Subchapter A--Physicians' Services
SEC. 4501. ESTABLISHMENT OF SINGLE CONVERSION FACTOR FOR 1998.
(a) In General.--Section 1848(d)(1) (42 U.S.C. 1395w-4(d)(1)) is amended-- (1) by redesignating subparagraph (C) as subparagraph (D), and (2) by inserting after subparagraph (B) the following: (C) Special rules for 1998.--The single conversion factor for 1998 under this subsection shall be the conversion factor for primary care services for 1997, increased by the Secretary's estimate of the weighted average of the three separate updates that would otherwise occur were it not for the enactment of chapter 1 of subtitle F of title IV of the Balanced Budget Act of 1997.".
(b) Conforming Amendments.--Section 1848 (42 U.S.C. 1395w-4) is amended-- (1) by striking "(or factors)" each place it appears in subsection (d)(1)(A) and (d)(1)(D)(ii) (as redesignated by subsection (a)(1)), (2) in subsection (d)(1)(A), by striking "or updates", (3) in subsection (d)(1)(D) (as redesignated by subsection (a)(1)), by striking "(or updates)" each place it appears, and (4) in subsection (j)(1), by striking "The term" and inserting "For services furnished before January 1, 1998, the term".
(a) Update.-- (1) In general.--Section 1848(d)(3) (42 U.S.C. 1395w-4(d)(3)) is amended to read as follows: (3) Update.-- (A) In general.--Unless otherwise provided by law, subject to subparagraph (D) and the budget-neutrality factor determined by the Secretary under subsection (c)(2)(B)(ii), the update to the single conversion factor established in paragraph (1)(C) for a year beginning with 1999 is equal to the product of-- (i) 1 plus the Secretary's estimate of the percentage increase in the MEI (as defined in section 1842(i)(3)) for the year (divided by 100), and (ii) 1 plus the Secretary's estimate of the update adjustment factor for the year (divided by 100), minus 1 and multiplied by 100.
(B) Update adjustment factor.--For purposes of subparagraph (A)(ii), the 'update adjustment factor' for a year is equal (as estimated by the Secretary) to-- (i) the difference between (I) the sum of the allowed expenditures for physicians' services (as determined under subparagraph (C)) for the period beginning April 1, 1997, and ending on March 31 of the year involved, and (II) the amount of actual expenditures for physicians' services furnished during the period beginning April 1, 1997, and ending on March 31 of the preceding year; divided by (ii) the actual expenditures for physicians' services for the 12-month period ending on March 31 of the preceding year, increased by the sustainable growth rate under subsection (f) for the fiscal year which begins during such 12-month period.
(C) Determination of allowed expenditures.--For purposes of this paragraph, the allowed expenditures for physicians' services for the 12-month period ending with March 31 of-- (i) 1997 is equal to the actual expenditures for physicians' services furnished during such 12-month period, as estimated by the Secretary; or (ii) a subsequent year is equal to the allowed expenditures for physicians' services for the previous year, increased by the sustainable growth rate under subsection (f) for the fiscal year which begins during such 12-month period.
(D) Restriction on variation from medicare economic index.--Notwithstanding the amount of the update adjustment factor determined under subparagraph (B) for a year, the update in the conversion factor under this paragraph for the year may not be-- (i) greater than 100 times the following amount: (1.03 + (MEI percentage/100)) -1; or (ii) less than 100 times the following amount: (0.93 + (MEI percentage/100)) -1, where 'MEI percentage' means the Secretary's estimate of the percentage increase in the MEI (as defined in section 1842(i)(3)) for the year involved.".
(2) Effective date.--The amendment made by this subsection shall apply to the update for years beginning with 1999.
(b) Elimination of Report.--Section 1848(d) (42 U.S.C. 1395w-4(d)) is amended by striking paragraph (2).
(a) In General.--Section 1848(f) (42 U.S.C. 1395w-4(f)) is amended by striking paragraphs (2) through (5) and inserting the following: (2) Specification of growth rate.--The sustainable growth rate for all physicians' services for a fiscal year (beginning with fiscal year 1998) shall be equal to the product of-- (A) 1 plus the Secretary's estimate of the weighted average percentage increase (divided by 100) in the fees for all physicians' services in the fiscal year involved, (B) 1 plus the Secretary's estimate of the percentage change (divided by 100) in the average number of individuals enrolled under this part (other than Medicare+Choice plan enrollees) from the previous fiscal year to the fiscal year involved, (C) 1 plus the Secretary's estimate of the projected percentage growth in real gross domestic product per capita (divided by 100) from the previous fiscal year to the fiscal year involved, and (D) 1 plus the Secretary's estimate of the percentage change (divided by 100) in expenditures for all physicians' services in the fiscal year (compared with the previous fiscal year) which will result from changes in law and regulations, determined without taking into account estimated changes in expenditures resulting from the update adjustment factor determined under subsection (d)(3)(B), minus 1 and multiplied by 100.
(3) Definitions.--In this subsection: (A) Services included in physicians' services.--The term 'physicians' services' includes other items and services (such as clinical diagnostic laboratory tests and radiology services), specified by the Secretary, that are commonly performed or furnished by a physician or in a physician's office, but does not include services furnished to a Medicare+Choice plan enrollee.
(B) Medicare+choice plan enrollee.--The term 'Medicare+Choice plan enrollee' means, with respect to a fiscal year, an individual enrolled under this part who has elected to receive benefits under this title for the fiscal year through a Medicare+Choice plan offered under part C, and also includes an individual who is receiving benefits under this part through enrollment with an eligible organization with a risk-sharing contract under section 1876.".
(b) Conforming Amendment.--So much of section 1848(f) (42 U.S.C. 1395w-4(f)) as precedes paragraph (2) is amended to read as follows: (f) Sustainable Growth Rate.-- (1) Publication.--The Secretary shall cause to have published in the Federal Register the sustainable growth rate for each fiscal year beginning with fiscal year 1998. Such publication shall occur by not later than August 1 before each fiscal year, except that such rate for fiscal year 1998 shall be published not later than November 1, 1997.".
(a) In General.--Section 1848(d)(1) (42 U.S.C. 1395w-4(d)(1)), as amended by section 4501(a), is amended-- (1) in subparagraph (C), by striking "The single" and inserting "Except as provided in subparagraph (D), the single"; (2) by redesignating subparagraph (D) as subparagraph (E); and (3) by inserting after subparagraph (C) the following new subparagraph: (D) Special rules for anesthesia services.--The separate conversion factor for anesthesia services for a year shall be equal to 46 percent of the single conversion factor established for other physicians' services, except as adjusted for changes in work, practice expense, or malpractice relative value units.".
(b) Effective Date.--The amendments made by subsection (a) shall apply to services furnished on or after January 1, 1998.
(a) 1-Year Delay in Implementation.--Section 1848(c) (42 U.S.C. 1395w-4(c)) is amended-- (1) in paragraph (2)(C)(ii), in the matter before subclause (I) and after subclause (II), by striking "1998" and inserting "1999" each place it appears; and (2) in paragraph (3)(C)(ii), by striking "1998" and inserting "1999".
(b) Phased-in Implementation.-- (1) In general.--Section 1848(c)(2)(C)(ii) (42 U.S.C. 1395w- 4(c)(2)(C)(ii)) is further amended-- (A) by striking the comma at the end of clause (ii) and inserting a period and the following: For 1999, such number of units shall be determined based 75 percent on such product and based 25 percent on the relative practice expense resources involved in furnishing the service. For 2000, such number of units shall be determined based 50 percent on such product and based 50 percent on such relative practice expense resources. For 2001, such number of units shall be determined based 25 percent on such product and based 75 percent on such relative practice expense resources. For a subsequent year, such number of units shall be determined based entirely on such relative practice expense resources.".
(2) Conforming amendment.--Section 1848(c)(3)(C)(ii) (42 U.S.C. 1395w-4(c)(3)(C)(ii)), as amended by subsection (a)(2), is amended by striking "1999" and inserting "2002".
(c) Review by Comptroller General.--The Comptroller General of the United States shall review and evaluate the proposed rule on resource- based methodology for practice expenses issued by the Secretary of Health and Human Services. The Comptroller General shall, within 6 months of the date of the enactment of this Act, report to the Committees on Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate the results of its evaluation, including an analysis of-- (1) the adequacy of the data used in preparing the rule, (2) categories of allowable costs, (3) methods for allocating direct and indirect expenses, (4) the potential impact of the rule on beneficiary access to services, and (5) any other matters related to the appropriateness of resource-based methodology for practice expenses.
The Comptroller General shall consult with representatives of physicians' organizations with respect to matters of both data and methodology.
(d) Requirements for Developing New Resource-Based Practice Expense Relative Value Units.-- (1) Development.--For purposes of section 1848(c)(2)(C)(ii) of the Social Security Act, the Secretary of Health and Human Services shall develop new resource-based relative value units. In developing such units the Secretary shall-- (A) utilize, to the maximum extent practicable, generally accepted cost accounting principles which (i) recognize all staff, equipment, supplies, and expenses, not just those which can be tied to specific procedures, and (ii) use actual data on equipment utilization and other key assumptions; (B) consult with organizations representing physicians regarding methodology and data to be used; and (C) develop a refinement process to be used during each of the 4 years of the transition period.
(2) Report.--The Secretary shall transmit a report by March 1, 1998, on the development of resource-based relative value units under paragraph (1) to the Committee on Ways and Means and the Committee on Commerce of the House of Representatives and the Committee on Finance of the Senate. The report shall include a presentation of data to be used in developing the value units and an explanation of the methodology.
