary (as determined by a medical review board or the Secretary), utilizing standards of care established by the network organization to assure proper medical care;
(F) collecting, validating, and analyzing such data as are necessary to prepare the reports required by subparagraph (H) and to assure the maintenance of the registry established under paragraph (7);
(G) identifying facilities and providers that are not cooperating toward meeting network goals and assisting such facilities and providers in developing appropriate plans for correction and reporting to the Secretary on facilities and providers that are not providing appropriate medical care; and
(H) submitting an annual report to the Secretary on July 1 of each year which shall include a full statement of the network's goals, data on the network's performance in meeting its goals (including data on the comparative performance of facilities and providers with respect to the identification and placement of suitable candidates in self-care settings and transplantation and encouraging participation in vocational rehabilitation programs), identification of those facilities that have consistently failed to cooperate with network goals, and recommendations with respect to the need for additional or alternative services or facilities in the network in order to meet the network goals, including self-dialysis training, transplantation, and organ procurement facilities.
(3) Where the Secretary determines, on the basis of the data contained in the network's annual report and such other relevant data as may be available to him, that a facility or provider has consistently failed to cooperate with network plans and goals or to follow the recommendations of the medical review board, he may terminate or withhold certification of such facility or provider (for purposes of payment for services furnished to individuals with end stage renal disease) until he determines that such provider or facility is making reasonable and appropriate efforts to cooperate with the network's plans and goals. If the Secretary determines that the facility's or provider's failure to cooperate with network plans and goals does not jeopardize patient health or safety or justify termination of certification, he may instead, after reasonable notice to the provider or facility and to the public, impose such other sanctions as he determines to be appropriate, which sanctions may include denial of reimbursement with respect to some or all patients admitted to the facility after the date of notice to the facility or provider, and graduated reduction in reimbursement for all patients.
(4) The Secretary shall, in determining whether to certify additional facilities or expansion of existing facilities within a network, take into account the network's goals and performance as reflected in the network's annual report.
(5) The Secretary, after consultation with appropriate professional and planning organizations, shall provide such guidelines with respect to the planning and delivery of renal disease services as are necessary to assist network organizations in their development of their respective networks' goals to promote the optimum use of self-dialysis and transplantation by suitable candidates for such modalities.
(6) It is the intent of the Congress that the maximum practical number of patients who are medically, socially, and psychologically suitable candidates for home dialysis or transplantation should be so treated and that the maximum practical number of patients who are suitable candidates for vocational rehabilitation services be given access to such services and encouraged to return to gainful employment. The Secretary shall consult with appropriate professional and network organizations and consider available evidence relating to developments in research, treatment methods, and technology for home dialysis and transplantation.
(7) The Secretary shall establish a national end stage renal disease registry the purpose of which shall be to assemble and analyze the data reported by network organizations, transplant centers, and other sources on all end stage renal disease patients in a manner that will permit—
(A) the preparation of the annual report to the Congress required under subsection (g) of this section;
(B) an identification of the economic impact, cost-effectiveness, and medical efficacy of alternative modalities of treatment;
(C) an evaluation with respect to the most appropriate allocation of resources for the treatment and research into the cause of end stage renal disease;
(D) the determination of patient mortality and morbidity rates, and trends in such rates, and other indices of quality of care; and
(E) such other analyses relating to the treatment and management of end stage renal disease as will assist the Congress in evaluating the end stage renal disease program under this section.
The Secretary shall provide for such coordination of data collection activities, and such consolidation of existing end stage renal disease data systems, as is necessary to achieve the purpose of such registry, shall determine the appropriate location of the registry, and shall provide for the appointment of a professional advisory group to assist the Secretary in the formulation of policies and procedures relevant to the management of such registry.
(8) The provisions of
(d) Donors of kidney for transplant surgery
Notwithstanding any provision to the contrary in
(e) Reimbursement of providers, facilities, and nonprofit entities for costs of artificial kidney and automated dialysis peritoneal machines for home dialysis
(1) Notwithstanding any other provision of this subchapter, the Secretary may, pursuant to agreements with approved providers of services, renal dialysis facilities, and nonprofit entities which the Secretary finds can furnish equipment economically and efficiently, reimburse such providers, facilities, and nonprofit entities (without regard to the deductible and coinsurance provisions of this subchapter) for the reasonable cost of the purchase, installation, maintenance and reconditioning for subsequent use of artificial kidney and automated dialysis peritoneal machines (including supportive equipment) which are to be used exclusively by entitled individuals dialyzing at home.
(2) An agreement under this subsection shall require that the provider, facility, or other entity will—
(A) make the equipment available for use only by entitled individuals dialyzing at home;
(B) recondition the equipment, as needed, for reuse by such individuals throughout the useful life of the equipment, including modification of the equipment consistent with advances in research and technology;
(C) provide for full access for the Secretary to all records and information relating to the purchase, maintenance, and use of the equipment; and
(D) submit such reports, data, and information as the Secretary may require with respect to the cost, management, and use of the equipment.
(3) For purposes of this section, the term "supportive equipment" includes blood pumps, heparin pumps, bubble detectors, other alarm systems, and such other items as the Secretary may determine are medically necessary.
(f) Experiments, studies, and pilot projects
(1) The Secretary shall initiate and carry out, at selected locations in the United States, pilot projects under which financial assistance in the purchase of new or used durable medical equipment for renal dialysis is provided to individuals suffering from end stage renal disease at the time home dialysis is begun, with provision for a trial period to assure successful adaptation to home dialysis before the actual purchase of such equipment.
(2) The Secretary shall conduct experiments to evaluate methods for reducing the costs of the end stage renal disease program. Such experiments shall include (without being limited to) reimbursement for nurses and dialysis technicians to assist with home dialysis, and reimbursement to family members assisting with home dialysis.
(3) The Secretary shall conduct experiments to evaluate methods of dietary control for reducing the costs of the end stage renal disease program, including (without being limited to) the use of protein-controlled products to delay the necessity for, or reduce the frequency of, dialysis in the treatment of end stage renal disease.
(4) The Secretary shall conduct a comprehensive study of methods for increasing public participation in kidney donation and other organ donation programs.
(5) The Secretary shall conduct a full and complete study of the reimbursement of physicians for services furnished to patients with end stage renal disease under this subchapter, giving particular attention to the range of payments to physicians for such services, the average amounts of such payments, and the number of hours devoted to furnishing such services to patients at home, in renal disease facilities, in hospitals, and elsewhere.
(6) The Secretary shall conduct a study of the number of patients with end stage renal disease who are not eligible for benefits with respect to such disease under this subchapter (by reason of this section or otherwise), and of the economic impact of such noneligibility of such individuals. Such study shall include consideration of mechanisms whereby governmental and other health plans might be instituted or modified to permit the purchase of actuarially sound coverage for the costs of end stage renal disease.
(7)(A) The Secretary shall establish protocols on standards and conditions for the reuse of dialyzer filters for those facilities and providers which voluntarily elect to reuse such filters.
(B) With respect to dialysis services furnished on or after January 1, 1988 (or July 1, 1988, with respect to protocols that relate to the reuse of bloodlines), no dialysis facility may reuse dialysis supplies (other than dialyzer filters) unless the Secretary has established a protocol with respect to the reuse of such supplies and the facility follows the protocol so established.
(C) The Secretary shall incorporate protocols established under this paragraph, and the requirement of subparagraph (B), into the requirements for facilities prescribed under subsection (b)(1)(A) of this section and failure to follow such a protocol or requirement subjects such a facility to denial of participation in the program established under this section and to denial of payment for dialysis treatment not furnished in compliance with such a protocol or in violation of such requirement.
(8) The Secretary shall submit to the Congress no later than October 1, 1979, a full report on the experiments conducted under paragraphs (1), (2), (3), and (7), and the studies under paragraphs (4), (5), (6), and (7). Such report shall include any recommendations for legislative changes which the Secretary finds necessary or desirable as a result of such experiments and studies.
(g) Conditional approval of dialysis facilities; restriction-of-payments notice to public and facility; notice and hearing; judicial review
(1) In any case where the Secretary—
(A) finds that a renal dialysis facility is not in substantial compliance with requirements for such facilities prescribed under subsection (b)(1)(A) of this section,
(B) finds that the facility's deficiencies do not immediately jeopardize the health and safety of patients, and
(C) has given the facility a reasonable opportunity to correct its deficiencies,
the Secretary may, in lieu of terminating approval of the facility, determine that payment under this subchapter shall be made to the facility only for services furnished to individuals who were patients of the facility before the effective date of the notice.
(2) The Secretary's decision to restrict payments under this subsection shall be made effective only after such notice to the public and to the facility as may be prescribed in regulations, and shall remain in effect until (A) the Secretary finds that the facility is in substantial compliance with the requirements under subsection (b)(1)(A) of this section, or (B) the Secretary terminates the agreement under this subchapter with the facility.
(3) A facility dissatisfied with a determination by the Secretary under paragraph (1) shall be entitled to a hearing thereon by the Secretary (after reasonable notice) to the same extent as is provided in
(Aug. 14, 1935, ch. 531, title XVIII, §1881, as added June 13, 1978,
References in Text
Amendments
1994—Subsec. (g)(3).
1993—Subsec. (b)(1)(C).
Subsec. (b)(11)(B)(ii)(I).
1990—Subsec. (b)(1).
Subsec. (b)(11).
1989—Subsec. (b)(3)(A).
Subsec. (b)(4).
Subsec. (b)(7).
Subsec. (c)(8).
1987—Subsec. (b)(1).
Subsec. (b)(2)(C).
Subsec. (c)(2)(F).
Subsec. (c)(6).
Subsec. (f)(7)(B).
Subsec. (g).
Subsec. (h).
1986—Subsec. (b)(7).
Subsec. (c)(1)(A).
Subsec. (c)(1)(B).
Subsec. (c)(2)(A).
Subsec. (c)(2)(B).
Subsec. (c)(2)(D) to (F).
Subsec. (c)(2)(G).
Subsec. (c)(2)(H).
Subsec. (c)(3).
Subsec. (c)(6).
Subsec. (c)(7).
Subsec. (f)(7).
1984—Subsecs. (a), (b)(1), (2)(A), (B), (3), (8).
Subsec. (b)(11).
Subsec. (c)(3).
1983—Subsec. (b)(2)(A).
1981—Subsec. (b)(2)(B).
Subsec. (b)(3)(B).
Subsec. (b)(4).
Subsec. (b)(6).
Subsec. (b)(7) to (10).
1980—Subsec. (e)(1).
Subsec. (e)(2).
Subsec. (g).
Effective Date of 1994 Amendment
Amendment by
Effective Date of 1993 Amendment
Amendment by
Effective Date of 1990 Amendment
Section 4201(c)(2) of
Amendment by section 4201(d)(2) of
Effective Date of 1989 Amendment
Section 6203(b)(3) of
Effective Date of 1987 Amendments
Amendment by section 4065(b) of
Amendment by
Effective Date of 1986 Amendment
Section 9335(a)(3) of
Section 9335(j)(2) of
[Section 4085(i)(21) of
Section 9335(l) of
Effective Date of 1984 Amendments
Amendment by
Amendment by section 2323(c) of
Section 2352(b) of
Amendment by section 2354(b)(41) of
Effective Date of 1983 Amendment
Amendment by
Effective Date of 1981 Amendment
Section 2145(b) of
Effective Date
Section effective with respect to services, supplies, and equipment furnished after the third calendar month beginning after June 13, 1978, except that provisions for the implementation of an incentive reimbursement system for dialysis services furnished in facilities and providers to become effective with respect to a facility's or provider's first accounting period beginning after the last day of the twelfth month following the month of June 1978, and except that provisions for reimbursement rates for home dialysis to become effective on Apr. 1, 1979, see section 6 of
PROPAC Study on ESRD Composite Rates
Section 4201(b) of
"(1)
"(A)
"(B)
"(i) hemodialysis and other modalities of treatment,
"(ii) the appropriate services to be included in such payments,
"(iii) the adjustment factors to be incorporated including facility characteristics, such as hospital versus free-standing facilities, urban versus rural, size and mix of services,
"(iv) adjustments for labor and nonlabor costs,
"(v) comparative profit margins for all types of renal dialysis providers of service and renal dialysis facilities,
"(vi) adjustments for patient complexity, such as age, diagnosis, case mix, and pediatric services, and
"(vii) efficient costs related to high quality of care and positive outcomes for all treatment modalities.
"(2)
"(3)
Staff-Assisted Home Dialysis Demonstration Project
Section 4202 of
"(a)
"(1)
"(2)
"(b)
"(1)
"(A)
"(B)
"(i) technical assistance with the operation of a hemodialysis machine in the patient's home and with such patient's care during in-home hemodialysis; and
"(ii) administration of medications within the patient's home to maintain the patency of the extra corporeal circuit.
"(2)
"(A)
"(B)
"(I) the rate determined under clause (ii) with respect to a provider of services or a renal dialysis facility; and
"(II) the factor by which the labor portion of the composite rate determined under section 1881(b)(7) of the Social Security Act [subsec. (b)(7) of this section] is adjusted for differences in area wage levels.
"(ii) The rate determined under this clause, with respect to a provider of services or renal dialysis facility, shall be equal to the difference between—
"(I) two-thirds of the labor portion of the composite rate applicable under section 1881(b)(7) of such Act to the provider or facility, and
"(II) the product of the national median hourly wage for a home hemodialysis staff assistant and the national median time expended in the provision of home hemodialysis staff assistant services (taking into account time expended in travel and predialysis patient care).
"(iii) For purposes of clause (ii)(II)—
"(I) the national median hourly wage for a home hemodialysis staff assistant and the national median average time expended for home hemodialysis staff assistant services shall be determined annually on the basis of the most recent data available, and
"(II) the national median hourly wage for a home hemodialysis staff assistant shall be the sum of 65 percent of the national median hourly wage for a licensed practical nurse and 35 percent of the national median hourly wage for a registered nurse.
"(C)
"(c)
"(1)
"(A) the individual is not a resident of a nursing facility;
"(B) the individual is an end stage renal disease patient entitled to benefits under title XVIII of the Social Security Act [this subchapter];
"(C) the individual's physician certifies that the individual is confined to a bed or wheelchair and cannot transfer themselves [sic] from a bed to a chair;
"(D) the individual has a serious medical condition (as specified by the Secretary) which would be exacerbated by travel to and from a dialysis facility;
"(E) the individual is eligible for ambulance transportation to receive routine maintenance dialysis treatments, and, based on the individual's medical condition, there is reasonable expectation that such transportation will be used by the individual for a period of at least 6 consecutive months, such that the cost of ambulance transportation can reasonably be expected to meet or exceed the cost of home hemodialysis staff assistance as provided under subsection (b)(2); and
"(F) no family member or other individual is available to provide such assistance to the individual.
"(2)
"(3)
"(d)
"(1) meets minimum qualifications as specified by the Secretary; and
"(2) meets any applicable qualifications as specified under the law of the State in which the home hemodialysis staff assistant is providing services.
"(e)
"(1)
"(2)
"(f)
"(1) For fiscal year 1991, $4,000,000.
"(2) For fiscal year 1992, $4,000,000.
"(3) For fiscal year 1993, $3,000,000.
"(4) For fiscal year 1994, $2,000,000.
"(5) For fiscal year 1995, $1,000,000."
Studies of End-Stage Renal Disease Program
Section 4036(d)(1)–(4) of
"(1) The Secretary of Health and Human Services (in this subsection referred to as the 'Secretary') shall arrange for a study of the end-stage renal disease program within the medicare program.
"(2) Among other items, the study shall address—
"(A) access to treatment by both individuals eligible for medicare benefits and those not eligible for such benefits;
"(B) the quality of care provided to end-stage renal disease beneficiaries, as measured by clinical indicators, functional status of patients, and patient satisfaction;
"(C) the effect of reimbursement on quality of treatment;
"(D) major epidemiological and demographic changes in the end-stage renal disease population that may affect access to treatment, the quality of care, or the resource requirements of the program; and
"(E) the adequacy of existing data systems to monitor these matters on a continuing basis.
"(3) The Secretary shall submit to Congress, not later than 3 years after the date of the enactment of this Act [Dec. 22, 1987], a report on the study.
"(4) The Secretary shall request the National Academy of Sciences, acting through the Institute of Medicine, to submit an application to conduct the study described in this section. If the Academy submits an acceptable application, the Secretary shall enter into an appropriate arrangement with the Academy for the conduct of the study. If the Academy does not submit an acceptable application to conduct the study, the Secretary may request one or more appropriate nonprofit private entities to submit an application to conduct the study and may enter into an appropriate arrangement for the conduct of the study by the entity which submits the best acceptable application."
Rates for Dialysis Services
Section 9335(a)(1) of
[Section 6203(a)(2) of
Study and Report on Medicare Payment Rate Reductions for Patients With End Stage Renal Disease
Section 9335(b) of
Deadline for Establishing New End Stage Renal Disease Network Areas; Transition
Section 9335(d)(2), (3) of
"(2)
"(3)
Report on Establishment of National End Stage Renal Disease Registry
Section 9335(i)(2) of
Deadline for Establishment of Protocols on Reuse of Dialyzer Filters
Section 9335(k)(2) of
[Section 4036(c)(1)(B) of
Limitation on Merger of End Stage Renal Disease Networks
Section Referred to in Other Sections
This section is referred to in
1 See References in Text note below.
§1395ss. Certification of medicare supplemental health insurance policies
(a) Submission of policy by insurer
(1) The Secretary shall establish a procedure whereby medicare supplemental policies (as defined in subsection (g)(1) of this section) may be certified by the Secretary as meeting minimum standards and requirements set forth in subsection (c) of this section. Such procedure shall provide an opportunity for any insurer to submit any such policy, and such additional data as the Secretary finds necessary, to the Secretary for his examination and for his certification thereof as meeting the standards and requirements set forth in subsection (c) of this section. Subject to subsections (k)(3), (m), and (n) of this section, such certification shall remain in effect if the insurer files a notarized statement with the Secretary no later than June 30 of each year stating that the policy continues to meet such standards and requirements and if the insurer submits such additional data as the Secretary finds necessary to independently verify the accuracy of such notarized statement. Where the Secretary determines such a policy meets (or continues to meet) such standards and requirements, he shall authorize the insurer to have printed on such policy (but only in accordance with such requirements and conditions as the Secretary may prescribe) an emblem which the Secretary shall cause to be designed for use as an indication that a policy has received the Secretary's certification. The Secretary shall provide each State commissioner or superintendent of insurance with a list of all the policies which have received his certification.
(2) No medicare supplemental policy may be issued in a State on or after the date specified in subsection (p)(1)(C) of this section unless—
(A) the State's regulatory program under subsection (b)(1) of this section provides for the application and enforcement of the standards and requirements set forth in such subsection (including the 1991 NAIC Model Regulation or 1991 Federal Regulation (as the case may be)) by the date specified in subsection (p)(1)(C) of this section; or
(B) if the State's program does not provide for the application and enforcement of such standards and requirements, the policy has been certified by the Secretary under paragraph (1) as meeting the standards and requirements set forth in subsection (c) of this section (including such applicable standards) by such date.
Any person who issues a medicare supplemental policy, on and after the effective date specified in subsection (p)(1)(C) of this section, in violation of this paragraph is subject to a civil money penalty of not to exceed $25,000 for each such violation. The provisions of
(b) Standards and requirements; periodic review by Secretary
(1) Any medicare supplemental policy issued in any State which the Secretary determines has established under State law a regulatory program that—
(A) provides for the application and enforcement of standards with respect to such policies equal to or more stringent than the NAIC Model Standards (as defined in subsection (g)(2)(A) of this section), except as otherwise provided by subparagraph (H);
(B) includes requirements equal to or more stringent than the requirements described in paragraphs (2) through (5) of subsection (c) of this section;
(C) provides that—
(i) information with respect to the actual ratio of benefits provided to premiums collected under such policies will be reported to the State on forms conforming to those developed by the National Association of Insurance Commissioners for such purpose, or
(ii) such ratios will be monitored under the program in an alternative manner approved by the Secretary, and that a copy of each such policy, the most recent premium for each such policy, and a listing of the ratio of benefits provided to premiums collected for the most recent 3-year period for each such policy issued or sold in the State is maintained and made available to interested persons;
(D) provides for application and enforcement of the standards and requirements described in subparagraphs (A), (B), and (C) to all medicare supplemental policies (as defined in subsection (g)(1) of this section) issued in such State,
(E) provides the Secretary periodically (but at least annually) with a list containing the name and address of the issuer of each such policy and the name and number of each such policy (including an indication of policies that have been previously approved, newly approved, or withdrawn from approval since the previous list was provided),
(F) reports to the Secretary on the implementation and enforcement of standards and requirements of this paragraph at intervals established by the Secretary,
(G) provides for a process for approving or disapproving proposed premium increases with respect to such policies, and establishes a policy for the holding of public hearings prior to approval of a premium increase, and
(H) in the case of a policy that meets the standards under subparagraph (A) except that benefits under the policy are limited to items and services furnished by certain entities (or reduced benefits are provided when items or services are furnished by other entities), provides for the application of requirements equal to or more stringent than the requirements under subsection (t) of this section,
shall be deemed (subject to subsections (k)(3), (m), and (n) of this section, for so long as the Secretary finds that such State regulatory program continues to meet the standards and requirements of this paragraph) to meet the standards and requirements set forth in subsection (c) of this section. Each report required under subparagraph (F) shall include information on loss ratios of policies sold in the State, frequency and types of instances in which policies approved by the State fail to meet the standards and requirements of this paragraph, actions taken by the State to bring such policies into compliance, information regarding State programs implementing consumer protection provisions, and such further information as the Secretary in consultation with the National Association of Insurance Commissioners may specify.
(2) The Secretary periodically shall review State regulatory programs to determine if they continue to meet the standards and requirements specified in paragraph (1). If the Secretary finds that a State regulatory program no longer meets the standards and requirements, before making a final determination, the Secretary shall provide the State an opportunity to adopt such a plan of correction as would permit the State regulatory program to continue to meet such standards and requirements. If the Secretary makes a final determination that the State regulatory program, after such an opportunity, fails to meet such standards and requirements, the program shall no longer be considered to have in operation a program meeting such standards and requirements.
(3) Notwithstanding paragraph (1), a medicare supplemental policy offered in a State shall not be deemed to meet the standards and requirements set forth in subsection (c) of this section, with respect to an advertisement (whether through written, radio, or television medium) used (or, at a State's option, to be used) for the policy in the State, unless the entity issuing the policy provides a copy of each advertisement to the Commissioner of Insurance (or comparable officer identified by the Secretary) of that State for review or approval to the extent it may be required under State law.
(c) Requisite findings
The Secretary shall certify under this section any medicare supplemental policy, or continue certification of such a policy, only if he finds that such policy (or, with respect to paragraph (3) or the requirement described in subsection (s) of this section, the issuer of the policy)—
(1) meets or exceeds (either in a single policy or, in the case of nonprofit hospital and medical service associations, in one or more policies issued in conjunction with one another) the NAIC Model Standards (except as otherwise provided by subsection (t) of this section);
(2) meets the requirements of subsection (r) of this section;
(3)(A) accepts a notice under
(B) where such a notice is received—
(i) provides notice to such physician or supplier and the beneficiary of the payment determination under the policy, and
(ii) provides any payment covered by such policy directly to the participating physician or supplier involved;
(C) provides each enrollee at the time of enrollment a card listing the policy name and number and a single mailing address to which notices under
(D) agrees to pay any user fees established under
(E) provides to the Secretary at least annually, for transmittal to carriers, a single mailing address to which notices under
(4) may, during a period of not less than 30 days after the policy is issued, be returned for a full refund of any premiums paid (without regard to the manner in which the purchase of the policy was solicited); and
(5) meets the applicable requirements of subsections (o) through (t) of this section.
(d) Criminal penalties; civil penalties for certain violations
(1) Whoever knowingly and willfully makes or causes to be made or induces or seeks to induce the making of any false statement or representation of a material fact with respect to the compliance of any policy with the standards and requirements set forth in subsection (c) of this section or in regulations promulgated pursuant to such subsection, or with respect to the use of the emblem designed by the Secretary under subsection (a) of this section, shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such prohibited act.
(2) Whoever falsely assumes or pretends to be acting, or misrepresents in any way that he is acting, under the authority of or in association with, the program of health insurance established by this subchapter, or any Federal agency, for the purpose of selling or attempting to sell insurance, or in such pretended character demands, or obtains money, paper, documents, or anything of value, shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such prohibited act.
(3)(A)(i) It is unlawful for a person to sell or issue to an individual entitled to benefits under part A of this subchapter or enrolled under part B of this subchapter—
(I) a health insurance policy with knowledge that the policy duplicates health benefits to which the individual is otherwise entitled under this subchapter or subchapter XIX of this chapter,
(II) a medicare supplemental policy with knowledge that the individual is entitled to benefits under another medicare supplemental policy, or
(III) a health insurance policy (other than a medicare supplemental policy) with knowledge that the policy duplicates health benefits to which the individual is otherwise entitled, other than benefits to which the individual is entitled under a requirement of State or Federal law.
(ii) Whoever violates clause (i) shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a person other than the issuer of the policy) for each such prohibited act.
(iii) A seller (who is not the issuer of a health insurance policy) shall not be considered to violate clause (i) with respect to the sale of a medicare supplemental policy if the policy is sold in compliance with subparagraph (B).
(B)(i) It is unlawful for a person to issue or sell a medicare supplemental policy to an individual entitled to benefits under part A of this subchapter or enrolled under part B of this subchapter, whether directly, through the mail, or otherwise, unless—
(I) the person obtains from the individual, as part of the application for the issuance or purchase and on a form described in clause (ii), a written statement signed by the individual stating, to the best of the individual's knowledge, what health insurance policies the individual has, from what source, and whether the individual is entitled to any medical assistance under subchapter XIX of this chapter, whether as a qualified medicare beneficiary or otherwise, and
(II) the written statement is accompanied by a written acknowledgment, signed by the seller of the policy, of the request for and receipt of such statement.
(ii) The statement required by clause (i) shall be made on a form that—
(I) states in substance that a medicare-eligible individual does not need more than one medicare supplemental policy,
(II) states in substance that individuals may be eligible for benefits under the State medicaid program under subchapter XIX of this chapter and that such individuals who are entitled to benefits under that program usually do not need a medicare supplemental policy and that benefits and premiums under any such policy shall be suspended upon request of the policyholder during the period (of not longer than 24 months) of entitlement to benefits under such subchapter and may be reinstituted upon loss of such entitlement, and
(III) states that counseling services may be available in the State to provide advice concerning the purchase of medicare supplemental policies and enrollment under the medicaid program and may provide the telephone number for such services.
(iii)(I) Except as provided in subclauses (II) and (III), if the statement required by clause (i) is not obtained or indicates that the individual has a medicare supplemental policy or indicates that the individual is entitled to any medical assistance under subchapter XIX of this chapter, the sale of a medicare supplemental policy shall be considered to be a violation of subparagraph (A).
(II) Subclause (I) shall not apply in the case of an individual who has a medicare supplemental policy, if the individual indicates in writing, as part of the application for purchase, that the policy being purchased replaces such other policy and indicates an intent to terminate the policy being replaced when the new policy becomes effective and the issuer or seller certifies in writing that such policy will not, to the best of the issuer 1 or seller's knowledge, duplicate coverage (taking into account any such replacement).
(III) If the statement required by clause (i) is obtained and indicates that the individual is entitled to any medical assistance under subchapter XIX of this chapter, the sale of the policy is not in violation of clause (i) (insofar as such clause relates to such medical assistance), if (aa) a State medicaid plan under such subchapter pays the premiums for the policy, (bb) in the case of a qualified medicare beneficiary described in
(iv) Whoever issues or sells a medicare supplemental policy in violation of this subparagraph shall be fined under title 18, or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not the issuer of a policy) for each such violation.
(C) Subparagraph (A) shall not apply with respect to (i) the sale or issuance of a group policy or plan of one or more employers or labor organizations, or of the trustees of a fund established by one or more employers or labor organizations (or combination thereof), for employees or former employees (or combination thereof) or for members or former members (or combination thereof) of the labor organizations, (ii) the sale or issuance of a policy or plan described in subparagraph (A)(i)(I) (other than a medicare supplemental policy to an individual entitled to any medical assistance under subchapter XIX of this chapter) under which all the benefits are fully payable directly to or on behalf of the individual without regard to other health benefit coverage of the individual but only if (for policies sold or issued more than 60 days after the date the statements are published or promulgated under subparagraph (D)) there is disclosed in a prominent manner as part of (or together with) the application the applicable statement (specified under subparagraph (D)) of the extent to which benefits payable under the policy or plan duplicate benefits under this subchapter, or (iii) the sale or issuance of a policy or plan described in subparagraph (A)(i)(III) under which all the benefits are fully payable directly to or on behalf of the individual without regard to other health benefit coverage of the individual.
(D)(i) If—
(I) within the 90-day period beginning on October 31, 1994, the National Association of Insurance Commissioners develops (after consultation with consumer and insurance industry representatives) and submits to the Secretary a statement for each of the types of health insurance policies (other than medicare supplemental policies and including, but not limited to, as separate types of policies, policies paying directly to the beneficiary fixed, cash benefits, and policies that limit benefit payments to specific diseases) which are sold or issued to persons entitled to health benefits under this subchapter, of the extent to which benefits payable under the policy or plan duplicate benefits under this subchapter, and
(II) the Secretary approves all the statements submitted as meeting the requirements of subclause (I),
each such statement shall be (for purposes of subparagraph (C)) the statement specified under this subparagraph for the type of policy involved. The Secretary shall review and approve (or disapprove) all the statements submitted under subclause (I) within 30 days after the date of their submittal. Upon approval of such statements, the Secretary shall publish such statements.
(ii) If the Secretary does not approve the statements under clause (i) or the statements are not submitted within the 90-day period specified in such clause, the Secretary shall promulgate (after consultation with consumer and insurance industry representatives and not later than 90 days after the date of disapproval or the end of such 90-day period (as the case may be)) a statement for each of the types of health insurance policies (other than medicare supplemental policies and including, but not limited to, as separate types of policies, policies paying directly to the beneficiary fixed, cash benefits, and policies that limit benefit payments to specific diseases) which are sold or issued to persons entitled to health benefits under this subchapter, of the extent to which benefits payable under the policy or plan duplicate benefits under this subchapter, and each such statement shall be (for purposes of subparagraph (C)) the statement specified under this subparagraph for the type of policy involved.
(4)(A) Whoever knowingly, directly or through his agent, mails or causes to be mailed any matter for a prohibited purpose (as determined under subparagraph (B)) shall be fined under title 18 or imprisoned not more than 5 years, or both, and, in addition to or in lieu of such a criminal penalty, is subject to a civil money penalty of not to exceed $5,000 for each such prohibited act.
(B) For purposes of subparagraph (A), a prohibited purpose means the advertising, solicitation, or offer for sale of a medicare supplemental policy, or the delivery of such a policy, in or into any State in which such policy has not been approved by the State commissioner or superintendent of insurance.
(C) Subparagraph (A) shall not apply in the case of a person who mails or causes to be mailed a medicare supplemental policy into a State if such person has ascertained that the party insured under such policy to whom (or on whose behalf) such policy is mailed is located in such State on a temporary basis.
(D) Subparagraph (A) shall not apply in the case of a person who mails or causes to be mailed a duplicate copy of a medicare supplemental policy previously issued to the party to whom (or on whose behalf) such duplicate copy is mailed.
(E) Subparagraph (A) shall not apply in the case of an issuer who mails or causes to be mailed a policy, certificate, or other matter solely to comply with the requirements of subsection (q) of this section.
(5) The provisions of
(e) Dissemination of information
(1) The Secretary shall provide to all individuals entitled to benefits under this subchapter (and, to the extent feasible, to individuals about to become so entitled) such information as will permit such individuals to evaluate the value of medicare supplemental policies to them and the relationship of any such policies to benefits provided under this subchapter.
(2) The Secretary shall—
(A) inform all individuals entitled to benefits under this subchapter (and, to the extent feasible, individuals about to become so entitled) of—
(i) the actions and practices that are subject to sanctions under subsection (d) of this section, and
(ii) the manner in which they may report any such action or practice to an appropriate official of the Department of Health and Human Services (or to an appropriate State official), and
(B) publish the toll-free telephone number for individuals to report suspected violations of the provisions of such subsection.
(3) The Secretary shall provide individuals entitled to benefits under this subchapter (and, to the extent feasible, individuals about to become so entitled) with a listing of the addresses and telephone numbers of State and Federal agencies and offices that provide information and assistance to individuals with respect to the selection of medicare supplemental policies.
(f) Study and evaluation of comparative effectiveness of various State approaches to regulating medicare supplemental policies; report to Congress no later than January 1, 1982; periodic evaluations
(1)(A) The Secretary shall, in consultation with Federal and State regulatory agencies, the National Association of Insurance Commissioners, private insurers, and organizations representing consumers and the aged, conduct a comprehensive study and evaluation of the comparative effectiveness of various State approaches to the regulation of medicare supplemental policies in (i) limiting marketing and agent abuse, (ii) assuring the dissemination of such information to individuals entitled to benefits under this subchapter (and to other consumers) as is necessary to permit informed choice, (iii) promoting policies which provide reasonable economic benefits for such individuals, (iv) reducing the purchase of unnecessary duplicative coverage, (v) improving price competition, and (vi) establishing effective approved State regulatory programs described in subsection (b) of this section.
(B) Such study shall also address the need for standards or certification of health insurance policies, other than medicare supplemental policies, sold to individuals eligible for benefits under this subchapter.
(C) The Secretary shall, no later than January 1, 1982, submit a report to the Congress on the results of such study and evaluation, accompanied by such recommendations as the Secretary finds warranted by such results with respect to the need for legislative or administrative changes to accomplish the objectives set forth in subparagraphs (A) and (B), including the need for a mandatory Federal regulatory program to assure the marketing of appropriate types of medicare supplemental policies, and such other means as he finds may be appropriate to enhance effective State regulation of such policies.
