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115th Congress } { Rept. 115-759
HOUSE OF REPRESENTATIVES
2d Session } { Part 1
======================================================================
STOP EXCESSIVE NARCOTICS IN OUR RETIREMENT COMMUNITIES PROTECTION ACT
OF 2018
_______
June 19, 2018.--Ordered to be printed
_______
Mr. Brady of Texas, from the Committee on Ways and Means, submitted the
following
R E P O R T
[To accompany H.R. 5676]
[Including cost estimate of the Congressional Budget Office]
The Committee on Ways and Means, to whom was referred the
bill (H.R. 5676) to amend title XVIII of the Social Security
Act to authorize the suspension of payments by Medicare
prescription drug plans and MA-PD plans pending investigations
of credible allegations of fraud by pharmacies, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
CONTENTS
Page
I. SUMMARY AND BACKGROUND............................................2
A. Purpose and Summary................................... 2
B. Background and Need for Legislation................... 2
C. Legislative History................................... 3
II. EXPLANATION OF THE BILL...........................................3
A. Stop Excessive Narcotics in our Retirement Communities
Protection Act....................................... 3
III.VOTES OF THE COMMITTEE............................................4
IV. BUDGET EFFECTS OF THE BILL........................................4
A. Committee Estimate of Budgetary Effects............... 4
B. Statement Regarding New Budget Authority and Tax
Expenditures Budget Authority........................ 4
C. Cost Estimate Prepared by the Congressional Budget
Office............................................... 4
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.......13
A. Committee Oversight Findings and Recommendations...... 13
B. Statement of General Performance Goals and Objectives. 13
C. Information Relating to Unfunded Mandates............. 13
D. Congressional Earmarks, Limited Tax Benefits, and
Limited Tariff Benefits.............................. 13
E. Duplication of Federal Programs....................... 13
F. Disclosure of Directed Rule Makings................... 13
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED............14
A. Text of Existing Law Amended or Repealed by the Bill,
as Reported.......................................... 14
B. Changes in Existing Law Proposed by the Bill, as
Reported............................................. 14
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Stop Excessive Narcotics in our
Retirement Communities Protection Act of 2018'' or the ``SENIOR
Communities Protection Act of 2018''.
SEC. 2. SUSPENSION OF PAYMENTS BY MEDICARE PRESCRIPTION DRUG PLANS AND
MA-PD PLANS PENDING INVESTIGATIONS OF CREDIBLE
ALLEGATIONS OF FRAUD BY PHARMACIES.
(a) In General.--Section 1860D-12(b) of the Social Security Act (42
U.S.C. 1395w-112(b)) is amended by adding at the end the following new
paragraph:
``(7) Suspension of payments pending investigation of
credible allegations of fraud by pharmacies.--
``(A) In general.--The provisions of section 1862(o)
shall apply with respect to a PDP sponsor with a
contract under this part, a pharmacy, and payments to
such pharmacy under this part in the same manner as
such provisions apply with respect to the Secretary, a
provider of services or supplier, and payments to such
provider of services or supplier under this title.
``(B) Rule of construction.--Nothing in this
paragraph shall be construed as limiting the authority
of a PDP sponsor to conduct postpayment review.''.
(b) Application to MA-PD Plans.--Section 1857(f)(3) of the Social
Security Act (42 U.S.C. 1395w-27(f)(3)) is amended by adding at the end
the following new subparagraph:
``(D) Suspension of payments pending investigation of
credible allegations of fraud by pharmacies.--Section
1860D-12(b)(7).''.
(c) Conforming Amendment.--Section 1862(o)(3) of the Social Security
Act (42 U.S.C. 1395y(o)(3)) is amended by inserting ``, section 1860D-
12(b)(7) (including as applied pursuant to section 1857(f)(3)(D)),''
after ``this subsection''.
(d) Clarification Relating to Credible Allegation of Fraud.--Section
1862(o) of the Social Security Act (42 U.S.C. 1395y(o)) is amended by
adding at the end the following new paragraph:
``(4) Credible allegation of fraud.--In carrying out this
subsection, section 1860D-12(b)(7) (including as applied
pursuant to section 1857(f)(3)(D)), and section 1903(i)(2)(C),
a fraud hotline tip (as defined by the Secretary) without
further evidence shall not be treated as sufficient evidence
for a credible allegation of fraud.''.
(e) Effective Date.--The amendments made by this section shall apply
with respect to plan years beginning on or after January 1, 2020.
I. SUMMARY AND BACKGROUND
A. Purpose and Summary
The bill, H.R. 5676, the Stop Excessive Narcotics in our
Retirement (SENIOR) Communities Protection Act of 2018, as
ordered reported by the Committee on Ways and Means on May 16,
2018, grants the Part D prescription drug plans the authority
to suspend payments to a provider or supplier pending an
investigation of a credible allegation of fraud against the
provider or supplier.
B. Background and Need for Legislation
Currently, the Secretary of the Department of Health and
Human Services (HHS) has the authority to suspend payments to a
provider or supplier pending an investigation of a credible
allegation of fraud against the provider or supplier. The
Secretary is required to consult with the Inspector General of
HHS in determining whether there is a credible allegation of
fraud against a provider of services or a supplier. However,
this authority is not provided to Medicare Advantage and
Prescription Drug Plans.
C. Legislative History
Background
H.R. 5676 was introduced on May 3, 2018, and was referred
to the Committee on Ways and Means and additionally the
Committee on Energy and Commerce.
Committee hearings
On January 17, 2018, the Subcommittee on Oversight held a
hearing on the current landscape and CMS actions to prevent
opioid misuse.
On February 6, 2018, the Subcommittee on Health held a
hearing on removing barriers to prevent and treat opioid abuse
and dependence in Medicare.
On April 12, 2018, the Subcommittee on Human Resources held
a hearing on local perspective on the jobs gap that discussed
problems the opioid epidemic is creating in finding qualified
workers.
On April 25, 2018, the Subcommittee on Trade held a hearing
on stopping the flow of synthetic opioids in the international
mail system.
Committee action
The Committee on Ways and Means marked up H.R. 5676, the
Stop Excessive Narcotics in our Retirement (SENIOR) Communities
Protection Act of 2018, on May 16, 2018, and ordered the bill,
as amended, favorably reported (with a quorum being present).