(3) Notice of proposed rulemaking.--The Secretary shall publish a notice of proposed rulemaking with the new resource-based relative value units on or before May 1, 1998, and shall allow for a 90-day public comment period.
(4) Items included.--The new proposed rule shall consider the following: (A) Impact projections which compare new proposed payment amounts on data on actual physician practice expenses.
(B) Impact projections for hospital-based and other specialties, geographic payment localities, and urban versus rural localities.
(e) Adjustments to Relative Value Units for 1998.--Section 1848(c)(2) (42 U.S.C. 1395w-4(c)(2)) is amended by adding at the end the following new subparagraph: (G) Adjustments in relative value units for 1998.--
(i) In general.--The Secretary shall-- (I) subject to clauses (iv) and (v), reduce the practice expense relative value units applied to any services described in clause (ii) furnished in 1998 to a number equal to 110 percent of the number of work relative value units, and (II) increase the practice expense relative value units for office visit procedure codes during 1998 by a uniform percentage which the Secretary estimates will result in an aggregate increase in payments for such services equal to the aggregate decrease in payments by reason of subclause (I).
(ii) Services covered.--For purposes of clause (i), the services described in this clause are physicians' services that are not described in clause (iii) and for which-- (I) there are work relative value units, and (II) the number of practice expense relative value units (determined for 1998) exceeds 110 percent of the number of work relative value units (determined for such year).
(iii) Excluded services.--For purposes of clause (ii), the services described in this clause are services which the Secretary determines at least 75 percent of which are provided under this title in an office setting.
(iv) Limitation on aggregate reallocation.--If the application of clause (i)(I) would result in an aggregate amount of reductions under such clause in excess of $390,000,000, such clause shall be applied by substituting for 110 percent such greater percentage as the Secretary estimates will result in the aggregate amount of such reductions equaling $390,000,000.
(v) No reduction for certain services.--Practice expense relative value units for a procedure performed in an office or in a setting out of an office shall not be reduced under clause (i) if the in-office or out-of-office practice expense relative value, respectively, for the procedure would increase under the proposed rule on resource-based practice expenses issued by the Secretary on June 18, 1997 (62 Federal Register 33158 et seq.).".
(f) Application of Resource-Based Methodology to Malpractice Relative Value Units.-- (1) In general.--Section 1848(c)(2)(C)(iii) (42 U.S.C. 1395w- 4(c)(2)(C)(iii)) is amended-- (A) in paragraph (2)(C)(iii)-- (i) by inserting "for the service for years before 2000" before "equal", and (ii) by striking the period at the end and inserting a comma and by adding at the end the following flush matter: and for years beginning with 2000 based on the malpractice expense resources involved in furnishing the service."; and (B) in paragraph (3)(C)(iii), by striking "The malpractice" and inserting "For years before 1999, the malpractice".
(2) Application of certain budget neutrality provisions.--In implementing the amendment made by paragraph (1)(A)(ii), the provisions of clauses (ii)(II) and (iii) of section 1848(c)(2)(B) of the Social Security Act (42 U.S.C. 1395w-4(c)(2)(B)) shall apply in the same manner as they apply to adjustments under clause (ii)(I) of such section.
(a) Determination and Notice Concerning Hospital-Specific Per Discharge Relative Values.-- (1) In general.--For 1999 and 2001 the Secretary of Health and Human Services shall determine for each hospital-- (A) the hospital-specific per discharge relative value under subsection (b); and (B) whether the hospital-specific relative value is projected to be excessive (as determined based on such value represented as a percentage of the median of hospital-specific per discharge relative values determined under subsection (b)).
(2) Notice to subset of medical staffs; evaluation of responses.--The Secretary shall notify the medical executive committee of a subset of the hospitals identified under paragraph (1)(B) as having an excessive hospital-specific relative value, of the determinations made with respect to the medical staff under paragraph (1). The Secretary shall evaluate the responses of the hospitals so notified with the responses of other hospitals so identified that were not so notified.
(b) Determination of Hospital-Specific Per Discharge Relative Values.-- (1) In general.--For purposes of this section, the hospital- specific per discharge relative value for the medical staff of a hospital (other than a teaching hospital) for a year shall be equal to the average per discharge relative value (as determined under section 1848(c)(2) of the Social Security Act (42 U.S.C. 1395w- 4(c)(2)) for physicians' services furnished to inpatients of the hospital by the hospital's medical staff (excluding interns and residents) during the second year preceding that calendar year, adjusted for variations in case-mix among hospitals and disproportionate share status and teaching status among hospitals (as determined by the Secretary under paragraph (3)).
(2) Special rule for teaching hospitals.--The hospital-specific relative value projected for a teaching hospital in a year shall be equal to the sum of-- (A) the average per discharge relative value (as determined under section 1848(c)(2) of such Act) for physicians' services furnished to inpatients of the hospital by the hospital's medical staff (excluding interns and residents) during the second year preceding that calendar year, and (B) the equivalent per discharge relative value (as determined under such section) for physicians' services furnished to inpatients of the hospital by interns and residents of the hospital during the second year preceding that calendar year, adjusted for variations in case-mix among hospitals, and in disproportionate share status and teaching status among hospitals (as determined by the Secretary under paragraph (3)).
The Secretary shall determine the equivalent relative value unit per discharge for interns and residents based on the best available data and may make such adjustment in the aggregate.
(3) Adjustment for teaching and disproportionate share hospitals.--The Secretary shall adjust the allowable per discharge relative values otherwise determined under this subsection to take into account the needs of teaching hospitals and hospitals receiving additional payments under subparagraphs (F) and (G) of section 1886(d)(5) of the Social Security Act (42 U.S.C. 1395ww(d)(5)). The adjustment for teaching status or disproportionate share shall not be less than zero.
(c) Definitions.--For purposes of this section: (1) Hospital.--The term hospital" means a subsection (d) hospital as defined in section 1886(d) of the Social Security Act (42 U.S.C. 1395ww(d)) .
(2) Medical staff.--An individual furnishing a physician's service is considered to be on the medical staff of a hospital-- (A) if (in accordance with requirements for hospitals established by the Joint Commission on Accreditation of Health Organizations)-- (i) the individual is subject to bylaws, rules, and regulations established by the hospital to provide a framework for the self-governance of medical staff activities, (ii) subject to the bylaws, rules, and regulations, the individual has clinical privileges granted by the hospital's governing body, and (iii) under the clinical privileges, the individual may provide physicians' services independently within the scope of the individual's clinical privileges, or (B) if the physician provides at least one service to an individual entitled to benefits under this title in that hospital.
(3) Physicians' services.--The term physicians' services" means the services described in section 1848(j)(3) of the Social Security Act (42 U.S.C. 1395w-4(j)(3)).
(4) Rural area; urban area.--The terms rural area" and urban area" have the meaning given those terms under section 1886(d)(2)(D) of such Act (42 U.S.C. 1395ww(d)(2)(D)).
(5) Secretary.--The term Secretary" means the Secretary of Health and Human Services.
(6) Teaching hospital.--The term teaching hospital" means a hospital which has a teaching program approved as specified in section 1861(b)(6) of the Social Security Act (42 U.S.C. 1395x(b)(6)).
(a) Items or Services Provided Through Private Contracts.-- (1) In general.--Section 1802 (42 U.S.C. 1395a) is amended by adding at the end the following new subsection: (b) Use of Private Contracts by Medicare Beneficiaries.-- (1) In general.--Subject to the provisions of this subsection, nothing in this title shall prohibit a physician or practitioner from entering into a private contract with a medicare beneficiary for any item or service-- (A) for which no claim for payment is to be submitted under this title, and (B) for which the physician or practitioner receives-- (i) no reimbursement under this title directly or on a capitated basis, and (ii) receives no amount for such item or service from an organization which receives reimbursement for such item or service under this title directly or on a capitated basis.
(2) Beneficiary protections.-- (A) In general.--Paragraph (1) shall not apply to any contract unless-- (i) the contract is in writing and is signed by the medicare beneficiary before any item or service is provided pursuant to the contract; (ii) the contract contains the items described in subparagraph (B); and (iii) the contract is not entered into at a time when the medicare beneficiary is facing an emergency or urgent health care situation.
(B) Items required to be included in contract.--Any contract to provide items and services to which paragraph (1) applies shall clearly indicate to the medicare beneficiary that by signing such contract the beneficiary-- (i) agrees not to submit a claim (or to request that the physician or practitioner submit a claim) under this title for such items or services even if such items or services are otherwise covered by this title; (ii) agrees to be responsible, whether through insurance or otherwise, for payment of such items or services and understands that no reimbursement will be provided under this title for such items or services; (iii) acknowledges that no limits under this title (including the limits under section 1848(g)) apply to amounts that may be charged for such items or services; (iv) acknowledges that Medigap plans under section 1882 do not, and other supplemental insurance plans may elect not to, make payments for such items and services because payment is not made under this title; and (v) acknowledges that the medicare beneficiary has the right to have such items or services provided by other physicians or practitioners for whom payment would be made under this title.
Such contract shall also clearly indicate whether the physician or practitioner is excluded from participation under the medicare program under section 1128.
(3) Physician or practitioner requirements.-- (A) In general.--Paragraph (1) shall not apply to any contract entered into by a physician or practitioner unless an affidavit described in subparagraph (B) is in effect during the period any item or service is to be provided pursuant to the contract.