(2) The Secretary shall submit to the Congress no later than July 1, 1982, and periodically as may be appropriate thereafter (but not less often than once every 2 years), a report evaluating the effectiveness of the certification procedure and the criminal penalties established under this section, and shall include in such reports an analysis of—
(A) the impact of such procedure and penalties on the types, market share, value, and cost to individuals entitled to benefits under this subchapter of medicare supplemental policies which have been certified by the Secretary;
(B) the need for any change in the certification procedure to improve its administration or effectiveness; and
(C) whether the certification program and criminal penalties should be continued.
(3) The Secretary shall provide information via a toll-free telephone number on medicare supplemental policies (including the relationship of State programs under subchapter XIX of this chapter to such policies).
(g) Definitions
(1) For purposes of this section, a medicare supplemental policy is a health insurance policy or other health benefit plan offered by a private entity to individuals who are entitled to have payment made under this subchapter, which provides reimbursement for expenses incurred for services and items for which payment may be made under this subchapter but which are not reimbursable by reason of the applicability of deductibles, coinsurance amounts, or other limitations imposed pursuant to this subchapter; but does not include any such policy or plan of one or more employers or labor organizations, or of the trustees of a fund established by one or more employers or labor organizations (or combination thereof), for employees or former employees (or combination thereof) or for members or former members (or combination thereof) of the labor organizations and does not include a policy or plan of an eligible organization (as defined in
(2) For purposes of this section:
(A) The term "NAIC Model Standards" means the "NAIC Model Regulation to Implement the Individual Accident and Sickness Insurance Minimum Standards Act", adopted by the National Association of Insurance Commissioners on June 6, 1979, as it applies to medicare supplement 2 policies.
(B) The term "State with an approved regulatory program" means a State for which the Secretary has made a determination under subsection (b)(1) of this section.
(C) The State in which a policy is issued means—
(i) in the case of an individual policy, the State in which the policyholder resides; and
(ii) in the case of a group policy, the State in which the holder of the master policy resides.
(h) Rules and regulations
The Secretary shall prescribe such regulations as may be necessary for the effective, efficient, and equitable administration of the certification procedure established under this section. The Secretary shall first issue final regulations to implement the certification procedure established under subsection (a) of this section not later than March 1, 1981.
(i) Commencement of certification program
(1) No medicare supplemental policy shall be certified and no such policy may be issued bearing the emblem authorized by the Secretary under subsection (a) of this section until July 1, 1982. On and after such date policies certified by the Secretary may bear such emblem, including policies which were issued prior to such date and were subsequently certified, and insurers may notify holders of such certified policies issued prior to such date using such emblem in the notification.
(2)(A) The Secretary shall not implement the certification program established under subsection (a) of this section with respect to policies issued in a State unless the Panel makes a finding that such State cannot be expected to have established, by July 1, 1982, an approved State regulatory program meeting the standards and requirements of subsection (b)(1) of this section. If the Panel makes such a finding, the Secretary shall implement such program under subsection (a) of this section with respect to medicare supplemental policies issued in such State, until such time as the Panel determines that such State has a program that meets the standards and requirements of subsection (b)(1) of this section.
(B) Any finding by the Panel under subparagraph (A) shall be transmitted in writing, not later than January 1, 1982, to the Committee on Finance of the Senate and to the Committee on Energy and Commerce and the Committee on Ways and Means of the House of Representatives and shall not become effective until 60 days after the date of its transmittal to the Committees of the Congress under this subparagraph. In counting such days, days on which either House is not in session because of an adjournment sine die or an adjournment of more than three days to a day certain are excluded in the computation.
(j) State regulation of policies issued in other States
Nothing in this section shall be construed so as to affect the right of any State to regulate medicare supplemental policies which, under the provisions of this section, are considered to be issued in another State.
(k) Amended NAIC Model Regulation or Federal model standards applicable; effective date; medicare supplemental policy and State regulatory program meeting applicable standards
(1)(A) If, within the 90-day period beginning on July 1, 1988, the National Association of Insurance Commissioners (in this subsection referred to as the "Association") amends the NAIC Model Regulation adopted on June 6, 1979 (as it relates to medicare supplemental policies), with respect to matters such as minimum benefit standards, loss ratios, disclosure requirements, and replacement requirements and provisions otherwise necessary to reflect the changes in law made by the Medicare Catastrophic Coverage Act of 1988, except as provided in subsection (m) of this section, subsection (g)(2)(A) of this section shall be applied in a State, effective on and after the date specified in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the Model Regulation as amended by the Association in accordance with this paragraph (in this subsection and subsection (l) of this section referred to as the "amended NAIC Model Regulation").
(B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the amended NAIC Model Regulation or 1 year after the date the Association first adopts such amended Regulation.
(2)(A) If the Association does not amend the NAIC Model Regulation within the 90-day period specified in paragraph (1)(A), the Secretary shall promulgate, not later than 60 days after the end of such period, Federal model standards (in this subsection and subsection (l) of this section referred to as "Federal model standards") for medicare supplemental policies to reflect the changes in law made by the Medicare Catastrophic Coverage Act of 1988, and subsection (g)(2)(A) of this section shall be applied in a State, effective on and after the date specified in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to Federal model standards.
(B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the Federal model standards or 1 year after the date the Secretary first promulgates such standards.
(3) Notwithstanding any other provision of this section (except as provided in subsections (l), (m), and (n) of this section)—
(A) no medicare supplemental policy may be certified by the Secretary pursuant to subsection (a) of this section,
(B) no certification made pursuant to subsection (a) of this section shall remain in effect, and
(C) no State regulatory program shall be found to meet (or to continue to meet) the requirements of subsection (b)(1)(A) of this section,
unless such policy meets (or such program provides for the application of standards equal to or more stringent than) the standards set forth in the amended NAIC Model Regulation or the Federal model standards (as the case may be) by the date specified in paragraph (1)(B) or (2)(B) (as the case may be).
(l) Transitional compliance with NAIC Model Transition Regulation; "qualifying medicare supplemental policy" and "NAIC Model Transition Regulation" defined; report to Congress respecting State action in adopting equal or more stringent standards
(1) Until the date specified in paragraph (3), in the case of a qualifying medicare supplemental policy described in paragraph (2) issued—
(A) before January 1, 1989, the policy is deemed to remain in compliance with this section if the insurer issuing the policy complies with the NAIC Model Transition Regulation (including giving notices to subscribers and filing for premium adjustments with the State as described in section 5.B. of such Regulation) by January 1, 1989; or
(B) on or after January 1, 1989, the policy is deemed to be in compliance with this section if the insurer issuing the policy complies with the NAIC Model Transition Regulation before the date of the sale of the policy.
(2) In paragraph (1), the term "qualifying medicare supplemental policy" means a medicare supplemental policy—
(A) issued in a State which—
(i) has not adopted standards equal to or more stringent than the NAIC Model Transition Regulation by January 1, 1989, and
(ii) has not adopted standards equal to or more stringent than the amended NAIC Model Regulation (or Federal model standards) by January 1, 1989; and
(B) which has been issued in compliance with this section (as in effect on June 1, 1988).
(3)(A) The date specified in this paragraph is the earlier of—
(i) the first date a State adopts, after January 1, 1989, standards equal to or more stringent than the NAIC Model Transition Regulation or equal to or more stringent than the amended NAIC Model Regulation (or Federal model standards), as the case may be, or
(ii) the later of (I) the date specified in subsection (k)(1)(B) or (k)(2)(B) of this section (as the case may be), or (II) the date specified in subparagraph (B).
(B) In the case of a State which the Secretary identifies as—
(i) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet standards described in subparagraph (A)(i), but
(ii) having a legislature which is not scheduled to meet in 1989 in a legislative session in which such legislation may be considered,
the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1989, and in which legislation described in clause (i) may be considered. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature.
(4) In the case of a medicare supplemental policy in effect on January 1, 1989, and offered in a State which, as of such date—
(A) has adopted standards equal to or more stringent than the amended NAIC Model Regulation (or Federal model standards), but
(B) does not have in effect standards equal to or more stringent than the NAIC Model Transition Regulation (or otherwise requiring notice substantially the same as the notice required in section 5.B. of such Regulation),
the policy shall not be deemed to meet the standards in subsection (c) of this section unless each individual who is entitled to benefits under this subchapter and is a policyholder under such policy on January 1, 1989, is sent such a notice in any appropriate form by not later than January 31, 1989, that explains—
(A) the improved benefits under this subchapter contained in the Medicare Catastrophic Coverage Act of 1988, and
(B) how these improvements affect the benefits contained in the policies and the premium for the policy.
(5) In this subsection, the term "NAIC Model Transition Regulation" refers to the standards contained in the "Model Regulation to Implement Transitional Requirements for the Conversion of Medicare Supplement Insurance Benefits and Premiums to Conform to Medicare Program Revisions" (as adopted by the National Association of Insurance Commissioners in September 1987).
(6) The Secretary shall report to the Congress in March 1989 and in July 1990 on actions States have taken in adopting standards equal to or more stringent than the NAIC Model Transition Regulation or the amended NAIC Model Regulation (or Federal model standards).
(m) Revision of amended NAIC Model Regulation and amended Federal model standards; effective dates; medicare supplemental policy and State regulatory program meeting applicable standards
(1)(A) If, within the 90-day period beginning on December 13, 1989, the National Association of Insurance Commissioners (in this subsection and subsection (n) of this section referred to as the "Association") revises the amended NAIC Model Regulation (referred to in subsection (k)(1)(A) of this section and adopted on September 20, 1988) to improve such regulation and otherwise to reflect the changes in law made by the Medicare Catastrophic Coverage Repeal Act of 1989, subsection (g)(2)(A) of this section shall be applied in a State, effective on and after the date specified in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the amended NAIC Model Regulation (referred to in subsection (k)(1)(A) of this section) as revised by the Association in accordance with this paragraph (in this subsection and subsection (n) of this section referred to as the "revised NAIC Model Regulation").
(B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the revised NAIC Model Regulation or 1 year after the date the Association first adopts such revised Regulation.
(2)(A) If the Association does not revise the amended NAIC Model Regulation, within the 90-day period specified in paragraph (1)(A), the Secretary shall promulgate, not later than 60 days after the end of such period, revised Federal model standards (in this subsection and subsection (n) of this section referred to as "revised Federal model standards") for medicare supplemental policies to improve such standards and otherwise to reflect the changes in law made by the Medicare Catastrophic Coverage Repeal Act of 1989, subsection (g)(2)(A) of this section shall be applied in a State, effective on and after the date specified in subparagraph (B), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the revised Federal model standards.
(B) The date specified in this subparagraph for a State is the earlier of the date the State adopts standards equal to or more stringent than the revised Federal model standards or 1 year after the date the Secretary first promulgates such standards.
(3) Notwithstanding any other provision of this section (except as provided in subsection (n) of this section)—
(A) no medicare supplemental policy may be certified by the Secretary pursuant to subsection (a) of this section,
(B) no certification made pursuant to subsection (a) of this section shall remain in effect, and
(C) no State regulatory program shall be found to meet (or to continue to meet) the requirements of subsection (b)(1)(A) of this section,
unless such policy meets (or such program provides for the application of standards equal to or more stringent than) the standards set forth in the revised NAIC Model Regulation or the revised Federal model standards (as the case may be) by the date specified in paragraph (1)(B) or (2)(B) (as the case may be).
(n) Transition compliance with revision of NAIC Model Regulation and Federal model standards
(1) Until the date specified in paragraph (4), in the case of a qualifying medicare supplemental policy described in paragraph (3) issued in a State—
(A) before the transition deadline, the policy is deemed to remain in compliance with the standards described in subsection (b)(1)(A) of this section only if the insurer issuing the policy complies with the transition provision described in paragraph (2), or
(B) on or after the transition deadline, the policy is deemed to be in compliance with the standards described in subsection (b)(1)(A) of this section only if the insurer issuing the policy complies with the revised NAIC Model Regulation or the revised Federal model standards (as the case may be) before the date of the sale of the policy.
In this paragraph, the term "transition deadline" means 1 year after the date the Association adopts the revised NAIC Model Regulation or 1 year after the date the Secretary promulgates revised Federal model standards (as the case may be).
(2) The transition provision described in this paragraph is—
(A) such transition provision as the Association provides, by not later than December 15, 1989, so as to provide for an appropriate transition (i) to restore benefit provisions which are no longer duplicative as a result of the changes in benefits under this subchapter made by the Medicare Catastrophic Coverage Repeal Act of 1989 and (ii) to eliminate the requirement of payment for the first 8 days of coinsurance for extended care services, or
(B) if the Association does not provide for a transition provision by the date described in subparagraph (A), such transition provision as the Secretary shall provide, by January 1, 1990, so as to provide for an appropriate transition described in subparagraph (A).
(3) In paragraph (1), the term "qualifying medicare supplemental policy" means a medicare supplemental policy which has been issued in compliance with this section as in effect on the date before December 13, 1989.
(4)(A) The date specified in this paragraph for a policy issued in a State is—
(i) the first date a State adopts, after December 13, 1989, standards equal to or more stringent than the revised NAIC Model Regulation (or revised Federal model standards), as the case may be, or
(ii) the date specified in subparagraph (B),
whichever is earlier.
(B) In the case of a State which the Secretary identifies, in consultation with the Association, as—
(i) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet standards described in subparagraph (A)(i), but
(ii) having a legislature which is not scheduled to meet in 1990 in a legislative session in which such legislation may be considered,
the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1990. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature.
(5) In the case of a medicare supplemental policy in effect on January 1, 1990, the policy shall not be deemed to meet the standards in subsection (c) of this section unless each individual who is entitled to benefits under this subchapter and is a policyholder or certificate holder under such policy on such date is sent a notice in an appropriate form by not later than January 31, 1990, that explains—
(A) the changes in benefits under this subchapter effected by the Medicare Catastrophic Coverage Repeal Act of 1989, and
(B) how these changes may affect the benefits contained in such policy and the premium for the policy.
(6)(A) Except as provided in subparagraph (B), in the case of an individual who had in effect, as of December 31, 1988, a medicare supplemental policy with an insurer (as a policyholder or, in the case of a group policy, as a certificate holder) and the individual terminated coverage under such policy before December 13, 1989, no medicare supplemental policy of the insurer shall be deemed to meet the standards in subsection (c) of this section unless the insurer—
(i) provides written notice, no earlier than December 15, 1989, and no later than January 30, 1990, to the policyholder or certificate holder (at the most recent available address) of the offer described in clause (ii), and
(ii) offers the individual, during a period of at least 60 days beginning not later than February 1, 1990, reinstitution of coverage (with coverage effective as of January 1, 1990), under the terms which (I) do not provide for any waiting period with respect to treatment of pre-existing conditions, (II) provides for coverage which is substantially equivalent to coverage in effect before the date of such termination, and (III) provides for classification of premiums on which terms are at least as favorable to the policyholder or certificate holder as the premium classification terms that would have applied to the policyholder or certificate holder had the coverage never terminated.
(B) An insurer is not required to make the offer under subparagraph (A)(ii) in the case of an individual who is a policyholder or certificate holder in another medicare supplemental policy as of December 13, 1989, if (as of January 1, 1990) the individual is not subject to a waiting period with respect to treatment of a pre-existing condition under such other policy.
(o) Requirements of group benefits; core group benefits; uniform outline of coverage
The requirements of this subsection are as follows:
(1) Each medicare supplemental policy shall provide for coverage of a group of benefits consistent with subsection (p) of this section.
(2) If the medicare supplemental policy provides for coverage of a group of benefits other than the core group of basic benefits described in subsection (p)(2)(B) of this section, the issuer of the policy must make available to the individual a medicare supplemental policy with only such core group of basic benefits.
(3) The issuer of the policy has provided, before the sale of the policy, an outline of coverage that uses uniform language and format (including layout and print size) that facilitates comparison among medicare supplemental policies and comparison with medicare benefits.
(p) Standards for group benefits
(1)(A) If, within 9 months after November 5, 1990, the National Association of Insurance Commissioners (in this subsection referred to as the "Association") changes the revised NAIC Model Regulation (described in subsection (m) of this section) to incorporate—
(i) limitations on the groups or packages of benefits that may be offered under a medicare supplemental policy consistent with paragraphs (2) and (3) of this subsection,
(ii) uniform language and definitions to be used with respect to such benefits,
(iii) uniform format to be used in the policy with respect to such benefits, and
(iv) other standards to meet the additional requirements imposed by the amendments made by the Omnibus Budget Reconciliation Act of 1990,
subsection (g)(2)(A) of this section shall be applied in each State, effective for policies issued to policyholders on and after the date specified in subparagraph (C), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the revised NAIC Model Regulation as changed under this subparagraph (such changed regulation referred to in this section as the "1991 NAIC Model Regulation").
(B) If the Association does not make the changes in the revised NAIC Model Regulation within the 9-month period specified in subparagraph (A), the Secretary shall promulgate, not later than 9 months after the end of such period, a regulation and subsection (g)(2)(A) of this section shall be applied in each State, effective for policies issued to policyholders on and after the date specified in subparagraph (C), as if the reference to the Model Regulation adopted on June 6, 1979, were a reference to the revised NAIC Model Regulation as changed by the Secretary under this subparagraph (such changed regulation referred to in this section as the "1991 Federal Regulation").
(C)(i) Subject to clause (ii), the date specified in this subparagraph for a State is the date the State adopts the 1991 NAIC Model Regulation or 1991 Federal Regulation or 1 year after the date the Association or the Secretary first adopts such standards, whichever is earlier.
(ii) In the case of a State which the Secretary identifies, in consultation with the Association, as—
(I) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to meet the 1991 NAIC Model Regulation or 1991 Federal Regulation, but
(II) having a legislature which is not scheduled to meet in 1992 in a legislative session in which such legislation may be considered,
the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1992. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature.
(D) In promulgating standards under this paragraph, the Association or Secretary shall consult with a working group composed of representatives of issuers of medicare supplemental policies, consumer groups, medicare beneficiaries, and other qualified individuals. Such representatives shall be selected in a manner so as to assure balanced representation among the interested groups.
(E) If benefits (including deductibles and coinsurance) under this subchapter are changed and the Secretary determines, in consultation with the Association, that changes in the 1991 NAIC Model Regulation or 1991 Federal Regulation are needed to reflect such changes, the preceding provisions of this paragraph shall apply to the modification of standards previously established in the same manner as they applied to the original establishment of such standards.
(2) The benefits under the 1991 NAIC Model Regulation or 1991 Federal Regulation shall provide—
(A) for such groups or packages of benefits as may be appropriate taking into account the considerations specified in paragraph (3) and the requirements of the succeeding subparagraphs;
(B) for identification of a core group of basic benefits common to all policies,3 and
(C) that, subject to paragraph (4)(B), the total number of different benefit packages (counting the core group of basic benefits described in subparagraph (B) and each other combination of benefits that may be offered as a separate benefit package) that may be established in all the States and by all issuers shall not exceed 10.
(3) The benefits under paragraph (2) shall, to the extent possible—
(A) provide for benefits that offer consumers the ability to purchase the benefits that are available in the market as of November 5, 1990; and
(B) balance the objectives of (i) simplifying the market to facilitate comparisons among policies, (ii) avoiding adverse selection, (iii) providing consumer choice, (iv) providing market stability, and (v) promoting competition.
(4)(A)(i) Except as provided in subparagraph (B) or paragraph (6), no State with a regulatory program approved under subsection (b)(1) of this section may provide for or permit the grouping of benefits (or language or format with respect to such benefits) under a medicare supplemental policy unless such grouping meets the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation.
(ii) Except as provided in subparagraph (B), the Secretary may not provide for or permit the grouping of benefits (or language or format with respect to such benefits) under a medicare supplemental policy seeking approval by the Secretary unless such grouping meets the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation.
(B) With the approval of the State (in the case of a policy issued in a State with an approved regulatory program) or the Secretary (in the case of any other policy), the issuer of a medicare supplemental policy may offer new or innovative benefits in addition to the benefits provided in a policy that otherwise complies with the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation. Any such new or innovative benefits may include benefits that are not otherwise available and are cost-effective and shall be offered in a manner which is consistent with the goal of simplification of medicare supplemental policies.
(5)(A) Except as provided in subparagraph (B), this subsection shall not be construed as preventing a State from restricting the groups of benefits that may be offered in medicare supplemental policies in the State.
(B) A State with a regulatory program approved under subsection (b)(1) of this section may not restrict under subparagraph (A) the offering of a medicare supplemental policy consisting only of the core group of benefits described in paragraph (2)(B).
(6) The Secretary may waive the application of standards described in clauses (i) through (iii) of paragraph (1)(A) in those States that on November 5, 1990, had in place an alternative simplification program.
(7) This subsection shall not be construed as preventing an issuer of a medicare supplemental policy who otherwise meets the requirements of this section from providing, through an arrangement with a vendor, for discounts from that vendor to policyholders or certificateholders for the purchase of items or services not covered under its medicare supplemental policies.
(8) Any person who sells or issues a medicare supplemental policy, on and after the effective date specified in paragraph (1)(C) (but subject to paragraph (10)), in violation of the applicable 1991 NAIC Model Regulation or 1991 Federal Regulation insofar as such regulation relates to the requirements of subsection (o) or (q) of this section or clause (i), (ii), or (iii) of paragraph (1)(A) is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not an issuer of a policy) for each such violation. The provisions of
(9)(A) Anyone who sells a medicare supplemental policy to an individual shall make available for sale to the individual a medicare supplemental policy with only the core group of basic benefits (described in paragraph (2)(B)).
(B) Anyone who sells a medicare supplemental policy to an individual shall provide the individual, before the sale of the policy, an outline of coverage which describes the benefits under the policy. Such outline shall be on a standard form approved by the State regulatory program or the Secretary (as the case may be) consistent with the 1991 NAIC Model Regulation or 1991 Federal Regulation under this subsection.
(C) Whoever sells a medicare supplemental policy in violation of this paragraph is subject to a civil money penalty of not to exceed $25,000 (or $15,000 in the case of a seller who is not the issuer of the policy) for each such violation. The provisions of
(D) Subject to paragraph (10), this paragraph shall apply to sales of policies occurring on or after the effective date specified in paragraph (1)(C).
(10) No penalty may be imposed under paragraph (8) or (9) in the case of a seller who is not the issuer of a policy until the Secretary has published a list of the groups of benefit packages that may be sold or issued consistent with paragraph (1)(A)(i).
(q) Guaranteed renewal of policies; termination; suspension
The requirements of this subsection are as follows:
(1) Each medicare supplemental policy shall be guaranteed renewable and—
(A) the issuer may not cancel or nonrenew the policy solely on the ground of health status of the individual; and
(B) the issuer shall not cancel or nonrenew the policy for any reason other than nonpayment of premium or material misrepresentation.
(2) If the medicare supplemental policy is terminated by the group policyholder and is not replaced as provided under paragraph (4), the issuer shall offer certificateholders an individual medicare supplemental policy which (at the option of the certificateholder)—
(A) provides for continuation of the benefits contained in the group policy, or
(B) provides for such benefits as otherwise meets 4 the requirements of this section.
(3) If an individual is a certificateholder in a group medicare supplemental policy and the individual terminates membership in the group, the issuer shall—
(A) offer the certificateholder the conversion opportunity described in paragraph (2), or
(B) at the option of the group policyholder, offer the certificateholder continuation of coverage under the group policy.
(4) If a group medicare supplemental policy is replaced by another group medicare supplemental policy purchased by the same policyholder, issuer 5 of the replacement policy shall offer coverage to all persons covered under the old group policy on its date of termination. Coverage under the new group policy shall not result in any exclusion for preexisting conditions that would have been covered under the group policy being replaced.
(5)(A) Each medicare supplemental policy shall provide that benefits and premiums under the policy shall be suspended at the request of the policyholder for the period (not to exceed 24 months) in which the policyholder has applied for and is determined to be entitled to medical assistance under subchapter XIX of this chapter, but only if the policyholder notifies the issuer of such policy within 90 days after the date the individual becomes entitled to such assistance. If such suspension occurs and if the policyholder or certificate holder loses entitlement to such medical assistance, such policy shall be automatically reinstituted (effective as of the date of termination of such entitlement) under terms described in subsection (n)(6)(A)(ii) of this section as of the termination of such entitlement if the policyholder provides notice of loss of such entitlement within 90 days after the date of such loss.
(B) Nothing in this section shall be construed as affecting the authority of a State, under subchapter XIX of this chapter, to purchase a medicare supplemental policy for an individual otherwise entitled to assistance under such subchapter.
(C) Any person who issues a medicare supplemental policy and fails to comply with the requirements of this paragraph is subject to a civil money penalty of not to exceed $25,000 for each such violation. The provisions of
(r) Required ratio of aggregate benefits to aggregate premiums
(1) A medicare supplemental policy may not be issued or renewed (or otherwise provide coverage after the date described in subsection (p)(1)(C) of this section) in any State unless—
(A) the policy can be expected for periods after the effective date of these provisions (as estimated for the entire period for which rates are computed to provide coverage, on the basis of incurred claims experience and earned premiums for such periods and in accordance with a uniform methodology, including uniform reporting standards, developed by the National Association of Insurance Commissioners) to return to policyholders in the form of aggregate benefits provided under the policy, at least 75 percent of the aggregate amount of premiums collected in the case of group policies and at least 65 percent in the case of individual policies; and
(B) the issuer of the policy provides for the issuance of a proportional refund, or a credit against future premiums of a proportional amount, based on the premium paid and in accordance with paragraph (2), of the amount of premiums received necessary to assure that the ratio of aggregate benefits provided to the aggregate premiums collected (net of such refunds or credits) complies with the expectation required under subparagraph (A), treating policies of the same type as a single policy for each standard package.
For purposes of applying subparagraph (A) only, policies issued as a result of solicitations of individuals through the mails or by mass media advertising (including both print and broadcast advertising) shall be deemed to be individual policies. For the purpose of calculating the refund or credit required under paragraph (1)(B) for a policy issued before the date specified in subsection (p)(1)(C) of this section, the refund or credit calculation shall be based on the aggregate benefits provided and premiums collected under all such policies issued by an insurer in a State (separated as to individual and group policies) and shall be based only on aggregate benefits provided and premiums collected under such policies after the date specified in section 171(m)(4) of the Social Security Act Amendments of 1994.
(2)(A) Paragraph (1)(B) shall be applied with respect to each type of policy by standard package. Paragraph (1)(B) shall not apply to a policy until 12 months following issue. The Comptroller General, in consultation with the National Association of Insurance Commissioners, shall submit to Congress a report containing recommendations on adjustment in the percentages under paragraph (1)(A) that may be appropriate. In the case of a policy issued before the date specified in subsection (p)(1)(C) of this section, paragraph (1)(B) shall not apply until 1 year after the date specified in section 171(m)(4) of the Social Security Act Amendments of 1994.
(B) A refund or credit required under paragraph (1)(B) shall be made to each policyholder insured under the applicable policy as of the last day of the year involved.
(C) Such a refund or credit shall include interest from the end of the calendar year involved until the date of the refund or credit at a rate as specified by the Secretary for this purpose from time to time which is not less than the average rate of interest for 13-week Treasury notes.
(D) For purposes of this paragraph and paragraph (1)(B), refunds or credits against premiums due shall be made, with respect to a calendar year, not later than the third quarter of the succeeding calendar year.
(3) The provisions of this subsection do not preempt a State from requiring a higher percentage than that specified in paragraph (1)(A).
(4) The Secretary shall submit in October of each year (beginning with 1993) a report to the Committees on Energy and Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate on loss ratios under medicare supplemental policies and the use of sanctions, such as a required rebate or credit or the disallowance of premium increases, for policies that fail to meet the requirements of this subsection (relating to loss ratios). Such report shall include a list of the policies that failed to comply with such loss ratio requirements or other requirements of this section.
(5)(A) The Comptroller General shall periodically, not less often than once every 3 years, perform audits with respect to the compliance of medicare supplemental policies with the loss ratio requirements of this subsection and shall report the results of such audits to the State involved and to the Secretary.
(B) The Secretary may independently perform such compliance audits.
(6)(A) A person who fails to provide refunds or credits as required in paragraph (1)(B) is subject to a civil money penalty of not to exceed $25,000 for each policy issued for which such failure occurred. The provisions of
(B) Each issuer of a policy subject to the requirements of paragraph (1)(B) shall be liable to the policyholder or, in the case of a group policy, to the certificate holder for credits required under such paragraph.
(s) Coverage for pre-existing conditions
(1) If a medicare supplemental policy replaces another medicare supplemental policy, the issuer of the replacing policy shall waive any time periods applicable to preexisting conditions, waiting period, elimination periods and probationary periods in the new medicare supplemental policy for similar benefits to the extent such time was spent under the original policy.
(2)(A) The issuer of a medicare supplemental policy may not deny or condition the issuance or effectiveness of a medicare supplemental policy, or discriminate in the pricing of the policy, because of health status, claims experience, receipt of health care, or medical condition in the case of an individual for whom an application is submitted prior to or during the 6 month period beginning with the first month as of the first day on which the individual is 65 years of age or older and is enrolled for benefits under part B of this subchapter.
(B) Subject to subparagraph (C), subparagraph (A) shall not be construed as preventing the exclusion of benefits under a policy, during its first 6 months, based on a pre-existing condition for which the policyholder received treatment or was otherwise diagnosed during the 6 months before the policy became effective.
(C) If a medicare supplemental policy or certificate replaces another such policy or certificate which has been in effect for 6 months or longer, the replacing policy may not provide any time period applicable to pre-existing conditions, waiting periods, elimination periods, and probationary periods in the new policy or certificate for similar benefits.
(3) Any issuer of a medicare supplemental policy that fails to meet the requirements of paragraphs (1) and (2) is subject to a civil money penalty of not to exceed $5,000 for each such failure. The provisions of
(t) Medicare select policies
(1) If a medicare supplemental policy meets the 1991 NAIC Model Regulation or 1991 Federal Regulation and otherwise complies with the requirements of this section except that benefits under the policy are restricted to items and services furnished by certain entities (or reduced benefits are provided when items or services are furnished by other entities), the policy shall nevertheless be treated as meeting those standards if—
(A) full benefits are provided for items and services furnished through a network of entities which have entered into contracts or agreements with the issuer of the policy;
(B) full benefits are provided for items and services furnished by other entities if the services are medically necessary and immediately required because of an unforeseen illness, injury, or condition and it is not reasonable given the circumstances to obtain the services through the network;
(C) the network offers sufficient access;
(D) the issuer of the policy has arrangements for an ongoing quality assurance program for items and services furnished through the network;
(E)(i) the issuer of the policy provides to each enrollee at the time of enrollment an explanation of (I) the restrictions on payment under the policy for services furnished other than by or through the network, (II) out of area coverage under the policy, (III) the policy's coverage of emergency services and urgently needed care, and (IV) the availability of a policy through the entity that meets the standards in the 1991 NAIC Model Regulation or 1991 Federal Regulation without reference to this subsection and the premium charged for such policy, and
(ii) each enrollee prior to enrollment acknowledges receipt of the explanation provided under clause (i); and
(F) the issuer of the policy makes available to individuals, in addition to the policy described in this subsection, any policy (otherwise offered by the issuer to individuals in the State) that meets the standards in the 1991 NAIC Model Regulation or 1991 Federal Regulation and other requirements of this section without reference to this subsection.
(2) If the Secretary determines that an issuer of a policy approved under paragraph (1)—
(A) fails substantially to provide medically necessary items and services to enrollees seeking such items and services through the issuer's network, if the failure has adversely affected (or has substantial likelihood of adversely affecting) the individual,
(B) imposes premiums on enrollees in excess of the premiums approved by the State,
(C) acts to expel an enrollee for reasons other than nonpayment of premiums, or
(D) does not provide the explanation required under paragraph (1)(E)(i) or does not obtain the acknowledgment required under paragraph (1)(E)(ii),
the issuer is subject to a civil money penalty in an amount not to exceed $25,000 for each such violation. The provisions of
(3) The Secretary may enter into a contract with an entity whose policy has been certified under paragraph (1) or has been approved by a State under subsection (b)(1)(H) of this section to determine whether items and services (furnished to individuals entitled to benefits under this subchapter and under that policy) are not allowable under
(Aug. 14, 1935, ch. 531, title XVIII, §1882, as added June 9, 1980,
References in Text
Parts A and B of this subchapter, referred to in subsecs. (d)(3)(A)(i), (B)(i) and (s)(2)(A), are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
Section 603(c) of the Social Security Amendments of 1983, referred to in subsec. (g)(1), is section 603(c) of
Section 2355 of the Deficit Reduction Act of 1984, referred to in subsec. (g)(1), is section 2355 of
Section 9412(b) of the Omnibus Budget Reconciliation Act of 1986, referred to in subsec. (g)(1), is section 9412(b) of
The Medicare Catastrophic Coverage Act of 1988, referred to in subsecs. (k)(1)(A), (2)(A) and (l)(4)(A), is
The Medicare Catastrophic Coverage Repeal Act of 1989, referred to in subsecs. (m)(1)(A), (2)(A) and (n)(2)(A), (5)(A), is
The Omnibus Budget Reconciliation Act of 1990, referred to in subsec. (p)(1)(A)(iv), is
Section 171(m)(4) of the Social Security Act Amendments of 1994, referred to in subsec. (r)(1), (2)(A), is section 171(m)(4) of
Amendments
1994—Subsec. (a)(2).
Subsec. (a)(2)(A).
Subsec. (b)(1).
Subsecs. (b)(1)(B), (c)(5).
Subsec. (d)(3)(A).
Subsec. (d)(3)(B)(ii)(II).
Subsec. (d)(3)(B)(iii)(I).
Subsec. (d)(3)(B)(iii)(II).
Subsec. (d)(3)(B)(iii)(III).
Subsec. (d)(3)(C).
Subsec. (d)(3)(D).
Subsec. (d)(4)(D).
Subsec. (d)(4)(E).
Subsec. (f)(3).
Subsec. (g)(1).
Subsec. (g)(2)(B).
Subsec. (o).
Subsec. (p).
Subsec. (p)(1)(A).