II. EXPLANATION OF THE BILL
A. Stop Excessive Narcotics in our Retirement Communities Protection
Act of 2018
PRESENT LAW
Section 1862(o) of the Social Security Act grants the
Secretary of the Department of Health and Human Services (HHS)
the authority to suspend payments to a provider or supplier
pending an investigation of a credible allegation of fraud
against the provider or supplier.
REASONS FOR CHANGE
This bill extends the authority of Medicare Advantage and
Prescription Drug Plans, in the same manner already provided to
HHS under Medicare Fee-for-Service, to suspend payments pending
credible allegations of fraud.
EXPLANATION OF PROVISIONS
Section 1: Short Title: ``Stop Excessive Narcotics in our
Retirement (SENIOR) Communities Protection Act of 2018.''
Section 2: Suspension of Payments by Medicare Prescription
Drug Plans and MA-PD Plans Pending Investigations of Credible
Allegations of Fraud by Pharmacies.
Applies provisions of Section 1862(o) of the Social
Security Act to a Prescription Drug Plan sponsor in the same
manner as such provisions apply to the Secretary of the
Department of Health and Human Services (HHS).
Rule of Construction: Nothing in this bill should be
construed as limiting the authority of a Prescription Drug Plan
sponsor to conduct post-payment review.
Clarification Relating to Credible Allegations of Fraud: A
fraud hotline tip is not considered as sufficient evidence for
a credible allegation of fraud unless further evidence is
provided.
Effective Date: Beginning on or after January 1, 2020.
EFFECTIVE DATE
Effective Date: Beginning on or after January 1, 2020.
III. VOTES OF THE COMMITTEE
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the vote of the Committee on Ways and Means in its
consideration of H.R. 5676, the SENIOR Communities Protection
Act of 2018, on May 16, 2018.
The Chairman's amendment in the nature of a substitute was
adopted by a voice vote (with a quorum being present).
The bill, H.R. 5676, was ordered favorably reported as
amended by voice vote (with a quorum being present).
IV. BUDGET EFFECTS OF THE BILL
A. Committee Estimate of Budgetary Effects
In compliance with clause 3(d) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the effects on the budget of the bill, H.R. 5676, as
reported. The Committee agrees with the estimate prepared by
the Congressional Budget Office (CBO), which is included below.
B. Statement Regarding New Budget Authority and Tax Expenditures Budget
Authority
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee states that the
bill involves no new or increased budget authority. The
Committee states further that the bill involves no new or
increased tax expenditures.
C. Cost Estimate Prepared by the Congressional Budget Office
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, requiring a cost estimate
prepared by the CBO, the following statement by CBO is
provided.
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 6, 2018.
Hon. Kevin Brady,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for the opioid-related
legislation ordered to be reported on May 16, 2018.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Tom Bradley.
Sincerely,
Mark P. Hadley
(For Keith Hall, Director).
Enclosure.
Opioid Legislation
Summary: On May 16, 2018, the House Committee on Ways and
Means ordered seven bills to be reported related to the
nation's response to the opioid epidemic. Generally, the bills
would:
Expand Medicare coverage of treatment for
opioid use disorder;
Give Medicare providers and health plans
additional tools to curtail inappropriate prescribing
and use of opioids;
Require the completion of studies and
reports related to opioid use and misuse in Medicare;
and
Require the United States Postal Service and
Customs and Border Protection (CBP) to reduce illegal
shipment of opioids across international borders.
Because the bills are related, CBO is publishing a single
comprehensive document that includes estimates for each piece
of legislation.
CBO estimates that enacting four of the bills would affect
direct spending; therefore, pay-as-you-go procedures apply for
those bills. None of the bills would affect revenues.
CBO estimates that although enacting one bill of the seven
included in this document (H.R. 5776) would increase net direct
spending and on-budget deficits over the four consecutive 10-
year periods beginning in 2029, those effects would not exceed
the threshold established by the Congress for long-term costs.
CBO estimates that none of the remaining bills would increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2029.
None of the bills contain intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act
(UMRA).
Estimated cost to the Federal Government: The estimates in
this document do not include the effects of interactions among
the bills. If all seven bills were combined and enacted as one
piece of legislation, the budgetary effects would be different
from the sum of the estimates in this document, although CBO
expects that those differences would be small. The effects of
this legislation fall within functions 550 (health), 570
(Medicare), and 750 (administration of justice).
Basis of estimate: For this estimate, CBO assumes that all
of the legislation will be enacted late in 2018 and that
authorized and estimated amounts will be appropriated each
year. Outlays for discretionary programs are estimated based on
historical spending patterns for similar programs.
Uncertainty
CBO aims to produce estimates that generally reflect the
middle of a range of the most likely budgetary outcomes that
would result if the legislation was enacted. Because data on
the utilization of mental health and substance abuse treatment
under Medicaid and Medicare is scarce, CBO cannot precisely
predict how patients or providers would respond to some policy
changes or what budgetary effects would result. In addition,
several of the bills would give the Department of Health and
Human Services (HHS) considerable latitude-in designing and
implementing policies. Budgetary effects could differ from
those provided in CBO's analyses depending on those decisions.
Direct Spending
Table 1 lists the four bills included in this estimate that
would affect direct spending.
H.R. 5676, the Stop Excessive Narcotics in our Retirement
Communities Protection Act of 2018, would allow prescription
drug plans to suspend payments to pharmacies while fraud
investigations are pending. CBO expects that enacting the
legislation would reduce payments by those plans to pharmacies
and result in lower premiums for benefits under Medicare's Part
D. CBO estimates that the reduction in premiums would lower
federal spending for Part D by $9 million over the 2019-2028
period.