(B) Affidavit.--An affidavit is described in this subparagraph if-- (i) the affidavit identifies the physician or practitioner and is in writing and is signed by the physician or practitioner; (ii) the affidavit provides that the physician or practitioner will not submit any claim under this title for any item or service provided to any medicare beneficiary (and will not receive any reimbursement or amount described in paragraph (1)(B) for any such item or service) during the 2-year period beginning on the date the affidavit is signed; and (iii) a copy of the affidavit is filed with the Secretary no later than 10 days after the first contract to which such affidavit applies is entered into.
(C) Enforcement.--If a physician or practitioner signing an affidavit under subparagraph (B) knowingly and willfully submits a claim under this title for any item or service provided during the 2-year period described in subparagraph (B)(ii) (or receives any reimbursement or amount described in paragraph (1)(B) for any such item or service) with respect to such affidavit-- (i) this subsection shall not apply with respect to any items and services provided by the physician or practitioner pursuant to any contract on and after the date of such submission and before the end of such period; and (ii) no payment shall be made under this title for any item or service furnished by the physician or practitioner during the period described in clause (i) (and no reimbursement or payment of any amount described in paragraph (1)(B) shall be made for any such item or service).
(4) Limitation on actual charge and claim submission requirement not applicable.--Section 1848(g) shall not apply with respect to any item or service provided to a medicare beneficiary under a contract described in paragraph (1).
(5) Definitions.--In this subsection: (A) Medicare beneficiary.--The term 'medicare beneficiary' means an individual who is entitled to benefits under part A or enrolled under part B.
(B) Physician.--The term 'physician' has the meaning given such term by section 1861(r)(1).
(C) Practitioner.--The term 'practitioner' has the meaning given such term by section 1842(b)(18)(C)." (2) Conforming amendments.-- (A) Section 1802 (42 U.S.C. 1395a) is amended by striking "Any" and inserting "(a) Basic Freedom of Choice.--Any".
(B) Section 1862(a) (42 U.S.C. 1395y(a)), as amended by sections 4319(b) and 4432, is amended by striking "or" at the end of paragraph (17), by striking the period at the end of paragraph (18) and inserting "; or", and by adding after paragraph (18) the following new paragraph: (19) which are for items or services which are furnished pursuant to a private contract described in section 1802(b).".
(b) Report.--Not later than October 1, 2001, the Secretary of Health and Human Services shall submit a report to Congress on the effect on the program under this title of private contracts entered into under the amendment made by subsection (a). Such report shall include-- (1) analyses regarding-- (A) the fiscal impact of such contracts on total Federal expenditures under title XVIII of the Social Security Act and on out-of-pocket expenditures by medicare beneficiaries for health services under such title; and (B) the quality of the health services provided under such contracts; and (2) recommendations as to whether medicare beneficiaries should continue to be able to enter private contracts under section 1802(b) of such Act (as added by subsection (a)) and if so, what legislative changes, if any should be made to improve such contracts.
(c) Effective Date.--The amendment made by subsection (a) shall apply with respect to contracts entered into on and after January 1, 1998.
SEC. 4511. INCREASED MEDICARE REIMBURSEMENT FOR NURSE PRACTITIONERS AND CLINICAL NURSE SPECIALISTS.
(a) Removal of Restrictions on Settings.-- (1) In general.--Clause (ii) of section 1861(s)(2)(K) (42 U.S.C. 1395x(s)(2)(K)) is amended to read as follows: (ii) services which would be physicians' services if furnished by a physician (as defined in subsection (r)(1)) and which are performed by a nurse practitioner or clinical nurse specialist (as defined in subsection (aa)(5)) working in collaboration (as defined in subsection (aa)(6)) with a physician (as defined in subsection (r)(1)) which the nurse practitioner or clinical nurse specialist is legally authorized to perform by the State in which the services are performed, and such services and supplies furnished as an incident to such services as would be covered under subparagraph (A) if furnished incident to a physician's professional service, but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services;".
(2) Conforming amendments.--(A) Section 1861(s)(2)(K) (42 U.S.C. 1395x(s)(2)(K)) is further amended-- (i) in clause (i), by inserting "and such services and supplies furnished as incident to such services as would be covered under subparagraph (A) if furnished incident to a physician's professional service; and" after "are performed,"; and (ii) by striking clauses (iii) and (iv).
(B) Section 1861(b)(4) (42 U.S.C. 1395x(b)(4)) is amended by striking "clauses (i) or (iii) of subsection (s)(2)(K)" and inserting "subsection (s)(2)(K)".
(C) Section 1862(a)(14) (42 U.S.C. 1395y(a)(14)) is amended by striking "section 1861(s)(2)(K)(i) or 1861(s)(2)(K)(iii)" and inserting "section 1861(s)(2)(K)".
(D) Section 1866(a)(1)(H) (42 U.S.C. 1395cc(a)(1)(H)) is amended by striking "section 1861(s)(2)(K)(i) or 1861(s)(2)(K)(iii)" and inserting "section 1861(s)(2)(K)".
(E) Section 1888(e)(2)(A)(ii) (42 U.S.C. 1395yy(e)(2)(A)(ii)), as added by section 4432(a) (relating to prospective payment system for rehabilitation hospitals), is amended by striking "through (iii)" and inserting "and (ii)".
(b) Increased Payment.-- (1) Fee schedule amount.--Subparagraph (O) of section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is amended to read as follows: (O) with respect to services described in section 1861(s)(2)(K)(ii) (relating to nurse practitioner or clinical nurse specialist services), the amounts paid shall be equal to 80 percent of (i) the lesser of the actual charge or 85 percent of the fee schedule amount provided under section 1848, or (ii) in the case of services as an assistant at surgery, the lesser of the actual charge or 85 percent of the amount that would otherwise be recognized if performed by a physician who is serving as an assistant at surgery; and".
(2) Conforming amendments.--Section 1833(r) (42 U.S.C. 1395l(r)) is amended-- (A) in paragraph (1), by striking "section 1861(s)(2)(K)(iii) (relating to nurse practitioner or clinical nurse specialist services provided in a rural area)" and inserting "section 1861(s)(2)(K)(ii) (relating to nurse practitioner or clinical nurse specialist services)"; (B) by striking paragraph (2); (C) in paragraph (3), by striking "section 1861(s)(2)(K)(iii)" and inserting "section 1861(s)(2)(K)(ii)"; and (D) by redesignating paragraph (3) as paragraph (2).
(c) Direct Payment for Nurse Practitioners and Clinical Nurse Specialists.--Section 1832(a)(2)(B)(iv) (42 U.S.C. 1395k(a)(2)(B)(iv)) is amended by striking "provided in a rural area (as defined in section 1886(d)(2)(D))" and inserting "but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services".
(d) Definition of Clinical Nurse Specialist Clarified.--Section 1861(aa)(5) (42 U.S.C. 1395x(aa)(5)) is amended-- (1) by inserting "(A)" after "(5)"; (2) by striking "The term 'physician assistant' and all that follows through "who performs" and inserting "The term 'physician assistant' and the term 'nurse practitioner' mean, for purposes of this title, a physician assistant or nurse practitioner who performs"; and (3) by adding at the end the following new subparagraph: (B) The term 'clinical nurse specialist' means, for purposes of this title, an individual who-- (i) is a registered nurse and is licensed to practice nursing in the State in which the clinical nurse specialist services are performed; and (ii) holds a master's degree in a defined clinical area of nursing from an accredited educational institution.".
(e) Effective Date.--The amendments made by this section shall apply with respect to services furnished and supplies provided on and after January 1, 1998.
(a) Removal of Restriction on Settings.--Section 1861(s)(2)(K)(i) (42 U.S.C. 1395x(s)(2)(K)(i)), as amended by section 4511, is amended-- (1) by striking "(I) in a hospital" and all that follows through "shortage area,", and (2) by adding at the end the following: but only if no facility or other provider charges or is paid any amounts with respect to the furnishing of such services,".
(b) Increased Payment.-- (1) Fee schedule amount.--Section 1833(a)(1)(O) (42 U.S.C. 1395l(a)(1)(O)), as amended by section 4511, is further amended-- (A) by striking "section 1861(s)(2)(K)(ii)" and inserting "1861(s)(2)(K)", and (B) by striking "nurse practitioner or clinical nurse specialist services" and inserting "services furnished by physician assistants, nurse practitioners, or clinic nurse specialists".
(2) Conforming amendment.--Paragraph (12) of section 1842(b) (42 U.S.C. 1395u(b)) is repealed.
(c) Removal of Restriction on Employment Relationship.--Section 1842(b)(6) (42 U.S.C. 1395u(b)(6)), as amended by section 4205, is amended by adding at the end the following new sentence: For purposes of subparagraph (C) of the first sentence of this paragraph, an employment relationship may include any independent contractor arrangement, and employer status shall be determined in accordance with the law of the State in which the services described in such clause are performed.".
(d) Effective Date.--The amendments made by this section shall apply with respect to services furnished and supplies provided on and after January 1, 1998.
(a) In General.--Section 1861(r)(5) (42 U.S.C. 1395x(r)(5)) is amended by striking "demonstrated by X-ray to exist".
(b) Effective Date.--The amendment made by subsection (a) applies to services furnished on or after January 1, 2000.
(c) Utilization Guidelines.--The Secretary of Health and Human Services shall develop and implement utilization guidelines relating to the coverage of chiropractic services under part B of title XVIII of the Social Security Act in cases in which a subluxation has not been demonstrated by X-ray to exist.