Subsec. (p)(1)(B).
Subsec. (p)(1)(C)(i).
Subsec. (p)(1)(C)(ii)(I), (E).
Subsec. (p)(2).
Subsec. (p)(2)(C).
Subsec. (p)(4).
Subsec. (p)(4)(A)(i).
Subsec. (p)(6).
Subsec. (p)(7).
Subsec. (p)(8).
Subsec. (p)(9)(B).
Subsec. (p)(9)(D).
Subsec. (p)(10).
Subsec. (q)(2).
Subsec. (q)(4).
Subsec. (q)(5)(A), (B).
Subsec. (r)(1).
Subsec. (r)(1)(A).
Subsec. (r)(1)(B).
Subsec. (r)(2)(A).
Subsec. (r)(2)(C), (D).
Subsec. (r)(4).
Subsec. (r)(6)(A).
Subsec. (r)(6)(B).
Subsec. (s)(2)(A).
Subsec. (s)(2)(B).
Subsec. (t)(1).
Subsec. (t)(1)(A).
Subsec. (t)(1)(E)(i), (F).
Subsec. (t)(2).
1990—
Subsec. (a).
Subsec. (b)(1).
Subsec. (b)(1)(A).
Subsec. (b)(1)(B).
Subsec. (b)(1)(C).
Subsec. (b)(1)(D).
Subsec. (b)(1)(F).
Subsec. (b)(1)(G).
Subsec. (b)(1)(H).
Subsec. (b)(2).
"(A) There is hereby established a panel (hereinafter in this section referred to as the 'Panel') to be known as the Supplemental Health Insurance Panel. The Panel shall consist of the Secretary, who shall serve as the Chairman, and four State commissioners or superintendents of insurance, who shall be appointed by the Secretary and serve at his pleasure. Such members shall first be appointed not later than December 31, 1980.
"(B) A majority of the members of the Panel shall constitute a quorum, but a lesser number may conduct hearings.
"(C) The Secretary shall provide such technical, secretarial, clerical, and other assistance as the Panel may require.
"(D) There are authorized to be appropriated such sums as may be necessary to carry out this paragraph.
"(E) Members of the Panel shall be allowed, while away from their homes or regular places of business in the performance of services for the Panel, travel expenses (including per diem in lieu of subsistence) in the same manner as persons employed intermittently in the Government service are allowed expenses under
Subsec. (c).
Subsec. (c)(1).
Subsec. (c)(2).
Subsec. (c)(5).
Subsec. (d)(3)(A).
Subsec. (d)(3)(B).
Subsec. (d)(4)(B).
"(i) the policy has been certified by the Secretary pursuant to subsection (c) of this section or was issued in a State with an approved regulatory program (as defined in subsection (g)(2)(B) of this section);
"(ii) the policy has been approved by the commissioners or superintendents of insurance in States in which more than 30 percent of such policies are sold; or
"(iii) the State has in effect a law which the commissioner or superintendent of insurance of the State has determined gives him the authority to review, and to approve, or effectively bar from sale in the State, such policy;
except that such a policy shall not be deemed to be approved by a State commissioner or superintendent of insurance if the State notifies the Secretary that such policy has been submitted for approval to the State and has been specifically disapproved by such State after providing appropriate notice and opportunity for hearing pursuant to the procedures (if any) of the State."
Subsec. (g)(1).
Subsecs. (o), (p).
Subsec. (q).
Subsec. (q)(5).
Subsec. (r).
Subsec. (s).
Subsec. (t).
1989—Subsecs. (a), (b)(1).
Subsec. (k)(1)(A).
Subsec. (k)(3).
Subsecs. (m), (n).
1988—Subsec. (a).
Subsec. (b)(1).
Subsec. (b)(1)(B).
Subsec. (b)(1)(C).
Subsec. (b)(1)(D), (E).
Subsec. (b)(2)(A).
Subsec. (b)(3).
Subsec. (c).
Subsec. (c)(3).
Subsec. (c)(3)(A).
Subsec. (c)(3)(B)(i).
Subsec. (c)(3)(B)(ii).
Subsec. (c)(4).
Subsec. (d).
Subsec. (d)(5).
Subsec. (e).
Subsecs. (k), (l).
1987—Subsec. (b)(1)(B).
Subsec. (b)(1)(D).
Subsec. (c).
Subsec. (c)(3).
Subsec. (d)(1).
Change of Name
Committee on Interstate and Foreign Commerce of House of Representatives changed to Committee on Energy and Commerce of House of Representatives immediately prior to noon on Jan. 3, 1981, by House Resolution No. 549, Ninety-sixth Congress, Mar. 25, 1980. Committee on Energy and Commerce of House of Representatives changed to Committee on Commerce of House of Representatives by House Resolution No. 6, One Hundred Fourth Congress, Jan. 4, 1995.
Effective Date of 1994 Amendment
Section 171(l) of
"(1) the amendments made by subsection (d)(1) [amending this section] shall take effect on the date of the enactment of this Act [Oct. 31, 1994], but no penalty shall be imposed under section 1882(d)(3)(A) of the Social Security Act [subsec. (d)(3)(A) of this section] (for an action occurring after the effective date of the amendments made by section 4354 of OBRA–1990 [see section 4354(c) of
"(2) the amendments made by subsection (d)(2)(A) [amending this section] and by subparagraphs (A), (B), and (E) of subsection (e)(1) [amending this section] shall be effective on the date specified in subsection (m)(4) [set out as a note below]; and
"(3) the amendment made by subsection (g)(2) [amending this section] shall take effect on January 1, 1995, and shall apply to individuals who attain 65 years of age or older on or after the effective date of section 1882(s)(2) of the Social Security Act [subsec. (s)(2) of this section, for effective date see section 4357(b) of
Effective Date of 1990 Amendment
Section 4353(d)(2) of
Section 4354(c) of
Section 4355(d) of
Section 4356(b) of
Section 4357(b) of
Amendment by section 4358(a), (b)(1), (2) of
Effective Date of 1989 Amendment
Section 203(e) of
Effective Date of 1988 Amendment
Section 221(g) of
"(1) Except as provided in paragraphs (2) and (3), the amendments made by this section [amending this section] shall take effect on the date of the enactment of this Act [July 1, 1988].
"(2) The amendments made by subsections (a) and (b) [amending this section] shall become effective on the date specified in subsection (k)(1)(B) or (k)(2)(B) of section 1882 of the Social Security Act [subsec. (k)(1)(B) or (k)(2)(B) of this section] (as added by subsection (d) of this section).
"(3) The amendment made by subsection (e) [amending this section] shall apply to medicare supplemental policies as of January 1, 1989, with respect to advertising used on or after such date.
"(4) The Secretary of Health and Human Services shall provide for the reappointment of members to the Supplemental Health Insurance Panel (under section 1882(b)(2) of the Social Security Act [subsec. (b)(2) of this section]) by not later than 90 days after the date of the enactment of this Act [July 1, 1988]."
Except as specifically provided in section 411 of
Amendment by section 428(b) of
Effective Date of 1987 Amendments
Section 4081(c)(2) of
"(A) The amendments made by subsection (b) [amending this section] shall apply to medicare supplemental policies as of January 1, 1989 (or, if applicable, the date established under subparagraph (B)).
"(B) In the case of a State which the Secretary of Health and Human Services identifies as—
"(i) requiring State legislation (other than legislation appropriating funds) in order for medicare supplemental policies to be changed to meet the requirements of section 1882(c)(3) of the Social Security Act [subsec. (c)(3) of this section], and
"(ii) having a legislature which is not scheduled to meet in 1988 in a legislative session in which such legislation may be considered or which has not enacted such legislation before July 1, 1988,
the date specified in this subparagraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1989, and in which legislation described in clause (i) may be considered."
Amendment by
Effective Date
Section 507(b) of
Applicability of Disclosure Requirement
Section 171(d)(3)(C) of
State Regulatory Programs
Section 171(m) of
"(1)
"(2) NAIC
"(3)
"(4)
"(A)
"(i) the date the State changes its statutes or regulations to conform its regulatory program to the changes made by this section, or
"(ii) 1 year after the date the NAIC or the Secretary first makes the modifications under paragraph (2) or (3), respectively.
"(B)
"(i) requiring State legislation (other than legislation appropriating funds) to conform its regulatory program to the changes made in this section, but
"(ii) having a legislature which is not scheduled to meet in 1996 in a legislative session in which such legislation may be considered,
the date specified in this paragraph is the first day of the first calendar quarter beginning after the close of the first legislative session of the State legislature that begins on or after January 1, 1996. For purposes of the previous sentence, in the case of a State that has a 2-year legislative session, each year of such session shall be deemed to be a separate regular session of the State legislature."
Evaluation of 1990 Amendments
Section 4358(d) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be "issuer's".
2 So in original. Probably should be "supplemental".
3 So in original. The comma probably should be a semicolon.
4 So in original. Probably should be "meet".
5 So in original. Probably should be preceded by "the".
§1395tt. Hospital providers of extended care services
(a) Hospital facility agreements; reasonable costs of services
(1) Any hospital (other than a hospital which has in effect a waiver under subparagraph (A) of the last sentence of
(2)(A) Notwithstanding any other provision of this subchapter, payment to any hospital for services furnished under an agreement entered into under this section shall be based upon the reasonable cost of the services as determined under subparagraph (B).
(B)(i) The reasonable cost of the services consists of the reasonable cost of routine services (determined under clause (ii)) and the reasonable cost of ancillary services (determined under clause (iii)).
(ii) The reasonable cost of routine services furnished during any calendar year by a hospital under an agreement under this section is equal to the product of—
(I) the number of patient-days during the year for which the services were furnished, and
(II) the average reasonable cost per patient-day, such average reasonable cost per patient-day being the average rate per patient-day paid for routine services during the most recent year for which cost reporting data are available with respect to such services (increased in a compounded manner by the applicable increase for payments for routine service costs of skilled nursing facilities under
(iii) The reasonable cost of ancillary services shall be determined in the same manner as the reasonable cost of ancillary services provided for inpatient hospital services.
(b) Eligible facilities
The Secretary may not enter into an agreement under this section with any hospital unless—
(1) except as provided under subsection (g) of this section, the hospital is located in a rural area and has less than 100 beds, and
(2) the hospital has been granted a certificate of need for the provision of long-term care services from the State health planning and development agency (designated under section 300m 1 of this title) for the State in which the hospital is located.
(c) Terms and conditions of facility agreements
An agreement with a hospital under this section shall, except as otherwise provided under regulations of the Secretary, be of the same duration and subject to termination on the same conditions as are agreements with skilled nursing facilities under
(d) Post-hospital extended care services
(1) Any agreement with a hospital under this section shall provide that payment for services will be made only for services for which payment would be made as post-hospital extended care services if those services had been furnished by a skilled nursing facility under an agreement entered into under
(2)(A) Any agreement under this section with a hospital with more than 49 beds shall provide that no payment may be made for extended care services which are furnished to an extended care patient after the end of the 5-day period (excluding weekends and holidays) beginning on an availability date for a skilled nursing facility, unless the patient's physician certifies, within such 5-day period, that the transfer of that patient to that facility is not medically appropriate on the availability date. The Secretary shall prescribe regulations to provide for notice by skilled nursing facilities of availability dates to hospitals which have agreements under this section and which are located within the same geographic region (as defined by the Secretary).
(B) In this paragraph:
(i) The term "availability date" means, with respect to an extended care patient at a hospital, any date on which a bed is available for the patient in a skilled nursing facility located within the geographic region in which the hospital is located.
(ii) The term "extended care patient" means an individual being furnished extended care services at a hospital pursuant to an agreement with the Secretary under this section.
(3) In the case of an agreement for a cost reporting period under this section with a hospital that has more than 49 beds, payment may not be made in the period for patient-days of extended care services that exceed 15 percent of the product of the number of days in the period and the average number of licensed beds in the hospital in the period, except that such payment shall continue to be made in the period for those patients who are receiving extended care services at the time the hospital reaches the limit specified in this paragraph.
(e) Reimbursement for routine hospital services
During a period for which a hospital has in effect an agreement under this section, in order to allocate routine costs between hospital and long-term care services for purposes of determining payment for inpatient hospital services, the total reimbursement due for routine services from all classes of long-term care patients (including this subchapter, subchapter XIX of this chapter, and private pay patients) shall be subtracted from the hospital's total routine costs before calculations are made to determine this subchapter reimbursement for routine hospital services.
(f) Conditions applicable to skilled nursing facilities
A hospital which enters into an agreement with the Secretary under this section shall be required to meet those conditions applicable to skilled nursing facilities relating to discharge planning and the social services function (and staffing requirements to satisfy it) which are promulgated by the Secretary under
(g) Agreements on demonstration basis
The Secretary may enter into an agreement under this section on a demonstration basis with any hospital which does not meet the requirement of subsection (b)(1) of this section, if the hospital otherwise meets the requirements of this section.
(Aug. 14, 1935, ch. 531, title XVIII, §1883, as added Dec. 5, 1980,
References in Text
Amendments
1990—Subsec. (a)(2)(B)(ii)(II).
1989—Subsecs. (d)(1), (f).
1988—Subsec. (d)(1).
Subsec. (d)(3).
Subsec. (f).
1987—Subsec. (b)(1).
Subsec. (d).
Subsec. (f).
Effective Date of 1990 Amendment
Section 4008(j)(4) of
Effective Date of 1989 Amendment
Amendment by
Effective Date of 1988 Amendments
Amendment by
Amendment by section 104(d)(6) of
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4005(b)(4) of
Amendment by section 4201(d)(3) of
Effective Date
Section 904(d) of
Hold Harmless for Amendment by Pub. L. 101–508
Section 4008(j)(2) of
Swing Beds Certified Prior to May 1, 1987
Section 4008(j)(3) of
Report of Hospital Admissions for Extended Care Services
Section 4005(b)(3) of
Report on Hospital Providers of Extended Care, Skilled Nursing, and Intermediate Care Services
Section 904(c) of
Section Referred to in Other Sections
This section is referred to in
1 See References in Text note below.
§1395uu. Payments to promote closing or conversion of underutilized hospital facilities
(a) Transitional allowances; procedures applicable
Any hospital may file an application with the Secretary (in such form and including such data and information as the Secretary may require) for establishment of a transitional allowance under this subchapter with respect to the closing or conversion of an underutilized hospital facility. The Secretary also may establish procedures, consistent with this section, by which a hospital, before undergoing an actual closure or conversion of a hospital facility, can have a determination made as to whether or not it will be eligible for a transitional allowance under this section with respect to such closure or conversion.
(b) Allowable costs as transitional allowances; findings and determinations
If the Secretary finds, after consideration of an application under subsection (a) of this section, that—
(1) the hospital's closure or conversion—
(A) is formally initiated after September 30, 1981,
(B) is expected to benefit the program under this subchapter by (i) eliminating excess bed capacity, (ii) discontinuing an underutilized service for which there are adequate alternative sources, or (iii) substituting for the underutilized service some other service which is needed in the area, and
(C) is consistent with the findings of an appropriate health planning agency and with any applicable State program for reduction in the number of hospital beds in the State, and
(2) in the case of a complete closure of a hospital—
(A) the hospital is a private nonprofit hospital or a local governmental hospital, and
(B) the closure is not for replacement of the hospital,
the Secretary may include as an allowable cost in the hospital's reasonable cost (for the purpose of making payments to the hospital under this subchapter) an amount (in this section referred to as a "transitional allowance"), as provided in subsection (c) of this section.
(c) Factors determinative of transitional allowance
(1) Each transitional allowance established shall be reasonably related to the prior or prospective use of the facility involved under this subchapter and shall recognize—
(A) in the case of a facility conversion or closure (other than a complete closure of a hospital)—
(i) in the case of a private nonprofit or local governmental hospital, that portion of the hospital's costs attributable to capital assets of the facility which have been taken into account in determining reasonable cost for purposes of determining the amount of payment to the hospital under this subchapter, and
(ii) in the case of any hospital, transitional operating cost increases related to the conversion or closure to the extent that such operating costs exceed amounts ordinarily reimbursable under this subchapter; and
(B) in the case of complete closure of a hospital, the outstanding portion of actual debt obligations previously recognized as reasonable for purposes of reimbursement under this subchapter, less any salvage value of the hospital.
(2) A transitional allowance shall be for a period (not to exceed 20 years) specified by the Secretary, except that, in the case of a complete closure described in paragraph (1)(B), the Secretary may provide for a lump-sum allowance where the Secretary determines that such a one-time allowance is more efficient and economical.
(3) A transitional allowance shall take effect on a date established by the Secretary, but not earlier than the date of completion of the closure or conversion concerned.
(4) A transitional allowance shall not be considered in applying the limits to costs recognized as reasonable pursuant to the third sentence of subparagraph (A) and subparagraph (L)(i) of
(d) Hearing to review determination
A hospital dissatisfied with a determination of the Secretary on its application under this section may obtain an informal or formal hearing, at the discretion of the Secretary, by filing (in such form and within such time period as the Secretary establishes) a request for such a hearing. The Secretary shall make a final determination on such application within 30 days after the last day of such hearing.
(Aug. 14, 1935, ch. 531, title XVIII, §1884, as added Aug. 13, 1981,
Amendments
1982—Subsec. (d).
Effective Date of 1982 Amendment
Amendment by
Effective Date
Section 2101(c) of
Payments To Promote Closure and Conversion of Underutilized Hospital Facilities
Establishment and Evaluation of Transitional Allowances; Report and Recommendations to Congress
Section 2101(b) of
Section Referred to in Other Sections
This section is referred to in
§1395vv. Withholding payments from certain medicaid providers
(a) Adjustments by Secretary
The Secretary may adjust, in accordance with this section, payments under parts A and B to any institution which has in effect an agreement with the Secretary under
(1) has (or previously had) in effect an agreement with a State agency to furnish medical care and services under a State plan approved under subchapter XIX of this chapter, and
(2) from which (or from whom) such State agency (A) has been unable to recover overpayments made under the State plan, or (B) has been unable to collect the information necessary to enable it to determine the amount (if any) of the overpayments made to such institution or person under the State plan.
(b) Implementing regulations; notice, opportunity to be heard, etc.
The Secretary shall by regulation provide procedures for implementation of this section, which procedures shall—
(1) assure that the authority under this section is exercised only on behalf of a State agency which demonstrates to the Secretary's satisfaction that it has provided adequate notice of a determination or of a need for information, and an opportunity to appeal such determination or to provide such information,
(2) determine the amount of the payment to which the institution or person would otherwise be entitled under this subchapter which shall be treated as a setoff against overpayments under subchapter XIX of this chapter, and
(3) assure the restoration to the institution or person of amounts withheld under this section which are ultimately determined to be in excess of overpayments under subchapter XIX of this chapter and to which the institution or person would otherwise be entitled under this subchapter.
(c) Payment to States of amounts recovered
Notwithstanding any other provision of this chapter, from the trust funds established under
(Aug. 14, 1935, ch. 531, title XVIII, §1885, as added Aug. 13, 1981,
§1395ww. Payments to hospitals for inpatient hospital services
(a) Determination of costs for inpatient hospital services; limitations; exemptions; "operating costs of inpatient hospital services" defined
(1)(A)(i) The Secretary, in determining the amount of the payments that may be made under this subchapter with respect to operating costs of inpatient hospital services (as defined in paragraph (4)) shall not recognize as reasonable (in the efficient delivery of health services) costs for the provision of such services by a hospital for a cost reporting period to the extent such costs exceed the applicable percentage (as determined under clause (ii)) of the average of such costs for all hospitals in the same grouping as such hospital for comparable time periods.
(ii) For purposes of clause (i), the applicable percentage for hospital cost reporting periods beginning—
(I) on or after October 1, 1982, and before October 1, 1983, is 120 percent;
(II) on or after October 1, 1983, and before October 1, 1984, is 115 percent; and
(III) on or after October 1, 1984, is 110 percent.
(B)(i) For purposes of subparagraph (A) the Secretary shall establish case mix indexes for all short-term hospitals, and shall set limits for each hospital based upon the general mix of types of medical cases with respect to which such hospital provides services for which payment may be made under this subchapter.
(ii) The Secretary shall set such limits for a cost reporting period of a hospital—
(I) by updating available data for a previous period to the immediate preceding cost reporting period by the estimated average rate of change of hospital costs industry-wide, and
(II) by projecting for the cost reporting period by the applicable percentage increase (as defined in subsection (b)(3)(B) of this section).
(C) The limitation established under subparagraph (A) for any hospital shall in no event be lower than the allowable operating costs of inpatient hospital services (as defined in paragraph (4)) recognized under this subchapter for such hospital for such hospital's last cost reporting period prior to the hospital's first cost reporting period for which this section is in effect.
(D) Subparagraph (A) shall not apply to cost reporting periods beginning on or after October 1, 1983.
(2) The Secretary shall provide for such exemptions from, and exceptions and adjustments to, the limitation established under paragraph (1)(A) as he deems appropriate, including those which he deems necessary to take into account—
(A) the special needs of sole community hospitals, of new hospitals, of risk based health maintenance organizations, and of hospitals which provide atypical services or essential community services, and to take into account extraordinary circumstances beyond the hospital's control, medical and paramedical education costs, significantly fluctuating population in the service area of the hospital, and unusual labor costs,
(B) the special needs of psychiatric hospitals and of public or other hospitals that serve a significantly disproportionate number of patients who have low income or are entitled to benefits under part A of this subchapter, and
(C) a decrease in the inpatient hospital services that a hospital provides and that are customarily provided directly by similar hospitals which results in a significant distortion in the operating costs of inpatient hospital services.
(3) The limitation established under paragraph (1)(A) shall not apply with respect to any hospital which—
(A) is located outside of a standard metropolitan statistical area, and
(B)(i) has less than 50 beds, and
(ii) was in operation and had less than 50 beds on September 3, 1982.
(4) For purposes of this section, the term "operating costs of inpatient hospital services" includes all routine operating costs, ancillary service operating costs, and special care unit operating costs with respect to inpatient hospital services as such costs are determined on an average per admission or per discharge basis (as determined by the Secretary), and includes the costs of all services for which payment may be made under this subchapter that are provided by the hospital (or by an entity wholly owned or operated by the hospital) to the patient during the 3 days (or, in the case of a hospital that is not a subsection (d) hospital, during the 1 day) immediately preceding the date of the patient's admission if such services are diagnostic services (including clinical diagnostic laboratory tests) or are other services related to the admission (as defined by the Secretary). Such term does not include costs of approved educational activities, a return on equity capital, or,1 other capital-related costs (as defined by the Secretary for periods before October 1, 1987).
(b) Computation of payment; definitions; exemptions; adjustments
(1) Notwithstanding
(A) are less than or equal to the target amount (as defined in paragraph (3)) for that hospital for that period, the amount of the payment with respect to such operating costs payable under part A of this subchapter on a per discharge or per admission basis (as the case may be) shall be equal to the amount of such operating costs, plus—
(i) 50 percent of the amount by which the target amount exceeds the amount of the operating costs, or
(ii) 5 percent of the target amount,
whichever is less; or
(B) are greater than the target amount, the amount of the payment with respect to such operating costs payable under part A of this subchapter on a per discharge or per admission basis (as the case may be) shall be equal to (i) the target amount, plus (ii) in the case of cost reporting periods beginning on or after October 1, 1991, an additional amount equal to 50 percent of the amount by which the operating costs exceed the target amount (except that such additional amount may not exceed 10 percent of the target amount) after any exceptions or adjustments are made to such target amount for the cost reporting period;
except that in no case may the amount payable under this subchapter (other than on the basis of a DRG prospective payment rate determined under subsection (d) of this section) with respect to operating costs of inpatient hospital services exceed the maximum amount payable with respect to such costs pursuant to subsection (a) of this section.
(2) Repealed.
(3)(A) Except as provided in subparagraphs (C), (D), and (E), for purposes of this subsection, the term "target amount" means, with respect to a hospital for a particular 12-month cost reporting period—
(i) in the case of the first such reporting period for which this subsection is in effect, the allowable operating costs of inpatient hospital services (as defined in subsection (a)(4) of this section) recognized under this subchapter for such hospital for the preceding 12-month cost reporting period, and
(ii) in the case of a later reporting period, the target amount for the preceding 12-month cost reporting period,
increased by the applicable percentage increase under subparagraph (B) for that particular cost reporting period.
(B)(i) For purposes of subsection (d) of this section for discharges occurring during a fiscal year, the "applicable percentage increase" shall be—
(I) for fiscal year 1986, ½ percent,
(II) for fiscal year 1987, 1.15 percent,
(III) for fiscal year 1988, 3.0 percent for hospitals located in a rural area, 1.5 percent for hospitals located in a large urban area (as defined in subsection (d)(2)(D) of this section), and 1.0 percent for hospitals located in other urban areas,
(IV) for fiscal year 1989, the market basket percentage increase minus 1.5 percent for hospitals located in a rural area, the market basket percentage increase minus 2.0 percentage points for hospitals located in a large urban area, and the market basket percentage increase minus 2.5 percentage points for hospitals located in other urban areas,
(V) for fiscal year 1990, the market basket percentage increase plus 4.22 percentage points for hospitals located in a rural area, the market basket percentage increase plus 0.12 percentage points for hospitals located in a large urban area, and the market basket percentage increase minus 0.53 percentage points for hospitals located in other urban areas,
(VI) for fiscal year 1991, the market basket percentage increase minus 2.0 percentage points for hospitals in a large urban or other urban area, and the market basket percentage increase minus 0.7 percentage point for hospitals located in a rural area,
(VII) for fiscal year 1992, the market basket percentage increase minus 1.6 percentage points for hospitals in a large urban or other urban area, and the market basket percentage increase minus 0.6 percentage point for hospitals located in a rural area,
(VIII) for fiscal year 1993, the market basket percentage increase minus 1.55 percentage point for hospitals in a large urban or other urban area, and the market basket percentage increase minus 0.55 2 for hospitals located in a rural area,
(IX) for fiscal year 1994, the market basket percentage increase minus 2.5 percentage points for hospitals located in a large urban or other urban area, and the market basket percentage increase minus 1.0 percentage point for hospitals located in a rural area,
(X) for fiscal year 1995, the market basket percentage increase minus 2.5 percentage points for hospitals located in a large urban or other urban area, and such percentage increase for hospitals located in a rural area as will provide for the average standardized amount determined under subsection (d)(3)(A) of this section for hospitals located in a rural area being equal to such average standardized amount for hospitals located in an urban area (other than a large urban area),
(XI) for fiscal year 1996, the market basket percentage increase minus 2.0 percentage points for hospitals in all areas,
(XII) for fiscal year 1997, the market basket percentage increase minus 0.5 percentage point for hospitals in all areas, and
(XIII) for fiscal year 1998 and each subsequent fiscal year, the market basket percentage increase for hospitals in all areas.
(ii) For purposes of subparagraphs (A) and (E), the "applicable percentage increase" for 12-month cost reporting periods beginning during—
(I) fiscal year 1986, is 0.5 percent,
(II) fiscal year 1987, is 1.15 percent,
(III) fiscal year 1988, is the market basket percentage increase minus 2.0 percentage points,
(IV) a subsequent fiscal year ending on or before September 30, 1993, is the market basket percentage increase,
(V) fiscal years 1994 through 1997, is the market basket percentage increase minus the applicable reduction (as defined in clause (v)(II)), or in the case of a hospital for a fiscal year for which the hospital's update adjustment percentage (as defined in clause (v)(I)) is at least 10 percent, the market basket percentage increase, and
(VI) subsequent fiscal years is the market basket percentage increase.
(iii) For purposes of this subparagraph, the term "market basket percentage increase" means, with respect to cost reporting periods and discharges occurring in a fiscal year, the percentage, estimated by the Secretary before the beginning of the period or fiscal year, by which the cost of the mix of goods and services (including personnel costs but excluding nonoperating costs) comprising routine, ancillary, and special care unit inpatient hospital services, based on an index of appropriately weighted indicators of changes in wages and prices which are representative of the mix of goods and services included in such inpatient hospital services, for the period or fiscal year will exceed the cost of such mix of goods and services for the preceding 12-month cost reporting period or fiscal year.
(iv) For purposes of subparagraphs (C) and (D), the "applicable percentage increase" is—
(I) for 12-month cost reporting periods beginning during fiscal years 1986 through 1993, the applicable percentage increase specified in clause (ii),
(II) for fiscal year 1994, the market basket percentage increase minus 2.3 percentage points (adjusted to exclude any portion of a cost reporting period beginning during fiscal year 1993 for which the applicable percentage increase is determined under subparagraph (I)),
(III) for fiscal year 1995, the market basket percentage increase minus 2.2 percentage points, and
(IV) for fiscal year 1996 and each subsequent fiscal year, the applicable percentage increase under clause (i).
(v) For purposes of clause (ii)(V)—
(I) a hospital's "update adjustment percentage" for a fiscal year is the percentage by which the hospital's allowable operating costs of inpatient hospital services recognized under this subchapter for the cost reporting period beginning in fiscal year 1990 exceeds the hospital's target amount (as determined under subparagraph (A)) for such cost reporting period, increased for each fiscal year (beginning with fiscal year 1994) by the sum of any of the hospital's applicable reductions under subclause (V) for previous fiscal years; and
(II) the "applicable reduction" with respect to a hospital for a fiscal year is the lesser of 1 percentage point or the percentage point difference between 10 percent and the hospital's update adjustment percentage for the fiscal year.
(C) In the case of a hospital that is a sole community hospital (as defined in subsection (d)(5)(D)(iii) of this section), the term "target amount" means—
(i) with respect to the first 12-month cost reporting period in which this subparagraph is applied to the hospital—
(I) the allowable operating costs of inpatient hospital services (as defined in subsection (a)(4) of this section) recognized under this subchapter for the hospital for the 12-month cost reporting period (in this subparagraph referred to as the "base cost reporting period") preceding the first cost reporting period for which this subsection was in effect with respect to such hospital, increased (in a compounded manner) by—
(II) the applicable percentage increases applied to such hospital under this paragraph for cost reporting periods after the base cost reporting period and up to and including such first 12-month cost reporting period,
(ii) with respect to a later cost reporting period beginning before fiscal year 1994, the target amount for the preceding 12-month cost reporting period, increased by the applicable percentage increase under subparagraph (B)(iv) for discharges occurring in the fiscal year in which that later cost reporting period begins,
(iii) with respect to discharges occurring in fiscal year 1994, the target amount for the cost reporting period beginning in fiscal year 1993 increased by the applicable percentage increase under subparagraph (B)(iv), or
(iv) with respect to discharges occurring in fiscal year 1995 and each subsequent fiscal year, the target amount for the preceding year increased by the applicable percentage increase under subparagraph (B)(iv).
There shall be substituted for the base cost reporting period described in clause (i) a hospital's cost reporting period (if any) beginning during fiscal year 1987 if such substitution results in an increase in the target amount for the hospital.
(D) For cost reporting periods ending on or before September 30, 1994, in the case of a hospital that is a medicare-dependent, small rural hospital (as defined in subsection (d)(5)(G) of this section), the term "target amount" means—
(i) with respect to the first 12-month cost reporting period in which this subparagraph is applied to the hospital—
(I) the allowable operating costs of inpatient hospital services (as defined in subsection (a)(4) of this section) recognized under this subchapter for the hospital for the 12-month cost reporting period (in this subparagraph referred to as the "base cost reporting period") preceding the first cost reporting period for which this subsection was in effect with respect to such hospital, increased (in a compounded manner) by—
(II) the applicable percentage increases applied to such hospital under this paragraph for cost reporting periods after the base cost reporting period and up to and including such first 12-month cost reporting period, or
(ii) with respect to a later cost reporting period beginning before fiscal year 1994, the target amount for the preceding 12-month cost reporting period, increased by the applicable percentage increase under subparagraph (B)(iv) for discharges occurring in the fiscal year in which that later cost reporting period begins, and
(iii) with respect to discharges occurring in fiscal year 1994, the target amount for the cost reporting period beginning in fiscal year 1993 increased by the applicable percentage increase under subparagraph (B)(iv).
There shall be substituted for the base cost reporting period described in clause (i) a hospital's cost reporting period (if any) beginning during fiscal year 1987 if such substitution results in an increase in the target amount for the hospital.
(E) In the case of a hospital described in clause (v) of subsection (d)(1)(B) of this section, the term "target amount" means—
(i) with respect to the first 12-month cost reporting period in which this subparagraph is applied to the hospital—
(I) the allowable operating costs of inpatient hospital services (as defined in subsection (a)(4) of this section) recognized under this subchapter for the hospital for the 12-month cost reporting period (in this subparagraph referred to as the "base cost reporting period") preceding the first cost reporting period for which this subsection was in effect with respect to such hospital, increased (in a compounded manner) by—
(II) the sum of the applicable percentage increases applied to such hospital under this paragraph for cost reporting periods after the base cost reporting period and up to and including such first 12-month cost reporting period, or
(ii) with respect to a later cost reporting period, the target amount for the preceding 12-month cost reporting period, increased by the applicable percentage increase under subparagraph (B)(ii) for that later cost reporting period.
There shall be substituted for the base cost reporting period described in clause (i) a hospital's cost reporting period (if any) beginning during fiscal year 1987 if such substitution results in an increase in the target amount for the hospital.
(4)(A)(i) The Secretary shall provide for an exemption from, or an exception and adjustment to, the method under this subsection for determining the amount of payment to a hospital where events beyond the hospital's control or extraordinary circumstances, including changes in the case mix of such hospital, create a distortion in the increase in costs for a cost reporting period (including any distortion in the costs for the base period against which such increase is measured). The Secretary may provide for such other exemptions from, and exceptions and adjustments to, such method as the Secretary deems appropriate, including the assignment of a new base period which is more representative, as determined by the Secretary, of the reasonable and necessary cost of inpatient services and including those which he deems necessary to take into account a decrease in the inpatient hospital services that a hospital provides and that are customarily provided directly by similar hospitals which results in a significant distortion in the operating costs of inpatient hospital services. The Secretary shall announce a decision on any request for an exemption, exception, or adjustment under this paragraph not later than 180 days after receiving a completed application from the intermediary for such exemption, exception, or adjustment, and shall include in such decision a detailed explanation of the grounds on which such request was approved or denied.
