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".