SEC. 4521. ELIMINATION OF FORMULA-DRIVEN OVERPAYMENTS (FDO) FOR CERTAIN OUTPATIENT HOSPITAL SERVICES.
(a) Elimination of FDO for Ambulatory Surgical Center Procedures.-- Section 1833(i)(3)(B)(i)(II) (42 U.S.C. 1395l(i)(3)(B)(i)(II)) is amended-- (1) by striking "of 80 percent"; and (2) by striking the period at the end and inserting the following: , less the amount a provider may charge as described in clause (ii) of section 1866(a)(2)(A).".
(b) Elimination of FDO for Radiology Services and Diagnostic Procedures.--Section 1833(n)(1)(B)(i) (42 U.S.C. 1395l(n)(1)(B)(i)) is amended-- (1) by striking "of 80 percent", and (2) by inserting before the period at the end the following: , less the amount a provider may charge as described in clause (ii) of section 1866(a)(2)(A)".
(c) Effective Date.--The amendments made by this section shall apply to services furnished during portions of cost reporting periods occurring on or after October 1, 1997.
(a) Reduction in Payments for Capital-Related Costs.--Section 1861(v)(1)(S)(ii)(I) (42 U.S.C. 1395x(v)(1)(S)(ii)(I)) is amended by striking "through 1998" and inserting "through 1999 and during fiscal year 2000 before January 1, 2000".
(b) Reduction in Payments for Other Costs.--Section 1861(v)(1)(S)(ii)(II) (42 U.S.C. 1395x(v)(1)(S)(ii)(II)) is amended by striking "through 1998" and inserting "through 1999 and during fiscal year 2000 before January 1, 2000".
(a) In General.--Section 1833 (42 U.S.C. 1395l) is amended by adding at the end the following: (t) Prospective Payment System for Hospital Outpatient Department Services.-- (1) Amount of payment.-- (A) In general.--With respect to covered OPD services (as defined in subparagraph (B)) furnished during a year beginning with 1999, the amount of payment under this part shall be determined under a prospective payment system established by the Secretary in accordance with this subsection.
(B) Definition of covered opd services.--For purposes of this subsection, the term 'covered OPD services'-- (i) means hospital outpatient services designated by the Secretary; (ii) subject to clause (iii), includes inpatient hospital services designated by the Secretary that are covered under this part and furnished to a hospital inpatient who (I) is entitled to benefits under part A but has exhausted benefits for inpatient hospital services during a spell of illness, or (II) is not so entitled; but (iii) does not include any therapy services described in subsection (a)(8) or ambulance services, for which payment is made under a fee schedule described in section 1834(k) or section 1834(l).
(2) System requirements.--Under the payment system-- (A) the Secretary shall develop a classification system for covered OPD services; (B) the Secretary may establish groups of covered OPD services, within the classification system described in subparagraph (A), so that services classified within each group are comparable clinically and with respect to the use of resources; (C) the Secretary shall, using data on claims from 1996 and using data from the most recent available cost reports, establish relative payment weights for covered OPD services (and any groups of such services described in subparagraph (B)) based on median hospital costs and shall determine projections of the frequency of utilization of each such service (or group of services) in 1999; (D) the Secretary shall determine a wage adjustment factor to adjust the portion of payment and coinsurance attributable to labor-related costs for relative differences in labor and labor-related costs across geographic regions in a budget neutral manner; (E) the Secretary shall establish other adjustments, in a budget neutral manner, as determined to be necessary to ensure equitable payments, such as outlier adjustments or adjustments for certain classes of hospitals; and (F) the Secretary shall develop a method for controlling unnecessary increases in the volume of covered OPD services.
(3) Calculation of base amounts.-- (A) Aggregate amounts that would be payable if deductibles were disregarded.--The Secretary shall estimate the sum of-- (i) the total amounts that would be payable from the Trust Fund under this part for covered OPD services in 1999, determined without regard to this subsection, as though the deductible under section 1833(b) did not apply, and (ii) the total amounts of copayments estimated to be paid under this subsection by beneficiaries to hospitals for covered OPD services in 1999, as though the deductible under section 1833(b) did not apply.
(B) Unadjusted copayment amount.-- (i) In general.--For purposes of this subsection, subject to clause (ii), the 'unadjusted copayment amount' applicable to a covered OPD service (or group of such services) is 20 percent of the national median of the charges for the service (or services within the group) furnished during 1996, updated to 1999 using the Secretary's estimate of charge growth during the period.
(ii) Adjusted to be 20 percent when fully phased in.--If the pre-deductible payment percentage for a covered OPD service (or group of such services) furnished in a year would be equal to or exceed 80 percent, then the unadjusted copayment amount shall be 20 percent of amount determined under subparagraph (D).
(iii) Rules for new services.--The Secretary shall establish rules for establishment of an unadjusted copayment amount for a covered OPD service not furnished during 1996, based upon its classification within a group of such services.
(C) Calculation of conversion factors.-- (i) For 1999.--
(I) In general.--The Secretary shall establish a 1999 conversion factor for determining the medicare OPD fee schedule amounts for each covered OPD service (or group of such services) furnished in 1999. Such conversion factor shall be established on the basis of the weights and frequencies described in paragraph (2)(C) and in such a manner that the sum for all services and groups of the products (described in subclause (II) for each such service or group) equals the total projected amount described in subparagraph (A).
(II) Product described.--The Secretary shall determine for each service or group the product of the medicare OPD fee schedule amounts (taking into account appropriate adjustments described in paragraphs (2)(D) and (2)(E)) and the estimated frequencies for such service or group.
(ii) Subsequent years.--Subject to paragraph (8)(B), the Secretary shall establish a conversion factor for covered OPD services furnished in subsequent years in an amount equal to the conversion factor established under this subparagraph and applicable to such services furnished in the previous year increased by the OPD fee schedule increase factor specified under clause (iii) for the year involved.
(iii) OPD fee schedule increase factor.--For purposes of this subparagraph, the 'OPD fee schedule increase factor' for services furnished in a year is equal to the market basket percentage increase applicable under section 1886(b)(3)(B)(iii) to hospital discharges occurring during the fiscal year ending in such year, reduced by 1 percentage point for such factor for services furnished in each of 2000, 2001, and 2002. In applying the previous sentence for years beginning with 2000, the Secretary may substitute for the market basket percentage increase an annual percentage increase that is computed and applied with respect to covered OPD services furnished in a year in the same manner as the market basket percentage increase is determined and applied to inpatient hospital services for discharges occurring in a fiscal year.
(D) Calculation of medicare opd fee schedule amounts.-- The Secretary shall compute a medicare OPD fee schedule amount for each covered OPD service (or group of such services) furnished in a year, in an amount equal to the product of-- (i) the conversion factor computed under subparagraph (C) for the year, and (ii) the relative payment weight (determined under paragraph (2)(C)) for the service or group.
(E) Pre-deductible payment percentage.--The pre- deductible payment percentage for a covered OPD service (or group of such services) furnished in a year is equal to the ratio of-- (i) the medicare OPD fee schedule amount established under subparagraph (D) for the year, minus the unadjusted copayment amount determined under subparagraph (B) for the service or group, to (ii) the medicare OPD fee schedule amount determined under subparagraph (D) for the year for such service or group.
(4) Medicare payment amount.--The amount of payment made from the Trust Fund under this part for a covered OPD service (and such services classified within a group) furnished in a year is determined as follows: (A) Fee schedule adjustments.--The medicare OPD fee schedule amount (computed under paragraph (3)(D)) for the service or group and year is adjusted for relative differences in the cost of labor and other factors determined by the Secretary, as computed under paragraphs (2)(D) and (2)(E).
(B) Subtract applicable deductible.--Reduce the adjusted amount determined under subparagraph (A) by the amount of the deductible under section 1833(b), to the extent applicable.
(C) Apply payment proportion to remainder.--The amount of payment is the amount so determined under subparagraph (B) multiplied by the pre-deductible payment percentage (as determined under paragraph (3)(E)) for the service or group and year involved.
(5) Copayment amount.-- (A) In general.--Except as provided in subparagraph (B), the copayment amount under this subsection is the amount by which the amount described in paragraph (4)(B) exceeds the amount of payment determined under paragraph (4)(C).
(B) Election to offer reduced copayment amount.--The Secretary shall establish a procedure under which a hospital, before the beginning of a year (beginning with 1999), may elect to reduce the copayment amount otherwise established under subparagraph (A) for some or all covered OPD services to an amount that is not less than 20 percent of the medicare OPD fee schedule amount (computed under paragraph (3)(D)) for the service involved. Under such procedures, such reduced copayment amount may not be further reduced or increased during the year involved and the hospital may disseminate information on the reduction of copayment amount effected under this subparagraph.
(C) No impact on deductibles.--Nothing in this paragraph shall be construed as affecting a hospital's authority to waive the charging of a deductible under section 1833(b).
(6) Periodic review and adjustments components of prospective payment system.-- (A) Periodic review.--The Secretary may periodically review and revise the groups, the relative payment weights, and the wage and other adjustments described in paragraph (2) to take into account changes in medical practice, changes in technology, the addition of new services, new cost data, and other relevant information and factors.
(B) Budget neutrality adjustment.--If the Secretary makes adjustments under subparagraph (A), then the adjustments for a year may not cause the estimated amount of expenditures under this part for the year to increase or decrease from the estimated amount of expenditures under this part that would have been made if the adjustments had not been made.