(ii) The payment reductions under paragraph (3)(B)(ii)(V) shall not be considered by the Secretary in making adjustments pursuant to clause (i).
(B) In determining under subparagraph (A) whether to assign a new base period which is more representative of the reasonable and necessary cost to a hospital of providing inpatient services, the Secretary shall take into consideration—
(i) changes in applicable technologies and medical practices, or differences in the severity of illness among patients, that increase the hospital's costs;
(ii) whether increases in wages and wage-related costs for hospitals located in the geographic area in which the hospital is located exceed the average of the increases in such costs paid by hospitals in the United States; and
(iii) such other factors as the Secretary considers appropriate in determining increases in the hospital's costs of providing inpatient services.
(C) Paragraph (1) shall not apply to payment of hospitals which is otherwise determined under paragraph (3) of
(5) In the case of any hospital having any cost reporting period of other than a 12-month period, the Secretary shall determine the 12-month period which shall be used for purposes of this section.
(6) In the case of any hospital which becomes subject to the taxes under section 3111 of the Internal Revenue Code of 1986, with respect to any or all of its employees, for part or all of a cost reporting period, and was not subject to such taxes with respect to any or all of its employees for all or part of the 12-month base cost reporting period referred to in subsection (b)(3)(A)(i) of this section, the Secretary shall provide for an adjustment by increasing the base period amount described in such subsection for such hospital by an amount equal to the amount of such taxes which would have been paid or accrued by such hospital for such base period if such hospital had been subject to such taxes for all of such base period with respect to all its employees, minus the amount of any such taxes actually paid or accrued for such base period.
(c) Payment in accordance with State hospital reimbursement control system; amount of payment; discontinuance of payments
(1) The Secretary may provide, in his discretion, that payment with respect to services provided by a hospital in a State may be made in accordance with a hospital reimbursement control system in a State, rather than in accordance with the other provisions of this title, if the chief executive officer of the State requests such treatment and if—
(A) the Secretary determines that the system, if approved under this subsection, will apply (i) to substantially all non-Federal acute care hospitals (as defined by the Secretary) in the State and (ii) to the review of at least 75 percent of all revenues or expenses in the State for inpatient hospital services and of revenues or expenses for inpatient hospital services provided under the State's plan approved under subchapter XIX of this chapter;
(B) the Secretary has been provided satisfactory assurances as to the equitable treatment under the system of all entities (including Federal and State programs) that pay hospitals for inpatient hospital services, of hospital employees, and of hospital patients;
(C) the Secretary has been provided satisfactory assurances that under the system, over 36-month periods (the first such period beginning with the first month in which this subsection applies to that system in the State), the amount of payments made under this subchapter under such system will not exceed the amount of payments which would otherwise have been made under this subchapter not using such system;
(D) the Secretary determines that the system will not preclude an eligible organization (as defined in
(E) the Secretary determines that the system requires hospitals to meet the requirement of
The Secretary cannot deny the application of a State under this subsection on the ground that the State's hospital reimbursement control system is based on a payment methodology other than on the basis of a diagnosis-related group or on the ground that the amount of payments made under this subchapter under such system must be less than the amount of payments which would otherwise have been made under this subchapter not using such system. If the Secretary determines that the conditions described in subparagraph (C) are based on maintaining payment amounts at no more than a specified percentage increase above the payment amounts in a base period, the State has the option of applying such test (for inpatient hospital services under part A of this subchapter) on an aggregate payment basis or on the basis of the amount of payment per inpatient discharge or admission. If the Secretary determines that the conditions described in subparagraph (C) are based on maintaining aggregate payment amounts below a national average percentage increase in total payments under part A of this subchapter for inpatient hospital services, the Secretary cannot deny the application of a State under this subsection on the ground that the State's rate of increase in such payments for such services must be less than such national average rate of increase.
(2) In determining under paragraph (1)(C) the amount of payment which would otherwise have been made under this subchapter for a State, the Secretary may provide for appropriate adjustment of such amount to take into account previous reductions effected in the amount of payments made under this subchapter in the State due to the operation of the hospital reimbursement control system in the State if the system has resulted in an aggregate rate of increase in operating costs of inpatient hospital services (as defined in subsection (a)(4) of this section) under this subchapter for hospitals in the State which is less than the aggregate rate of increase in such costs under this subchapter for hospitals in the United States.
(3) The Secretary shall discontinue payments under a system described in paragraph (1) if the Secretary—
(A) determines that the system no longer meets the requirements of subparagraphs (A), (D), and (E) of paragraph (1) and, if applicable, the requirements of paragraph (5), or
(B) has reason to believe that the assurances described in subparagraph (B) or (C) of paragraph (1) (or, if applicable, in paragraph (5)) are not being (or will not be) met.
(4) The Secretary shall approve the request of a State under paragraph (1) with respect to a hospital reimbursement control system if—
(A) the requirements of subparagraphs (A), (B), (C), (D), and (E) of paragraph (1) have been met with respect to the system, and
(B) with respect to that system a waiver of certain requirements of this subchapter has been approved on or before (and which is in effect as of) April 20, 1983, pursuant to
With respect to a State system described in this paragraph, the Secretary shall judge the effectiveness of such system on the basis of its rate of increase or inflation in inpatient hospital payments for individuals under this subchapter, as compared to the national rate of increase or inflation for such payments, with the State retaining the option to have the test applied on the basis of the aggregate payments under the State system as compared to aggregate payments which would have been made under the national system since October 1, 1984, to the most recent date for which annual data are available.
(5) The Secretary shall approve the request of a State under paragraph (1) with respect to a hospital reimbursement control system if—
(A) the requirements of subparagraphs (A), (B), (C), (D), and (E) of paragraph (1) have been met with respect to the system;
(B) the Secretary determines that the system—
(i) is operated directly by the State or by an entity designated pursuant to State law,
(ii) provides for payment of hospitals covered under the system under a methodology (which sets forth exceptions and adjustments, as well as any method for changes in the methodology) by which rates or amounts to be paid for hospital services during a specified period are established under the system prior to the defined rate period, and
(iii) hospitals covered under the system will make such reports (in lieu of cost and other reports, identified by the Secretary, otherwise required under this subchapter) as the Secretary may require in order to properly monitor assurances provided under this subsection;
(C) the State has provided the Secretary with satisfactory assurances that operation of the system will not result in any change in hospital admission practices which result in—
(i) a significant reduction in the proportion of patients (receiving hospital services covered under the system) who have no third-party coverage and who are unable to pay for hospital services,
(ii) a significant reduction in the proportion of individuals admitted to hospitals for inpatient hospital services for which payment is (or is likely to be) less than the anticipated charges for or costs of such services,
(iii) the refusal to admit patients who would be expected to require unusually costly or prolonged treatment for reasons other than those related to the appropriateness of the care available at the hospital, or
(iv) the refusal to provide emergency services to any person who is in need of emergency services if the hospital provides such services;
(D) any change by the State in the system which has the effect of materially reducing payments to hospitals can only take effect upon 60 days notice to the Secretary and to the hospitals the payment to which is likely to be materially affected by the change; and
(E) the State has provided the Secretary with satisfactory assurances that in the development of the system the State has consulted with local governmental officials concerning the impact of the system on public hospitals.
The Secretary shall respond to requests of States under this paragraph within 60 days of the date the request is submitted to the Secretary.
(6) If the Secretary determines that the assurances described in paragraph (1)(C) have not been met with respect to any 36-month period, the Secretary may reduce payments under this subchapter to hospitals under the system in an amount equal to the amount by which the payment under this subchapter under such system for such period exceeded the amount of payments which would otherwise have been made under this subchapter not using such system.
(7) In the case of a State which made a request under paragraph (5) before December 31, 1984, for the approval of a State hospital reimbursement control system and which request was approved—
(A) in applying paragraphs (1)(C) and (6), a reference to a "36-month period" is deemed a reference to a "48-month period", and
(B) in order to allow the State the opportunity to provide the assurances described in paragraph (1)(C) for a 48-month period, the Secretary may not discontinue payments under the system, under the authority of paragraph (3)(A) because the Secretary has reason to believe that such assurances are not being (or will not be) met, before July 1, 1986.
(d) Inpatient hospital service payments on basis of prospective rates; Medicare Geographical Classification Review Board
(1)(A) Notwithstanding
(i) beginning on or after October 1, 1983, and before October 1, 1984, is equal to the sum of—
(I) the target percentage (as defined in subparagraph (C)) of the hospital's target amount for the cost reporting period (as defined in subsection (b)(3)(A) of this section, but determined without the application of subsection (a) of this section), and
(II) the DRG percentage (as defined in subparagraph (C)) of the regional adjusted DRG prospective payment rate determined under paragraph (2) for such discharges;
(ii) beginning on or after October 1, 1984, and before October 1, 1987, is equal to the sum of—
(I) the target percentage (as defined in subparagraph (C)) of the hospital's target amount for the cost reporting period (as defined in subsection (b)(3)(A) of this section, but determined without the application of subsection (a) of this section), and
(II) the DRG percentage (as defined in subparagraph (C)) of the applicable combined adjusted DRG prospective payment rate determined under subparagraph (D) for such discharges; or
(iii) beginning on or after April 1, 1988, is equal to—
(I) the national adjusted DRG prospective payment rate determined under paragraph (3) for such discharges, or
(II) for discharges occurring during a fiscal year ending on or before September 30, 1996, the sum of 85 percent of the national adjusted DRG prospective payment rate determined under paragraph (3) for such discharges and 15 percent of the regional adjusted DRG prospective payment rate determined under such paragraph, but only if the average standardized amount (described in clause (i)(I) or clause (ii)(I) of paragraph (3)(D)) for hospitals within the region of, and in the same large urban or other area (or, for discharges occurring during a fiscal year ending on or before September 30, 1994, the same large urban or other area) as, the hospital is greater than the average standardized amount (described in the respective clause) for hospitals within the United States in that type of area for discharges occurring during such fiscal year.
(B) As used in this section, the term "subsection (d) hospital" means a hospital located in one of the fifty States or the District of Columbia other than—
(i) a psychiatric hospital (as defined in
(ii) a rehabilitation hospital (as defined by the Secretary),
(iii) a hospital whose inpatients are predominantly individuals under 18 years of age,
(iv) a hospital which has an average inpatient length of stay (as determined by the Secretary) of greater than 25 days, or
(v) a hospital that the Secretary has classified, at any time on or before December 31, 1990,3 (or, in the case of a hospital that, as of December 19, 1989, is located in a State operating a demonstration project under
and, in accordance with regulations of the Secretary, does not include a psychiatric or rehabilitation unit of the hospital which is a distinct part of the hospital (as defined by the Secretary).
(C) For purposes of this subsection, for cost reporting periods beginning—
(i) on or after October 1, 1983, and before October 1, 1984, the "target percentage" is 75 percent and the "DRG percentage" is 25 percent;
(ii) on or after October 1, 1984, and before October 1, 1985, the "target percentage" is 50 percent and the "DRG percentage" is 50 percent;
(iii) on or after October 1, 1985, and before October 1, 1986, the "target percentage" is 45 percent and the "DRG percentage" is 55 percent; and
(iv) on or after October 1, 1986, and before October 1, 1987, the "target percentage" is 25 percent and the "DRG percentage" is 75 percent.
(D) For purposes of subparagraph (A)(ii)(II), the "applicable combined adjusted DRG prospective payment rate" for discharges occurring—
(i) on or after October 1, 1984, and before October 1, 1986, is a combined rate consisting of 25 percent of the national adjusted DRG prospective payment rate, and 75 percent of the regional adjusted DRG prospective payment rate, determined under paragraph (3) for such discharges; and
(ii) on or after October 1, 1986, and before October 1, 1987, is a combined rate consisting of 50 percent of the national adjusted DRG prospective payment rate, and 50 percent of the regional adjusted DRG prospective payment rate, determined under paragraph (3) for such discharges.
(2) The Secretary shall determine a national adjusted DRG prospective payment rate, for each inpatient hospital discharge in fiscal year 1984 involving inpatient hospital services of a subsection (d) hospital in the United States, and shall determine a regional adjusted DRG prospective payment rate for such discharges in each region, for which payment may be made under part A of this subchapter. Each such rate shall be determined for hospitals located in urban or rural areas within the United States or within each such region, respectively, as follows:
(A) The Secretary shall determine the allowable operating costs per discharge of inpatient hospital services for the hospital for the most recent cost reporting period for which data are available.
(B) The Secretary shall update each amount determined under subparagraph (A) for fiscal year 1984 by—
(i) updating for fiscal year 1983 by the estimated average rate of change of hospital costs industry-wide between the cost reporting period used under such subparagraph and fiscal year 1983 and the most recent case-mix data available, and
(ii) projecting for fiscal year 1984 by the applicable percentage increase (as defined in subsection (b)(3)(B) of this section) for fiscal year 1984.
(C) The Secretary shall standardize the amount updated under subparagraph (B) for each hospital by—
(i) excluding an estimate of indirect medical education costs (taking into account, for discharges occurring after September 30, 1986, the amendments made by section 9104(a) of the Medicare and Medicaid Budget Reconciliation Amendments of 1985),
(ii) adjusting for variations among hospitals by area in the average hospital wage level,
(iii) adjusting for variations in case mix among hospitals, and
(iv) for discharges occurring on or after October 1, 1986, excluding an estimate of the additional payments to certain hospitals to be made under paragraph (5)(F), except that the Secretary shall not exclude additional payments under such paragraph made as a result of the enactment of section 6003(c) of the Omnibus Budget Reconciliation Act of 1989 or the enactment of section 4002(b) of the Omnibus Budget Reconciliation Act of 1990.
(D) The Secretary shall compute an average of the standardized amounts determined under subparagraph (C) for the United States and for each region—
(i) for all subsection (d) hospitals located in an urban area within the United States or that region, respectively, and
(ii) for all subsection (d) hospitals located in a rural area within the United States or that region, respectively.
For purposes of this subsection, the term "region" means one of the nine census divisions, comprising the fifty States and the District of Columbia, established by the Bureau of the Census for statistical and reporting purposes; the term "urban area" means an area within a Metropolitan Statistical Area (as defined by the Office of Management and Budget) or within such similar area as the Secretary has recognized under subsection (a) of this section by regulation; the term "large urban area" means, with respect to a fiscal year, such an urban area which the Secretary determines (in the publications described in subsection (e)(5) of this section before the fiscal year) has a population of more than 1,000,000 (as determined by the Secretary based on the most recent available population data published by the Bureau of the Census); and the term "rural area" means any area outside such an area or similar area. A hospital located in a Metropolitan Statistical Area shall be deemed to be located in the region in which the largest number of the hospitals in the same Metropolitan Statistical Area are located, or, at the option of the Secretary, the region in which the majority of the inpatient discharges (with respect to which payments are made under this subchapter) from hospitals in the same Metropolitan Statistical Area are made.
(E) The Secretary shall reduce each of the average standardized amounts determined under subparagraph (D) by a proportion equal to the proportion (estimated by the Secretary) of the amount of payments under this subsection based on DRG prospective payment rates which are additional payments described in paragraph (5)(A) (relating to outlier payments).
(F) The Secretary shall adjust each of such average standardized amounts as may be required under subsection (e)(1)(B) of this section for that fiscal year.
(G) For each discharge classified within a diagnosis-related group, the Secretary shall establish a national DRG prospective payment rate and shall establish a regional DRG prospective payment rate for each region, each of which is equal—
(i) for hospitals located in an urban area in the United States or that region (respectively), to the product of—
(I) the average standardized amount (computed under subparagraph (D), reduced under subparagraph (E), and adjusted under subparagraph (F)) for hospitals located in an urban area in the United States or that region, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group; and
(ii) for hospitals located in a rural area in the United States or that region (respectively), to the product of—
(I) the average standardized amount (computed under subparagraph (D), reduced under subparagraph (E), and adjusted under subparagraph (F)) for hospitals located in a rural area in the United States or that region, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group.
(H) The Secretary shall adjust the proportion, (as estimated by the Secretary from time to time) of hospitals' costs which are attributable to wages and wage-related costs, of the national and regional DRG prospective payment rates computed under subparagraph (G) for area differences in hospital wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the hospital compared to the national average hospital wage level.
(3) The Secretary shall determine a national adjusted DRG prospective payment rate, for each inpatient hospital discharge in a fiscal year after fiscal year 1984 involving inpatient hospital services of a subsection (d) hospital in the United States, and shall determine a regional adjusted DRG prospective payment rate for such discharges in each region for which payment may be made under part A of this subchapter. Each such rate shall be determined for hospitals located in large urban, other urban, or rural areas within the United States and within each such region, respectively, as follows:
(A)(i) For discharges occurring in a fiscal year beginning before October 1, 1987, the Secretary shall compute an average standardized amount for hospitals located in an urban area and for hospitals located in a rural area within the United States and for hospitals located in an urban area and for hospitals located in a rural area within each region, equal to the respective average standardized amount computed for the previous fiscal year under paragraph (2)(D) or under this subparagraph, increased for the fiscal year involved by the applicable percentage increase under subsection (b)(3)(B) of this section. With respect to discharges occurring on or after October 1, 1987, the Secretary shall compute urban and rural averages on the basis of discharge weighting rather than hospital weighting, making appropriate adjustments to ensure that computation on such basis does not result in total payments under this section that are greater or less than the total payments that would have been made under this section but for this sentence, and making appropriate changes in the manner of determining the reductions under subparagraph (C)(ii).
(ii) For discharges occurring in a fiscal year beginning on or after October 1, 1987, and ending on or before September 30, 1994, the Secretary shall compute an average standardized amount for hospitals located in a large urban area, for hospitals located in a rural area, and for hospitals located in other urban areas, within the United States and within each region, equal to the respective average standardized amount computed for the previous fiscal year under this subparagraph increased by the applicable percentage increase under subsection (b)(3)(B)(i) of this section with respect to hospitals located in the respective areas for the fiscal year involved.
(iii) For discharges occurring in the fiscal year beginning on October 1, 1994, the average standardized amount for hospitals located in a rural area shall be equal to the average standardized amount for hospitals located in an other 4 urban area. For discharges occurring on or after October 1, 1994, the Secretary shall adjust the ratio of the labor portion to non-labor portion of each average standardized amount to equal such ratio for the national average of all standardized amounts.
(iv) For discharges occurring in a fiscal year beginning on or after October 1, 1995, the Secretary shall compute an average standardized amount for hospitals located in a large urban area and for hospitals located in other areas within the United States and within each region equal to the respective average standardized amount computed for the previous fiscal year under this subparagraph increased by the applicable percentage increase under subsection (b)(3)(B)(i) of this section with respect to hospitals located in the respective areas for the fiscal year involved.
(v) Average standardized amounts computed under this paragraph shall be adjusted to reflect the most recent case-mix data available.
(B) The Secretary shall reduce each of the average standardized amounts determined under subparagraph (A) by a factor equal to the proportion of payments under this subsection (as estimated by the Secretary) based on DRG prospective payment amounts which are additional payments described in paragraph (5)(A) (relating to outlier payments).
(C)(i) For discharges occurring in fiscal year 1985, the Secretary shall adjust each of such average standardized amounts as may be required under subsection (e)(1)(B) of this section for that fiscal year.
(ii) For discharges occurring after September 30, 1986, the Secretary shall further reduce each of the average standardized amounts (in a proportion which takes into account the differing effects of the standardization effected under paragraph (2)(C)(i)) so as to provide for a reduction in the total of the payments (attributable to this paragraph) made for discharges occurring on or after October 1, 1986, of an amount equal to the estimated reduction in the payment amounts under paragraph (5)(B) that would have resulted from the enactment of the amendments made by section 9104 of the Medicare and Medicaid Budget Reconciliation Amendments of 1985 and by section 4003(a)(1) of the Omnibus Budget Reconciliation Act of 1987 if the factor described in clause (ii)(II) of paragraph (5)(B) (determined without regard to amendments made by the Omnibus Budget Reconciliation Act of 1990) were applied for discharges occurring on or after such date instead of the factor described in clause (ii) of that paragraph.
(D) For each discharge classified within a diagnosis-related group, the Secretary shall establish for the fiscal year a national DRG prospective payment rate and shall establish a regional DRG prospective payment rate for each region, each of which is equal—
(i) for hospitals located in a large urban area in the United States or that region (respectively), to the product of—
(I) the average standardized amount (computed under subparagraph (A), reduced under subparagraph (B), and adjusted or reduced under subparagraph (C)) for the fiscal year for hospitals located in such a large urban area in the United States or that region, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group; and
(ii) for hospitals located in other areas in the United States or that region (respectively), to the product of—
(I) the average standardized amount (computed under subparagraph (A), reduced under subparagraph (B), and adjusted or reduced under subparagraph (C)) for the fiscal year for hospitals located in other areas in the United States or that region, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group.
(E) The Secretary shall adjust the proportion, (as estimated by the Secretary from time to time) of hospitals' costs which are attributable to wages and wage-related costs, of the DRG prospective payment rates computed under subparagraph (D) for area differences in hospital wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the hospital compared to the national average hospital wage level. Not later than October 1, 1990, and October 1, 1993 (and at least every 12 months thereafter), the Secretary shall update the factor under the preceding sentence on the basis of a survey conducted by the Secretary (and updated as appropriate) of the wages and wage-related costs of subsection (d) hospitals in the United States. To the extent determined feasible by the Secretary, such survey shall measure the earnings and paid hours of employment by occupational category and shall exclude data with respect to the wages and wage-related costs incurred in furnishing skilled nursing facility services. Any adjustments or updates made under this subparagraph for a fiscal year (beginning with fiscal year 1991) shall be made in a manner that assures that the aggregate payments under this subsection in the fiscal year are not greater or less than those that would have been made in the year without such adjustment.
(4)(A) The Secretary shall establish a classification of inpatient hospital discharges by diagnosis-related groups and a methodology for classifying specific hospital discharges within these groups.
(B) For each such diagnosis-related group the Secretary shall assign an appropriate weighting factor which reflects the relative hospital resources used with respect to discharges classified within that group compared to discharges classified within other groups.
(C)(i) The Secretary shall adjust the classifications and weighting factors established under subparagraphs (A) and (B), for discharges in fiscal year 1988 and at least annually thereafter, to reflect changes in treatment patterns, technology, and other factors which may change the relative use of hospital resources.
(ii) For discharges in fiscal year 1990, the Secretary shall reduce the weighting factor for each diagnosis-related group by 1.22 percent.
(iii) Any such adjustment under clause (i) for discharges in a fiscal year (beginning with fiscal year 1991) shall be made in a manner that assures that the aggregate payments under this subsection for discharges in the fiscal year are not greater or less than those that would have been made for discharges in the year without such adjustment.
(iv) The Secretary shall include recommendations with respect to adjustments to weighting factors under clause (i) in the annual report to Congress required under subsection (e)(3)(B) of this section.
(5)(A)(i) For discharges occurring during fiscal years ending on or before September 30, 1997, the Secretary shall provide for an additional payment for a subsection (d) hospital for any discharge in a diagnosis-related group, the length of stay of which exceeds the mean length of stay for discharges within that group by a fixed number of days, or exceeds such mean length of stay by some fixed number of standard deviations, whichever is the fewer number of days.
(ii) For cases which are not included in clause (i), a subsection (d) hospital may request additional payments in any case where charges, adjusted to cost, exceed a fixed multiple of the applicable DRG prospective payment rate, or exceed such other fixed dollar amount, whichever is greater, or, for discharges in fiscal years beginning on or after October 1, 1994, exceed the applicable DRG prospective payment rate plus a fixed dollar amount determined by the Secretary.
(iii) The amount of such additional payment under clauses (i) and (ii) shall be determined by the Secretary and shall (except as payments under clause (i) are required to be reduced to take into account the requirements of clause (v)) approximate the marginal cost of care beyond the cutoff point applicable under clause (i) or (ii).
(iv) The total amount of the additional payments made under this subparagraph for discharges in a fiscal year may not be less than 5 percent nor more than 6 percent of the total payments projected or estimated to be made based on DRG prospective payment rates for discharges in that year.
(v) The Secretary shall provide that—
(I) the day outlier percentage for fiscal year 1995 shall be 75 percent of the day outlier percentage for fiscal year 1994;
(II) the day outlier percentage for fiscal year 1996 shall be 50 percent of the day outlier percentage for fiscal year 1994; and
(III) the day outlier percentage for fiscal year 1997 shall be 25 percent of the day outlier percentage for fiscal year 1994.
(vi) For purposes of this subparagraph, the term "day outlier percentage" means, for a fiscal year, the percentage of the total additional payments made by the Secretary under this subparagraph for discharges in that fiscal year which are additional payments under clause (i).
(B) The Secretary shall provide for an additional payment amount for subsection (d) hospitals with indirect costs of medical education, in an amount computed in the same manner as the adjustment for such costs under regulations (in effect as of January 1, 1983) under subsection (a)(2) of this section, except as follows:
(i) The amount of such additional payment shall be determined by multiplying (I) the sum of the amount determined under paragraph (1)(A)(ii)(II) (or, if applicable, the amount determined under paragraph (1)(A)(iii)) and the amount paid to the hospital under subparagraph (A), by (II) the indirect teaching adjustment factor described in clause (ii).
(ii) For purposes of clause (i)(II), the indirect teaching adjustment factor for discharges occurring on or after October 1, 1988, is equal to 1.89 × (((1 + r) to the nth power) −1), where "r" is the ratio of the hospital's full-time equivalent interns and residents to beds and "n" equals .405.
(iii) In determining such adjustment the Secretary shall not distinguish between those interns and residents who are employees of a hospital and those interns and residents who furnish services to a hospital but are not employees of such hospital.
(iv) In determining such adjustment, the Secretary shall continue to count interns and residents assigned to outpatient services of the hospital or providing services at any entity receiving a grant under
(C)(i) The Secretary shall provide for such exceptions and adjustments to the payment amounts established under this subsection (other than under paragraph (9)) as the Secretary deems appropriate to take into account the special needs of regional and national referral centers (including those hospitals of 275 or more beds located in rural areas). A hospital which is classified as a rural hospital may appeal to the Secretary to be classified as a rural referral center under this clause on the basis of criteria (established by the Secretary) which shall allow the hospital to demonstrate that it should be so reclassified by reason of certain of its operating characteristics being similar to those of a typical urban hospital located in the same census region and which shall not require a rural osteopathic hospital to have more than 3,000 discharges in a year in order to be classified as a rural referral center. Such characteristics may include wages, scope of services, service area, and the mix of medical specialties. The Secretary shall publish the criteria not later than August 17, 1984, for implementation by October 1, 1984. An appeal allowed under this clause must be submitted to the Secretary (in such form and manner as the Secretary may prescribe) during the quarter before the first quarter of the hospital's cost reporting period (or, in the case of a cost reporting period beginning during October 1984, during the first quarter of that period), and the Secretary must make a final determination with respect to such appeal within 60 days after the date the appeal was submitted. Any payment adjustments necessitated by a reclassification based upon the appeal shall be effective at the beginning of such cost reporting period.
(ii) The Secretary shall provide, under clause (i), for the classification of a rural hospital as a regional referral center if the hospital has a case mix index equal to or greater than the median case mix index for hospitals (other than hospitals with approved teaching programs) located in an urban area in the same region (as defined in paragraph (2)(D)), has at least 5,000 discharges a year or, if less, the median number of discharges in urban hospitals in the region in which the hospital is located (or, in the case of a rural osteopathic hospital, meets the criterion established by the Secretary under clause (i) with respect to the annual number of discharges for such hospitals), and meets any other criteria established by the Secretary under clause (i).
(D)(i) For any cost reporting period beginning on or after April 1, 1990, with respect to a subsection (d) hospital which is a sole community hospital, payment under paragraph (1)(A) shall be—
(I) an amount based on 100 percent of the hospital's target amount for the cost reporting period, as defined in subsection (b)(3)(C) of this section, or
(II) the amount determined under paragraph (1)(A)(iii),
whichever results in greater payment to the hospital.
(ii) In the case of a sole community hospital that experiences, in a cost reporting period compared to the previous cost reporting period, a decrease of more than 5 percent in its total number of inpatient cases due to circumstances beyond its control, the Secretary shall provide for such adjustment to the payment amounts under this subsection (other than under paragraph (9)) as may be necessary to fully compensate the hospital for the fixed costs it incurs in the period in providing inpatient hospital services, including the reasonable cost of maintaining necessary core staff and services.
(iii) For purposes of this subchapter, the term "sole community hospital" means any hospital—
(I) that the Secretary determines is located more than 35 road miles from another hospital,
(II) that, by reason of factors such as the time required for an individual to travel to the nearest alternative source of appropriate inpatient care (in accordance with standards promulgated by the Secretary), location, weather conditions, travel conditions, or absence of other like hospitals (as determined by the Secretary), is the sole source of inpatient hospital services reasonably available to individuals in a geographic area who are entitled to benefits under part A of this subchapter, or
(III) that is located in a rural area and designated by the Secretary as an essential access community hospital under
(iv) The Secretary shall promulgate a standard for determining whether a hospital meets the criteria for classification as a sole community hospital under clause (iii)(II) because of the time required for an individual to travel to the nearest alternative source of appropriate inpatient care.
(v) If the Secretary determines that, in the case of a hospital located in a rural area and designated by the Secretary as an essential access community hospital under
(E)(i) The Secretary shall estimate the amount of reimbursement made for services described in
(ii) The Secretary shall provide for an adjustment to the payment for subsection (d) hospitals in each fiscal year so as appropriately to reflect the net amount described in clause (i).
(F)(i) For discharges occurring on or after May 1, 1986, the Secretary shall provide, in accordance with this subparagraph, for an additional payment amount for each subsection (d) hospital which—
(I) serves a significantly disproportionate number of low-income patients (as defined in clause (v)), or
(II) is located in an urban area, has 100 or more beds, and can demonstrate that its net inpatient care revenues (excluding any of such revenues attributable to this subchapter or State plans approved under subchapter XIX of this chapter), during the cost reporting period in which the discharges occur, for indigent care from State and local government sources exceed 30 percent of its total of such net inpatient care revenues during the period.
(ii) The amount of such payment for each discharge shall be determined by multiplying (I) the sum of the amount determined under paragraph (1)(A)(ii)(II) (or, if applicable, the amount determined under paragraph (1)(A)(iii)) and the amount paid to the hospital under subparagraph (A) for that discharge, by (II) the disproportionate share adjustment percentage established under clause (iii) or (iv) for the cost reporting period in which the discharge occurs.
(iii) The disproportionate share adjustment percentage for a cost reporting period for a hospital described in clause (i)(II) is equal to 35 percent.
(iv) The disproportionate share adjustment percentage for a cost reporting period for a hospital that is not described in clause (i)(II) and that—
(I) is located in an urban area and has 100 or more beds or is described in the second sentence of clause (v), is equal to the percent determined in accordance with the applicable formula described in clause (vii);
(II) is located in an urban area and has less than 100 beds, is equal to 5 percent;
(III) is located in a rural area and is not described in subclause (IV) or (V) or in the second sentence of clause (v), is equal to 4 percent;
(IV) is located in a rural area, is classified as a rural referral center under subparagraph (C), and is classified as a sole community hospital under subparagraph (D), is equal to 10 percent or, if greater, the percent determined in accordance with the applicable formula described in clause (viii);
(V) is located in a rural area, is classified as a rural referral center under subparagraph (C), and is not classified as a sole community hospital under subparagraph (D), is equal to the percent determined in accordance with the applicable formula described in clause (viii); or
(VI) is located in a rural area, is classified as a sole community hospital under subparagraph (D), and is not classified as a rural referral center under subparagraph (C), is 10 percent.
(v) In this subparagraph, a hospital "serves a significantly disproportionate number of low income patients" for a cost reporting period if the hospital has a disproportionate patient percentage (as defined in clause (vi)) for that period which equals, or exceeds—
(I) 15 percent, if the hospital is located in an urban area and has 100 or more beds,
(II) 30 percent, if the hospital is located in a rural area and has more than 100 beds, or is located in a rural area and is classified as a sole community hospital under subparagraph (D),
(III) 40 percent, if the hospital is located in an urban area and has less than 100 beds, or
(IV) 45 percent, if the hospital is located in a rural area and is not described in subclause (II).
A hospital located in a rural area and with 500 or more beds also "serves a significantly disproportionate number of low income patients" for a cost reporting period if the hospital has a disproportionate patient percentage (as defined in clause (vi)) for that period which equals or exceeds a percentage specified by the Secretary.
(vi) In this subparagraph, the term "disproportionate patient percentage" means, with respect to a cost reporting period of a hospital, the sum of—
(I) the fraction (expressed as a percentage), the numerator of which is the number of such hospital's patient days for such period which were made up of patients who (for such days) were entitled to benefits under part A of this subchapter and were entitled to supplementary security income benefits (excluding any State supplementation) under subchapter XVI of this chapter, and the denominator of which is the number of such hospital's patient days for such fiscal year which were made up of patients who (for such days) were entitled to benefits under part A of this subchapter, and
(II) the fraction (expressed as a percentage), the numerator of which is the number of the hospital's patient days for such period which consist of patients who (for such days) were eligible for medical assistance under a State plan approved under subchapter XIX of this chapter, but who were not entitled to benefits under part A of this subchapter, and the denominator of which is the total number of the hospital's patient days for such period.
(vii) The formula used to determine the disproportionate share adjustment percentage for a cost reporting period for a hospital described in clause (iv)(I) is—
(I) in the case of such a hospital with a disproportionate patient percentage (as defined in clause (vi)) greater than 20.2—
(a) for discharges occurring on or after April 1, 1990, and on or before December 31, 1990, (P−20.2)(.65) + 5.62,
(b) for discharges occurring on or after January 1, 1991, and on or before September 30, 1993, (P−20.2)(.7) + 5.62,
(c) for discharges occurring on or after October 1, 1993, and on or before September 30, 1994, (P−20.2)(.8) + 5.88, and
(d) for discharges occurring on or after October 1, 1994, (P−20.2)(.825) + 5.88; or
(II) in the case of any other such hospital—
(a) for discharges occurring on or after April 1, 1990, and on or before December 31, 1990, (P−15)(.6) + 2.5,
(b) for discharges occurring on or after January 1, 1991, and on or before September 30, 1993, (P−15)(.6) + 2.5,5
(c) for discharges occurring on or after October 1, 1993, (P−15)(.65) + 2.5,
where "P" is the hospital's disproportionate patient percentage (as defined in clause (vi)).