TABLE 1.--ESTIMATED CHANGES IN MANDATORY SPENDING
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
------------------------------------------------------------------------------------------------------------------------
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2019-2023 2019-2028
--------------------------------------------------------------------------------------------------------------------------------------------------------
INCREASES OR DECREASES (-) IN DIRECT SPENDING
H.R. 5676, Stop Excessive
Narcotics in our Retirement
Communities Protection Act of
2018:
Budget Authority........... 0 0 -1 -1 -1 -1 -1 -1 -1 -1 -1 -4 -9
Outlays.................... 0 0 -1 -1 -1 -1 -1 -1 -1 -1 -1 -4 -9
H.R. 5773, Preventing Addiction
for Susceptible Seniors Act of
2018:a
Budget Authority........... 0 0 0 -6 -7 -7 -7 -8 -9 -9 -11 -20 -64
Outlays.................... 0 0 0 -6 -7 -7 -7 -8 -9 -9 -11 -20 -64
H.R. 5776, the Medicare and
Opioid Safe Treatment Act of
2018:a
Budget Authority........... 0 8 0 20 20 25 30 30 35 35 40 73 243
Outlays.................... 0 2 4 22 20 25 30 30 35 35 40 73 243
H.R. 5788, Securing the
International Mail Against
Opioids Act of 2018:a
Budget Authority........... 0 0 * * * * * * * * * * *
Outlays.................... 0 0 * * * * * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
Annual amounts may not sum to totals because of rounding. * = between -$500,000 and $500,000
aThis bill also would affect spending subject to appropriation.
H.R. 5773, the Preventing Addiction for Susceptible Seniors
Act of 2018, would require Part D prescription drug plans to
provide drug management programs for Medicare beneficiaries who
are at risk for prescription drug abuse. (Under current law,
Part D plans are permitted but not required to establish such
programs as of 2019.) Based on an analysis of the number of
plans currently providing those programs, CBO estimates that
enacting H.R. 5773 would lower federal spending by $64 million
over the 2019-2028 period by reducing the number of
prescriptions filled and Medicare's payments for controlled
substances.
Two provisions of H.R. 5773 would have no significant
budgetary effect; they are described later in this document.
H.R. 5776, the Medicare and Opioid Safe Treatment Act of
2018, would appropriate $8 million in 2019, which would be
available until expended, for Federally Qualified Health
Centers and Rural Health Clinics to support training in the
treatment of opioid use disorder. CBO expects that $8 million
would be spent between 2019 and 2021.
H.R. 5776 also would expand the availability of medication-
assisted treatment (MAT) for Medicare beneficiaries with opioid
use disorder. The bill would allow treatment programs certified
by the Substance Abuse and Mental Health Services
Administration (SAMHSA) to become Medicare-participating
providers.\1\ H.R. 5776 also would direct the Secretary of HHS
to create a new schedule of bundled payments for MAT through
certified programs and grant the Secretary considerable
discretion for defining bundles and establishing payment rates.
---------------------------------------------------------------------------
\1\MAT combines behavioral therapy and pharmaceutical treatment for
substance use disorders. Under current law, methadone (an opioid used
to treat and manage dependence on other drugs, such as heroin) can be
dispensed only by SAMHSA-certified treatment programs, which do not
participate in Medicare. Other drugs used in MAT, including
buprenorphine and naltrexone, can be dispensed more widely.
---------------------------------------------------------------------------
CBO projects that, beginning in 2021, about 3,000 Medicare
beneficiaries who would not be treated for opioid abuse under
current law would newly enroll each year in treatment offered
by SAMHSA-certified programs and that the annual cost per
participant would range from about $6,000 to about $10,000,
depending largely on the medications dispensed and the period
for which beneficiaries adhered to the protocol. CBO's
projection of the number of beneficiaries who would receive
treatment takes into consideration the number of beneficiaries
estimated to have opioid-use disorder, the number already
receiving some form of treatment, and the availability of
providers to treat those who newly enroll in MAT. To develop a
per capita treatment cost, CBO analyzed rates for MAT paid by
other payers, as well as Medicare spending for health care
services typically used by people receiving MAT. CBO estimates
that the new MAT benefit would increase direct spending by $235
million over the 2019-2028 period.
CBO estimates that enacting H.R. 5776 would increase net
Medicare spending by $243 million over the 2019-2028 period.
(If enacted, H.R. 5776 would also affect spending subject to
appropriation; CBO has not completed an estimate of that
amount.)
H.R. 5788, the Securing the International Mail Against
Opioids Act of 2018, would establish a new fee for certain
items mailed to the United States from overseas, beginning
January 1, 2020. Initially, the fee for most such items would
be one dollar, but the amount could be adjusted annually
thereafter. Using information provided by CBP, CBO estimates
that about $100 million in new fees would be collected over the
2020-2028 period. The collections would be divided equally
between CBP and the Postal Service and spent by those agencies
on activities related to the processing of inbound mail. CBO
estimates that the net effect on federal spending in each year
would be insignificant. (If enacted, H.R. 5788 would also
affect spending subject to appropriation; those effects are
described below.)
Spending subject to appropriation
For this document, CBO has grouped bills with spending that
would be subject to appropriation into three general
categories:
Bills with provisions that would have no
budgetary effect;
Bills with provisions for which CBO has
estimated an authorization of appropriations (see Table
2); and
Bills with provisions that would affect
spending subject to appropriation for which CBO has not
yet completed an estimate.
No Budgetary Effect. CBO estimates that three of the bills
have provisions that would not significantly affect direct
spending, revenues, or spending subject to appropriation.
H.R. 5773, the Preventing Addiction for Susceptible Seniors
Act of 2018, would require health care professionals to submit
prior authorization requests electronically, starting on
January 1, 2021, for drugs covered under Medicare Part D.
Taking into account that many prescribers already use
electronic methods to submit such requests, CBO estimates that
enacting that Section 3 of H.R. 5773 would not significantly
affect direct spending for Part D.
Section 5 of that bill would expand medication therapy
management programs under Medicare Part D to include
beneficiaries who are at risk for prescription drug abuse.
Because relatively few beneficiaries would be affected by this
provision, CBO estimates that its enactment would not
significantly affect direct spending for Part D.
Section 6 of that bill would require the Secretary of HHS
on an annual basis to identify high prescribers of opioids and
furnish them with information about proper prescribing methods.
Because HHS already has the capacity to meet those
requirements, CBO estimates that enacting that provision would
not impose additional administrative costs on the agency.
H.R. 5775, the Providing Reliable Options for Patients and
Educational Resources Act of 2018, would require prescription
drug plans that provide coverage under Medicare Part D to
furnish information to beneficiaries about the risks of opioid
use and the availability of alternative treatments for pain.
The bill also would require Medicare Advantage plans and
prescription drug plans to provide information regarding safe
disposal of controlled substances in home health risk
assessments and medication therapy management programs,
respectively. In CBO's estimation, neither proposal would have
a budgetary effect because those activities would not impose
significant administrative costs on plans or federal agencies.