(C) Update factor.--If the Secretary determines under methodologies described in paragraph (2)(F) that the volume of services paid for under this subsection increased beyond amounts established through those methodologies, the Secretary may appropriately adjust the update to the conversion factor otherwise applicable in a subsequent year.
(7) Special rule for ambulance services.--The Secretary shall pay for hospital outpatient services that are ambulance services on the basis described in the matter in subsection (a)(1) preceding subparagraph (A), or, if applicable, the fee schedule established under section 1834(l).
(8) Special rules for certain hospitals.--In the case of hospitals described in section 1886(d)(1)(B)(v)-- (A) the system under this subsection shall not apply to covered OPD services furnished before January 1, 2000; and (B) the Secretary may establish a separate conversion factor for such services in a manner that specifically takes into account the unique costs incurred by such hospitals by virtue of their patient population and service intensity.
(9) Limitation on review.--There shall be no administrative or judicial review under section 1869, 1878, or otherwise of-- (A) the development of the classification system under paragraph (2), including the establishment of groups and relative payment weights for covered OPD services, of wage adjustment factors, other adjustments, and methods described in paragraph (2)(F); (B) the calculation of base amounts under paragraph (3); (C) periodic adjustments made under paragraph (6); and (D) the establishment of a separate conversion factor under paragraph (8)(B).".
(b) Coinsurance.--Section 1866(a)(2)(A)(ii) (42 U.S.C. 1395cc(a)(2)(A)(ii)) is amended by adding at the end the following: In the case of items and services for which payment is made under part B under the prospective payment system established under section 1833(t), clause (ii) of the first sentence shall be applied by substituting for 20 percent of the reasonable charge, the applicable copayment amount established under section 1833(t)(5).".
(c) Treatment of Reduction in Copayment Amount.--Section 1128A(i)(6) (42 U.S.C. 1320a-7a(i)(6)) is amended-- (1) by striking "or" at the end of subparagraph (B), (2) by striking the period at the end of subparagraph (C) and inserting "; or", and (3) by adding at the end the following new subparagraph: (D) a reduction in the copayment amount for covered OPD services under section 1833(t)(5)(B).".
(d) Conforming Amendments.-- (1) Approved asc procedures performed in hospital outpatient departments.-- (A)(i) Section 1833(i)(3)(A) (42 U.S.C. 1395l(i)(3)(A)) is amended-- (I) by inserting "before January 1, 1999," after "furnished", and (II) by striking "in a cost reporting period".
(ii) The amendment made by clause (i) shall apply to services furnished on or after January 1, 1999.
(B) Section 1833(a)(4) (42 U.S.C. 1395l(a)(4)) is amended by inserting "or subsection (t)" before the semicolon.
(2) Radiology and other diagnostic procedures.-- (A) Section 1833(n)(1)(A) (42 U.S.C. 1395l(n)(1)(A)) is amended by inserting "and before January 1, 1999," after "October 1, 1988," and after "October 1, 1989,".
(B) Section 1833(a)(2)(E) (42 U.S.C. 1395l(a)(2)(E)) is amended by inserting "or, for services or procedures performed on or after January 1, 1999, subsection (t)" before the semicolon.
(3) Other hospital outpatient services.--Section 1833(a)(2)(B) (42 U.S.C. 1395l(a)(2)(B)) is amended-- (A) in clause (i), by inserting "furnished before January 1, 1999," after "(i)", (B) in clause (ii), by inserting "before January 1, 1999," after "furnished", (C) by redesignating clause (iii) as clause (iv), and (D) by inserting after clause (ii), the following new clause: (iii) if such services are furnished on or after January 1, 1999, the amount determined under subsection (t), or".
SEC. 4531. PAYMENTS FOR AMBULANCE SERVICES.
(a) Interim Reductions.-- (1) Payments determined on reasonable cost basis.--Section 1861(v)(1) (42 U.S.C. 1395x(v)(1)), as amended by section 4451, is amended by adding at the end the following new subparagraph: (U) In determining the reasonable cost of ambulance services (as described in subsection (s)(7)) provided during fiscal year 1998, during fiscal year 1999, and during so much of fiscal year 2000 as precedes January 1, 2000, the Secretary shall not recognize the costs per trip in excess of costs recognized as reasonable for ambulance services provided on a per trip basis during the previous fiscal year (after application of this subparagraph), increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) as estimated by the Secretary for the 12- month period ending with the midpoint of the fiscal year involved reduced by 1.0 percentage point. For ambulance services provided after June 30, 1998, the Secretary may provide that claims for such services must include a code (or codes) under a uniform coding system specified by the Secretary that identifies the services furnished.".
(2) Payments determined on reasonable charge basis.--Section 1842(b) (42 U.S.C. 1395u(b)) is amended by adding at the end the following new paragraph: (19) For purposes of section 1833(a)(1), the reasonable charge for ambulance services (as described in section 1861(s)(7)) provided during calendar year 1998 and calendar year 1999 may not exceed the reasonable charge for such services provided during the previous calendar year (after application of this paragraph), increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) as estimated by the Secretary for the 12-month period ending with the midpoint of the year involved reduced by 1.0 percentage point.".
(b) Establishment of Prospective Fee Schedule.-- (1) Payment in accordance with fee schedule.--Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)), as amended by section 4315(b), is amended-- (A) by striking "and (Q)" and inserting "(Q)"; and (B) by striking the semicolon at the end and inserting the following: , and (R) with respect to ambulance service, the amounts paid shall be 80 percent of the lesser of the actual charge for the services or the amount determined by a fee schedule established by the Secretary under section 1834(l);".
(2) Establishment of schedule.--Section 1834 (42 U.S.C. 1395m), as amended by section 4541, is amended by adding at the end the following new subsection: (l) Establishment of Fee Schedule for Ambulance Services.-- (1) In general.--The Secretary shall establish a fee schedule for payment for ambulance services whether provided directly by a supplier or provider or under arrangement with a provider under this part through a negotiated rulemaking process described in title 5, United States Code, and in accordance with the requirements of this subsection.
(2) Considerations.--In establishing such fee schedule, the Secretary shall-- (A) establish mechanisms to control increases in expenditures for ambulance services under this part; (B) establish definitions for ambulance services which link payments to the type of services provided; (C) consider appropriate regional and operational differences; (D) consider adjustments to payment rates to account for inflation and other relevant factors; and (E) phase in the application of the payment rates under the fee schedule in an efficient and fair manner.
(3) Savings.--In establishing such fee schedule, the Secretary shall-- (A) ensure that the aggregate amount of payments made for ambulance services under this part during 2000 does not exceed the aggregate amount of payments which would have been made for such services under this part during such year if the amendments made by section 4531(a) of the Balanced Budget Act of 1997 continued in effect, except that in making such determination the Secretary shall assume an update in such payments for 2002 equal to percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year reduced in the case of 2001 and 2002 by 1.0 percentage points; and (B) set the payment amounts provided under the fee schedule for services furnished in 2001 and each subsequent year at amounts equal to the payment amounts under the fee schedule for services furnished during the previous year, increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12- month period ending with June of the previous year reduced in the case of 2001 and 2002 by 1.0 percentage points.
(4) Consultation.--In establishing the fee schedule for ambulance services under this subsection, the Secretary shall consult with various national organizations representing individuals and entities who furnish and regulate ambulance services and share with such organizations relevant data in establishing such schedule.
(5) Limitation on review.--There shall be no administrative or judicial review under section 1869 or otherwise of the amounts established under the fee schedule for ambulance services under this subsection, including matters described in paragraph (2).
(6) Restraint on billing.--The provisions of subparagraphs (A) and (B) of section 1842(b)(18) shall apply to ambulance services for which payment is made under this subsection in the same manner as they apply to services provided by a practitioner described in section 1842(b)(18)(C).
(7) Coding system.--The Secretary may require the claim for any services for which the amount of payment is determined under this subsection to include a code (or codes) under a uniform coding system specified by the Secretary that identifies the services furnished.".
(3) Effective date.--The amendments made by this subsection shall apply to services furnished on or after January 1, 2000.
(c) Authorizing Payment for Paramedic Intercept Service Providers in Rural Communities.--In promulgating regulations to carry out section 1861(s)(7) of the Social Security Act (42 U.S.C. 1395x(s)(7)) with respect to the coverage of ambulance service, the Secretary of Health and Human Services may include coverage of advanced life support services (in this subsection referred to as ALS intercept services") provided by a paramedic intercept service provider in a rural area if the following conditions are met: (1) The ALS intercept services are provided under a contract with one or more volunteer ambulance services and are medically necessary based on the health condition of the individual being transported.
(2) The volunteer ambulance service involved-- (A) is certified as qualified to provide ambulance service for purposes of such section, (B) provides only basic life support services at the time of the intercept, and (C) is prohibited by State law from billing for any services.
(3) The entity supplying the ALS intercept services-- (A) is certified as qualified to provide such services under the medicare program under title XVIII of the Social Security Act, and (B) bills all recipients who receive ALS intercept services from the entity, regardless of whether or not such recipients are medicare beneficiaries.
(a) Demonstration Project Contracts with Local Governments.--The Secretary of Health and Human Services shall establish up to 3 demonstration projects under which, at the request of a unit of local government, the Secretary enters into a contract with the unit of local government under which-- (1) the unit of local government furnishes (or arranges for the furnishing of) ambulance services for which payment may be made under part B of title XVIII of the Social Security Act for individuals residing in the unit of local government who are enrolled under such part, except that the unit of local government may not enter into the contract unless the contract covers at least 80 percent of the individuals residing in the unit of local government who are enrolled under such part but not in a Medicare+Choice plan; (2) any individual or entity furnishing ambulance services under the contract meets the requirements otherwise applicable to individuals and entities furnishing such services under such part; and (3) for each month during which the contract is in effect, the Secretary makes a capitated payment to the unit of local government in accordance with subsection (b).