(viii) The formula used to determine the disproportionate share adjustment percentage for a cost reporting period for a hospital described in clause (iv)(IV) or (iv)(V) is the percentage determined in accordance with the following formula: (P^30)(.6)+4.0, where "P" is the hospital's disproportionate patient percentage (as defined in clause (vi)).
(G)(i) For any cost reporting period beginning on or after April 1, 1990, and before October 1, 1994, in the case of a subsection (d) hospital which is a medicare-dependent, small rural hospital, payment under paragraph (1)(A) shall be equal to the sum of the amount determined under clause (ii) and the amount determined under paragraph (1)(A)(iii).
(ii) The amount determined under this clause is—
(I) for discharges occurring during the 36-month period beginning with the first day of the cost reporting period that begins on or after April 1, 1990, the amount by which the hospital's target amount for the cost reporting period (as defined in subsection (b)(3)(D) of this section) exceeds the amount determined under paragraph (1)(A)(iii); and
(II) for discharges occurring during any subsequent cost reporting period (or portion thereof) and before October 1, 1994, 50 percent of the amount by which the hospital's target amount for the cost reporting period (as defined in subsection (b)(3)(D) of this section) exceeds the amount determined under paragraph (1)(A)(iii).
(iii) In the case of a medicare dependent, small rural hospital that experiences, in a cost reporting period compared to the previous cost reporting period, a decrease of more than 5 percent in its total number of inpatient cases due to circumstances beyond its control, the Secretary shall provide for such adjustment to the payment amounts under this subsection (other than under paragraph (9)) as may be necessary to fully compensate the hospital for the fixed costs it incurs in the period in providing inpatient hospital services, including the reasonable cost of maintaining necessary core staff and services.
(iv) The term "medicare-dependent, small rural hospital" means, with respect to any cost reporting period to which clause (i) applies, any hospital—
(I) located in a rural area,
(II) that has not more than 100 beds,
(III) that is not classified as a sole community hospital under subparagraph (D), and
(IV) for which not less than 60 percent of its inpatient days or discharges during the cost reporting period beginning in fiscal year 1987 were attributable to inpatients entitled to benefits under part A of this subchapter.
(H) The Secretary may provide for such adjustments to the payment amounts under this subsection as the Secretary deems appropriate to take into account the unique circumstances of hospitals located in Alaska and Hawaii.
(I)(i) The Secretary shall provide by regulation for such other exceptions and adjustments to such payment amounts under this subsection as the Secretary deems appropriate.
(ii) In making adjustments under clause (i) for transfer cases (as defined by the Secretary) in a fiscal year, the Secretary may make adjustments to each of the average standardized amounts determined under paragraph (3) to assure that the aggregate payments made under this subsection for such fiscal year are not greater or lesser than those that would have otherwise been made in such fiscal year.
(6) The Secretary shall provide for publication in the Federal Register, on or before the September 1 before each fiscal year (beginning with fiscal year 1984), of a description of the methodology and data used in computing the adjusted DRG prospective payment rates under this subsection, including any adjustments required under subsection (e)(1)(B) of this section.
(7) There shall be no administrative or judicial review under
(A) the determination of the requirement, or the proportional amount, of any adjustment effected pursuant to subsection (e)(1) of this section, and
(B) the establishment of diagnosis-related groups, of the methodology for the classification of discharges within such groups, and of the appropriate weighting factors thereof under paragraph (4).
(8)(A) In the case of any hospital which is located in an area which is, at any time after April 20, 1983, reclassified from an urban to a rural area, payments to such hospital for the first two cost reporting periods for which such reclassification is effective shall be made as follows:
(i) For the first such cost reporting period, payment shall be equal to the amount payable to such hospital for such reporting period on the basis of the rural classification, plus an amount equal to two-thirds of the amount (if any) by which—
(I) the amount which would have been payable to such hospital for such reporting period on the basis of an urban classification, exceeds
(II) the amount payable to such hospital for such reporting period on the basis of the rural classification.
(ii) For the second such cost reporting period, payment shall be equal to the amount payable to such hospital for such reporting period on the basis of the rural classification, plus an amount equal to one-third of the amount (if any) by which—
(I) the amount which would have been payable to such hospital for such reporting period on the basis of an urban classification, exceeds
(II) the amount payable to such hospital for such reporting period on the basis of the rural classification.
(B) For purposes of this subsection, the Secretary shall treat a hospital located in a rural county adjacent to one or more urban areas as being located in the urban metropolitan statistical area to which the greatest number of workers in the county commute, if the rural county would otherwise be considered part of an urban area, under the standards for designating Metropolitan Statistical Areas (and for designating New England County Metropolitan Areas) published in the Federal Register on January 3, 1980, if the commuting rates used in determining outlying counties (or, for New England, similar recognized areas) were determined on the basis of the aggregate number of resident workers who commute to (and, if applicable under the standards, from) the central county or counties of all contiguous Metropolitan Statistical Areas (or New England County Metropolitan Areas).
(C)(i) If the application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10), by treating hospitals located in a rural county or counties as being located in an urban area, or by treating hospitals located in one urban area as being located in another urban area—
(I) reduces the wage index for that urban area (as applied under this subsection) by 1 percentage point or less, the Secretary, in calculating such wage index under this subsection, shall exclude those hospitals so treated, or
(II) reduces the wage index for that urban area by more than 1 percentage point (as applied under this subsection), the Secretary shall calculate and apply such wage index under this subsection separately to hospitals located in such urban area (excluding all the hospitals so treated) and to the hospitals so treated (as if such hospitals were located in such urban area).
(ii) If the application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10), by treating hospitals located in a rural county or counties as not being located in the rural area in a State, reduces the wage index for that rural area (as applied under this subsection), the Secretary shall calculate and apply such wage index under this subsection as if the hospitals so treated had not been excluded from calculation of the wage index for that rural area.
(iii) The application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10) may not result in the reduction of any county's wage index to a level below the wage index for rural areas in the State in which the county is located.
(iv) The application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or of the Secretary under paragraph (10) may not result in a reduction in an urban area's wage index if—
(I) the urban area has a wage index below the wage index for rural areas in the State in which it is located; or
(II) the urban area is located in a State that is composed of a single urban area.
(v) This subparagraph shall apply with respect to discharges occurring in a fiscal year only if the Secretary uses a method for making adjustments to the DRG prospective payment rate for area differences in hospital wage levels under paragraph (3)(E) for the fiscal year that is based on the use of Metropolitan Statistical Area classifications.
(D) The Secretary shall make a proportional adjustment in the standardized amounts determined under paragraph (3) to assure that the provisions of subparagraphs (B) and (C) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10) do not result in aggregate payments under this section that are greater or less than those that would otherwise be made.
(9)(A) Notwithstanding
(i) 75 percent of the Puerto Rico adjusted DRG prospective payment rate (determined under subparagraph (B) or (C)) for such discharges, and
(ii) 25 percent of the discharge-weighted average of—
(I) the national adjusted DRG prospective payment rate (determined under paragraph (3)(D)) for hospitals located in a large urban area,
(II) such rate for hospitals located in other urban areas, and
(III) such rate for hospitals located in a rural area,
for such discharges, adjusted in the manner provided in paragraph (3)(E) for different area wage levels. As used in this section, the term "subsection (d) Puerto Rico hospital" means a hospital that is located in Puerto Rico and that would be a subsection (d) hospital (as defined in paragraph (1)(B)) if it were located in one of the fifty States.
(B) The Secretary shall determine a Puerto Rico adjusted DRG prospective payment rate, for each inpatient hospital discharge in fiscal year 1988 involving inpatient hospital services of a subsection (d) Puerto Rico hospital for which payment may be made under part A of this subchapter. Such rate shall be determined for such hospitals located in urban or rural areas within Puerto Rico, as follows:
(i) The Secretary shall determine the target amount (as defined in subsection (b)(3)(A) of this section) for the hospital for the cost reporting period beginning in fiscal year 1987 and increase such amount by prorating the applicable percentage increase (as defined in subsection (b)(3)(B) of this section) to update the amount to the midpoint in fiscal year 1988.
(ii) The Secretary shall standardize the amount determined under clause (i) for each hospital by—
(I) excluding an estimate of indirect medical education costs,
(II) adjusting for variations among hospitals by area in the average hospital wage level,
(III) adjusting for variations in case mix among hospitals, and
(IV) excluding an estimate of the additional payments to certain subsection (d) Puerto Rico hospitals to be made under subparagraph (D)(iii) (relating to disproportionate share payments).
(iii) The Secretary shall compute a discharge weighted average of the standardized amounts determined under clause (ii) for all hospitals located in an urban area and for all hospitals located in a rural area (as such terms are defined in paragraph (2)(D)).
(iv) The Secretary shall reduce the average standardized amount by a proportion equal to the proportion (estimated by the Secretary) of the amount of payments under this paragraph which are additional payments described in subparagraph (D)(i) (relating to outlier payments).
(v) For each discharge classified within a diagnosis-related group for hospitals located in an urban or rural area, respectively, the Secretary shall establish a Puerto Rico DRG prospective payment rate equal to the product of—
(I) the average standardized amount (computed under clause (iii) and reduced under clause (iv)) for hospitals located in an urban or rural area, respectively, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group.
(vi) The Secretary shall adjust the proportion (as estimated by the Secretary from time to time) of hospitals' costs which are attributable to wages and wage-related costs, of the Puerto Rico DRG prospective payment rate computed under clause (v) for area differences in hospital wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the hospital compared to the Puerto Rican average hospital wage level.
(C) The Secretary shall determine a Puerto Rico adjusted DRG prospective payment rate, for each inpatient hospital discharge after fiscal year 1988 involving inpatient hospital services of a subsection (d) Puerto Rico hospital for which payment may be made under part A of this subchapter. Such rate shall be determined for hospitals located in urban or rural areas within Puerto Rico as follows:
(i) The Secretary shall compute an average standardized amount for hospitals located in an urban area and for hospitals located in a rural area equal to the respective average standardized amount computed for the previous fiscal year under subparagraph (B)(iii) or under this clause, increased for fiscal year 1989 by the applicable percentage increase under subsection (b)(3)(B) of this section, and adjusted for subsequent fiscal years in accordance with the final determination of the Secretary under subsection (e)(4) of this section, and adjusted to reflect the most recent case-mix data available.
(ii) The Secretary shall reduce each of the average standardized amounts by a proportion equal to the proportion (estimated by the Secretary) of the amount of payments under this paragraph which are additional payments described in subparagraph (D)(i) (relating to outlier payments).
(iii) For each discharge classified within a diagnosis-related group for hospitals located in an urban or rural area, respectively, the Secretary shall establish a Puerto Rico DRG prospective payment rate equal to the product of—
(I) the average standardized amount (computed under clause (i) and reduced under clause (ii)) for hospitals located in an urban or rural area, respectively, and
(II) the weighting factor (determined under paragraph (4)(B)) for that diagnosis-related group.
(iv) The Secretary shall adjust the proportion (as estimated by the Secretary from time to time) of hospitals' costs which are attributable to wages and wage-related costs, of the Puerto Rico DRG prospective payment rate computed under clause (iii) for area differences in hospital wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the hospital compared to the Puerto Rico average hospital wage level. The second and third sentences of paragraph (3)(E) shall apply to subsection (d) Puerto Rico hospitals under this clause in the same manner as they apply to subsection (d) hospitals under such paragraph and, for purposes of this clause, any reference in such paragraph to a subsection (d) hospital is deemed a reference to a subsection (d) Puerto Rico hospital.
(D) The following provisions of paragraph (5) shall apply to subsection (d) Puerto Rico hospitals receiving payment under this paragraph in the same manner and to the extent as they apply to subsection (d) hospitals receiving payment under this subsection:
(i) Subparagraph (A) (relating to outlier payments).
(ii) Subparagraph (B) (relating to payments for indirect medical education costs), except that for this purpose the sum of the amount determined under subparagraph (A) of this paragraph and the amount paid to the hospital under clause (i) of this subparagraph shall be substituted for the sum referred to in paragraph (5)(B)(i)(I).
(iii) Subparagraph (F) (relating to disproportionate share payments), except that for this purpose the sum described in clause (ii) of this subparagraph shall be substituted for the sum referred to in paragraph (5)(F)(ii)(I).
(iv) Subparagraph (H) (relating to exceptions and adjustments).
(10)(A) There is hereby established the Medicare Geographic Classification Review Board (hereinafter in this paragraph referred to as the "Board").
(B)(i) The Board shall be composed of 5 members appointed by the Secretary without regard to the provisions of title 5, governing appointments in the competitive service. Two of such members shall be representative of subsection (d) hospitals located in a rural area under paragraph (2)(D). At least 1 member shall be knowledgeable in the field of analyzing costs with respect to the provision of inpatient hospital services.
(ii) The Secretary shall make initial appointments to the Board as provided in this paragraph within 180 days after December 19, 1989.
(C)(i) The Board shall consider the application of any subsection (d) hospital requesting that the Secretary change the hospital's geographic classification for purposes of determining for a fiscal year—
(I) the hospital's average standardized amount under paragraph (2)(D), or
(II) the factor used to adjust the DRG prospective payment rate for area differences in hospital wage levels that applies to such hospital under paragraph (3)(E).
(ii) A hospital requesting a change in geographic classification under clause (i) for a fiscal year shall submit its application to the Board not later than the first day of the preceding fiscal year.
(iii)(I) The Board shall render a decision on an application submitted under clause (i) not later than 180 days after the deadline referred to in clause (ii).
(II) Appeal of decisions of the Board shall be subject to the provisions of section 557b 6 of title 5. The Secretary shall issue a decision on such an appeal not later than 90 days after the date on which the appeal is filed. The decision of the Secretary shall be final and shall not be subject to judicial review.
(D)(i) The Secretary shall publish guidelines to be utilized by the Board in rendering decisions on applications submitted under this paragraph, and shall include in such guidelines the following:
(I) Guidelines for comparing wages, taking into account (to the extent the Secretary determines appropriate) occupational mix, in the area in which the hospital is classified and the area in which the hospital is applying to be classified.
(II) Guidelines for determining whether the county in which the hospital is located should be treated as being a part of a particular Metropolitan Statistical Area.
(III) Guidelines for considering information provided by an applicant with respect to the effects of the hospital's geographic classification on access to inpatient hospital services by medicare beneficiaries.
(IV) Guidelines for considering the appropriateness of the criteria used to define New England County Metropolitan Areas.
(ii) Notwithstanding clause (i), if the Secretary uses a method for making adjustments to the DRG prospective payment rate for area differences in hospital wage levels under paragraph (3)(E) that is not based on the use of Metropolitan Statistical Area classifications, the Secretary may revise the guidelines published under clause (i) to the extent such guidelines are used to determine the appropriateness of the geographic area in which the hospital is determined to be located for purposes of making such adjustments.
(iii) The Secretary shall publish the guidelines described in clause (i) by July 1, 1990.
(E)(i) The Board shall have full power and authority to make rules and establish procedures, not inconsistent with the provisions of this subchapter or regulations of the Secretary, which are necessary or appropriate to carry out the provisions of this paragraph. In the course of any hearing the Board may administer oaths and affirmations. The provisions of subsections (d) and (e) of
(ii) The Board is authorized to engage such technical assistance and to receive such information as may be required to carry out its functions, and the Secretary shall, in addition, make available to the Board such secretarial, clerical, and other assistance as the Board may require to carry out its functions.
(F)(i) Each member of the Board who is not an officer or employee of the Federal Government shall be compensated at a rate equal to the daily equivalent of the annual rate of basic pay prescribed for grade GS–18 of the General Schedule under
(ii) Members of the Board shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of
(e) Proportional adjustments in applicable percentage increases; Prospective Payment Assessment Commission
(1)(A) For cost reporting periods of hospitals beginning in fiscal year 1984 or fiscal year 1985, the Secretary shall provide for such proportional adjustment in the applicable percentage increase (otherwise applicable to the periods under subsection (b)(3)(B) of this section) as may be necessary to assure that—
(i) the aggregate payment amounts otherwise provided under subsection (d)(1)(A)(i)(I) of this section for that fiscal year for operating costs of inpatient hospital services of hospitals (excluding payments made under
are not greater or less than—
(ii) the target percentage (as defined in subsection (d)(1)(C) of this section) of the payment amounts which would have been payable for such services for those same hospitals for that fiscal year under this section under the law as in effect before April 20, 1983 (excluding payments made under
except that the adjustment made under this subparagraph shall apply only to subsection (d) hospitals and shall not apply for purposes of making computations under subsection (d)(2)(B)(ii) of this section or subsection (d)(3)(A) of this section.
(B) For discharges occurring in fiscal year 1984 or fiscal year 1985, the Secretary shall provide under subsections (d)(2)(F) and (d)(3)(C) of this section for such equal proportional adjustment in each of the average standardized amounts otherwise computed for that fiscal year as may be necessary to assure that—
(i) the aggregate payment amounts otherwise provided under subsection (d)(1)(A)(i)(II) and (d)(5) of this section for that fiscal year for operating costs of inpatient hospital services of hospitals (excluding payments made under
are not greater or less than—
(ii) the DRG percentage (as defined in subsection (d)(1)(C) of this section) of the payment amounts which would have been payable for such services for those same hospitals for that fiscal year under this section under the law as in effect before April 20, 1983 (excluding payments made under
(C) For discharges occurring in fiscal year 1988, the Secretary shall provide for such equal proportional adjustment in each of the average standardized amounts otherwise computed under subsection (d)(3) of this section for that fiscal year as may be necessary to assure that—
(i) the aggregate payment amounts otherwise provided under subsections (d)(1)(A)(iii), (d)(5), and (d)(9) of this section for that fiscal year for operating costs of inpatient hospital services of subsection (d) hospitals and subsection (d) Puerto Rico hospitals,
are not greater or less than—
(ii) the payment amounts that would have been payable for such services for those same hospitals for that fiscal year but for the enactment of the amendments made by section 9304 of the Omnibus Budget Reconciliation Act of 1986.
(2)(A) The Director of the Congressional Office of Technology Assessment (hereinafter in this subsection referred to as the "Director" and the "Office", respectively) shall provide for appointment of a Prospective Payment Assessment Commission (hereinafter in this subsection referred to as the "Commission"), to be composed of independent experts appointed by the Director (without regard to the provisions of title 5 governing appointments in the competitive service). The Commission shall review the applicable percentage increase factor described in subsection (b)(3)(B) of this section and make recommendations to the Secretary on the appropriate percentage change which should be effected for hospital inpatient discharges under subsections (b) and (d) of this section for fiscal years beginning with fiscal year 1986. In making its recommendations, the Commission shall take into account changes in the hospital market-basket described in subsection (b)(3)(B) of this section, hospital productivity, technological and scientific advances, the quality of health care provided in hospitals (including the quality and skill level of professional nursing required to maintain quality care), and long-term cost-effectiveness in the provision of inpatient hospital services.
(B) In order to promote the efficient and effective delivery of high-quality health care services, the Commission shall, in addition to carrying out its functions under subparagraph (A), study and make recommendations for each fiscal year regarding changes in each existing reimbursement policy under this subchapter under which payments to an institution are based upon prospectively determined rates and the development of new institutional reimbursement policies under this subchapter, including recommendations relating to payments during such fiscal year under the prospective payment system established under this section for determining payments for the operating costs of inpatient hospital services, including changes in the number of diagnosis-related groups used to classify inpatient hospital discharges under subsection (d) of this section, adjustments to such groups to reflect severity of illness, and changes in the methods by which hospitals are reimbursed for capital-related costs, together with general recommendations on the effectiveness and quality of health care delivery systems in the United States and the effects on such systems of institutional reimbursements under this subchapter.
(C) By not later than June 1 of each year, the Commission shall submit a report to Congress containing an examination of issues affecting health care delivery in the United States, including issues relating to—
(i) trends in health care costs;
(ii) the financial condition of hospitals and the effect of the level of payments made to hospitals under this subchapter on such condition;
(iii) trends in the use of health care services; and
(iv) new methods used by employers, insurers, and others to constrain growth in health care costs.
(3)(A) The Commission, not later than the March 1 before the beginning of each fiscal year (beginning with fiscal year 1986), shall report its recommendations to Congress on an appropriate change factor which should be used for inpatient hospital services for discharges in that fiscal year, together with its general recommendations under paragraph (2)(B) regarding the effectiveness and quality of health care delivery systems in the United States.
(B) The Secretary, not later than April 1, 1987, for fiscal year 1988 and not later than March 1 before the beginning of each fiscal year (beginning with fiscal year 1989), shall report to the Congress the Secretary's initial estimate of the percentage change that the Secretary will recommend under paragraph (4) with respect to that fiscal year.
(4)(A) Taking into consideration the recommendations of the Commission, the Secretary shall recommend for each fiscal year (beginning with fiscal year 1988) an appropriate change factor for inpatient hospital services for discharges in that fiscal year which will take into account amounts necessary for the efficient and effective delivery of medically appropriate and necessary care of high quality. The appropriate change factor may be different for all large urban subsection (d) hospitals, other urban subsection (d) hospitals, urban subsection (d) Puerto Rico hospitals, rural subsection (d) hospitals, and rural subsection (d) Puerto Rico hospitals, and all other hospitals and units not paid under subsection (d) of this section, and may vary among such other hospitals and units.
(B) In addition to the recommendation made under subparagraph (A), the Secretary shall, taking into consideration the recommendations of the Commission under paragraph (2)(B), recommend for each fiscal year (beginning with fiscal year 1992) other appropriate changes in each existing reimbursement policy under this subchapter under which payments to an institution are based upon prospectively determined rates.
(5) The Secretary shall cause to have published in the Federal Register, not later than—
(A) the May 1 before each fiscal year (beginning with fiscal year 1986), the Secretary's proposed recommendations under paragraph (4) for that fiscal year for public comment, and
(B) the September 1 before such fiscal year after such consideration of public comment on the proposal as is feasible in the time available, the Secretary's final recommendations under such paragraph for that year.
The Secretary shall include in the publication referred to in subparagraph (A) for a fiscal year the report of the Commission's recommendations submitted under paragraph (3) for that fiscal year. To the extent that the Secretary's recommendations under paragraph (4) differ from the Commission's recommendations for that fiscal year, the Secretary shall include in the publication referred to in subparagraph (A) an explanation of the Secretary's grounds for not following the Commission's recommendations.
(6)(A) The Commission shall consist of 17 individuals. Members of the Commission shall first be appointed no later than April 1, 1984, for a term of three years, except that the Director may provide initially for such shorter terms as will insure that (on a continuing basis) the terms of no more than seven members expire in any one year.
(B) The membership of the Commission shall include individuals with national recognition for their expertise in health economics, health facility management, reimbursement of health facilities or other providers of services which reflect the scope of the Commission's responsibilities, and other related fields, who provide a mix of different professionals, broad geographic representation, and a balance between urban and rural representatives, including physicians and registered professional nurses, employers, third party payors, individuals skilled in the conduct and interpretation of biomedical, health services, and health economics research, and individuals having expertise in the research and development of technological and scientific advances in health care.
(C) Subject to such review as the Office deems necessary to assure the efficient administration of the Commission, the Commission may—
(i) employ and fix the compensation of an Executive Director (subject to the approval of the Director of the Office) and such other personnel (not to exceed 25) as may be necessary to carry out its duties (without regard to the provisions of title 5 governing appointments in the competitive service);
(ii) seek such assistance and support as may be required in the performance of its duties from appropriate Federal departments and agencies;
(iii) enter into contracts or make other arrangements, as may be necessary for the conduct of the work of the Commission (without regard to
(iv) make advance, progress, and other payments which relate to the work of the Commission;
(v) provide transportation and subsistence for persons serving without compensation; and
(vi) prescribe such rules and regulations as it deems necessary with respect to the internal organization and operation of the Commission.
Section 10(a)(1) of the Federal Advisory Committee Act shall not apply to any portion of a Commission meeting if the Commission, by majority vote, determines that such portion of such meeting should be closed.
(D) 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
(E) In order to identify medically appropriate patterns of health resources use in accordance with paragraph (2), the Commission shall collect and assess information on medical and surgical procedures and services, including information on regional variations of medical practice and lengths of hospitalization and on other patient-care data, giving special attention to treatment patterns for conditions which appear to involve excessively costly or inappropriate services not adding to the quality of care provided. In order to assess the safety, efficacy, and cost-effectiveness of new and existing medical and surgical procedures, the Commission shall, in coordination to the extent possible with the Secretary, collect and assess factual information, giving special attention to the needs of updating existing diagnosis-related groups, establishing new diagnosis-related groups, and making recommendations on relative weighting factors for such groups to reflect appropriate differences in resource consumption in delivering safe, efficacious, and cost-effective care. In collecting and assessing information, 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 paragraph;
(ii) carry out, or award grants or contracts for, original research and experimentation, including clinical research, where existing information is inadequate for the development of useful and valid guidelines by the Commission; and
(iii) adopt procedures allowing any interested party to submit information with respect to medical and surgical procedures and services (including new practices, such as the use of new technologies and treatment modalities), which information the Commission shall consider in making reports and recommendations to the Secretary and Congress.
(F) The Commission shall have access to such relevant information and data as may be available from appropriate Federal agencies and shall assure that its activities, especially the conduct of original research and medical studies, are coordinated with the activities of Federal agencies.
(G)(i) The Office shall have unrestricted access to all deliberations, records, and data of the Commission, immediately upon its request.
(ii) In order to carry out its duties under this paragraph, the Office is authorized to expend reasonable and neccessary 7 funds as mutually agreed upon by the Office and the Commission. The Office shall be reimbursed for such funds by the Commission from the appropriations made with respect to the Commission.
(H) The Commission shall be subject to periodic audit by the General Accounting Office.
(I)(i) There are authorized to be appropriated such sums as may be necessary to carry out the provisions of this paragraph.
(ii) Eighty-five percent of such appropriation shall be payable from the Federal Hospital Insurance Trust Fund, and 15 percent of such appropriation shall be payable from the Federal Supplementary Medical Insurance Trust Fund.
(J) The Commission shall submit requests for appropriations in the same manner as the Office submits requests for appropriations, but amounts appropriated for the Commission shall be separate from amounts appropriated for the Office.
(f) Reporting of costs of hospitals receiving payments on basis of prospective rates
(1)(A) The Secretary shall maintain a system for the reporting of costs of hospitals receiving payments computed under subsection (d) of this section.
(B)(i) Subject to clause (ii), the Secretary shall place into effect a standardized electronic cost reporting format for hospitals under this subchapter.
(ii) The Secretary may delay or waive the implementation of such format in particular instances where such implementation would result in financial hardship (in particular with respect to hospitals with a small percentage of inpatients entitled to benefits under this subchapter).
(2) If the Secretary determines, based upon information supplied by a utilization and quality control peer review organization under part B of subchapter XI of this chapter, that a hospital, in order to circumvent the payment method established under subsection (b) or (d) of this section, has taken an action that results in the admission of individuals entitled to benefits under part A unnecessarily, unnecessary multiple admissions of the same such individuals, or other inappropriate medical or other practices with respect to such individuals, the Secretary may—
(A) deny payment (in whole or in part) under part A of this subchapter with respect to inpatient hospital services provided with respect to such an unnecessary admission (or subsequent admission of the same individual), or
(B) require the hospital to take other corrective action necessary to prevent or correct the inappropriate practice.
(3) The provisions of subsections (c) through (g) of
(g) Prospective payment for capital-related costs; return on equity capital for hospitals
(1)(A) Notwithstanding
(B) Such system—
(i) shall provide for (I) a payment on a per discharge basis, and (II) an appropriate weighting of such payment amount as relates to the classification of the discharge;
(ii) may provide for an adjustment to take into account variations in the relative costs of capital and construction for the different types of facilities or areas in which they are located;
(iii) may provide for such exceptions (including appropriate exceptions to reflect capital obligations) as the Secretary determines to be appropriate, and
(iv) may provide for suitable adjustment to reflect hospital occupancy rate.
(C) In this paragraph, the term "capital-related costs" has the meaning given such term by the Secretary under subsection (a)(4) of this section as of September 30, 1987, and does not include a return on equity capital.
(2)(A) The Secretary shall provide that the amount which is allowable, with respect to reasonable costs of inpatient hospital services for which payment may be made under this subchapter, for a return on equity capital for hospitals shall, for cost reporting periods beginning on or after April 20, 1983, be equal to amounts otherwise allowable under regulations in effect on March 1, 1983, except that the rate of return to be recognized shall be equal to the applicable percentage (described in subparagraph (B)) of the average of the rates of interest, for each of the months any part of which is included in the reporting period, on obligations issued for purchase by the Federal Hospital Insurance Trust Fund.
(B) In this paragraph, the "applicable percentage" is—
(i) 75 percent, for cost reporting periods beginning during fiscal year 1987,
(ii) 50 percent, for cost reporting periods beginning during fiscal year 1988,
(iii) 25 percent, for cost reporting periods beginning during fiscal year 1989, and
(iv) 0 percent, for cost reporting periods beginning on or after October 1, 1989.
(3)(A) Except as provided in subparagraph (B), in determining the amount of the payments that may be made under this subchapter with respect to all the capital-related costs of inpatient hospital services of a subsection (d) hospital and a subsection (d) Puerto Rico hospital, the Secretary shall reduce the amounts of such payments otherwise established under this subchapter by—
(i) 3.5 percent for payments attributable to portions of cost reporting periods occurring during fiscal year 1987,
(ii) 7 percent for payments attributable to portions of cost reporting periods or discharges (as the case may be) occurring during fiscal year 1988 on or after October 1, 1987, and before January 1, 1988,
(iii) 12 percent for payments attributable to portions of cost reporting periods or discharges (as the case may be) in fiscal year 1988, occurring on or after January 1, 1988,
(iv) 15 percent for payments attributable to portions of cost reporting periods or discharges (as the case may be) occurring during fiscal year 1989, and
(v) 15 percent for payments attributable to portions of cost reporting periods or discharges (as the case may be) occurring during the period beginning January 1, 1990, and ending September 30, 1991.
(B) Subparagraph (A) shall not apply to payments with respect to the capital-related costs of any hospital that is a sole community hospital (as defined in subsection (d)(5)(D)(iii) of this section 8 or a rural primary care hospital (as defined in
(h) Payments for direct graduate medical education costs
(1) Substitution of special payment rules
Notwithstanding
(2) Determination of hospital-specific approved FTE resident amounts
The Secretary shall determine, for each hospital with an approved medical residency training program, an approved FTE resident amount for each cost reporting period beginning on or after July 1, 1985, as follows:
(A) Determining allowable average cost per FTE resident in a hospital's base period
The Secretary shall determine, for the hospital's cost reporting period that began during fiscal year 1984, the average amount recognized as reasonable under this subchapter for direct graduate medical education costs of the hospital for each full-time-equivalent resident.
(B) Updating to the first cost reporting period
(i) In general
The Secretary shall update each average amount determined under subparagraph (A) by the percentage increase in the consumer price index during the 12-month cost reporting period described in such subparagraph.
(ii) Exception
The Secretary shall not perform an update under clause (i) in the case of a hospital if the hospital's reporting period, described in subparagraph (A), began on or after July 1, 1984, and before October 1, 1984.
(C) Amount for first cost reporting period
For the first cost reporting period of the hospital beginning on or after July 1, 1985, the approved FTE resident amount for the hospital is equal to the amount determined under subparagraph (B) increased by 1 percent.
(D) Amount for subsequent cost reporting periods
(i) Except as provided in clause (ii), for each subsequent cost reporting period, the approved FTE resident amount for the hospital is equal to the amount determined under this paragraph for the previous cost reporting period updated, through the midpoint of the period, by projecting the estimated percentage change in the consumer price index during the 12-month period ending at that midpoint, with appropriate adjustments to reflect previous under- or over-estimations under this subparagraph in the projected percentage change in the consumer price index.
(ii) For cost reporting periods beginning during fiscal year 1994 or fiscal year 1995, the approved FTE resident amount for a hospital shall not be updated under clause (i) for a resident who is not a primary care resident (as defined in paragraph (5)(H)) or a resident enrolled in an approved medical residency training program in obstetrics and gynecology.
(E) Treatment of certain hospitals
In the case of a hospital that did not have an approved medical residency training program or was not participating in the program under this subchapter for a cost reporting period beginning during fiscal year 1984, the Secretary shall, for the first such period for which it has such a residency training program and is participating under this subchapter, provide for such approved FTE resident amount as the Secretary determines to be appropriate, based on approved FTE resident amounts for comparable programs.
(3) Hospital payment amount per resident
(A) In general
The payment amount, for a hospital cost reporting period beginning on or after July 1, 1985, is equal to the product of—
(i) the aggregate approved amount (as defined in subparagraph (B)) for that period, and
(ii) the hospital's medicare patient load (as defined in subparagraph (C)) for that period.
(B) Aggregate approved amount
As used in subparagraph (A), the term "aggregate approved amount" means, for a hospital cost reporting period, the product of—
(i) the hospital's approved FTE resident amount (determined under paragraph (2)) for that period, and
(ii) the weighted average number of full-time-equivalent residents (as determined under paragraph (4)) in the hospital's approved medical residency training programs in that period.
(C) Medicare patient load
As used in subparagraph (A), the term "medicare patient load" means, with respect to a hospital's cost reporting period, the fraction of the total number of inpatient-bed-days (as established by the Secretary) during the period which are attributable to patients with respect to whom payment may be made under part A of this subchapter.
(4) Determination of full-time-equivalent residents
(A) Rules
The Secretary shall establish rules consistent with this paragraph for the computation of the number of full-time-equivalent residents in an approved medical residency training program.