In addition, H.R. 5775 would restrict the use of certain
pain-related questions on the Hospital Consumer Assessment of
Healthcare Providers and Systems (HCAHPS) survey, which is
administered by the Centers for Medicare & Medicaid Services
(CMS). The survey is one measure used in CMS's Hospital Value-
Based Purchasing (VBP) Program, which adjusts payments to acute
care hospitals on the basis of the quality of care they provide
to Medicare beneficiaries. Because the VBP program is funded by
reducing base payments to all hospitals, CBO estimates that
changing the HCAHPS survey would not affect the total amount
paid by Medicare.
H.R. 5776, the Medicare and Opioid Safe Treatment Act of
2018, in section 3, would require CMS, beginning on January 1,
2020, to review and possibly modify payments made through
Medicare's Hospital Outpatient Prospective Payment System for
certain opioid and nonopioid pain management treatments and
technologies. CMS could revise payments if the Secretary of HHS
determined that there was a financial incentive to use opioids
in place of nonopioid medications. The budget neutrality
requirement under current law would apply to such revisions,
and the rest of the payment rates within the system would be
subject to offsetting adjustments. Because the changes would be
made in a budget-neutral manner, CBO estimates that this
provision would have no budgetary effect.
Section 6 of H.R. 5776 would explicitly authorize the
Center for Medicare and Medicaid Innovation (CMMI) to test
approaches for expanding beneficiaries' awareness of
psychological services and to help those beneficiaries curtail
use of hospital-based mental health or behavioral health
services. Because CMMI already has that authority, CBO
estimates that enacting the legislation would not affect
federal spending.
Estimated Authorizations. Table 2 shows CBO's estimates of
the authorization of appropriations for provisions in four
bills. For those estimates, CBO assumes that appropriated funds
would be available to implement those provisions.
H.R. 5723, the Expanding Oversight of Opioid Prescribing
and Payment Act of 2018, would require the Medicare Payment
Advisory Commission to report to the Congress on payments for
pain treatment, incentives for prescribing opioids in inpatient
and outpatient settings, and documented tracking of opioid use
from Medicare claims data. CBO estimates that producing such a
report would cost less than $500,000 over the 2019-2023 period.
TABLE 2.--ESTIMATED SPENDING SUBJECT TO APPROPRIATION FOR BILLS WITH ESTIMATED AUTHORIZATIONS
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
----------------------------------------------------
2018 2019 2020 2021 2022 2023 2019-2023
----------------------------------------------------------------------------------------------------------------
INCREASES IN SPENDING SUBJECT TO APPROPRIATION
H.R. 5723, Expanding Oversight of Opioid Prescribing and
Payment Act of 2018:
Estimated Authorization Level.......................... 0 * 0 0 0 0 *
Estimated Outlays...................................... 0 * 0 0 0 0 *
H.R. 5773, Preventing Addiction for Susceptible Seniors Act
of 2018:a
Estimated Authorization Level.......................... 0 2 2 2 2 2 9
Estimated Outlays...................................... 0 2 2 2 2 2 9
H.R. 5776, Medicare and Opioid Safe Treatment Act of 2018:a
Estimated Authorization Level.......................... 0 1 0 0 0 0 1
Estimated Outlays...................................... 0 1 0 0 0 0 1
H.R. 5788, Securing the International Mail Against Opioids
Act of 2018:a
Estimated Authorization Level.......................... 0 100 0 0 0 0 100
Estimated Outlays...................................... 0 40 40 20 0 0 100
----------------------------------------------------------------------------------------------------------------
Annual amounts may not sum to totals because of rounding. * = between zero and $500,000
aThis bill also would affect mandatory spending.
H.R. 5773, the Preventing Addiction for Susceptible Seniors
Act of 2018, would require the Secretary of HHS to establish a
secure Internet portal to allow HHS, Medicare Advantage plans,
and Medicare Part D plans to exchange information about fraud,
waste, and abuse among providers and suppliers no later than
two years after enactment. H.R. 5773 also would require
organizations with Medicare Advantage contracts to submit
information on investigations related to providers suspected of
prescribing large volumes of opioids through a process
established by the Secretary no later than January 2021. Based
on historical spending patterns for similar activities, CBO
estimates that implementing H.R. 5773 would cost approximately
$9 million over the 2019-2023 period.
H.R. 5776, the Medicare and Opioid Safe Treatment Act of
2018, would direct the Secretary of HHS to report to the
Congress on the availability of supplemental benefits to pay
for treatment or prevention of substance abuse among enrollees
in Medicare Advantage plans. The Secretary also would report on
coverage of and payment for pain treatment and substance use
disorders under Medicare. CBO estimates that producing those
reports would cost $1 million over five years.
H.R. 5788, the Securing the International Mail Against
Opioids Act of 2018, would direct the Postal Service, CBP, and
other federal agencies to collaborate to develop technology to
detect opioids and other drugs that enter the United States in
the mail. Using information provided by CBP, CBO estimates that
it would cost roughly $100 million over the 2019-2021 period to
deploy drug detection systems at international mail facilities.
Other Authorizations. CBO has determined that provisions in
two bills--H.R. 5774, Combating Opioid Abuse for Care in
Hospitals Act of 2018; and H.R. 5776, the Medicare and Safe
Opioid Treatment Act of 2018--would increase authorization
levels, but has not completed estimates of amounts. Any
spending that would result from those authorizations would be
subject to future appropriation action.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. Four of the bills discussed in this document contain
direct spending and are subject to pay-as-you-go procedures.
Details about the amount of direct spending in those bills can
be found in Table 1.
Increase in long-term direct spending and deficits: CBO
estimates that although enacting H.R. 5776, the Medicare and
Opioid Safe Treatment Act of 2018, would increase net direct
spending and on-budget deficits over the four consecutive 10-
year periods beginning in 2029, those effects would not exceed
the threshold established by the Congress for long-term costs
($2.5 billion for net direct spending and $5 billion for on-
budget deficits). CBO estimates that none of the remaining
bills would increase net direct spending or on-budget deficits
in any of the four consecutive 10-year periods beginning in
2029.
Mandates: None of the bills contains intergovernmental or
private-sector mandates as defined in UMRA.