The projects may extend over a period of not to exceed 3 years each.
(b) Amount of Payment.-- (1) In general.--The amount of the monthly payment made for months occurring during a calendar year to a unit of local government under a demonstration project contract under subsection (a) shall be equal to the product of-- (A) the Secretary's estimate of the number of individuals covered under the contract for the month; and (B) \1/12\ of the capitated payment rate for the year established under paragraph (2).
(2) Capitated payment rate defined.--In this subsection, the capitated payment rate" applicable to a contract under this subsection for a calendar year is equal to 95 percent of-- (A) for the first calendar year for which the contract is in effect, the average annual per capita payment made under part B of title XVIII of the Social Security Act with respect to ambulance services furnished to such individuals during the 3 most recent calendar years for which data on the amount of such payment is available; and (B) for a subsequent year, the amount provided under this paragraph for the previous year increased by the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year.
(c) Other Terms of Contract.--The Secretary and the unit of local government may include in a contract under this section such other terms as the parties consider appropriate, including-- (1) covering individuals residing in additional units of local government (under arrangements entered into between such units and the unit of local government involved); (2) permitting the unit of local government to transport individuals to non-hospital providers if such providers are able to furnish quality services at a lower cost than hospital providers; or (3) implementing such other innovations as the unit of local government may propose to improve the quality of ambulance services and control the costs of such services.
(d) Contract Payments in Lieu of Other Benefits.--Payments under a contract to a unit of local government under this section shall be instead of the amounts which (in the absence of the contract) would otherwise be payable under part B of title XVIII of the Social Security Act for the services covered under the contract which are furnished to individuals who reside in the unit of local government.
(e) Report on Effects of Capitated Contracts.-- (1) Study.--The Secretary shall evaluate the demonstration projects conducted under this section. Such evaluation shall include an analysis of the quality and cost-effectiveness of ambulance services furnished under the projects.
(2) Report.--Not later than January 1, 2000, the Secretary shall submit a report to Congress on the study conducted under paragraph (1), and shall include in the report such recommendations as the Secretary considers appropriate, including recommendations regarding modifications to the methodology used to determine the amount of payments made under such contracts and extending or expanding such projects.
SEC. 4541. PROSPECTIVE PAYMENT FOR OUTPATIENT REHABILITATION SERVICES.
(a) Payment Based on Fee Schedule.-- (1) Special payment rules.--Section 1833(a) (42 U.S.C. 1395l(a)) is amended-- (A) in paragraph (2) in the matter before subparagraph (A), by inserting "(C)," before (D)"; (B) in paragraph (3), by striking "subparagraphs (D) and (E) of section 1832(a)(2)" and inserting "section 1832(a)(2)(D)"; (C) in paragraph (6), by striking "and" at the end; (D) in paragraph (7), by striking the period at the end and inserting a semicolon; and (E) by adding at the end the following new paragraphs: (8) in the case of-- (A) outpatient physical therapy services (which includes outpatient speech-language pathology services) and outpatient occupational therapy services furnished-- (i) by a rehabilitation agency, public health agency, clinic, comprehensive outpatient rehabilitation facility, or skilled nursing facility, (ii) by a home health agency to an individual who is not homebound, or (iii) by another entity under an arrangement with an entity described in clause (i) or (ii); and (B) outpatient physical therapy services (which includes outpatient speech-language pathology services) and outpatient occupational therapy services furnished-- (i) by a hospital to an outpatient or to a hospital inpatient who is entitled to benefits under part A but has exhausted benefits for inpatient hospital services during a spell of illness or is not so entitled to benefits under part A, or (ii) by another entity under an arrangement with a hospital described in clause (i), the amounts described in section 1834(k); and (9) in the case of services described in section 1832(a)(2)(E) that are not described in paragraph (8), the amounts described in section 1834(k).".
(2) Payment rates.--Section 1834 (42 U.S.C. 1395m) is amended by adding at the end the following new subsection: (k) Payment for Outpatient Therapy Services and Comprehensive Outpatient Rehabilitation Services.-- (1) In general.--With respect to services described in section 1833(a)(8) or 1833(a)(9) for which payment is determined under this subsection, the payment basis shall be-- (A) for services furnished during 1998, the amount determined under paragraph (2); or (B) for services furnished during a subsequent year, 80 percent of the lesser of-- (i) the actual charge for the services, or (ii) the applicable fee schedule amount (as defined in paragraph (3)) for the services.
(2) Payment in 1998 based upon adjusted reasonable costs.-- The amount under this paragraph for services is the lesser of-- (A) the charges imposed for the services, or (B) the adjusted reasonable costs (as defined in paragraph (4)) for the services, less 20 percent of the amount of the charges imposed for such services.
(3) Applicable fee schedule amount.--In this subsection, the term 'applicable fee schedule amount' means, with respect to services furnished in a year, the amount determined under the fee schedule established under section 1848 for such services furnished during the year or, if there is no such fee schedule established for such services, the amount determined under the fee schedule established for such comparable services as the Secretary specifies.
(4) Adjusted reasonable costs.--In paragraph (2), the term 'adjusted reasonable costs' means, with respect to any services, reasonable costs determined for such services, reduced by 10 percent. The 10-percent reduction shall not apply to services described in section 1833(a)(8)(B) (relating to services provided by hospitals).
(5) Uniform coding.--For claims for services submitted on or after April 1, 1998, for which the amount of payment is determined under this subsection, the claim shall include a code (or codes) under a uniform coding system specified by the Secretary that identifies the services furnished.
(6) Restraint on billing.--The provisions of subparagraphs (A) and (B) of section 1842(b)(18) shall apply to therapy services for which payment is made under this subsection in the same manner as they apply to services provided by a practitioner described in section 1842(b)(18)(C).".
(3) Conforming change in billing.--Section 1866(a)(2)(A)(ii) (42 U.S.C. 1395cc(a)(2)(A)(ii)) is amended by adding at the end the following: In the case of services described in section 1833(a)(8) or section 1833(a)(9) for which payment is made under part B under section 1834(k), clause (ii) of the first sentence shall be applied by substituting for 20 percent of the reasonable charge for such services 20 percent of the lesser of the actual charge or the applicable fee schedule amount (as defined in such section) for such services.".
(b) Application of Standards to Outpatient Occupational and Physical Therapy Services Provided As an Incident to a Physician's Professional Services.--Section 1862(a), as amended by sections 4319(b), 4432(b), and 4507(a)(2)(B), (42 U.S.C. 1395y(a)) is amended-- (1) by striking "or" at the end of paragraph (18); (2) by striking the period at the end of paragraph (19) and inserting "; or"; and (3) by inserting after paragraph (19) the following: (20) in the case of outpatient occupational therapy services or outpatient physical therapy services furnished as an incident to a physician's professional services (as described in section 1861(s)(2)(A)), that do not meet the standards and conditions (other than any licensing requirement specified by the Secretary) under the second sentence of section 1861(p) (or under such sentence through the operation of section 1861(g)) as such standards and conditions would apply to such therapy services if furnished by a therapist.".
(c) Applying Financial Limitation to All Rehabilitation Services.-- Section 1833(g) (42 U.S.C. 1395l(g)) is amended-- (1) in the first sentence, by striking "services described in the second sentence of section 1861(p)" and inserting "physical therapy services of the type described in section 1861(p), but not described in section 1833(a)(8)(B), and physical therapy services of such type which are furnished by a physician or as incident to physicians' services", and (2) in the second sentence, by striking "outpatient occupational therapy services which are described in the second sentence of section 1861(p) through the operation of section 1861(g)" and inserting "occupational therapy services (of the type that are described in section 1861(p) (but not described in section 1833(a)(8)(B)) through the operation of section 1861(g) and of such type which are furnished by a physician or as incident to physicians' services)".
(d) Indexing Limitation.-- (1) In general.--Section 1833(g) (42 U.S.C. 1395l(g)), as amended by subsection (c), is further amended-- (A) by striking "$900" each place it appears and inserting "the amount specified in paragraph (2) for the year", (B) by inserting "(1)" after "(g)", (C) by designating the last sentence as a paragraph (3), and (D) by inserting before paragraph (3), as so designated, the following: (2) The amount specified in this paragraph-- (A) for 1999, 2000, and 2001, is $1,500, and (B) for a subsequent year is the amount specified in this paragraph for the preceding year increased by the percentage increase in the MEI (as defined in section 1842(i)(3)) for such subsequent year; except that if an increase under subparagraph (B) for a year is not a multiple of $10, it shall be rounded to the nearest multiple of $10.".
(2) Report.--By not later than January 1, 2001, the Secretary of Health and Human Services shall submit to Congress a report that includes recommendations on the establishment of a revised coverage policy of outpatient physical therapy services and outpatient occupational therapy services under the Social Security Act based on classification of individuals by diagnostic category and prior use of services, in both inpatient and outpatient settings, in place of the uniform dollar limitations specified in section 1833(g) of such Act, as amended by paragraph (1). The recommendations shall include how such a system of durational limits by diagnostic category might be implemented in a budget- neutral manner.