(B) Adjustment for part-year or part-time residents
Such rules shall take into account individuals who serve as residents for only a portion of a period with a hospital or simultaneously with more than one hospital.
(C) Weighting factors for certain residents
Subject to subparagraph (D), such rules shall provide, in calculating the number of full-time-equivalent residents in an approved residency program—
(i) before July 1, 1986, for each resident the weighting factor is 1.00,
(ii) on or after July 1, 1986, for a resident who is in the resident's initial residency period (as defined in paragraph (5)(F)), the weighting factor is 1.00,
(iii) on or after July 1, 1986, and before July 1, 1987, for a resident who is not in the resident's initial residency period (as defined in paragraph (5)(F)), the weighting factor is .75, and
(iv) on or after July 1, 1987, for a resident who is not in the resident's initial residency period (as defined in paragraph (5)(F)), the weighting factor is .50.
(D) Foreign medical graduates required to pass FMGEMS examination
(i) In general
Except as provided in clause (ii), such rules shall provide that, in the case of an individual who is a foreign medical graduate (as defined in paragraph (5)(D)), the individual shall not be counted as a resident on or after July 1, 1986, unless—
(I) the individual has passed the FMGEMS examination (as defined in paragraph (5)(E)), or
(II) the individual has previously received certification from, or has previously passed the examination of, the Educational Commission for Foreign Medical Graduates.
(ii) Transition for current FMGS
On or after July 1, 1986, but before July 1, 1987, in the case of a foreign medical graduate who—
(I) has served as a resident before July 1, 1986, and is serving as a resident after that date, but
(II) has not passed the FMGEMS examination or a previous examination of the Educational Commission for Foreign Medical Graduates before July 1, 1986,
the individual shall be counted as a resident at a rate equal to one-half of the rate at which the individual would otherwise be counted.
(E) Counting time spent in outpatient settings
Such rules shall provide that only time spent in activities relating to patient care shall be counted and that all the time so spent by a resident under an approved medical residency training program shall be counted towards the determination of full-time equivalency, without regard to the setting in which the activities are performed, if the hospital incurs all, or substantially all, of the costs for the training program in that setting.
(5) Definitions and special rules
As used in this subsection:
(A) Approved medical residency training program
The term "approved medical residency training program" means a residency or other postgraduate medical training program participation in which may be counted toward certification in a specialty or subspecialty and includes formal postgraduate training programs in geriatric medicine approved by the Secretary.
(B) Consumer price index
The term "consumer price index" refers to the Consumer Price Index for All Urban Consumers (United States city average), as published by the Secretary of Commerce.
(C) Direct graduate medical education costs
The term "direct graduate medical education costs" means direct costs of approved educational activities for approved medical residency training programs.
(D) Foreign medical graduate
The term "foreign medical graduate" means a resident who is not a graduate of—
(i) a school of medicine accredited by the Liaison Committee on Medical Education of the American Medical Association and the Association of American Medical Colleges (or approved by such Committee as meeting the standards necessary for such accreditation),
(ii) a school of osteopathy accredited by the American Osteopathic Association, or approved by such Association as meeting the standards necessary for such accreditation, or
(iii) a school of dentistry or podiatry which is accredited (or meets the standards for accreditation) by an organization recognized by the Secretary for such purpose.
(E) FMGEMS examination
The term "FMGEMS examination" means parts I and II of the Foreign Medical Graduate Examination in the Medical Sciences or any successor examination recognized by the Secretary for this purpose.
(F) Initial residency period
The term "initial residency period" means the period of board eligibility, except that—
(i) except as provided in clause (ii), in no case shall the initial period of residency exceed an aggregate period of formal training of more than five years for any individual, and
(ii) a period, of not more than two years, during which an individual is in a geriatric residency or fellowship program or a preventive medicine residency or fellowship program which meets such criteria as the Secretary may establish, shall be treated as part of the initial residency period, but shall not be counted against any limitation on the initial residency period.
The initial residency period shall be determined, with respect to a resident, as of the time the resident enters the residency training program.
(G) Period of board eligibility
(i) General rule
Subject to clauses (ii) and (iii), the term "period of board eligibility" means, for a resident, the minimum number of years of formal training necessary to satisfy the requirements for initial board eligibility in the particular specialty for which the resident is training.
(ii) Application of 1985–1986 directory
Except as provided in clause (iii), the period of board eligibility shall be such period specified in the 1985–1986 Directory of Residency Training Programs published by the Accreditation Council on Graduate Medical Education.
(iii) Changes in period of board eligibility
On or after July 1, 1989, if the Accreditation Council on Graduate Medical Education, in its Directory of Residency Training Programs—
(I) increases the minimum number of years of formal training necessary to satisfy the requirements for a specialty, above the period specified in its 1985–1986 Directory, the Secretary may increase the period of board eligibility for that specialty, but not to exceed the period of board eligibility specified in that later Directory, or
(II) decreases the minimum number of years of formal training necessary to satisfy the requirements for a specialty, below the period specified in its 1985–1986 Directory, the Secretary may decrease the period of board eligibility for that specialty, but not below the period of board eligibility specified in that later Directory.
(H) Primary care resident
The term "primary care resident" means a resident enrolled in an approved medical residency training program in family medicine, general internal medicine, general pediatrics, preventive medicine, geriatric medicine, or osteopathic general practice.
(I) Resident
The term "resident" includes an intern or other participant in an approved medical residency training program.
(J) Adjustments for certain family practice residency programs
(i) In general
In the case of an approved medical residency training program (meeting the requirements of clause (ii)) of a hospital which received funds from the United States, a State, or a political subdivision of a State or an instrumentality of such a State or political subdivision (other than payments under this subchapter or a State plan under subchapter XIX of this chapter) for the program during the cost reporting period that began during fiscal year 1984, the Secretary shall—
(I) provide for an average amount under paragraph (2)(A) that takes into account the Secretary's estimate of the amount that would have been recognized as reasonable under this subchapter if the hospital had not received such funds, and
(II) reduce the payment amount otherwise provided under this subsection in an amount equal to the proportion of such program funds received during the cost reporting period involved that is allocable to this subchapter.
(ii) Additional requirements
A hospital's approved medical residency program meets the requirements of this clause if—
(I) the program is limited to training for family and community medicine;
(II) the program is the only approved medical residency program of the hospital; and
(III) the average amount determined under paragraph (2)(A) for the hospital (as determined without regard to the increase in such amount described in clause (i)(I)) does not exceed $10,000.
(i) Avoiding duplicative payments to hospitals participating in rural demonstration programs
The Secretary shall reduce any payment amounts otherwise determined under this section to the extent necessary to avoid duplication of any payment made under section 4005(e) of the Omnibus Budget Reconciliation Act of 1987.
(Aug. 14, 1935, ch. 531, title XVIII, §1886, as added and amended Sept. 3, 1982,
References in Text
Parts A and B of this subchapter, referred to in text, are classified to sections 1395c et seq. and 1395j et seq., respectively, of this title.
The Internal Revenue Code of 1986, referred to in subsec. (b)(6), is classified generally to Title 26, Internal Revenue Code.
Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (c)(4)(B), is section 222(a) of
Section 9104(a) of the Medicare and Medicaid Budget Reconciliation Amendments of 1985, referred to in subsec. (d)(2)(C)(i), is section 9104(a) of
Section 6003(c) of the Omnibus Budget Reconciliation Act of 1989, referred to in subsec. (d)(2)(C)(iv), is section 6003(c) of
Section 4002(b) of the Omnibus Budget Reconciliation Act of 1990, referred to in subsec. (d)(2)(C)(iv), is section 4002(b) of
Section 9104 of the Medicare and Medicaid Budget Reconciliation Amendments of 1985, referred to in subsec. (d)(3)(C)(ii), is section 9104 of
Section 4003(a)(1) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (d)(3)(C)(ii), is section 4003(a)(1) of
The Omnibus Budget Reconciliation Act of 1990, referred to in subsec. (d)(3)(C)(ii), is
The provisions of title 5 governing appointments in the competitive service, referred to in subsecs. (d)(10)(B)(i) and (e)(2)(A), (6)(C)(i), are classified generally to
Section 9304 of the Omnibus Budget Reconciliation Act of 1986, referred to in subsec. (e)(1)(C)(ii), is section 9304 of
Section 10(a)(1) of the Federal Advisory Committee Act, referred to in subsec. (e)(6)(C), is section 10(a)(1) of
Part B of subchapter XI of this chapter, referred to in subsec. (f)(2), is classified to
Section 4005(e) of the Omnibus Budget Reconciliation Act of 1987, referred to in subsec. (i), is section 4005(e) of
Amendments
1994—Subsec. (a)(4).
Subsec. (b)(3)(B)(iv)(II).
Subsec. (b)(3)(D).
Subsec. (d)(3)(A)(iii).
Subsec. (d)(5)(B)(ii).
Subsec. (d)(5)(D)(iii)(III).
Subsec. (d)(5)(D)(v).
Subsec. (d)(5)(G)(ii)(I).
Subsec. (d)(5)(I).
Subsec. (d)(8)(C)(iv).
Subsec. (d)(8)(C)(v).
Subsec. (d)(10)(C)(i)(II).
Subsec. (d)(10)(D)(i)(I).
Subsec. (d)(10)(D)(ii), (iii).
Subsec. (e)(6)(B).
Subsec. (h)(5)(E).
1993—Subsec. (b)(3)(B)(i)(IX).
Subsec. (b)(3)(B)(i)(X).
Subsec. (b)(3)(B)(i)(XI).
Subsec. (b)(3)(B)(i)(XII), (XIII).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(B)(ii)(III) to (VI).
Subsec. (b)(3)(B)(iv).
Subsec. (b)(3)(B)(v).
Subsec. (b)(3)(C)(i)(II).
Subsec. (b)(3)(C)(ii).
Subsec. (b)(3)(C)(iii), (iv).
Subsec. (b)(3)(D)(ii).
Subsec. (b)(3)(D)(iii).
Subsec. (b)(4)(A).
Subsec. (d)(1)(A)(iii).
Subsec. (d)(5)(A)(i).
Subsec. (d)(5)(A)(ii).
Subsec. (d)(5)(A)(iii).
Subsec. (d)(5)(A)(v), (vi).
Subsec. (d)(5)(B)(iv).
Subsec. (d)(5)(G)(i).
"(I) an amount based on 100 percent of the hospital's target amount for the cost reporting period, as defined in subsection (b)(3)(D) of this section, or
"(II) the amount determined under paragraph (1)(A)(iii),
whichever results in the greater payment to the hospital." to reflect the probable intent of Congress.
Subsec. (d)(5)(G)(ii) to (iv).
Subsec. (d)(8)(C)(iv).
Subsec. (g)(1)(A).
Subsec. (h)(2)(D).
Subsec. (h)(5)(F).
Subsec. (h)(5)(F)(ii).
Subsec. (h)(5)(H), (I).
Subsec. (h)(5)(J).
1990—Subsec. (a)(4).
Subsec. (b)(1)(B)(ii).
Subsec. (b)(3)(B)(i)(V).
Subsec. (b)(3)(B)(i)(VI).
Subsec. (b)(3)(B)(i)(VII).
Subsec. (b)(3)(B)(i)(VIII).
Subsec. (b)(3)(B)(i)(IX).
Subsec. (b)(3)(B)(i)(X).
Subsec. (b)(3)(B)(i)(XI).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(C)(ii), (D)(ii).
Subsec. (b)(4)(A).
Subsec. (b)(4)(B), (C).
Subsec. (c)(4).
Subsec. (d)(1)(A)(iii).
Subsec. (d)(2)(C)(iv).
Subsec. (d)(3)(A)(ii).
Subsec. (d)(3)(A)(iii) to (v).
Subsec. (d)(3)(B).
Subsec. (d)(3)(C)(ii).
"(I) on or after October 1, 1986, and before October 1, 1995, of an amount equal to the estimated reduction in the payment amounts under paragraph (5)(B) that would have resulted from the enactment of the amendments made by section 9104 of the Medicare and Medicaid Budget Reconciliation Amendments of 1985 and by section 4003(a)(1) of the Omnibus Budget Reconciliation Act of 1987 if the factor described in clause (ii)(II) of paragraph (5)(B) were applied for discharges occurring during such period instead of the factor described in clause (ii)(I) of that paragraph, and
"(II) on or after October 1, 1995, of an amount equal to the estimated reduction in the payment amounts under paragraph (5)(B) for those discharges that has resulted from the enactment of the amendments made by section 9104 of the Medicare and Medicaid Budget Reconciliation Amendments of 1985 and by section 4003(a)(1) of the Omnibus Budget Reconciliation Act of 1987."
Subsec. (d)(3)(D)(i).
Subsec. (d)(3)(D)(i)(I).
Subsec. (d)(3)(D)(ii).
Subsec. (d)(4)(D).
Subsec. (d)(5)(B)(ii).
"(I) on or after May 1, 1986, and before October 1, 1995, is equal to 1.89×((1+r).405^1), or
"(II) on or after October 1, 1995, is equal to 1.43×((1+r).5795^1),
where 'r' is the ratio of the hospital's full-time equivalent interns and residents to beds."
Subsec. (d)(5)(D)(iii).
Subsec. (d)(5)(F)(i).
Subsec. (d)(5)(F)(iii).
Subsec. (d)(5)(F)(vii)(I).
Subsec. (d)(5)(F)(vii)(II).
Subsec. (d)(8)(C)(i).
Subsec. (d)(8)(C)(i)(II).
Subsec. (d)(8)(C)(ii) to (iv).
"(I) reduces the wage index for the urban area within which the county or counties is reclassified by 1 percentage point or less (as applied under this subsection), the Secretary, in calculating such wage index under this subsection, shall exclude those counties so reclassified, or
"(II) reduces the wage index for the urban area within which the county or counties is reclassified by more than 1 percentage point (as applied under this subsection), the Secretary shall calculate and apply such wage index under this subsection separately to hospitals located in such urban area (excluding all the hospitals so reclassified) and to hospitals located in the counties so reclassified (as if each affected county were a separate area)."
Subsec. (d)(8)(D).
Subsec. (d)(10)(A).
Subsec. (d)(10)(B)(i).
Subsec. (d)(10)(B)(ii).
Subsec. (d)(10)(C)(iii)(II).
Subsec. (e)(2).
Subsec. (e)(2)(A).
Subsec. (e)(3)(A).
Subsec. (e)(4).
Subsec. (e)(5).
Subsec. (e)(6)(G).
Subsec. (g)(1)(A).
Subsec. (g)(3)(A)(v).
Subsec. (g)(3)(B).
1989—Subsec. (a)(4).
Subsec. (b)(3)(A).
Subsec. (b)(3)(B)(i)(V), (VI).
Subsec. (b)(3)(B)(ii).
Subsec. (b)(3)(C).
Subsec. (b)(3)(D).
Subsec. (b)(3)(E).
Subsec. (b)(4)(A).
Subsec. (c)(4).
Subsec. (d)(1)(B)(v).
Subsec. (d)(3)(E).
Subsec. (d)(4)(C).
Subsec. (d)(5)(C).
Subsec. (d)(5)(D).
Subsec. (d)(5)(D)(iii)(III).
Subsec. (d)(5)(D)(v).
Subsec. (d)(5)(E).
Subsec. (d)(5)(F)(iii).
Subsec. (d)(5)(F)(iv)(I).
Subsec. (d)(5)(F)(iv)(III).
Subsec. (d)(5)(F)(iv)(IV) to (VI).
Subsec. (d)(5)(F)(v)(II) to (IV).
Subsec. (d)(5)(F)(vii).
Subsec. (d)(5)(F)(viii).
Subsec. (d)(5)(G).
Subsec. (d)(5)(H).
Subsec. (d)(5)(I).
Subsec. (d)(8)(C).
"(i) If the application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10),, [sic] by treating hospitals located in a rural county or counties as being located in an urban area, reduces the wage index for that urban area (as applied under this subsection), the Secretary shall calculate and apply such wage index under this subsection separately to hospitals located in such urban area (excluding all the hospitals so treated) and to the hospitals so treated (as if each affected rural county were a separate urban area). If the application of subparagraph (B) or a decision of the Medicare Geographic Classification Review Board or the Secretary under paragraph (10),, [sic] by treating the hospitals located in a rural county or counties as not being located in the rural area in a State, reduces the wage index for that rural area (as applied under this subsection), the Secretary shall calculate and apply such wage index under this subsection as if the hospitals so treated had not been excluded from calculation of the wage index for that rural area.
"(ii) Clause (i) shall only apply to discharges occurring on or after October 1, 1989, and before October 1, 1991."
Subsec. (d)(8)(C)(i).
Subsec. (d)(8)(C)(iv).
Subsec. (d)(8)(D).
Subsec. (d)(9)(B)(ii)(IV).
Subsec. (d)(9)(D)(iii).
Subsec. (d)(9)(D)(iv).
Subsec. (d)(9)(D)(v).
Subsec. (d)(10).
Subsec. (g)(3)(A)(iv).
Subsec. (g)(3)(A)(v).
Subsec. (g)(3)(B).
Subsec. (i).
1988—Subsec. (b)(3)(B)(i)(III).
Subsec. (b)(3)(B)(i)(IV).
Subsec. (b)(3)(B)(i)(V).
Subsec. (d)(1)(A)(iii).
Subsec. (d)(2)(C)(i).
Subsec. (d)(2)(C)(iv).
Subsec. (d)(2)(D).
Subsec. (d)(3)(A).
Subsec. (d)(3)(A)(i).
Subsec. (d)(3)(A)(ii).
Subsec. (d)(3)(C)(ii).
Subsec. (d)(3)(C)(ii)(I), (II).
Subsec. (d)(3)(C)(iii).
Subsec. (d)(5)(B)(ii)(I), (II).
Subsec. (d)(5)(F)(i).
Subsec. (d)(5)(F)(vi)(I).
Subsec. (d)(8).
Subsec. (d)(8)(B).
"(i) the rural county would otherwise be considered part of an urban area but for the fact that the rural county does not meet the standard relating to the rate of commutation between the rural county and the central county or counties of any adjacent urban area; and
"(ii) either (I) the number of residents of the rural county who commute for employment to the central county or counties of any adjacent urban area is equal to at least 15 percent of the number of residents of the rural county who are employed, or (II) the sum of the number of residents of the rural county who commute for employment to the central county or counties of any adjacent urban area and the number of residents of any adjacent urban area who commute for employment to the rural county is at least equal to 20 percent of the number of residents of the rural county who are employed."
Subsec. (d)(8)(C).
Subsec. (d)(8)(D).
Subsec. (d)(9)(C)(iv).
Subsec. (e)(6)(B).
Subsec. (f)(1)(A).
Subsec. (f)(1)(B).
Subsec. (g)(3)(A)(ii) to (iv).
Subsec. (g)(3)(A)(iv).
1987—Subsec. (a)(4).
Subsec. (b)(3)(B)(i).
Subsec. (b)(3)(B)(i)(II).
Subsec. (b)(3)(B)(i)(III) to (V).
Subsec. (b)(3)(B)(ii), (iii).
Subsec. (d)(1)(A)(iii).
Subsec. (d)(2)(C)(iv).
Subsec. (d)(2)(D).
Subsec. (d)(3).
Subsec. (d)(3)(A)(i).
Subsec. (d)(3)(C)(ii).
Subsec. (d)(3)(C)(iii).
Subsec. (d)(3)(D)(i).
Subsec. (d)(3)(E).
Subsec. (d)(5)(B)(ii).
Subsec. (d)(5)(C)(i)(I).
Subsec. (d)(5)(C)(i)(II).
Subsec. (d)(5)(C)(ii).
Subsec. (d)(5)(F)(i).
Subsec. (d)(5)(F)(i)(II).
Subsec. (d)(5)(F)(iii).
Subsec. (d)(5)(F)(iv)(I).
Subsec. (d)(5)(F)(vi)(I).
Subsec. (d)(8).
Subsec. (d)(9)(A)(ii).
Subsec. (d)(9)(B).
Subsec. (d)(9)(C)(iv).
Subsec. (e)(3)(B).
Subsec. (e)(4).
Subsec. (e)(5).
Subsec. (e)(6)(B).
Subsec. (e)(6)(D).
Subsec. (f)(1)(A).
Subsec. (f)(1)(B).
Subsec. (f)(3).
Subsec. (g)(1).
Subsec. (g)(3)(A)(ii) to (iv).
Subsec. (g)(3)(C).
"(i) notwithstanding any other provision of this subchapter, for the continuation of payment under the reasonable cost methodology described in
"(ii) in the design of such payment system that the aggregate payment amounts under this subchapter for such other capital-related costs for payments attributable to portions of cost reporting periods occurring during fiscal year 1988 and fiscal year 1989 shall approximate the aggregate payment amount under this subchapter that would have been made (taking into account the provisions of subparagraphs (A) and (B)) during that fiscal year but for the inclusion of such costs by the Secretary."
Subsec. (h)(4)(C).
1986—Subsec. (a)(4).
Subsec. (b)(3)(B).
Subsec. (b)(3)(B)(i)(II).
Subsec. (b)(6).
Subsec. (c)(7).
Subsec. (d)(1)(A).
Subsec. (d)(1)(C).
Subsec. (d)(1)(D).
Subsec. (d)(2)(C)(i).
Subsec. (d)(2)(C)(iv).
Subsec. (d)(3)(A).
Subsec. (d)(3)(B).
Subsec. (d)(3)(C).
Subsec. (d)(3)(C)(ii).
"(I) the sum of the additional payment amounts under paragraph (5)(B) (relating to indirect costs of medical education) if the indirect teaching adjustment factor were equal to 1.159r (as 'r' is defined in paragraph (5)(B)(ii)), and
"(II) that sum using the factor specified in paragraph (5)(B)(ii)(II)."
Subsec. (d)(3)(C)(iii).
Subsec. (d)(3)(D)(i)(I), (ii)(I).
Subsec. (d)(4)(C).
Subsec. (d)(5)(B).
Subsec. (d)(5)(B)(ii).
Subsec. (d)(5)(C)(i).
Subsec. (d)(5)(C)(i)(I).
Subsec. (d)(5)(C)(ii).
Subsec. (d)(5)(E).
Subsec. (d)(5)(F).
Subsec. (d)(5)(F)(i).
Subsec. (d)(5)(F)(iv)(I).
Subsec. (d)(5)(F)(iv)(III).
Subsec. (d)(5)(F)(v).
Subsec. (d)(5)(F)(vi)(I).
Subsec. (d)(9).
Subsec. (e)(1)(C).
Subsec. (e)(3).
Subsec. (e)(3)(A).
Subsec. (e)(4).
Subsec. (e)(5).
Subsec. (e)(5)(A).
Subsec. (e)(6)(A).
Subsec. (g)(1).
Subsec. (g)(2).
Subsec. (g)(2)(B).
Subsec. (g)(3).
Subsec. (g)(3)(A).
Subsec. (h).
Subsec. (h)(2)(C).
Subsec. (h)(4)(D).
Subsec. (h)(4)(E).
Subsec. (h)(5)(B).
1984—Subsec. (a)(2)(B).
Subsec. (a)(4).
Subsec. (b)(3)(A)(ii).
Subsec. (b)(3)(B).
Subsec. (c)(4)(A).
Subsec. (d)(2)(D).
Subsec. (d)(3)(D)(i)(I).
Subsec. (d)(5)(B).
Subsec. (d)(5)(C)(i).
Subsec. (d)(5)(E).
Subsec. (d)(8).
Subsec. (e)(2).
Subsec. (e)(5).
Subsec. (e)(5)(A).
Subsec. (e)(6)(C).
Subsec. (e)(6)(C)(i).
Subsec. (e)(6)(C)(iii).
Subsec. (e)(6)(D).
Subsec. (e)(6)(J).
1983—Subsec. (a)(1)(D).
Subsec. (a)(4).
Subsec. (b)(1).
Subsec. (b)(2).
Subsec. (b)(3)(B).
Subsec. (b)(6).
Subsec. (b)(6)(C).
Subsec. (c)(1).
Subsec. (c)(3)(A).
Subsec. (c)(3)(B).
Subsec. (c)(4) to (6).
Subsec. (d).
Subsecs. (e) to (g).
1982—Subsec. (d).
Effective Date of 1994 Amendment
Section 101(a)(2) of
Section 153(b) of
Effective Date of 1993 Amendment
Section 13501(b)(3) of
Section 13563(b)(2) of
Section 13563(c)(2) of
Effective Date of 1990 Amendment
Section 4002(a)(2) of
Section 4002(b)(5) of
Section 4002(c)(3) of
Section 4002(e)(4)[(3)] of
Section 4002(g)(5) of
Section 4002(h)(1)(B) of
Section 4003(b) of
"(1) in the case of any services provided during the day immediately preceding the date of a patient's admission (without regard to whether the services are related to the admission), to services furnished on or after the date of the enactment of this Act [Nov. 5, 1990] and before October 1, 1991;
"(2) in the case of diagnostic services (including clinical diagnostic laboratory tests), to services furnished on or after January 1, 1991; and
"(3) in the case of any other services, to services furnished on or after October 1, 1991."
Section 4005(a)(2) of
Section 4005(c)(4) of
Section 4008(f)(2) of
Effective and Termination Dates of 1989 Amendment
Section 6003(a)(2) of
Section 6003(c)(4) of
Section 6003(h)(7) of
Section 6004(a)(3) of
"(A) in the case of a hospital classified by the Secretary of Health and Human Services as a hospital involved extensively in treatment for or research on cancer under section 1886(d)(5)(I) of the Social Security Act [subsec. (d)(5)(I) of this section] (as redesignated by section 6003(e)(1)(A)) after the date of the enactment of this Act [Dec. 19, 1989], such amendments shall apply with respect to cost reporting periods beginning on or after the date of such classification,
"(B) in the case of a hospital that is not described in subparagraph (A), such amendments shall apply with respect to portions of cost reporting periods or discharges occurring during and after fiscal year 1987 for purposes of section 1886(g) of the Social Security Act [subsec. (g) of this section], and
"(C) such amendments shall take effect 30 days after the date of the enactment of this Act for purposes of determining the eligibility of a hospital to receive periodic interim payments under section 1815(e)(2) of the Social Security Act [
Section 6004(b)(2) of
Section 6011(d) of
[Section 13505 of
Section 6015(c) of
Effective Date of 1988 Amendments
Amendment by section 1018(r)(1) of
Amendment by
Except as specifically provided in section 411 of
Effective Date of 1987 Amendments
Section 4002(g) of
"(1)
"(A) the amendments made by subsections (a) and (c) [amending this section] shall apply to payments made under section 1886(d)(1)(A)(iii) of the Social Security Act [subsec. (d)(1)(A)(iii) of this section] on the basis of discharges occurring on or after April 1, 1988, and
"(B) for discharges occurring on or after October 1, 1988, the applicable percentage increase (described in section 1886(b)(3)(B) of such Act [subsec. (b)(3)(B) of this section]) for discharges occurring during fiscal year 1987 is deemed to have been such percentage increase as amended by subsection (a).
"(2)
"(A) the amendment made by subsections (a) and (c) [amending this section] shall apply to payments under section 1886(d)(1)(A)(ii)(I) of the Social Security Act made on the basis of discharges occurring during a cost reporting period of a hospital, for the hospital's cost reporting period beginning on or after October 1, 1987;
"(B) notwithstanding subparagraph (A), for cost reporting period beginning during fiscal year 1988, the applicable percentage increase (as defined in section 1886(b)(3)(B) of such Act [subsec. (b)(3)(B) of this section]) for the—
"(i) first 51 days of the cost reporting period shall be 0 percent,
"(ii) next 132 days of such period shall be 2.7 percent, and
"(iii) remainder of such period of the cost reporting period shall be the applicable percentage increase (as so defined, as amended by subsection (a)); and
"(C) for cost reporting periods beginning on or after October 1, 1988, the applicable percentage increase (as so defined) with respect to the previous cost reporting period shall be deemed to have been the applicable percentage increase (as so defined, as amended by subsection (a)).
"(3)
"(A) the amendments made by subsection (e) [amending this section] shall apply to cost reporting periods beginning on or after October 1, 1987;
"(B) notwithstanding subparagraph (A), for the hospital's cost reporting period beginning during fiscal year 1988, payment under title XVIII of the Social Security Act [this subchapter] shall be made as though the applicable percentage increase described in section 1886(b)(3)(B) of such Act [subsec. (b)(3)(B) of this section] were equal to the product of 2.7 percent and the ratio of 315 to 366; and
"(C) for cost reporting periods beginning on or after October 1, 1988, the applicable percentage increase (as so defined) with respect to the cost reporting period beginning during fiscal year 1988 shall be deemed to have been 2.7 percent.
"(4)
"(5)
"(6)
Section 4003(e) of
Section 4005(a)(3) of
Section 4005(c)(2)(A) of
Section 4005(d)(1)(B) of
Section 4006(b)(3) of
Section 4007(b)(2) of
Section 4009(d)(2) of
Section 4009(j)(6) of
Section 4083(b)(2) of
Amendment by
Effective Date of 1986 Amendments
Section 1895(b)(1)(D) of
Section 1895(b)(2)(B), formerly §1895(b)(2)(D), of
Amendment by section 1895(b)(3), (9) of
Section 9302(a)(3) of
Section 9302(b)(2) of
Section 9302(d)(1)(B) of
"(i) Subject to clause (ii), the amendments made by subparagraph (A) [amending this section] shall apply to payments for discharges occurring on or after October 1, 1986.
"(ii) An appeal for classification of a rural hospital as a regional referral center, pursuant to the amendments made by subparagraph (A), which is filed before January 1, 1987, and which is approved shall be effective with respect to discharges occurring on or after October 1, 1986."
Section 9303(b) of
Section 9304(d) of
Section 9306(d) of
Section 9307(c)(1) of
Section 9314(b) of
Amendment by section 9320(g) of
Section 9321(e)(3)(B) of
Section 9101(d) of
Section 9101(e) of
"(1)
"(A) the amendment made by subsection (b) [amending this section] shall apply to payments made under section 1886(d)(1)(A) of such Act [subsec. (d)(1)(A) of this section] made on the basis of discharges occurring on or after May 1, 1986; and
"(B) for discharges occurring on or after October 1, 1986, the applicable percentage increase (described in section 1886(b)(3)(B) [subsec. (b)(3)(B) of this section]) for discharges occurring during fiscal year 1986 shall be deemed to have been ½ percent.
"(2)
"(A) the amendment made by subsection (b) [amending this section] shall apply to payments under section 1886(d)(1)(A) of the Social Security Act [subsec. (d)(1)(A) of this section] made on the basis of discharges occurring during a cost reporting period of a hospital, for the hospital's cost reporting periods beginning on or after October 1, 1985;
"(B) notwithstanding subparagraph (A), for the cost reporting period beginning during fiscal year 1986, the applicable percentage increase (as defined in section 1886(b)(3)(B) of such Act [subsec. (b)(3)(B) of this section]) for the—
"(i) first 7 months of the cost reporting period shall be 0 percent, and
"(ii) for the remaining 5 months of the cost reporting period shall be ½ percent; and
"(C) for cost reporting periods beginning on or after October 1, 1986, the applicable percentage increase (as so defined) with respect to the previous cost reporting period shall be deemed to have been ½ percent.
"(3)
"(A) the amendment made by subsection (b) [amending this section] shall apply to cost reporting periods beginning on or after October 1, 1985;
"(B) notwithstanding subparagraph (A), for the hospital's cost reporting period beginning during fiscal year 1986, payment under title XVIII of the Social Security Act [this subchapter] shall be made as though the applicable percentage increase described in section 1886(b)(3)(B) [subsec. (b)(3)(B) of this section] were equal to 5/24 of 1 percent; and
"(C) for cost reporting periods beginning on or after October 1, 1986, the applicable percentage increase (as so defined) with respect to the cost reporting period beginning during fiscal year 1986 shall be deemed to have been ½ percent.
"(4)
Section 9102(d) of
"(1)
"(2)
"(A) to cost reporting periods beginning on or after October 1, 1985, but
"(B) notwithstanding subparagraph (A), for a hospital's cost reporting period beginning during fiscal year 1986, for purposes of section 1886(d)(1)(A) of the Social Security Act [subsec. (d)(1)(A) of this section]—
"(i) during the first 7 months of the period the 'target percentage' is 50 percent and the 'DRG percentage' is 50 percent, and
"(ii) during the remaining 5 months of the period the 'target percentage' is 45 percent and the 'DRG percentage' is 55 percent.
"(3)
"(4)
"(A) Notwithstanding any other provision of this subsection, the amendments made by this section [amending this section] shall not apply to payments with respect to the operating costs of inpatient hospital services (as defined in section 1886(a)(4) of the Social Security Act [subsec. (a)(4) of this section]) of a subsection (d) hospital (as defined in section 1886(d)(1)(B) of such Act [subsec. (d)(1)(B) of this section]) located in the State of Oregon.
"(B) Notwithstanding any other provision of law, for a cost reporting period beginning during fiscal year 1986 of a subsection (d) hospital to which the amendments made by this section [amending this section] do not apply, for purposes of section 1886(d)(1)(A) of of [sic] Social Security Act [subsec. (d)(1)(A) of this section]—
"(i) during the first 7 months of the period the 'target percentage' is 50 percent and the 'DRG percentage' is 50 percent, and
"(ii) during the remaining 5 months of the period the 'target percentage' is 25 percent and the 'DRG percentage' is 75 percent.
"(C) Notwithstanding any other provision of law, for purposes of section 1886(d)(1)(D) of such Act [subsec. (d)(1)(D) of this section], the applicable combined adjusted DRG prospective payment rate for a subsection (d) hospital to which the amendments made by this section [amending this section] do not apply is, for discharges occurring on or after October 1, 1985, and before May 1, 1986, a combined rate consisting of 25 percent of the national adjusted DRG prospective payment rate and 75 percent of the regional adjusted DRG prospective payment rate for such discharges."
Section 9104(c) of
"(1) Except as provided in paragraph (2), the amendments made by this section [amending this section] shall apply to discharges occurring on or after May 1, 1986.
"(2) The amendments made by this section shall not first be applied to discharges occurring as of a date unless, for discharges occurring on that date, the amendments made by section 9105 [amending this section] are also being applied."