Previous CBO estimate: On June 6, 2018, CBO issued an
estimate for 59 opioid-related bills ordered reported by the
House Committee on Energy and Commerce on May 9 and May 17,
2018. Several of those bills contain provisions that are
identical or similar to those in the legislation ordered
reported by the Committee on Ways and Means, and for those
provisions, CBO's estimates are the same.
In particular, several sections in H.R. 5773, the
Preventing Addiction for Susceptible Seniors Act of 2018,
contain provisions that are identical or similar to those in
five bills listed in the other estimate:
Section 2, which would require prescription
drug plans to implement drug management programs, is
identical to a provision in H.R. 5675.
Section 3, regarding electronic prior
authorization for prescriptions under Medicare's Part
D, is similar to a provision in H.R. 4841.
Section 4, which would mandate the creation
of a new Internet portal to allow various stakeholders
to exchange information, is identical to a provision in
H.R. 5715.
Section 5, which would expand medication
therapy management, is the same as a provision in H.R.
5684.
Section 6, regarding prescriber
notification, is identical to H.R. 5716.
In addition, in this estimate, a provision related to
Medicare beneficiary education in section 2 of H.R. 5775, the
Providing Reliable Options for Patients and Educational
Resources Act of 2018, is the same as a provision in H.R. 5686,
the Medicare Clear Health Options in Care for Enrollees Act of
2018, in CBO's estimate for the Committee on Energy and
Commerce.
Estimate prepared by: Federal Costs--Medicare: Philippa
Haven, Lori Housman, Jamease Kowalczyk, Lara Robillard, Sarah
Sajewski, Colin Yee, and Rebecca Yip; U.S. Postal Service and
Customs and Border Protection: Mark Grabowicz; Mandates: Andrew
Laughlin; Fact Checking: Zachary Byrum and Kate Kelly.
Estimate reviewed by: Tom Bradley, Chief, Health Systems
and Medicare Cost Estimates Unit; Kim P. Cawley, Chief, Natural
Resources Cost Estimates Unit; Susan Willie, Chief, Mandates
Unit; Leo Lex, Deputy Assistant Director for Budget Analysis;
Theresa A. Gullo, Assistant Director for Budget Analysis.
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE
A. Committee Oversight Findings and Recommendations
With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives, the Committee made findings and
recommendations that are reflected in this report.
B. Statement of General Performance Goals and Objectives
With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill contains no measure that authorizes funding, so no
statement of general performance goals and objectives for which
any measure authorizes funding is required.
C. Information Relating to Unfunded Mandates
This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
The Committee has determined that the bill does not contain
Federal mandates on the private sector. The Committee has
determined that the bill does not impose a Federal
intergovernmental mandate on State, local, or tribal
governments.
D. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the bill, and states that the provisions of
the bill do not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits within the meaning of the
rule.
E. Duplication of Federal Programs
In compliance with Sec. 3(g)(2) of H. Res. 5 (114th
Congress), the Committee states that no provision of the bill
establishes or reauthorizes: (1) a program of the Federal
Government known to be duplicative of another Federal program;
(2) a program included in any report from the Government
Accountability Office to Congress pursuant to section 21 of
Public Law 111-139; or (3) a program related to a program
identified in the most recent Catalog of Federal Domestic
Assistance, published pursuant to the Federal Program
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No.
98-169).
F. Disclosure of Directed Rule Makings
In compliance with Sec. 3(i) of H. Res. 5 (114th Congress),
the following statement is made concerning directed rule
makings: The Committee estimates that the bill requires no
directed rule makings within the meaning of such section.
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
In compliance with clause 3(e)(1)(B) of rule XIII of the
Rules of the House of Representatives, changes in existing law
proposed by the bill, as reported, are shown as follows
(existing law proposed to be omitted is enclosed in black
brackets, new matter is printed in italic, existing law in
which no change is proposed is shown in roman):
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italic and existing law in which no change is
proposed is shown in roman):
SOCIAL SECURITY ACT
* * * * * * *
TITLE XVIII--HEALTH INSURANCE FOR THE AGED AND DISABLED
* * * * * * *
Part C--Medicare+Choice Program
* * * * * * *
contracts with medicare+choice organizations
Sec. 1857. (a) In General.--The Secretary shall not permit
the election under section 1851 of a Medicare+Choice plan
offered by a Medicare+Choice organization under this part, and
no payment shall be made under section 1853 to an organization,
unless the Secretary has entered into a contract under this
section with the organization with respect to the offering of
such plan. Such a contract with an organization may cover more
than 1 Medicare+Choice plan. Such contract shall provide that
the organization agrees to comply with the applicable
requirements and standards of this part and the terms and
conditions of payment as provided for in this part.
(b) Minimum Enrollment Requirements.--
(1) In general.--Subject to paragraph (2), the
Secretary may not enter into a contract under this
section with a Medicare+Choice organization unless the
organization has--
(A) at least 5,000 individuals (or 1,500
individuals in the case of an organization that
is a provider-sponsored organization) who are
receiving health benefits through the
organization, or
(B) at least 1,500 individuals (or 500
individuals in the case of an organization that
is a provider-sponsored organization) who are
receiving health benefits through the
organization if the organization primarily
serves individuals residing outside of
urbanized areas.
(2) Application to msa plans.--In applying paragraph
(1) in the case of a Medicare+Choice organization that
is offering an MSA plan, paragraph (1) shall be applied
by substituting covered lives for individuals.
(3) Allowing transition.--The Secretary may waive the
requirement of paragraph (1) during the first 3
contract years with respect to an organization.
(c) Contract Period and Effectiveness.--
(1) Period.--Each contract under this section shall
be for a term of at least 1 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.
(2) Termination authority.--In accordance with
procedures established under subsection (h), the
Secretary may at any time terminate any such contract
if the Secretary determines 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 part; or
(C) no longer substantially meets the
applicable conditions of this part.
(3) Effective date of contracts.--The effective date
of any contract executed pursuant to this section shall
be specified in the contract, except that in no case
shall a contract under this section which provides for
coverage under an MSA plan be effective before January
1999 with respect to such coverage.
(4) Previous terminations.--
(A) In general.--The Secretary may not enter
into a contract with a Medicare+Choice
organization if a previous contract with that
organization under this section was terminated
at the request of the organization within the
preceding 2-year period, except as provided in
subparagraph (B) and except in such other
circumstances which warrant special
consideration, as determined by the Secretary.