(e) Effective Dates.-- (1) The amendments made by subsections (a)(1), (a)(2), and (b) apply to services furnished on or after January 1, 1998, including portions of cost reporting periods occurring on or after such date, except that section 1834(k) of the Social Security Act (as added by subsection (a)(2)) shall not apply to services described in section 1833(a)(8)(B) of such Act (as added by subsection (a)(1)) that are furnished during 1998.
(2) The amendments made by subsections (a)(3) and (c) apply to services furnished on or after January 1, 1999.
(3) The amendments made by subsection (d)(1) apply to expenses incurred on or after January 1, 1999.
SEC. 4551. PAYMENTS FOR DURABLE MEDICAL EQUIPMENT.
(a) Reduction in Payment Amounts for Items of Durable Medical Equipment.-- (1) Freeze in update for covered items.--Section 1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended-- (A) in subparagraph (A), by striking "and" at the end; (B) in subparagraph (B)-- (i) by striking "a subsequent year" and inserting "1993, 1994, 1995, 1996, and 1997", and (ii) by striking the period at the end and inserting a semicolon; and (C) by adding at the end the following new subparagraphs: (C) for each of the years 1998 through 2002, 0 percentage points; and (D) for a subsequent year, the percentage increase in the consumer price index for all urban consumers (U.S. urban average) for the 12-month period ending with June of the previous year.".
(2) Update for orthotics and prosthetics.--Section 1834(h)(4)(A) (42 U.S.C. 1395m(h)(4)(A)) is amended-- (A) in clause (iii), by striking ", and" at the end and inserting a semicolon; (B) in clause (iv), by striking "a subsequent year" and inserting "1996 and 1997"; and (C) by adding at the end the following new clauses: (v) for each of the years 1998 through 2002, 1 percent, and (vi) for a subsequent year, the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the previous year;".
(b) Payment Freeze for Parenteral and Enteral Nutrients, Supplies, and Equipment.--In determining the amount of payment under part B of title XVIII of the Social Security Act with respect to parenteral and enteral nutrients, supplies, and equipment during each of the years 1998 through 2002, the charges determined to be reasonable with respect to such nutrients, supplies, and equipment may not exceed the charges determined to be reasonable with respect to such nutrients, supplies, and equipment during 1995.
(c) Upgraded Durable Medical Equipment.-- (1) In general.--Section 1834(a) (42 U.S.C. 1395m(a)), as amended by section 4312(a), is amended by inserting after paragraph (16) the following new paragraph: (17) Certain upgraded items.-- (A) Individual's right to choose upgraded item.-- Notwithstanding any other provision of this title, the Secretary may issue regulations under which an individual may purchase or rent from a supplier an item of upgraded durable medical equipment for which payment would be made under this subsection if the item were a standard item.
(B) Payments to supplier.--In the case of the purchase or rental of an upgraded item under subparagraph (A)-- (i) the supplier shall receive payment under this subsection with respect to such item as if such item were a standard item; and (ii) the individual purchasing or renting the item shall pay the supplier an amount equal to the difference between the supplier's charge and the amount under clause (i).
In no event may the supplier's charge for an upgraded item exceed the applicable fee schedule amount (if any) for such item.
(C) Consumer protection safeguards.--Any regulations under subparagraph (A) shall provide for consumer protection standards with respect to the furnishing of upgraded equipment under subparagraph (A). Such regulations shall provide for-- (i) determination of fair market prices with respect to an upgraded item; (ii) full disclosure of the availability and price of standard items and proof of receipt of such disclosure information by the beneficiary before the furnishing of the upgraded item; (iii) conditions of participation for suppliers in the billing arrangement; (iv) sanctions of suppliers who are determined to engage in coercive or abusive practices, including exclusion; and (v) such other safeguards as the Secretary determines are necessary.".
(2) Effective date.--The amendment made by paragraph (1) shall apply to purchases or rentals after the effective date of any regulations issued pursuant to such amendment.
(a) In General.--Section 1834(a)(9)(B) (42 U.S.C. 1395m(a)(9)(B)) is amended-- (1) in clause (iii), by striking "and" at the end; (2) in clause (iv)-- (A) by striking "each subsequent year" and inserting "1995, 1996, and 1997", and (B) by striking the period at the end and inserting a semicolon; and (3) by adding at the end the following new clauses: (v) for 1998, 75 percent of the amount determined under this subparagraph for 1997; and (vi) for 1999 and each subsequent year, 70 percent of the amount determined under this subparagraph for 1997.".
(b) Establishment of Classes for Payment.--Section 1848(a)(9) (42 U.S.C. 1395m(a)(9)) is amended by adding at the end the following new subparagraph: (D) Authority to create classes.-- (i) In general.--Subject to clause (ii), the Secretary may establish separate classes for any item of oxygen and oxygen equipment and separate national limited monthly payment rates for each of such classes.
(ii) Budget neutrality.--The Secretary may take actions under clause (i) only to the extent such actions do not result in expenditures for any year to be more or less than the expenditures which would have been made if such actions had not been taken.".
(c) Standards.--The Secretary shall as soon as practicable establish service standards for persons seeking payment under part B of title XVIII of the Social Security Act for the providing of oxygen and oxygen equipment to beneficiaries within their homes.
(d) Access to Home Oxygen Equipment.-- (1) Study.--The Comptroller General of the United States shall study issues relating to access to home oxygen equipment and shall, within 18 months after the date of the enactment of this Act, report to the Committees on Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate the results of the study, including recommendations (if any) for legislation.
(2) Peer review evaluation.--The Secretary of Health and Human Services shall arrange for peer review organizations established under section 1154 of the Social Security Act to evaluate access to, and quality of, home oxygen equipment.
(e) Effective Date.-- (1) Oxygen.--The amendments made by subsection (a) shall apply to items furnished on and after January 1, 1998.
(2) Other provisions.--The amendments made by this section other than subsection (a) shall take effect on the date of the enactment of this Act.
(a) Change in Update.--Section 1833(h)(2)(A)(ii)(IV) (42 U.S.C. 1395l(h)(2)(A)(ii)(IV)) is amended by inserting "and 1998 through 2002" after "1995".
(b) Lowering Cap on Payment Amounts.--Section 1833(h)(4)(B) (42 U.S.C. 1395l(h)(4)(B)) is amended-- (1) in clause (vi), by striking "and" at the end; (2) in clause (vii)-- (A) by inserting "and before January 1, 1998," after "1995,", and (B) by striking the period at the end and inserting ", and"; and (3) by adding at the end the following new clause: (viii) after December 31, 1997, is equal to 74 percent of such median.".
(c) Study and Report on Clinical Laboratory Tests.-- (1) In general.--The Secretary shall request the Institute of Medicine of the National Academy of Sciences to conduct a study of payments under part B of title XVIII of the Social Security Act for clinical laboratory tests. The study shall include a review of the adequacy of the current methodology and recommendations regarding alternative payment systems. The study shall also analyze and discuss the relationship between such payment systems and access to high quality laboratory tests for medicare beneficiaries, including availability and access to new testing methodologies.
(2) Report to congress.--The Secretary shall, not later than 2 years after the date of enactment of this section, report to the Committees on Ways and Means and Commerce of the House of Representatives and the Committee on Finance of the Senate the results of the study described in paragraph (1), including any recommendations for legislation.
(a) Selection of Regional Carriers.-- (1) In general.--The Secretary of Health and Human Services (in this section referred to as the Secretary") shall-- (A) divide the United States into no more than 5 regions, and (B) designate a single carrier for each such region, for the purpose of payment of claims under part B of title XVIII of the Social Security Act with respect to clinical diagnostic laboratory tests furnished on or after such date (not later than July 1, 1999) as the Secretary specifies.
(2) Designation.--In designating such carriers, the Secretary shall consider, among other criteria-- (A) a carrier's timeliness, quality, and experience in claims processing, and (B) a carrier's capacity to conduct electronic data interchange with laboratories and data matches with other carriers.
(3) Single data resource.--The Secretary shall select one of the designated carriers to serve as a central statistical resource for all claims information relating to such clinical diagnostic laboratory tests handled by all the designated carriers under such part.
(4) Allocation of claims.--The allocation of claims for clinical diagnostic laboratory tests to particular designated carriers shall be based on whether a carrier serves the geographic area where the laboratory specimen was collected or other method specified by the Secretary.
(5) Secretarial exclusion.--Paragraph (1) shall not apply with respect to clinical diagnostic laboratory tests furnished by physician office laboratories if the Secretary determines that such offices would be unduly burdened by the application of billing responsibilities with respect to more than one carrier.
(b) Adoption of National Policies for Clinical Laboratory Tests Benefit.-- (1) In general.--Not later than January 1, 1999, the Secretary shall first adopt, consistent with paragraph (2), national coverage and administrative policies for clinical diagnostic laboratory tests under part B of title XVIII of the Social Security Act, using a negotiated rulemaking process under subchapter III of chapter 5 of title 5, United States Code.
(2) Considerations in design of national policies.--The policies under paragraph (1) shall be designed to promote program integrity and national uniformity and simplify administrative requirements with respect to clinical diagnostic laboratory tests payable under such part in connection with the following: (A) Beneficiary information required to be submitted with each claim or order for laboratory tests.
(B) The medical conditions for which a laboratory test is reasonable and necessary (within the meaning of section 1862(a)(1)(A) of the Social Security Act).
(C) The appropriate use of procedure codes in billing for a laboratory test, including the unbundling of laboratory services.