Section 9105(e) of
Section 9106(b) of
Section 9107(c)(1) of
Section 9109(b) of
Section 9111(b) of
Section 9202(b) of
Effective and Termination Dates of 1984 Amendments
Amendment by
Section 2307(b)(2) of
Section 2310(b) of
Section 2311(d) of
"(1) Except as provided in paragraph (2), the amendments made by subsections (b) and (c) [amending this section] shall be effective with respect to cost reporting periods beginning on or after October 1, 1983, and the amendment made by subsection (a) [amending this section] shall be effective with respect to cost reporting periods beginning on or after October 1, 1984.
"(2) The amendment made by subsection (b) [amending this section] shall not apply so as to reduce any payment under section 1886(d) of the Social Security Act [subsec. (d) of this section] to a hospital the region of which is deemed to be changed pursuant to such amendment for discharges occurring in any cost reporting period beginning before October 1, 1984."
Section 2312(c) of
Amendment by section 2313(a), (b), (d) of
Section 2315(g) of
Amendment by section 2354(b)(42)–(44) of
Effective Date of 1983 Amendments
Section 601(b)(9) of
Section 604 of title VI of
"(a)(1) Except as provided in section 602(l) [amending
"(2) Section 1866(a)(1)(F) of the Social Security Act [
"(b) The Secretary shall make an appropriate reduction in the payment amount under section 1886(d) of the Social Security Act [subsec. (d) of this section] (as amended by this title) for any discharge, if the admission has occurred before a hospital's first cost reporting period that begins after September 1983, to take into account amounts payable under title XVIII of that Act [this subchapter] (as in effect before the date of the enactment of this Act [Apr. 20, 1983]) for items and services furnished before that period.
"(c)(1) The Secretary shall cause to be published in the Federal Register a notice of the interim final DRG prospective payment rates established under subsection (d) of section 1886 of the Social Security Act [subsec. (d) of this section] (as amended by this title) no later than September 1, 1983, and allow for a period of public comment thereon. Payment on the basis of prospective rates shall become effective on October 1, 1983, without the necessity for consideration of comments received, but the Secretary shall, by notice published in the Federal Register, affirm or modify the amounts by December 31, 1983, after considering those comments.
"(2) A modification under paragraph (1) that reduces a prospective payment rate shall apply only to discharges occurring after 30 days after the date the notice of the modification is published in the Federal Register.
"(3) Rules to implement the amendments made by this title [amending this section and
Amendment by
Effective Date
Section 101(b)(1) of
Regulations
Section 4003(c) of
Section 2315(f)(2) of
Section 101(b)(2)(A) of
No Standardized Amount Adjustments for Fiscal Years 1992 or 1993
Section 13501(b)(2) of
Extension of Regional Referral Center Classifications Through Fiscal Year 1994; Reclassification
Section 13501(d) of
"(1)
"(2)
"(A) notify such hospital of such failure to qualify,
"(B) provide an opportunity for such hospital to decline such reclassification, and
"(C) if the hospital—
"(i) declines such reclassification, administer the Social Security Act [this chapter] (other than section 1886(d)(8)(D)) for such fiscal year as if the decision by the Review Board had not occurred, or
"(ii) fails to decline such reclassification, administer the Social Security Act without regard to paragraph (1).
"(3)
"(A)
"(B)
Hospitals Declining Urban Area Reclassifications; Retroactive Payments
Section 13501(e)(2), (3) of
"(2)
"(A) notify such hospital of such failure to qualify,
"(B) provide an opportunity for such hospital to decline such reclassification, and
"(C) if the hospital declines such reclassification, administer the Social Security Act [this chapter] (other than section 1886(d)(8)(D)) for such fiscal year as if the decision by the Review Board had not occurred.
"(3)
"(A)
"(B)
Adjustment in GME Base-Year Costs of Federal Insurance Contributions Act
Section 13563(d) of
"(1)
"(2)
"(3)
"(A) The 'base cost reporting period' for a hospital is the hospital's cost reporting period that began during fiscal year 1984.
"(B) The term 'FICA taxes' means, with respect to a hospital, the taxes under section 3111 of the Internal Revenue Code of 1986 [
Determination of Area Wage Index for Discharges Occurring January 1, 1991 to October 1, 1993
Section 4002(d)(1) of
"(A) For purposes of section 1886(d)(3)(E) of the Social Security Act [subsec. (d)(3)(E) of this section] for discharges occurring on or after January 1, 1991, and before October 1, 1993, the Secretary of Health and Human Services shall apply an area wage index determined using the survey of the 1988 wages and wage-related costs of hospitals in the United States conducted under such section.
"(B) The Secretary shall apply the wage index described in subparagraph (A) without regard to a previous survey of wages and wage-related costs."
Study and Report on Relationship Between Non-Wage-Related Input Prices and Adjusted Average Standardized Amounts
Section 4002(e)(2) of
Deadline for Submission of Applications to Geographic Classification Review Board
Section 4002(h)(2)(A) of
Payments for Medical Education Costs
Section 4004 of
"(a)
"(1)
"(2)
"(3)
"(b)
"(1)
"(2)
"(A) the hospital claimed and was reimbursed for such costs during the most recent cost reporting period that ended on or before October 1, 1989;
"(B) the proportion of the hospital's total allowable costs that is attributable to the clinical training costs of the approved program, and allowable under (b)(1) during the cost reporting period does not exceed the proportion of total allowable costs that were attributable to the clinical training costs during the cost reporting period described in subparagraph (A);
"(C) the hospital receives a benefit for the support it furnishes to such program through the provision of clinical services by nursing or allied health students participating in such program; and
"(D) the costs incurred by the hospital for such program do not exceed the costs that would be incurred by the hospital if it operated the program itself.
"(3)
"(A)
"(B)
"(4)
"(5)
Section 4159 of
"(a)
"(1)
"(2)
"(3)
"(b)
"(1)
"(2)
"(A) the hospital claimed and was reimbursed for such costs during the most recent cost reporting period that ended on or before October 1, 1989;
"(B) the proportion of the hospital's total allowable costs that is attributable to the clinical training costs of the approved program, and allowable under (b)(1) during the cost reporting period does not exceed the proportion of total allowable costs that were attributable to clinical training costs during the cost reporting period described in subparagraph (A);
"(C) the hospital receives a benefit for the support it furnishes to such program through the provision of clinical services by nursing or allied health students participating in such program; and
"(D) the costs incurred by the hospital for such program do not exceed the costs that would be incurred by the hospital if it operated the program itself.
"(3)
"(A)
"(B)
"(4)
"(5)
Development of National Prospective Payment Rates for Current Non-PPS Hospitals
Section 4005(b) of
"(1)
"(A) take into consideration the need to provide for appropriate limits on increases in expenditures under the medicare program;
"(B) provide for adjustments to prospectively determined rates to account for changes in a hospital's case mix, severity of illness of patients, volume of cases, and the development of new technologies and standards of medical practice;
"(C) take into consideration the need to increase the payment otherwise made under such system in the case of services provided to patients whose length of stay or costs of treatment greatly exceed the length of stay or cost of treatment provided for under the applicable prospectively determined payment rate;
"(D) take into consideration the need to adjust payments under the system to take into account factors such as a disproportionate share of low-income patients, costs related to graduate medical education programs, differences in wages and wage-related costs among hospitals located in various geographic areas, and other factors the Secretary considers appropriate; and
"(E) provide for the appropriate allocation of operating and capital-related costs of hospitals not subject to the new prospective payment system and distinct units of such hospitals that would be paid under such system.
"(2)
"(B) By not later than June 1, 1992, the Prospective Payment Assessment Commission shall submit an analysis of and comments on the proposal developed under paragraph (1) to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives."
Guidance to Intermediaries and Hospitals
Section 4005(c)(3) of
Freeze in Payments Under Part A of This Subchapter Through December 31, 1990
Section 4007 of
"(a)
"(1) The market basket percentage increase (described in section 1886(b)(3)(B)(iii) of the Social Security Act) shall be deemed to be 0 for discharges occurring during such period.
"(2) The percentage increase or decrease in the medical care expenditure category of the consumer price index applicable under section 1814(i)(2)(B) of such Act [
"(3) The area wage index applicable to a subsection (d) hospital under section 1886(d)(3)(E) of such Act shall be deemed to be the area wage index applicable to such hospital as of September 30, 1990.
"(4) The percentage change in the consumer price index applicable under section 1886(h)(2)(D) of such Act shall be deemed to be 0.
"(b)
Review of Hospital Regulations With Respect to Rural Hospitals
Section 4008(l) of
"(1)
"(2)
Prohibition on Cost Savings Policies Before Beginning of Fiscal Year
Section 4207(b)(1), formerly 4027(b)(1), of
"(A) The Secretary may issue such a proposed regulation, instruction, or other policy with respect to the fiscal year before the May 15 preceding the beginning of the fiscal year.
"(B) The Secretary may issue such a final regulation, instruction, or other policy with respect to the fiscal year on or after October 15 of the fiscal year.
"(C) The Secretary may, at any time, issue such a proposed or final regulation, instruction, or other policy with respect to the fiscal year if required to implement specific provisions under statute."
Prohibition of Payment Cycle Changes
Section 4207(b)(2), formerly 4027(b)(2), of
Extension of Area Wage Index
Section 115(a) of
Adjustments Resulting From Extensions of Regional Floor on Standardized Amounts
Section 115(b)(2) of
Indexing of Future Applicable Percentage Increases
Section 6003(a)(3) of
Continuation of Sole Community Hospital Designation for Current Sole Community Hospitals
Section 6003(e)(3) of
Additional Payment Resulting From Corrections of Erroneously Determined Wage Index
Section 6003(h)(5) of
"(A)
"(B)
"(i) the error resulted from the submission of erroneous data, except that a hospital is not eligible for such additional payment if it submitted such erroneous data;
"(ii) the error was made with respect to the survey of the 1984 wages and wage-related costs of hospitals in the United States conducted under section 1886(d)(3)(E) of the Social Security Act; and
"(iii) the correction of the error resulted in an adjustment to the area wage index of not less than 3 percentage points.
"(C)
Legislative Proposal Eliminating Separate Average Standardized Amounts
Section 6003(i) of
"(1)
"(A) A transition period beginning in fiscal year 1992 during which a single rate for determining payment to hospitals in all areas shall be phased in with such single rate to be completely in effect by fiscal year 1995.
"(B) Recommendations, where appropriate, for modifying or maintaining additional payments or adjustments made under title XVIII of the Social Security Act [this subchapter] for teaching hospitals, rural referral centers, sole community hospitals, disproportionate share hospitals, and outlier cases, and for creating additional payments or adjustments where deemed appropriate by the Secretary.
"(C) Recommendations with respect to recalculating standardized amounts to reflect information from more recent cost reporting periods.
"(D) Recommendations, where appropriate, for modifying reimbursement for hospitals that are not subsection (d) hospitals under title XVIII of such Act.
"(E) A recommendation for a methodology to reflect the severity of illness of different patients within the same diagnosis-related group (as determined in section 1886(d)(4)(B) of such Act [subsec. (d)(4)(B) of this section]).
"(2)
"(B) Not later than February 1, 1991, the Prospective Payment Assessment Commission and the Director of the Congressional Budget Office shall each prepare and submit to Congress a report analyzing the legislative proposal submitted under subparagraph (A), and shall include in such report an analysis of the probable impact of such legislation on hospitals participating in the medicare program."
Determination and Recommendations of Payments for Costs of Administering Blood Clotting Factors to Individuals With Hemophilia
Section 6011(b), (c) of
"(b)
"(c)
Publication of Instructions Relating to Exceptions and Adjustments in Target Amounts
Section 6015(b) of
Delay in Recoupment of Certain Nursing and Allied Education Costs
Section 6205(b) of
"(1) The Secretary of Health and Human Services (in this subsection referred to as the 'Secretary') shall not, before October 1, 1990, recoup from, or otherwise reduce or adjust payments under title XVIII of the Social Security Act [this subchapter] to, hospitals because of alleged overpayments to such hospitals under such title due to a determination that costs which were reported by a hospital on its medicare cost reports relating to approved nursing and allied health education programs were allowable costs and are included in the definition of 'operating costs of inpatient hospital services' pursuant to section 1886(a)(4) of such Act [subsec. (a)(4) of this section], so that no pass-through of such costs was permitted under that section.
"(2)(A) Before July 1, 1990, the Secretary shall issue regulations respecting payment of costs described in paragraph (1).
"(B) In issuing such regulations—
"(i) the Secretary shall allow a comment period of not less than 60 days,
"(ii) the Secretary shall consult with the Prospective Payment Assessment Commission, and
"(iii) any final rule shall not be effective prior to October 1, 1990, or 30 days after publication of the final rule in the Federal Register, whichever is later.
"(C) Such regulations shall specify—
"(i) the relationship required between an approved nursing or allied health education program and a hospital for the program's costs to be attributed to the hospital;
"(ii) the types of costs related to nursing or allied health education programs that are allowable by medicare;
"(iii) the distinction between costs of approved educational activities as recognized under section 1886(a)(3) of the Social Security Act [subsec. (a)(3) of this section] and educational costs treated as operating costs of inpatient hospital services; and
"(iv) the treatment of other funding sources for the program."
Inner-City Hospital Triage Demonstration Project
Section 6217 of
"(a)
"(1) to train hospital personnel to operate and participate in the system; and
"(2) to provide services to patients who might otherwise be denied appropriate and prompt care.
"(b)
"(2) The amount of payment made under the demonstration project during a single year may not exceed $500,000."
Transition Adjustments to Target Amounts for Inpatient Hospital Services
Section 101(c)(2)(B) of title I of
Election of Personnel Policy for ProPAC Employees
Section 8405 of
Adjustments in Payments for Inpatient Hospital Services
Section 104(c) of
"(1) PPS
"(2) PPS-
[Amendment of section 104(c) of
ProPAC Study
Section 203(c)(2) of
Clinic Hospital Wage Indices
Section 4004(b) of
Limitation on Amounts Paid in Fiscal Years 1988 and 1989
Section 4005(c)(2)(B) of
Study of Criteria for Classification of Hospitals as Rural Referral Centers; Report
Section 4005(d)(2) of
Grant Program for Rural Health Care Transition
Section 4005(e) of
"(1) The Administrator of the Health Care Financing Administration, in consultation with the Assistant Secretary for Health (or a designee), shall establish a program of grants to assist eligible small rural hospitals and their communities in the planning and implementation of projects to modify the type and extent of services such hospitals provide in order to adjust for one or more of the following factors:
"(A) Changes in clinical practice patterns.
"(B) Changes in service populations.
"(C) Declining demand for acute-care inpatient hospital capacity.
"(D) Declining ability to provide appropriate staffing for inpatient hospitals.
"(E) Increasing demand for ambulatory and emergency services.
"(F) Increasing demand for appropriate integration of community health services.
"(G) The need for adequate access (including appropriate transportation) to emergency care and inpatient care in areas in which a significant number of underutilized hospital beds are being eliminated.
"(H) The Administrator shall submit a final report on the program to the Congress not later than 180 days after all projects receiving a grant under the program are completed.
Each demonstration project under this subsection shall demonstrate methods of strengthening the financial and managerial capability of the hospital involved to provide necessary services. Such methods may include programs of cooperation with other health care providers, of diversification in services furnished (including the provision of home health services), of physician recruitment, and of improved management systems. Grants under this paragraph may be used to provide instruction and consultation (and such other services as the Administrator determines appropriate) via telecommunications to physicians in such rural areas (within the meaning of section 1886(d)(2)(D) of the Social Security Act [subsec. (d)(2)(D) of this section]) as are designated either class 1 or class 2 health manpower shortage areas under section 332(a)(1)(A) of the Public Health Service Act [
"(2) For purposes of this subsection, the term 'eligible small rural hospital' means any rural primary care hospital designated by the Secretary under section 1820(i)(2) of the Social Security Act [
"(A) is located in a rural area (as determined in accordance with subsection (d)),
"(B) has less than 100 beds, and
"(C) is not for profit.
"(3)(A) Any eligible small rural hospital that desires to modify the type or extent of health care services that it provides in order to adjust for one or more of the factors specified in paragraph (1) may submit an application to the Administrator and a copy of such application to the Governor of the State in which it is located. The application shall specify the nature of the project proposed by the hospital, the data and information on which the project is based, and a timetable (of not more than 24 months) for completion of the project. The application shall be submitted on or before a date specified by the Administrator and shall be in such form as the Administrator may require.
"(B) The Governor shall transmit to the Administrator, within a reasonable time after receiving a copy of an application pursuant to subparagraph (A), any comments with respect to the application that the Governor deems appropriate.
"(C) The Governor of a State may designate an appropriate State agency to receive and comment on applications submitted under subparagraph (A).
"(4) A hospital shall be considered to be located in a rural area for purposes of this subsection if it is treated as being located in a rural area for purposes of section 1886(d)(3)(D) of the Social Security Act [subsec. (d)(3)(D) of this section].
"(5) In determining which hospitals making application under paragraph (3) will receive grants under this subsection, the Administrator shall take into account—
"(A) any comments received under paragraph (3)(B) with respect to a proposed project;
"(B) the effect that the project will have on—
"(i) reducing expenditures from the Federal Hospital Insurance Trust Fund,
"(ii) improving the access of medicare beneficiaries to health care of a reasonable quality;
"(C) the extent to which the proposal of the hospital, using appropriate data, demonstrates an understanding of—
"(i) the primary market or service area of the hospital, and
"(ii) the health care needs of the elderly and disabled that are not currently being met by providers in such market or area, and
"(D) the degree of coordination that may be expected between the proposed project and—
"(i) other local or regional health care providers, and
"(ii) community and government leaders,
as evidenced by the availability of support for the project (in cash or in kind) and other relevant factors.
"(6) A grant to a hospital under this subsection may not exceed $50,000 a year and may not exceed a term of 3 years.
"(7)(A) Except as provided in subparagraphs (B) and (C), a hospital receiving a grant under this subsection may use the grant for any of expenses incurred in planning and implementing the project with respect to which the grant is made.
"(B) A hospital receiving a grant under this subsection for a project may not use the grant to retire debt incurred with respect to any capital expenditure made prior to the date on which the project is initiated.
"(C) Not more than one-third of any grant made under this subsection may be expended for capital-related costs (as defined by the Secretary for purposes of section 1886(a)(4) of the Social Security Act [subsec. (a)(4) of this section]) of the project, except that this limitation shall not apply with respect to a grant used for the purposes described in subparagraph (D).
"(D) A hospital may use a grant received under this subsection to develop a plan for converting itself to a rural primary care hospital (as described in section 1820 of the Social Security Act [
"(8)(A) A hospital receiving a grant under this section [amending this section and
"(B) The Administrator shall report to the Congress at least once every 12 months on the program of grants established under this subsection. The report shall assess the functioning and status of the program, shall evaluate the progress made toward achieving the purposes of the program, and shall include any recommendations the Secretary may deem appropriate with respect to the program. In preparing the report, the Secretary shall solicit and include the comments and recommendations of private and public entities with an interest in rural health care.
"(C) The Administrator shall submit a final report on the program to the Congress not later than 180 days after all projects receiving a grant under the program are completed.
"(9) For purposes of carrying out the program of grants under this subsection, there are authorized to be appropriated from the Federal Hospital Insurance Trust Fund $15,000,000 for fiscal year 1989, $25,000,000 for each of the fiscal years 1990, 1991, and 1992 and $30,000,000 for each of fiscal years 1993 through 1997."
[Section 103(a)(2) of
[
[Section 6003(g)(1)(B)(ii) of
Reporting Hospital Information
Section 4007 of
"(a)
"(b) [Amended subsec. (f) of this section and enacted provisions set out as an Effective Date of 1987 Amendment note above.]
"(c)
"(1) The Secretary of Health and Human Services shall provide for a demonstration project to develop, and determine the costs and benefits of establishing a uniform system for the reporting by medicare participating hospitals of balance sheet and information described in paragraph (2). In conducting the project, the Secretary shall require hospitals in at least 2 States, one of which maintains a uniform hospital reporting system, to report such information based on standard information established by the Secretary.
"(2) The information described in this paragraph is as follows:
"(A) Hospital discharges (classified by class of primary payer).
"(B) Patient days (classified by class of primary payer).
"(C) Licensed beds, staffed beds, and occupancy.
"(D) Inpatient charges and revenues (classified by class of primary payer).
"(E) Outpatient charges and revenues (classified by class of primary payer).
"(F) Inpatient and outpatient hospital expenses (by cost-center classified for operating and capital).
"(G) Reasonable costs.
"(H) Other income.
"(I) Bad debt and charity care.
"(J) Capital acquisitions.
"(K) Capital assets.
The Secretary shall develop a definition of 'outpatient visit' for purposes of reporting hospital information.
"(3) The Secretary shall develop the system under subsection (c) in a manner so as—
"(A) to facilitate the submittal of the information in the report in an electronic form, and
"(B) to be compatible with the needs of the medicare prospective payment system.
"(4) The Secretary shall prepare and submit, to the Prospective Payment Assessment Commission, the Comptroller General, the Committee on Ways and Means of the House of Representatives, and the Committee on Finance of the Senate, by not later than 45 days after the end of each calendar quarter, data collected under the system.
"(5) In paragraph (2):
"(A) The term 'bad debt and charity care' has such meaning as the Secretary establishes.
"(B) The term 'class' means, with respect to payers at least, the programs under this title XVIII of the Social Security Act [this subchapter], a State plan approved under title XIX of such Act [subchapter XIX of this chapter], other third party-payers, and other persons (including self-paying individuals).
"(6) The Secretary shall set aside at least a total of $3,000,000 for fiscal years 1988, 1989, and 1990 from existing research funds or from operations funds to develop the format, according to paragraph (1) and for data collection and analysis, but total funds shall not exceed $15,000,000.
"(7) The Comptroller General shall analyze the adequacy of the existing system for reporting of hospital information and the costs and benefits of data reporting under the demonstration system and will recommend improvements in hospital data collection and in analysis and display of data in support of policy making.
"(d)
Hospital Outlier Payments and Policy
Section 4008(d) of
"(1)
"(A)
"(B)
"(2)
"(A)
"(B)
"(3)
ProPAC Studies and Reports
Section 4009(h) of
"(1)
"(2)
"(3)
Special Rule for Urban Areas in New England
Section 4009(i) of
Rural Health Medical Education Demonstration Project
Section 4038 of
"(a)
"(b)
"(c)
"(A) two of such hospitals are located in rural counties of more than 2,700 square miles (one of which is east of the Mississippi River and one of which is west of such river); and
"(B) two of such hospitals are located in rural counties with (as determined by the Secretary) a severe shortage of physicians (one of which is east of the Mississippi River and one of which is west of such river).
"(2) The provisions of paragraph (1) shall not apply with respect to applications submitted as a result of amendments made by section 6216 of the Omnibus Budget Reconciliation Act of 1989 [
"(d)
"(1) with respect to subsection (d)(5)(B) of such section, any resident physician participating in the project under subsection (a) for any part of a year shall be treated as if he or she were working at the appropriate sponsoring hospital with an agreement under subsection (a) on September 1 of such year (and shall not be treated as if working at the small rural hospital); and
"(2) with respect to subsection (h) of such section, the payment amount permitted under such subsection for a sponsoring hospital with an agreement under subsection (a) shall be increased (for the duration of the project only) by an amount equal to the amount of any direct graduate medical education costs (as defined in paragraph (5) of such subsection (h)) incurred by such hospital in supervising the education and training activities under a project under subsection (a).
"(e)
"(f)
Prohibition on Policy by Secretary of Health and Human Services To Reduce Expenditures in Fiscal Years 1989, 1990, and 1991
Section 4039(d) of
Temporary Extension of Payment Policies for Inpatient Hospital Services
"(A)
"(B)
"(i)
"(I) during the extension period is the rate specified in subsection (d)(1)(D)(ii) of such section, or
"(II) after such period is the national adjusted prospective payment rate determined under subsection (d)(3) of such section.
"(ii)
"(C)
"(D)
"(E)
[Section 4002(f)(2) of
Freezing Certain Changes in Medicare Payment Regulations and Policies
"(1)
"(A) any final regulation that changes the policy with respect to payment under title XVIII of the Social Security Act [this subchapter] to providers of service for reasonable costs relating to unrecovered costs associated with unpaid deductible and coinsurance amounts incurred under such title;
"(B) any final regulation, instruction, or other policy change which is primarily intended to have the effect of slowing down claims processing, or delaying payment of claims, under such title; or
"(C) any final regulation that changes the policy under such title with respect to payment for a return on equity capital for outpatient hospital services.
The final regulation of the Health Care Financing Administration published on September 1, 1987 (52 Federal Register 32920) and relating to changes to the return on equity capital provisions for outpatient hospital services is void and of no effect.
"(2)
"(3)
Maintaining Current Outlier Policy in Fiscal Year 1987
Section 9302(b)(3) of
"(A) the proportions under paragraph (3)(B) for hospitals located in urban and rural areas shall be established at such levels as produce the same total dollar reduction under such paragraph as if this section had not been enacted; and
"(B) the thresholds and standards used for making additional payments under paragraph (5) of such section shall be the same as those in effect as of October 1, 1986."
Extension of Regional Referral Center Classification
Section 6003(d) of
Section 9302(d)(2) of
Budget-Neutral Implementation
Section 9302(d)(3) of
Promulgation of New Rate
Section 9302(f) of
Miscellaneous Accounting Provision
Section 9307(d) of
"(1) had a cost reporting period beginning on September 28, 29, or 30 of 1985,
"(2) is located in a State in which inpatient hospital services were paid in fiscal year 1985 pursuant to a Statewide demonstration project under section 402 of the Social Security Amendments of 1967 [section 402 of
"(3) elects, by notice to the Secretary of Health and Human Services by not later than April 1, 1988, to have this subsection apply,
during the first 7 months of such cost reporting period the 'target percentage' shall be 75 percent and the 'DRG percentage' shall be 25 percent, and during the remaining 5 months of such period the 'target percentage' and the 'DRG percentage' shall each be 50 percent."
[Section 4008(e) of
Treatment of Capital-Related Regulations
Section 9321(c) of
"(1)
"(2)
"(3)
"(4)
Limitation on Authority To Issue Certain Final Regulations and Instructions Relating to Hospitals or Physicians
Section 9321(d) of
Study of Methodology for Area Wage Adjustment for Central Cities; Report to Congress
Section 9103(b) of
"(1) The Secretary of Health and Human Services, in consultation with the Prospective Payment Assessment Commission, shall collect information and shall develop one or more methodologies to permit the adjustment of the wage indices used for purposes of sections 1886(d)(2)(C)(ii), 1886(d)(2)(H), and 1886(d)(3)(E) of the Social Security Act [subsec. (d)(2)(C)(ii), (H), and (3)(E) of this section], in order to more accurately reflect hospital labor markets, by taking into account variations in wages and wage-related costs between the central city portion of urban areas and other parts of urban areas.
"(2) The Secretary shall report to Congress on the information collected and the methodologies developed under paragraph (1) not later than May 1, 1987. The report shall include a recommendation as to the feasibility and desirability of implementing such methodologies."
Continuation of Medicare Reimbursement Waivers for Certain Hospitals Participating in Regional Hospital Reimbursement Demonstrations
Section 9108 of
"(a)
"(1) to substantially all non-Federal acute care hospitals (as defined by the Secretary) in the geographic area served by such system on January 1, 1985, and
"(2) to the review of at least 75 percent of—
"(A) all revenues or expenses in such geographic area for inpatient hospital services, and
"(B) revenues or expenses in such geographic area for inpatient hospital services provided under the State's plan approved under title XIX [subchapter XIX of this chapter].
"(b)
"(c)
Information on Impact of PPS Payments on Hospitals
Section 9114 of
"(a)
"(b)
Special Rules for Implementation of Hospital Reimbursement
Section 9115 of
"(a)
"(b)
Appointment of Additional Members to Prospective Payment Assessment Commission
Section 9127(b) of
Studies by Secretary; GAO Study; Report on Uniformity of Approved FTE Resident Amounts; Study on Foreign Medical Graduates; Establishing Physician Identifier System; Paperwork Reduction
Section 9202(c)–(h) of
"(c)
"(A) the types and numbers of such programs, and number of students supported or trained under each program;
"(B) the fiscal and administrative relationships between the hospitals involved and the schools with which the programs and students are affiliated; and
"(C) the types and amounts of expenses of such programs for which reimbursement is made, and the financial and other contributions which accrue to the hospital as a consequence of having such programs.
The Secretary shall report the results of such study to the Committee on Finance of the Senate and the Committees on Ways and Means and Energy and Commerce of the House of Representatives prior to December 31, 1987.
"(2) The Secretary shall conduct a separate study of the advisability of continuing or terminating the exception under section 1886(h)(5)(F)(ii) of the Social Security Act [subsec. (h)(5)(F)(ii) of this section] for geriatric residencies and fellowships, and of expanding such exception to cover other educational activities, particularly those which are necessary to meet the projected health care needs of Medicare beneficiaries. Such study shall also examine the adequacy of the supply of faculty in the field of geriatrics. The Secretary shall report the results of such study to the committees described in paragraph (1) prior to July 1, 1990.
"(d)
"(2) In carrying out such study, the Comptroller General may utilize a sample of hospital patients and any other data sources which he deems appropriate, and shall, to the extent feasible, control for differences in severity of illness levels, area wage levels, levels of physician reasonable charges for like services and procedures, and for other factors which could affect the comparability of patients and of payments between teaching and nonteaching settings and among teaching settings. The information obtained in the study shall be coordinated with the information obtained in conducting the study of teaching physicians' services under section 2307(c) of the Deficit Reduction Act of 1984 [section 2307(c) of
"(3) The Comptroller General shall report the results of the study to the committees described in subsection (c)(1) prior to December 31, 1987.
"(e)
"(f)
"(1) the types of services provided;
"(2) the cost of providing such services, relative to the cost of other physicians providing the services or other approaches to providing the services;
"(3) any deficiencies in the quality of the services provided, and methods of assuring the quality of such services; and
"(4) the impact on costs of and access to services if medicare payment for hospitals' costs of graduate medical education of foreign medical graduates were phased out.
"[(g) Repealed.
"(h)
Special Treatment of States Formerly Under Waiver
Section 9202(j) of
"(1) the Secretary of Health and Human Services shall permit the hospital to change the method by which it allocates administrative and general costs to the direct medical education cost centers to the method specified in the medicare cost report;
"(2) the Secretary may make appropriate adjustments in the regional adjusted DRG prospective payment rate (for the region in which the State is located), based on the assumption that all teaching hospitals in the State use the medicare cost report; and
"(3) the Secretary shall adjust the hospital-specific portion of payment under section 1886(d) of such Act [subsec. (d) of this section] for any such hospital that actually chooses to use the medicare cost report.
The Secretary shall implement this subsection based on the best available data."
Moratorium on Laboratory Payment Demonstrations; Cooperation in Study; Report to Congress
Section 9204 of
"(a)
"(b)
Medicare Hospital and Physician Payment Provisions; Extension Period
"(a)
"(b)
"(c)
"(1)
"(2)
[Amendment of section 5 of
Definition of Hospital Serving Significantly Disproportionate Number of Low-Income Patients or Patients Entitled to Hospital Insurance Benefits for Aged and Disabled; Identification
Section 2315(h) of
"(1) develop and publish a definition of 'hospitals that serve a significantly disproportionate number of patients who have low income or are entitled to benefits under part A' of title XVIII of the Social Security Act [part A of this subchapter] for purposes of section 1886(d)(5)(C)(i) of that Act [subsec. (d)(5)(C)(i) of this section], and
"(2) identify those hospitals which meet such definition, and make such identity available to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate."
Prospective Payment Wage Index; Studies and Reports to Congress
Section 2316 of
"(a) The Secretary of Health and Human Services, in consultation with the Secretary of Labor, shall conduct a study to develop an appropriate index for purposes of adjusting payment amounts under section 1886(d) of the Social Security Act [subsec. (d) of this section] to reflect area differences in average hospital wage levels, as required under paragraphs (2)(H) and (3)(E) of such section [subsec. (d)(2)(H) and (3)(E) of this section], taking into account wage differences of full time and part time workers. The Secretary of Health and Human Services shall report the results of such study to the Congress not later than 30 days after the date of the enactment of this Act [July 18, 1984], including any changes which the Secretary determines to be necessary to provide for an appropriate index.
"(b) The Secretary shall adjust the payment amounts for hospitals for discharges occurring on or after May 1, 1986, to reflect the changes the Secretary has promulgated in final regulations (on September 3, 1985) relating to the hospital wage index under section 1886(d)(3)(E) of the Social Security Act [subsec. (d)(3)(E) of this section]. For discharges occurring after September 30, 1986, the Secretary shall provide for such periodic adjustments in the appropriate wage index used under that section as may be necessary, taking into account changes in the wage levels and relative proportions of full-time and part-time workers.
"(c) The Secretary shall conduct a study and report to the Congress on proposed criteria under which, in the case of a hospital that demonstrates to the Secretary in a current fiscal year that the adjustment being made under paragraph (2)(H) or (3)(E) of section 1886(d) of the Social Security Act [subsec. (d)(2)(H) or (3)(E) of this section] for that hospital's discharges in that fiscal year does not accurately reflect the wage levels in the labor market serving the hospital, the Secretary, to the extent he deems appropriate, would modify such adjustment for that hospital for discharges in the subsequent fiscal year to take into account a difference in payment amounts in that current fiscal year to the hospital that resulted from such inaccuracy."
[Section 9103(a)(2) of
Different Treatment of Capital-Projects-Related Costs Before and After Implementation of System for Including Such Costs Under Prospectively Determined Payment Rate
Section 601(a)(3) of
New England Hospitals; Classification as Urban or Rural
Section 601(g) of
Reports, Experiments, and Demonstration Projects Related to Inclusion in Prospective Payment Amounts of Inpatient Hospital Service Capital-Related Costs
Section 603(a) of title VI of
"(1) The Secretary of Health and Human Services (hereinafter in this title referred to as the 'Secretary') shall study, develop, and report to the Congress within 18 months after the date of the enactment of this Act [Apr. 20, 1983] on the method and proposals for legislation by which capital-related costs, such as return on net equity, associated with inpatient hospital services can be included within the prospective payment amounts computed under section 1886(d) of the Social Security Act [subsec. (d) of this section].