(B) Earlier re-entry permitted where change
in payment policy.--Subparagraph (A) shall not
apply with respect to the offering by a
Medicare+Choice organization of a
Medicare+Choice plan in a Medicare+Choice
payment area if during the 6-month period
beginning on the date the organization notified
the Secretary of the intention to terminate the
most recent previous contract, there was a
legislative change enacted (or a regulatory
change adopted) that has the effect of
increasing payment amounts under section 1853
for that Medicare+Choice payment area.
(5) Contracting authority.--The authority vested in
the Secretary by this part 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 title.
(d) Protections Against Fraud and Beneficiary Protections.--
(1) Periodic auditing.--The Secretary shall provide
for the annual auditing of the financial records
(including data relating to medicare utilization and
costs, including allowable costs under section 1858(c))
of at least one-third of the Medicare+Choice
organizations offering Medicare+Choice plans under this
part. The Comptroller General shall monitor auditing
activities conducted under this subsection.
(2) Inspection and audit.--Each contract under this
section shall provide that the Secretary, or any person
or organization designated by the Secretary--
(A) shall have the right to timely 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
(B) shall have the right to timely audit and
inspect any books and records of the
Medicare+Choice 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.
(3) Enrollee notice at time of termination.--Each
contract under this section shall require the
organization 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 title, to each individual enrolled with the
organization under this part.
(4) Disclosure.--
(A) In general.--Each Medicare+Choice
organization shall, in accordance with
regulations of the Secretary, report to the
Secretary financial information which shall
include the following:
(i) Such information as the Secretary
may require demonstrating that the
organization has a fiscally sound
operation.
(ii) A copy of the report, if any,
filed with the Secretary containing the
information required to be reported
under section 1124 by disclosing
entities.
(iii) A description of transactions,
as specified by the Secretary, between
the organization and a party in
interest. Such transactions shall
include--
(I) any sale or exchange, or
leasing of any property between
the organization and a party in
interest;
(II) any furnishing for
consideration of goods,
services (including management
services), or facilities
between the organization and a
party in interest, but not
including salaries paid to
employees for services provided
in the normal course of their
employment and health services
provided to members by
hospitals and other providers
and by staff, medical group (or
groups), individual practice
association (or associations),
or any combination thereof; and
(III) any lending of money or
other extension of credit
between an organization and a
party in interest.
The Secretary may require that information
reported respecting an organization which
controls, is controlled by, or is under common
control with, another entity be in the form of
a consolidated financial statement for the
organization and such entity.
(B) Party in interest defined.--For the
purposes of this paragraph, the term ``party in
interest'' means--
(i) any director, officer, partner,
or employee responsible for management
or administration of a Medicare+Choice
organization, any person who is
directly or indirectly the beneficial
owner of more than 5 percent of the
equity of the organization, any person
who is the beneficial owner of a
mortgage, deed of trust, note, or other
interest secured by, and valuing more
than 5 percent of the organization,
and, in the case of a Medicare+Choice
organization organized as a nonprofit
corporation, an incorporator or member
of such corporation under applicable
State corporation law;
(ii) any entity in which a person
described in clause (i)--
(I) is an officer or
director;
(II) is a partner (if such
entity is organized as a
partnership);
(III) has directly or
indirectly a beneficial
interest of more than 5 percent
of the equity; or
(IV) has a mortgage, deed of
trust, note, or other interest
valuing more than 5 percent of
the assets of such entity;
(iii) any person directly or
indirectly controlling, controlled by,
or under common control with an
organization; and
(iv) any spouse, child, or parent of
an individual described in clause (i).
(C) Access to information.--Each
Medicare+Choice organization shall make the
information reported pursuant to subparagraph
(A) available to its enrollees upon reasonable
request.
(5) Loan information.--The contract 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.
(6) Review to ensure compliance with care management
requirements for specialized medicare advantage plans
for special needs individuals.--In conjunction with the
periodic audit of a specialized Medicare Advantage plan
for special needs individuals under paragraph (1), the
Secretary shall conduct a review to ensure that such
organization offering the plan meets the requirements
described in section 1859(f)(5).
(e) Additional Contract Terms.--
(1) In general.--The contract shall contain such
other terms and conditions not inconsistent with this
part (including requiring the organization to provide
the Secretary with such information) as the Secretary
may find necessary and appropriate.
(2) Cost-sharing in enrollment-related costs.--
(A) In general.--A Medicare+Choice
organization and a PDP sponsor under part D
shall pay the fee established by the Secretary
under subparagraph (B).
(B) Authorization.--The Secretary is
authorized to charge a fee to each
Medicare+Choice organization with a contract
under this part and each PDP sponsor with a
contract under part D that is equal to the
organization' or sponsor's pro rata share (as
determined by the Secretary) of the aggregate
amount of fees which the Secretary is directed
to collect in a fiscal year. Any amounts
collected shall be available without further
appropriation to the Secretary for the purpose
of carrying out section 1851 (relating to
enrollment and dissemination of information),
section 1860D-1(c), and section 4360 of the
Omnibus Budget Reconciliation Act of 1990
(relating to the health insurance counseling
and assistance program).
(C) Authorization of appropriations.--There
are authorized to be appropriated for the
purposes described in subparagraph (B) for each
fiscal year beginning with fiscal year 2001 and
ending with fiscal year 2005 an amount equal to
$100,000,000, and for each fiscal year
beginning with fiscal year 2006 an amount equal
to $200,000,000, reduced by the amount of fees
authorized to be collected under this paragraph
and section 1860D-12(b)(3)(D) for the fiscal
year.
(D) Limitation.--In any fiscal year the fees
collected by the Secretary under subparagraph
(B) shall not exceed the lesser of--
(i) the estimated costs to be
incurred by the Secretary in the fiscal
year in carrying out the activities
described in section 1851 and section
1860D-1(c) and section 4360 of the
Omnibus Budget Reconciliation Act of
1990; or
(ii)(I) $200,000,000 in fiscal year
1998;
(II) $150,000,000 in fiscal year
1999;
(III) $100,000,000 in fiscal year
2000;
(IV) the Medicare+Choice portion (as
defined in subparagraph (E)) of
$100,000,000 in fiscal year 2001 and
each succeeding fiscal year before
fiscal year 2006; and
(V) the applicable portion (as
defined in subparagraph (F)) of
$200,000,000 in fiscal year 2006 and
each succeeding fiscal year.