(D) The medical documentation that is required by a medicare contractor at the time a claim is submitted for a laboratory test in accordance with section 1833(e) of the Social Security Act.
(E) Recordkeeping requirements in addition to any information required to be submitted with a claim, including physicians' obligations regarding such requirements.
(F) Procedures for filing claims and for providing remittances by electronic media.
(G) Limitation on frequency of coverage for the same tests performed on the same individual.
(3) Changes in laboratory policies pending adoption of national policy.--During the period that begins on the date of the enactment of this Act and ends on the date the Secretary first implements national policies pursuant to regulations promulgated under this subsection, a carrier under such part may implement changes relating to requirements for the submission of a claim for clinical diagnostic laboratory tests.
(4) Use of interim policies.--After the date the Secretary first implements such national policies, the Secretary shall permit any carrier to develop and implement interim policies of the type described in paragraph (1), in accordance with guidelines established by the Secretary, in cases in which a uniform national policy has not been established under this subsection and there is a demonstrated need for a policy to respond to aberrant utilization or provision of unnecessary tests. Except as the Secretary specifically permits, no policy shall be implemented under this paragraph for a period of longer than 2 years.
(5) Interim national policies.--After the date the Secretary first designates regional carriers under subsection (a), the Secretary shall establish a process under which designated carriers can collectively develop and implement interim national policies of the type described in paragraph (1). No such policy shall be implemented under this paragraph for a period of longer than 2 years.
(6) Biennial review process.--Not less often than once every 2 years, the Secretary shall solicit and review comments regarding changes in the national policies established under this subsection.
As part of such biennial review process, the Secretary shall specifically review and consider whether to incorporate or supersede interim policies developed under paragraph (4) or (5).
Based upon such review, the Secretary may provide for appropriate changes in the national policies previously adopted under this subsection.
(7) Requirement and notice.--The Secretary shall ensure that any policies adopted under paragraph (3), (4), or (5) shall apply to all laboratory claims payable under part B of title XVIII of the Social Security Act, and shall provide for advance notice to interested parties and a 45-day period in which such parties may submit comments on the proposed change.
(c) Inclusion of Laboratory Representative on Carrier Advisory Committees.--The Secretary shall direct that any advisory committee established by a carrier to advise such carrier with respect to coverage and administrative policies under part B of title XVIII of the Social Security Act shall include an individual to represent the independent clinical laboratories and such other laboratories as the Secretary deems appropriate. The Secretary shall consider recommendations from national and local organizations that represent independent clinical laboratories in such selection.
Section 1833(i)(2)(C) (42 U.S.C. 1395l(i)(2)(C)) is amended by inserting at the end the following new sentence: In each of the fiscal years 1998 through 2002, the increase under this subparagraph shall be reduced (but not below zero) by 2.0 percentage points.".
(a) In General.--Section 1842 (42 U.S.C. 1395u) is amended by inserting after subsection (n) the following new subsection: (o)(1) If a physician's, supplier's, or any other person's bill or request for payment for services includes a charge for a drug or biological for which payment may be made under this part and the drug or biological is not paid on a cost or prospective payment basis as otherwise provided in this part, the amount payable for the drug or biological is equal to 95 percent of the average wholesale price.
(2) If payment for a drug or biological is made to a licensed pharmacy approved to dispense drugs or biologicals under this part, the Secretary may pay a dispensing fee (less the applicable deductible and coinsurance amounts) to the pharmacy.".
(b) Conforming Amendment.--Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)), as amended by sections 4315(b) and 4531(b)(1), is amended-- (1) by striking "and (R)" and inserting "(R)"; and (2) by striking the semicolon at the end and inserting the following: , and (S) with respect to drugs and biologicals not paid on a cost or prospective payment basis as otherwise provided in this part (other than items and services described in subparagraph (B)), the amounts paid shall be 80 percent of the lesser of the actual charge or the payment amount established in section 1842(o);".
(c) Study and report.--The Secretary of Health and Human Services shall study the effect on the average wholesale price of drugs and biologicals of the amendments made by subsection (a) and shall report to the Committees on Ways and Means and Commerce of the House of Representatives and the Committee on Finance of the Senate the result of such study not later than July 1, 1999.
(d) Effective Date.--The amendments made by subsections (a) and (b) shall apply to drugs and biologicals furnished on or after January 1, 1998.
(a) In General.--Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)), as amended by sections 4104 and 4105, is amended-- (1) by striking "and" at the end of subparagraph (R); and (2) by inserting after subparagraph (S) the following new subparagraph: (T) an oral drug (which is approved by the Federal Food and Drug Administration) prescribed for use as an acute anti-emetic used as part of an anticancer chemotherapeutic regimen if the drug is administered by a physician (or as prescribed by a physician)-- (i) for use immediately before, at, or within 48 hours after the time of the administration of the anticancer chemotherapeutic agent; and (ii) as a full replacement for the anti-emetic therapy which would otherwise be administered intravenously.".
(b) Effective Date.--The amendments made by subsection (a) shall apply to items and services furnished on or after January 1, 1998.
(a) Auditing of Cost Reports.--Beginning with cost reports for 1996, the Secretary shall audit cost reports of each renal dialysis provider at least once every 3 years.
(b) Implementation of Quality Standards.--The Secretary of Health and Human Services shall develop, by not later than January 1, 1999, and implement, by not later than January 1, 2000, a method to measure and report quality of renal dialysis services provided under the medicare program under title XVIII of the Social Security Act.
(a) In General.--Effective only for electrocardiogram tests furnished during 1998, the Secretary of Health and Human Services shall restore separate payment, under part B of title XVIII of the Social Security Act, for the transportation of electrocardiogram equipment (HCPCS code R0076) based upon payment methods in effect for such service as of December 31, 1996.
(b) Determination.--By not later than July 1, 1998, the Secretary of Health and Human Services shall make a recommendation to the Committees on Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate as to whether coverage of portable electrocardiogram transportation should be provided under part B of title XVIII of the Social Security Act. In making such recommendation, the Secretary shall take into account the study of coverage of portable electrocardiogram transportation conducted by the Comptroller General of the United States and other relevant information, including information submitted by interested parties.
Subchapter A--Determination of Part B Premium Amount
SEC. 4571. PART B PREMIUM.
(a) In General.--Section 1839(a)(3) (42 U.S.C. 1395r(a)(3)) is amended by striking the first 3 sentences and inserting the following: The Secretary, during September of each year, shall determine and promulgate a monthly premium rate for the succeeding calendar year that is equal to 50 percent of the monthly actuarial rate for enrollees age 65 and over, determined according to paragraph (1), for that succeeding calendar year.".
(b) Conforming and Technical Amendments.-- (1) Section 1839.--Section 1839 (42 U.S.C. 1395r) is amended-- (A) in subsection (a)(2), by striking "(b) and (e)" and inserting "(b), (c), and (f)"; (B) in the last sentence of subsection (a)(3)-- (i) by inserting "rate" after "premium", and (ii) by striking "and the derivation of the dollar amounts specified in this paragraph"; (C) in the first sentence of subsection (b), by striking "or (e)"; (D) by striking subsection (e); and (E) by redesignating subsection (g) as subsection (e) and inserting that subsection after subsection (d).
(2) Section 1844.--Subparagraphs (A)(i) and (B)(i) of section 1844(a)(1) (42 U.S.C. 1395w(a)(1)) are each amended by striking "or 1839(e), as the case may be".
SEC. 4581. PROTECTIONS UNDER THE MEDICARE PROGRAM FOR DISABLED WORKERS WHO LOSE BENEFITS UNDER A GROUP HEALTH PLAN.
(a) No Premium Penalty for Late Enrollment.--The first sentence of section 1839(b) (42 U.S.C. 1395r(b)) is amended by inserting "and not pursuant to a special enrollment period under section 1837(i)(4)" after "section 1837)".
(b) Special Medicare Enrollment Period.-- (1) In general.--Section 1837(i) (42 U.S.C. 1395p(i)) is amended by adding at the end the following new paragraph: (4)(A) In the case of an individual who is entitled to benefits under part A pursuant to section 226(b) and-- (i) who at the time the individual first satisfies paragraph (1) of section 1836-- (I) is enrolled in a group health plan described in section 1862(b)(1)(A)(v) by reason of the individual's current or former employment or by reason of the current or former employment status of a member of the individual's family, and (II) has elected not to enroll (or to be deemed enrolled) under this section during the individual's initial enrollment period; and (ii) whose continuous enrollment under such group health plan is involuntarily terminated at a time when the enrollment under the plan is not by reason of the individual's current employment or by reason of the current employment of a member of the individual's family, there shall be a special enrollment period described in subparagraph (B).
(B) The special enrollment period referred to in subparagraph (A) is the 6-month period beginning on the first day of the month which includes the date of the enrollment termination described in subparagraph (A)(ii).".
(2) Coverage period.--Section 1838(e) (42 U.S.C. 1395q(e)) is amended-- (A) by inserting "or 1837(i)(4)(B)" after "1837(i)(3)" the first place it appears, and (B) by inserting "or specified in section 1837(i)(4)(A)(i)" after "1837(i)(3)" the second place it appears.
(c) Effective Date.--The amendments made by this section shall apply to involuntary terminations of coverage under a group health plan occurring on or after the date of the enactment of this Act.
Section 1839(e)(1) (as amended by section 4571(b)) is amended-- (1) by inserting "(or any appropriate State or local governmental entity specified by the Secretary)" after "State" the first place it appears, and (2) by inserting "(or such entity)" after "State" the second and third place it appears.