"(2)(A) The Secretary shall study and report annually to the Congress at the end of each year (beginning with 1984 and ending with 1989) on the impact, of the payment methodology under section 1886(d) of the Social Security Act [subsec. (d) of this section] during the previous year, on classes of hospitals, beneficiaries, and other payors for inpatient hospital services, and other providers, and, in particular, on the impact of computing DRG prospective payment rates by census division, rather than exclusively on a national basis. Each such report shall include such recommendations for such changes in legislation as the Secretary deems appropriate.
"(B) During fiscal year 1984, the Secretary shall begin the collection of data necessary to compute the amount of physician charges attributable, by diagnosis-related groups, to physicians' services furnished to inpatients of hospitals whose discharges are classified within those groups. The Secretary shall submit to Congress, not later than July 1, 1985, a report to Congress which includes recommendations on the advisability and feasibility of providing for determining the amount of the payments for physicians' services furnished to hospital inpatients based on the DRG type classification of the discharges of those inpatients, and legislative recommendations thereon.
"(C) In the annual report to Congress under subparagraph (A) for 1985, the Secretary shall include the results of studies on—
"(i) the feasibility and impact of eliminating or phasing out separate urban and rural DRG prospective payment rates under paragraph (3) of section 1886(d) of the Social Security Act [subsec. (d)(3) of this section];
"(ii) whether and the method under which hospitals, not paid based on amounts determined under such section, can be paid for inpatient hospital services on a prospective basis as under such section;
"(iii) the appropriateness of the factors used under paragraph (5)(A) of such section to compensate hospitals for the additional expenses of outlier cases, and the application of severity of illness, intensity of care, or other modifications to the diagnosis-related groups, and the advisability and feasibility of providing for such modifications;
"(iv) the feasibility and desirability of applying the payment methodology under such section to payment by all payors for inpatient hospital services; and
"(v) the impact of such section on hospital admissions and the feasibility of making a volume adjustment in the DRG prospective payment rates or requiring preadmission certification in order to minimize the incentive to increase admissions.
Such report shall specifically include, with respect to the item described in clause (iv), consideration of the extent of cost-shifting to non-Federal payors and the impact of such cost-shifting on health insurance costs and premiums borne by employers and employees.
"(D) In the annual report to Congress under subparagraph (A) for 1986, the Secretary shall include the results of a study examining the overall impact of State systems of hospital payment (either approved under section 1886(c) of the Social Security Act [subsec. (c) of this section] or under a waiver approved under section 402(a) of the Social Security Amendments of 1967 [
"(E) In each annual report to Congress under subparagraph (A), the Secretary shall include—
"(i) an evaluation of the adequacy of the procedures for assuring quality of post-hospital services furnished under title XVIII of the Social Security Act [this subchapter],
"(ii) an assessment of problems that have prevented groups of medicare beneficiaries (including those eligible for medical assistance under title XIX of such Act [subchapter XIX of this chapter]) from receiving appropriate post-hospital services covered under such title, and
"(iii) information on reconsiderations and appeals taken under title XVIII of such Act [this subchapter] with respect to payment for post-hospital services.
"(3)(A) The Secretary shall complete a study and make legislative recommendations to the Congress with respect to an equitable method of reimbursing sole community hospitals which takes into account their unique vulnerability to substantial variations in occupancy.
"(B) In addition, the Secretary shall examine ways to coordinate an information transfer between parts A and B of title XVIII of the Social Security Act [parts A and B of this subchapter], particularly with respect to those cases where a denial of coverage is made under part A of such title and no adjustment is made in the reimbursement to the admitting physician or physicians.
"(C) The Secretary shall also report on the appropriate treatment of uncompensated care costs, and adjustments that might be appropriate for large teaching hospitals located in rural areas.
"(D) The Secretary shall also report on the advisability of having hospitals make available information on the cost of care to patients financed by both public programs and private payors.
"(E) The studies and reports described in this paragraph shall be completed and submitted not later than April 1, 1985.
"(4) The Secretary shall complete a study and make recommendations to the Congress, before April 1, 1984, with respect to a method for including hospitals located outside of the fifty States and the District of Columbia under a prospective payment system."
[Section 9305(i)(2) of
Inapplicability of Coordination of Federal Information Policy to the Collection of Information
Section 101(b)(2)(B) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. The comma probably should not appear.
2 So in original. Probably should be followed by "percentage point".
3 So in original. The comma probably should not appear.
4 So in original. Probably should be "another".
5 So in original. Probably should be followed by "and".
6 So in original. Probably should be section "557(b)".
7 So in original. Probably should be "necessary".
8 So in original. Probably should be followed by a closing parenthesis.
§1395xx. Payment of provider-based physicians and payment under certain percentage arrangements
(a) Criteria; amount of payments
(1) The Secretary shall by regulation determine criteria for distinguishing those services (including inpatient and outpatient services) rendered in hospitals or skilled nursing facilities—
(A) which constitute professional medical services, which are personally rendered for an individual patient by a physician and which contribute to the diagnosis or treatment of an individual patient, and which may be reimbursed as physicians' services under part B, and
(B) which constitute professional services which are rendered for the general benefit to patients in a hospital or skilled nursing facility and which may be reimbursed only on a reasonable cost basis or on the bases described in
(2)(A) For purposes of cost reimbursement, the Secretary shall recognize as a reasonable cost of a hospital or skilled nursing facility only that portion of the costs attributable to services rendered by a physician in such hospital or facility which are services described in paragraph (1)(B), apportioned on the basis of the amount of time actually spent by such physician rendering such services.
(B) In determining the amount of the payments which may be made with respect to services described in paragraph (1)(B), after apportioning costs as required by subparagraph (A), the Secretary may not recognize as reasonable (in the efficient delivery of health services) such portion of the provider's costs for such services to the extent that such costs exceed the reasonable compensation equivalent for such services. The reasonable compensation equivalent for any service shall be established by the Secretary in regulations.
(C) The Secretary may, upon a showing by a hospital or facility that it is unable to recruit or maintain an adequate number of physicians for the hospital or facility on account of the reimbursement limits established under this subsection, grant exceptions to such reimbursement limits as may be necessary to allow such provider to provide a compensation level sufficient to provide adequate physician services in such hospital or facility.
(b) Prohibition of recognition of payments under certain percentage agreements
(1) Except as provided in paragraph (2), in the case of a provider of services which is paid under this subchapter on a reasonable cost basis, or other basis related to costs that are reasonable, and which has entered into a contract for the purpose of having services furnished for or on behalf of it, the Secretary may not include any cost incurred by the provider under the contract if the amount payable under the contract by the provider for that cost is determined on the basis of a percentage (or other proportion) of the provider's charges, revenues, or claim for reimbursement.
(2) Paragraph (1) shall not apply—
(A) to services furnished by a physician and described in subsection (a)(1)(B) of this section and covered by regulations in effect under subsection (a) of this section, and
(B) under regulations established by the Secretary, where the amount involved under the percentage contract is reasonable and the contract—
(i) is a customary commercial business practice, or
(ii) provides incentives for the efficient and economical operation of the provider of services.
(Aug. 14, 1935, ch. 531, title XVIII, §1887, as added and amended Sept. 3, 1982,
Amendments
1983—Subsec. (a)(1)(B).
1982—Subsec. (b).
Effective Date of 1983 Amendment
Amendment by
Effective Date of 1982 Amendment
Section 109(c)(1), (2) of
"(1) The amendments made by this section [amending this section and
"(2) In the case of a contract with a provider of services entered into prior to the date of the enactment of this Act [Sept. 3, 1982], the amendment made by subsection (a) [amending this section] shall apply to payments under such contract (A) 30 days after the first date (after such date of enactment) the provider of services may unilaterally terminate the contract, or (B) one year after the date of the enactment of this Act, whichever is earlier."
Effective Date of Regulations
Section 108(b), formerly §108(c), of
Section Referred to in Other Sections
This section is referred to in
§1395yy. Payment to skilled nursing facilities for routine service costs
(a) Per diem limitations
The Secretary, in determining the amount of the payments which may be made under this subchapter with respect to routine service costs of extended care services shall not recognize as reasonable (in the efficient delivery of health services) per diem costs of such services to the extent that such per diem costs exceed the following per diem limits, except as otherwise provided in this section:
(1) With respect to freestanding skilled nursing facilities located in urban areas, the limit shall be equal to 112 percent of the mean per diem routine service costs for freestanding skilled nursing facilities located in urban areas.
(2) With respect to freestanding skilled nursing facilities located in rural areas, the limit shall be equal to 112 percent of the mean per diem routine service costs for freestanding skilled nursing facilities located in rural areas.
(3) With respect to hospital-based skilled nursing facilities located in urban areas, the limit shall be equal to the sum of the limit for freestanding skilled nursing facilities located in urban areas, plus 50 percent of the amount by which 112 percent of the mean per diem routine service costs for hospital-based skilled nursing facilities located in urban areas exceeds the limit for freestanding skilled nursing facilities located in urban areas.
(4) With respect to hospital-based skilled nursing facilities located in rural areas, the limit shall be equal to the sum of the limit for freestanding skilled nursing facilities located in rural areas, plus 50 percent of the amount by which 112 percent of the mean per diem routine service costs for hospital-based skilled nursing facilities located in rural areas exceeds the limit for freestanding skilled nursing facilities located in rural areas.
In applying this subsection the Secretary shall make appropriate adjustments to the labor related portion of the costs based upon an appropriate wage index, and shall, for cost reporting periods beginning on or after October 1, 1992, on or after October 1, 1995, and every 2 years thereafter, provide for an update to the per diem cost limits described in this subsection 1
(b) Excess overhead allocations for hospital-based facilities
With respect to a hospital-based skilled nursing facility, the Secretary may not recognize as reasonable the portion of the cost differences between hospital-based and freestanding skilled nursing facilities attributable to excess overhead allocations.
(c) Adjustments in limitations; publication of data
The Secretary may make adjustments in the limits set forth in subsection (a) of this section with respect to any skilled nursing facility to the extent the Secretary deems appropriate, based upon case mix or circumstances beyond the control of the facility. The Secretary shall publish the data and criteria to be used for purposes of this subsection on an annual basis.
(d) Access to skilled nursing facilities
(1) Any skilled nursing facility may choose to be paid under this subsection on the basis of a prospective payment for all routine service costs (including the costs of services required to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident eligible for benefits under this subchapter) and capital-related costs of extended care services provided in a cost reporting period if such facility had, in the preceding cost reporting period, fewer than 1,500 patient days with respect to which payments were made under this subchapter. Such prospective payment shall be in lieu of payments which would otherwise be made for routine service costs pursuant to
(2)(A) The amount of the payment under this section shall be determined on a per diem basis.
(B) Subject to the limitations of subparagraph (C), for skilled nursing facilities located—
(i) in an urban area, the amount shall be equal to 105 percent of the mean of the per diem reasonable routine service and capital-related costs of extended care services for skilled nursing facilities in urban areas within the same region, determined without regard to the limitations of subsection (a) of this section and adjusted for different area wage levels, and
(ii) in a rural area the amount shall be equal to 105 percent of the mean of the per diem reasonable routine service and capital-related costs of extended care services for skilled nursing facilities in rural areas within the same region, determined without regard to the limitations of subsection (a) of this section and adjusted for different area wage levels.
(C) The per diem amounts determined under subparagraph (B) shall not exceed the limit on routine service costs determined under subsection (a) of this section with respect to the facility, adjusted to take into account average capital-related costs with respect to the type and location of the facility.
(3) For purposes of this subsection, urban and rural areas shall be determined in the same manner as for purposes of subsection (a) of this section, and the term "region" shall have the same meaning as under
(4) The Secretary shall establish the prospective payment amounts for cost reporting periods beginning in a fiscal year at least 90 days prior to the beginning of such fiscal year, on the basis of the most recent data available for a 12-month period. A skilled nursing facility must notify the Secretary of its intention to be paid pursuant to this subsection for a cost reporting period no later than 30 days before the beginning of that period.
(5) The Secretary shall provide for a simplified cost report to be filed by facilities being paid pursuant to this subsection, which shall require only the cost information necessary for determining prospective payment amounts pursuant to paragraph (2) and reasonable costs of ancillary services.
(6) In lieu of payment on a cost basis for ancillary services provided by a facility which is being paid pursuant to this subsection, the Secretary may pay for such ancillary services on a reasonable charge basis if the Secretary determines that such payment basis will provide an equitable level of reimbursement and will ease the reporting burden of the facility.
(7) In computing the rates of payment to be made under this subsection, there shall be taken into account the costs described in the last sentence of
(Aug. 14, 1935, ch. 531, title XVIII, §1888, as added July 18, 1984,
Amendments
1993—Subsec. (a).
Subsec. (b).
1990—Subsec. (a).
Subsec. (d)(1).
1987—Subsec. (d)(7).
1986—Subsec. (b).
Subsec. (c).
Subsec. (d).
Subsec. (d)(1).
Subsec. (d)(4).
Effective Date of 1993 Amendment
Section 13503(a)(3)(B) of
Effective Date of 1990 Amendment
Section 4008(e)(3) of
Amendment by section 4008(h)(2)(A)(ii) of
Effective Date of 1987 Amendment
Amendment by
Effective Date of 1986 Amendments
Section 1895(b)(7)(D) of
Amendment by section 9219(b)(1)(C) of
Section 9126(d) of
"(1) The amendment made by subsection (a) [amending this section] shall apply to cost reporting periods beginning on or after October 1, 1986.
"(2) The amendment made by subsection (b) [amending this section] shall become effective on the date of the enactment of this Act [Apr. 7, 1986]."
Effective Date
Section 2319(c) of
Construction of Wage Index for Skilled Nursing Facilities
No Change in Limits on Per Diem Service Costs for Extended Care Services for Fiscal Years 1994 and 1995
Section 13503(a)(1) of
No Change in Prospective Payments for Services Furnished During Fiscal Years 1994 and 1995
Section 13503(b) of
Prospective Payment System for Skilled Nursing Facility Services
Section 4008(k) of
"(1)
"(A) take into consideration the need to provide for appropriate limits on increases in expenditures under the medicare program without jeopardizing access to extended care services for individuals unable to care for themselves;
"(B) provide for adjustments to prospectively determined rates to account for changes in a facility's case mix, volume of cases, and the development of new technologies and standards of medical practice;
"(C) take into consideration the need to increase the payment otherwise made under such system in the case of services provided to patients whose length of stay or costs of treatment greatly exceed the length of stay or cost of treatment provided for under the applicable prospectively determined payment rate;
"(D) take into consideration the need to adjust payments under the system to take into account factors such as a disproportionate share of low-income patients, differences in wages and wage-related costs among facilities located in various geographic areas, and other factors the Secretary considers appropriate; and
"(E) take into consideration the appropriateness of classifying patients and payments upon functional disability, cognitive impairment, and other patient characteristics.
"(2)
"(B) By not later than September 1, 1991, the Secretary shall submit the proposal developed under paragraph (1) to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives.
"(C) By not later than March 1, 1992, the Prospective Payment Assessment Commission shall submit an analysis of and comments on the proposal developed under paragraph (1) to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives."
Use of More Recent Data Regarding Routine Service Costs of Skilled Nursing Facilities
Section Referred To in Other Sections
This section is referred to in
1 So in original. Probably should be followed by a period.
§1395zz. Repealed. Pub. L. 103–432, title I, §171(j)(3), Oct. 31, 1994, 108 Stat. 4451
Section, act Aug. 14, 1935, ch. 531, title XVIII, §1889, as added Nov. 5, 1990,
A prior section 1395zz, act Aug. 14, 1935, ch. 531, title XVIII, §1889, formerly §1833(f), as added Jan. 2, 1968,
Effective Date of Repeal
Repeal effective as if included in the enactment of
§1395aaa. Transferred
Codification
Section, act Aug. 14, 1935, ch. 531, title XVIII, §1890, as added Aug. 18, 1987,
§1395bbb. Conditions of participation for home health agencies; home health quality
(a) Conditions of participation; protection of individual rights; notification of State entities; use of home health aides; medical equipment; individual's plan of care; compliance with Federal, State, and local laws and regulations
The conditions of participation that a home health agency is required to meet under this subsection are as follows:
(1) The agency protects and promotes the rights of each individual under its care, including each of the following rights:
(A) The right to be fully informed in advance about the care and treatment to be provided by the agency, to be fully informed in advance of any changes in the care or treatment to be provided by the agency that may affect the individual's well-being, and (except with respect to an individual adjudged incompetent) to participate in planning care and treatment or changes in care or treatment.
(B) The right to voice grievances with respect to treatment or care that is (or fails to be) furnished without discrimination or reprisal for voicing grievances.
(C) The right to confidentiality of the clinical records described in
(D) The right to have one's property treated with respect.
(E) The right to be fully informed orally and in writing (in advance of coming under the care of the agency) of—
(i) all items and services furnished by (or under arrangements with) the agency for which payment may be made under this subchapter,
(ii) the coverage available for such items and services under this subchapter, subchapter XIX of this chapter, and any other Federal program of which the agency is reasonably aware,
(iii) any charges for items and services not covered under this subchapter and any charges the individual may have to pay with respect to items and services furnished by (or under arrangements with) the agency, and
(iv) any changes in the charges or items and services described in clause (i), (ii), or (iii).
(F) The right to be fully informed in writing (in advance of coming under the care of the agency) of the individual's rights and obligations under this subchapter.
(G) The right to be informed of the availability of the State home health agency hot-line established under
(2) The agency notifies the State entity responsible for the licensing or certification of the agency of a change in—
(A) the persons with an ownership or control interest (as defined in
(B) the persons who are officers, directors, agents, or managing employees (as defined in
(C) the corporation, association, or other company responsible for the management of the agency.
Such notice shall be given at the time of the change and shall include the identity of each new person or company described in the previous sentence.
(3)(A) The agency must not use as a home health aide (on a full-time, temporary, per diem, or other basis), any individual to provide items or services described in
(i) has completed a training and competency evaluation program, or a competency evaluation program, that meets the minimum standards established by the Secretary under subparagraph (D), and
(ii) is competent to provide such items and services.
For purposes of clause (i), an individual is not considered to have completed a training and competency evaluation program, or a competency evaluation program if, since the individual's most recent completion of such a program, there has been a continuous period of 24 consecutive months during none of which the individual provided items and services described in
(B)(i) The agency must provide, with respect to individuals used as a home health aide by the agency as of July 1, 1989, for a competency evaluation program (as described in subparagraph (A)(i)) and such preparation as may be necessary for the individual to complete such a program by January 1, 1990.
(ii) The agency must provide such regular performance review and regular in-service education as assures that individuals used to provide items and services described in
(C) The agency must not permit an individual, other than in a training and competency evaluation program that meets the minimum standards established by the Secretary under subparagraph (D), to provide items or services of a type for which the individual has not demonstrated competency.
(D)(i) The Secretary shall establish minimum standards for the programs described in subparagraph (A) by not later than October 1, 1988.
(ii) Such standards shall include the content of the curriculum, minimum hours of training, qualification of instructors, and procedures for determination of competency.
(iii) Such standards may permit approval of programs offered by or in home health agencies, as well as outside agencies (including employee organizations), and of programs in effect on December 22, 1987; except that they may not provide for the approval of a program offered by or in a home health agency which, within the previous 2 years—
(I) has been determined to be out of compliance with subparagraph (A), (B), or (C);
(II) has been subject to an extended (or partial extended) survey under subsection (c)(2)(D) of this section;
(III) has been assessed a civil money penalty described in subsection (f)(2)(A)(i) of this section of not less than $5,000; or
(IV) has been subject to the remedies described in subsection (e)(1) of this section or in clauses (ii) or (iii) of subsection (f)(2)(A) of this section.
(iv) Such standards shall permit a determination that an individual who has completed (before July 1, 1989) a training and competency evaluation program or a competency evaluation program shall be deemed for purposes of subparagraph (A) to have completed a program that is approved by the Secretary under the standards established under this subparagraph if the Secretary determines that, at the time the program was offered, the program met such standards.
(E) In this paragraph, the term "home health aide" means any individual who provides the items and services described in
(i) who is a licensed health professional (as defined in subparagraph (F)), or
(ii) who volunteers to provide such services without monetary compensation.
(F) In this paragraph, the term "licensed health professional" means a physician, physician assistant, nurse practitioner, physical, speech, or occupational therapist, physical or occupational therapy assistant, registered professional nurse, licensed practical nurse, or licensed or certified social worker.
(4) The agency includes an individual's plan of care required under
(5) The agency operates and provides services in compliance with all applicable Federal, State, and local laws and regulations (including the requirements of
(6) The agency complies with the requirement of
(b) Duty of Secretary
It is the duty and responsibility of the Secretary to assure that the conditions of participation and requirements specified in or pursuant to
(c) Surveys of home health agencies
(1) Any agreement entered into or renewed by the Secretary pursuant to
(2)(A) Except as provided in subparagraph (B), each home health agency shall be subject to a standard survey not later than 15 months after the date of the previous standard survey conducted under this paragraph. The statewide average interval between standard surveys of any home health agency shall not exceed 12 months.
(B) If not otherwise conducted under subparagraph (A), a standard survey (or an abbreviated standard survey) of an agency—
(i) may be conducted within 2 months of any change of ownership, administration, or management of the agency to determine whether the change has resulted in any decline in the quality of care furnished by the agency, and
(ii) shall be conducted within 2 months of when a significant number of complaints have been reported with respect to the agency to the Secretary, the State, the entity responsible for the licensing of the agency, the State or local agency responsible for maintaining a toll-free hotline and investigative unit (under
(C) A standard survey conducted under this paragraph with respect to a home health agency—
(i) shall include (to the extent practicable), for a case-mix stratified sample of individuals furnished items or services by the agency—
(I) visits to the homes of such individuals, but only with the consent of such individuals, for the purpose of evaluating (in accordance with a standardized reproducible assessment instrument (or instruments) approved by the Secretary under subsection (d) of this section) the extent to which the quality and scope of items and services furnished by the agency attained and maintained the highest practicable functional capacity of each such individual as reflected in such individual's written plan of care required under
(II) a survey of the quality of care and services furnished by the agency as measured by indicators of medical, nursing, and rehabilitative care;
(ii) shall be based upon a protocol that is developed, tested, and validated by the Secretary not later than January 1, 1989; and
(iii) shall be conducted by an individual—
(I) who meets minimum qualifications established by the Secretary not later than July 1, 1989,
(II) who is not serving (or has not served within the previous 2 years) as a member of the staff of, or as a consultant to, the home health agency surveyed respecting compliance with the conditions of participation specified in or pursuant to
(III) who has no personal or familial financial interest in the home health agency surveyed.
(D) Each home health agency that is found, under a standard survey, to have provided substandard care shall be subject to an extended survey to review and identify the policies and procedures which produced such substandard care and to determine whether the agency has complied with the conditions of participation specified in or pursuant to
(E) Nothing in this paragraph shall be construed as requiring an extended (or partial extended) survey as a prerequisite to imposing a sanction against an agency under subsection (e) of this section on the basis of the findings of a standard survey.
(d) Assessment process; reports to Congress
(1) Not later than January 1, 1989, the Secretary shall designate an assessment instrument (or instruments) for use by an agency in complying with subsection (c)(2)(C)(I) 1 of this section.
(2)(A) Not later than January 1, 1992, the Secretary shall—
(i) evaluate the assessment process,
(ii) report to Congress on the results of such evaluation, and
(iii) based on such evaluation, make such modifications in the assessment process as the Secretary determines are appropriate.
(B) The Secretary shall periodically update the evaluation conducted under subparagraph (A), report the results of such update to Congress, and, based on such update, make such modifications in the assessment process as the Secretary determines are appropriate.
(3) The Secretary shall provide for the comprehensive training of State and Federal surveyors in matters relating to the performance of standard and extended surveys under this section, including the use of any assessment instrument (or instruments) designated under paragraph (1).
(e) Enforcement
(1) If the Secretary determines on the basis of a standard, extended, or partial extended survey or otherwise, that a home health agency that is certified for participation under this subchapter is no longer in compliance with the requirements specified in or pursuant to
(2) If the Secretary determines on the basis of a standard, extended, or partial extended survey or otherwise, that a home health agency that is certified for participation under this subchapter is no longer in compliance with the requirements specified in or pursuant to
(3) If the Secretary determines that a home health agency that is certified for participation under this subchapter is in compliance with the requirements specified in or pursuant to
(4) The Secretary may continue payments under this subchapter with respect to a home health agency not in compliance with the requirements specified in or pursuant to
(A) the State or local survey agency finds that it is more appropriate to take alternative action to assure compliance of the agency with the requirements than to terminate the certification of the agency,
(B) the agency has submitted a plan and timetable for corrective action to the Secretary for approval and the Secretary approves the plan of corrective action, and
(C) the agency agrees to repay to the Federal Government payments received under this subparagraph if the corrective action is not taken in accordance with the approved plan and timetable.
The Secretary shall establish guidelines for approval of corrective actions requested by home health agencies under this subparagraph.
(f) Intermediate sanctions
(1) The Secretary shall develop and implement, by not later than April 1, 1989—
(A) a range of intermediate sanctions to apply to home health agencies under the conditions described in subsection (e) of this section, and
(B) appropriate procedures for appealing determinations relating to the imposition of such sanctions.
(2)(A) The intermediate sanctions developed under paragraph (1) shall include—
(i) civil money penalties in an amount not to exceed $10,000 for each day of noncompliance,
(ii) suspension of all or part of the payments to which a home health agency would otherwise be entitled under this subchapter with respect to items and services furnished by a home health agency on or after the date on which the Secretary determines that intermediate sanctions should be imposed pursuant to subsection (e)(2) of this section, and
(iii) the appointment of temporary management to oversee the operation of the home health agency and to protect and assure the health and safety of the individuals under the care of the agency while improvements are made in order to bring the agency into compliance with all the requirements specified in or pursuant to
The provisions of
(B) The sanctions specified in subparagraph (A) are in addition to sanctions otherwise available under State or Federal law and shall not be construed as limiting other remedies, including any remedy available to an individual at common law.
(C) A finding to suspend payment under subparagraph (A)(ii) shall terminate when the Secretary finds that the home health agency is in substantial compliance with all the requirements specified in or pursuant to
(3) The Secretary shall develop and implement, by not later than April 1, 1989, specific procedures with respect to the conditions under which each of the intermediate sanctions developed under paragraph (1) is to be applied, including the amount of any fines and the severity of each of these sanctions. Such procedures shall be designed so as to minimize the time between identification of deficiencies and imposition of these sanctions and shall provide for the imposition of incrementally more severe fines for repeated or uncorrected deficiencies.
(Aug. 14, 1935, ch. 531, title XVIII, §1891, as added and amended Dec. 22, 1987,
Amendments
1990—Subsec. (a)(3)(D)(iii).
Subsec. (a)(6).
1988—Subsec. (a)(3)(A).
Subsec. (a)(3)(F).
Subsec. (a)(4) to (6).
Subsec. (c)(1).
Subsec. (d)(2)(A).
Subsecs. (e), (f).
Subsec. (f)(2)(A).
Subsec. (f)(2)(A)(i).
1987—Subsecs. (c), (d).
Subsecs. (e), (f).
Effective Date of 1990 Amendment
Amendment by section 4206(d)(2) of
Section 4207(i)(1), formerly 4027(i)(1), of
Section 4207(i)(2), formerly 4027(i)(2), of
"(i) had its participation terminated under title XVIII of the Social Security Act [this subchapter];
"(ii) was assessed a civil money penalty not less than $5,000 for deficiencies in applicable quality standards for home health agencies;
"(iii) was subject to suspension by the Secretary of all or part of the payments to which it would otherwise be entitled under such title;
"(iv) operated under a temporary management appointed to oversee the operation of the agency and to ensure the health and safety of the agency's patients; or
"(v) pursuant to State action, was closed or had its patients transferred."
Effective Date of 1988 Amendments
Amendment by
Except as specifically provided in section 411 of
Effective Date of 1987 Amendment
Section 4022(b) of
Section 4023(b) of
Effective Date
Section applicable to home health agencies as of the first day of the 18th calendar month that begins after Dec. 22, 1987, except as otherwise provided, see section 4021(c) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be subsection "(c)(2)(C)(i)(I)".
§1395ccc. Offset of payments to individuals to collect past-due obligations arising from breach of scholarship and loan contract
(a) In general
(1)(A) Subject to subparagraph (B), the Secretary shall enter into an agreement under this section with any individual who, by reason of a breach of a contract entered into by such individual pursuant to the National Health Service Corps Scholarship Program, the Physician Shortage Area Scholarship Program, or the Health Education Assistance Loan Program, owes a past-due obligation to the United States (as defined in subsection (b) of this section).
(B) The Secretary shall not enter into an agreement with an individual under this section to the extent—
(i)(I) the individual has entered into a contract with the Secretary pursuant to section 204(a)(1) of the Public Health Service Amendments of 1987, and
(II) the individual has fulfilled or (as determined by the Secretary) is fulfilling the terms of such contract; or
(ii) the liability of the individual under such section 204(a)(1) has otherwise been relieved under such section; or
(iii) the individual is performing such physician's 1 service obligation under a forbearance agreement entered into with the Secretary under subpart II of part D of title III of the Public Health Service Act [
(2) The agreement under this section shall provide that—
(A) deductions shall be made from the amounts otherwise payable to the individual under this subchapter, in accordance with a formula and schedule agreed to by the Secretary and the individual, until such past-due obligation (and accrued interest) have been repaid;
(B) payment under this subchapter for services provided by such individual shall be made only on an assignment-related basis;
(C) if the individual does not provide services, for which payment would otherwise be made under this subchapter, of a sufficient quantity to maintain the offset collection according to the agreed upon formula and schedule—
(i) the Secretary shall immediately inform the Attorney General, and the Attorney General shall immediately commence an action to recover the full amount of the past-due obligation, and
(ii) subject to paragraph (4), the Secretary shall immediately exclude the individual from the program under this subchapter, until such time as the entire past-due obligation has been repaid.
(3) If the individual refuses to enter into an agreement or breaches any provision of the agreement—
(A) the Secretary shall immediately inform the Attorney General, and the Attorney General shall immediately commence an action to recover the full amount of the past-due obligation, and
(B) subject to paragraph (4), the Secretary shall immediately exclude the individual from the program under this subchapter, until such time as the entire past-due obligation has been repaid.
(4) The Secretary shall not exclude an individual pursuant to paragraph (2)(C)(ii) or paragraph (3)(B) if such individual is a sole community practitioner or sole source of essential specialized services in a community if a State requests that the individual not be excluded.
(b) Past-due obligation
For purposes of this section, a past-due obligation is any amount—
(1) owed by an individual to the United States by reason of a breach of a scholarship contract under section 338E of the Public Health Service Act [
(2) owed by an individual to the United States by reason of a loan covered by Federal loan insurance under subpart I 2 of part C of title VII of the Public Health Service Act and payment for which has not been cancelled, waived, or suspended by the Secretary under such subpart.
(c) Collection under this section shall not be exclusive
This section shall not preclude the United States from applying other provisions of law otherwise applicable to the collection of obligations owed to the United States, including (but not limited to) the use of tax refund offsets pursuant to
(d) Collection from providers and health maintenance organizations
(1) In the case of an individual who owes a past-due obligation, and who is an employee of, or affiliated by a medical services agreement with, a provider having an agreement under
(2) Deductions shall be in accordance with a formula and schedule agreed to by the Secretary, the individual and the provider, organization, or plan. The deductions shall be made from the amounts otherwise payable to the individual under this subchapter as long as the individual continues to be employed or affiliated by a medical services agreement.
(3) Such deduction shall not be made until 6 months after the Secretary notifies the provider, organization, or plan of the amount to be deducted and the particular physicians 3 to whom the deductions are attributable.
(4) A deduction made under this subsection shall relieve the individual of the obligation (to the extent of the amount collected) to the United States, but the provider, organization, or plan shall have a right of action to collect from such individual the amount deducted pursuant to this subsection (including accumulated interest).
(5) No deduction shall be made under this subsection if, within the 6-month period after notice is given to the provider, organization, or plan, the individual pays the past-due obligation, or ceases to be employed by the provider, organization, or plan.
(6) The Secretary shall also apply the provisions of this subsection in the case of an individual who is a member of a group practice, if such group practice submits bills under this program as a group, rather than by individual physicians.3
(e) Transfer from trust funds
Amounts equal to the amounts deducted pursuant to this section shall be transferred from the Trust Fund from which the payment to the individual, provider, or other entity would otherwise have been made, to the general fund in the Treasury, and shall be credited as payment of the past-due obligation of the individual from whom (or with respect to whom) the deduction was made.
(Aug. 14, 1935, ch. 531, title XVIII, §1892, as added Dec. 22, 1987,
References in Text
Section 204(a)(1) of the Public Health Service Amendments of 1987, referred to in subsec. (a)(1)(B), is section 204(a)(1) of
The Public Health Service Act, referred to in subsecs. (a)(1)(B)(iii) and (b), is act July 1, 1944, ch. 373,
Amendments
1988—
Subsec. (a)(1)(A).
Subsec. (a)(1)(B).
Subsec. (a)(2)(A) to (C).
Subsec. (a)(2)(C)(ii).
Subsec. (a)(3).
Subsec. (a)(3)(B).
Subsec. (a)(4).
Subsec. (b).
Subsec. (b)(1).
Subsec. (b)(2).
Subsec. (d)(1).
Subsec. (d)(2).
Subsec. (d)(4) to (6).
Subsec. (e).
Effective Date of 1988 Amendments
Amendment by
Except as specifically provided in section 411 of
Section 411(f)(10)(C)(iii) of
Effective Date
Section 4052(c) of
Section Referred to in Other Sections
This section is referred to in
1 So in original. Probably should be "individual's".