(E) Medicare+choice portion defined.--In this
paragraph, the term ``Medicare+Choice portion''
means, for a fiscal year, the ratio, as
estimated by the Secretary, of--
(i) the average number of individuals
enrolled in Medicare+Choice plans
during the fiscal year, to
(ii) the average number of
individuals entitled to benefits under
part A, and enrolled under part B,
during the fiscal year.
(F) Applicable portion defined.--In this
paragraph, the term ``applicable portion''
means, for a fiscal year--
(i) with respect to MA organizations,
the Secretary's estimate of the total
proportion of expenditures under this
title that are attributable to
expenditures made under this part
(including payments under part D that
are made to such organizations); or
(ii) with respect to PDP sponsors,
the Secretary's estimate of the total
proportion of expenditures under this
title that are attributable to
expenditures made to such sponsors
under part D.
(3) Agreements with federally qualified health
centers.--
(A) Payment levels and amounts.--A contract
under this section with an MA organization
shall require the organization to provide, in
any written agreement described in section
1853(a)(4) between the organization and a
federally qualified health center, for a level
and amount of payment to the federally
qualified health center for services provided
by such health center that is not less than the
level and amount of payment that the plan would
make for such services if the services had been
furnished by a entity providing similar
services that was not a federally qualified
health center.
(B) Cost-sharing.--Under the written
agreement referred to in subparagraph (A), a
federally qualified health center must accept
the payment amount referred to in such
subparagraph plus the Federal payment provided
for in section 1833(a)(3)(B) as payment in full
for services covered by the agreement, except
that such a health center may collect any
amount of cost-sharing permitted under the
contract under this section, so long as the
amounts of any deductible, coinsurance, or
copayment comply with the requirements under
section 1854(e).
(4) Requirement for minimum medical loss ratio.--If
the Secretary determines for a contract year (beginning
with 2014) that an MA plan has failed to have a medical
loss ratio of at least .85--
(A) the MA plan shall remit to the Secretary
an amount equal to the product of--
(i) the total revenue of the MA plan
under this part for the contract year;
and
(ii) the difference between .85 and
the medical loss ratio;
(B) for 3 consecutive contract years, the
Secretary shall not permit the enrollment of
new enrollees under the plan for coverage
during the second succeeding contract year; and
(C) the Secretary shall terminate the plan
contract if the plan fails to have such a
medical loss ratio for 5 consecutive contract
years.
(f) Prompt Payment by Medicare+Choice Organization.--
(1) Requirement.--A contract under this part shall
require a Medicare+Choice organization to provide
prompt payment (consistent with the provisions of
sections 1816(c)(2) and 1842(c)(2)) of claims submitted
for services and supplies furnished to enrollees
pursuant to the contract, if the services or supplies
are not furnished under a contract between the
organization and the provider or supplier (or in the
case of a Medicare+Choice private fee-for-service plan,
if a claim is submitted to such organization by an
enrollee).
(2) Secretary's option to bypass noncomplying
organization.--In the case of a Medicare+Choice
eligible organization which the Secretary determines,
after notice and opportunity for a hearing, has failed
to make payments of amounts in compliance with
paragraph (1), the Secretary may provide for direct
payment of the amounts owed to providers and suppliers
(or, in the case of a Medicare+Choice private fee-for-
service plan, amounts owed to the enrollees) for
covered services and supplies furnished to individuals
enrolled under this part under the contract. If the
Secretary provides for the direct payments, the
Secretary shall provide for an appropriate reduction in
the amount of payments otherwise made to the
organization under this part to reflect the amount of
the Secretary's payments (and the Secretary's costs in
making the payments).
(3) Incorporation of certain prescription drug plan
contract requirements.--The following provisions shall
apply to contracts with a Medicare Advantage
organization offering an MA-PD plan in the same manner
as they apply to contracts with a PDP sponsor offering
a prescription drug plan under part D:
(A) Prompt payment.--Section 1860D-12(b)(4).
(B) Submission of claims by pharmacies
located in or contracting with long-term care
facilities.--Section 1860D-12(b)(5).
(C) Regular update of prescription drug
pricing standard.--Section 1860D-12(b)(6).
(D) Suspension of payments pending
investigation of credible allegations of fraud
by pharmacies.--Section 1860D-12(b)(7).
(g) Intermediate Sanctions.--
(1) In general.--If the Secretary determines that a
Medicare+Choice organization with a contract under this
section--
(A) 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;
(B) imposes premiums on individuals enrolled
under this part in excess of the amount of the
Medicare+Choice monthly basic and supplemental
beneficiary premiums permitted under section
1854;
(C) acts to expel or to refuse to re-enroll
an individual in violation of the provisions of
this part;
(D) engages in any practice that would
reasonably be expected to have the effect of
denying or discouraging enrollment (except as
permitted by this part) by eligible individuals
with the organization whose medical condition
or history indicates a need for substantial
future medical services;
(E) misrepresents or falsifies information
that is furnished--
(i) to the Secretary under this part,
or
(ii) to an individual or to any other
entity under this part;
(F) fails to comply with the applicable
requirements of section 1852(j)(3) or
1852(k)(2)(A)(ii);
(G) employs or contracts with any individual
or entity that is excluded from participation
under this title under section 1128 or 1128A
for the provision of health care, utilization
review, medical social work, or administrative
services or employs or contracts with any
entity for the provision (directly or
indirectly) through such an excluded individual
or entity of such services;
(H) except as provided under subparagraph (C)
or (D) of section 1860D-1(b)(1), enrolls an
individual in any plan under this part without
the prior consent of the individual or the
designee of the individual;
(I) transfers an individual enrolled under
this part from one plan to another without the
prior consent of the individual or the designee
of the individual or solely for the purpose of
earning a commission;
(J) fails to comply with marketing
restrictions described in subsections (h) and
(j) of section 1851 or applicable implementing
regulations or guidance; or
(K) employs or contracts with any individual
or entity who engages in the conduct described
in subparagraphs (A) through (J) of this
paragraph;
the Secretary may provide, in addition to any other
remedies authorized by law, for any of the remedies
described in paragraph (2). The Secretary may provide,
in addition to any other remedies authorized by law,
for any of the remedies described in paragraph (2), if
the Secretary determines that any employee or agent of
such organization, or any provider or supplier who
contracts with such organization, has engaged in any
conduct described in subparagraphs (A) through (K) of
this paragraph.
(2) Remedies.--The remedies described in this
paragraph are--
(A) civil money penalties of not more than
$25,000 for each determination under paragraph
(1) or, with respect to a determination under
subparagraph (D) or (E)(i) of such paragraph,
of not more than $100,000 for each such
determination, except with respect to a
determination under subparagraph (E), an
assessment of not more than the amount claimed
by such plan or plan sponsor based upon the
misrepresentation or falsified information
involved, plus, with respect to a determination
under paragraph (1)(B), double the excess
amount charged in violation of such paragraph
(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 paragraph (1)(D),
$15,000 for each individual not enrolled as a
result of the practice involved,
(B) suspension of enrollment of individuals
under this part after the date the Secretary
notifies the organization of a determination
under paragraph (1) and until the Secretary is
satisfied that the basis for such determination
has been corrected and is not likely to recur,
or
(C) suspension of payment to the organization
under this part for individuals enrolled after
the date the Secretary notifies the
organization of a determination under paragraph
(1) and until the Secretary is satisfied that
the basis for such determination has been
corrected and is not likely to recur.
(3) Other intermediate sanctions.--In the case of a
Medicare+Choice organization for which the Secretary
makes a determination under subsection (c)(2) the basis
of which is not described in paragraph (1), the
Secretary may apply the following intermediate
sanctions:
(A) Civil money penalties of not more than
$25,000 for each determination under subsection
(c)(2) if the deficiency that is the basis of
the determination has directly adversely
affected (or has the substantial likelihood of
adversely affecting) an individual covered
under the organization's contract.
(B) Civil money penalties of not more than
$10,000 for each week beginning after the
initiation of civil money penalty procedures by
the Secretary during which the deficiency that
is the basis of a determination under
subsection (c)(2) exists.
(C) Suspension of enrollment of individuals
under this part after the date the Secretary
notifies the organization of a determination
under subsection (c)(2) and until the Secretary
is satisfied that the deficiency that is the
basis for the determination has been corrected
and is not likely to recur.
(D) Civil monetary penalties of not more than
$100,000, or such higher amount as the
Secretary may establish by regulation, where
the finding under subsection (c)(2)(A) is based
on the organization's termination of its
contract under this section other than at a
time and in a manner provided for under
subsection (a).
(4) Civil money penalties.--The provisions of section
1128A (other than subsections (a) and (b)) shall apply
to a civil money penalty under paragraph (2) or (3) in
the same manner as they apply to a civil money penalty
or proceeding under section 1128A(a).
(h) Procedures for Termination.--
(1) In general.--The Secretary may terminate a
contract with a Medicare+Choice organization under this
section in accordance with formal investigation and
compliance procedures established by the Secretary
under which--
(A) the Secretary provides the organization
with the reasonable opportunity to develop and
implement a corrective action plan to correct
the deficiencies that were the basis of the
Secretary's determination under subsection
(c)(2); and
(B) the Secretary provides the organization
with reasonable notice and opportunity for
hearing (including the right to appeal an
initial decision) before terminating the
contract.
(2) Exception for imminent and serious risk to
health.--Paragraph (1) shall not apply if the Secretary
determines that a delay in termination, resulting from
compliance with the procedures specified in such
paragraph prior to termination, would pose an imminent
and serious risk to the health of individuals enrolled
under this part with the organization.
(3) Delay in contract termination authority for plans
failing to achieve minimum quality rating.--During the
period beginning on the date of the enactment of this
paragraph and through the end of plan year 2018, the
Secretary may not terminate a contract under this
section with respect to the offering of an MA plan by a
Medicare Advantage organization solely because the MA
plan has failed to achieve a minimum quality rating
under the 5-star rating system under section
1853(o)(4).
(i) Medicare+Choice Program Compatibility With Employer or
Union Group Health Plans.--
(1) Contracts with ma organizations.--To facilitate
the offering of Medicare+Choice plans under contracts
between Medicare+Choice organizations and employers,
labor organizations, or the trustees of a fund
established by one or more employers or labor
organizations (or combination thereof) to furnish
benefits to the entity's employees, former employees
(or combination thereof) or members or former members
(or combination thereof) of the labor organizations,
the Secretary may waive or modify requirements that
hinder the design of, the offering of, or the
enrollment in such Medicare+Choice plans.
(2) Employer sponsored ma plans.--To facilitate the
offering of MA plans by employers, labor organizations,
or the trustees of a fund established by one or more
employers or labor organizations (or combination
thereof) to furnish benefits to the entity's employees,
former employees (or combination thereof) or members or
former members (or combination thereof) of the labor
organizations, the Secretary may waive or modify
requirements that hinder the design of, the offering
of, or the enrollment in such MA plans. Notwithstanding
section 1851(g), an MA plan described in the previous
sentence may restrict the enrollment of individuals
under this part to individuals who are beneficiaries
and participants in such plan.
* * * * * * *
Part D--Voluntary Prescription Drug Benefit Program
* * * * * * *
Subpart 2--Prescription Drug Plans; PDP Sponsors; Financing
* * * * * * *
requirements for and contracts with prescription drug plan (pdp)
sponsors
Sec. 1860D-12. (a) General Requirements.--Each PDP sponsor of
a prescription drug plan shall meet the following requirements:
(1) Licensure.--Subject to subsection (c), the
sponsor is organized and licensed under State law as a
risk-bearing entity eligible to offer health insurance
or health benefits coverage in each State in which it
offers a prescription drug plan.
(2) Assumption of financial risk for unsubsidized
coverage.--
(A) In general.--Subject to subparagraph (B),
to the extent that the entity is at risk the
entity assumes financial risk on a prospective
basis for benefits that it offers under a
prescription drug plan and that is not covered
under section 1860D-15(b).
(B) Reinsurance permitted.--The plan sponsor
may obtain insurance or make other arrangements
for the cost of coverage provided to any
enrollee to the extent that the sponsor is at
risk for providing such coverage.
(3) Solvency for unlicensed sponsors.--In the case of
a PDP sponsor that is not described in paragraph (1)
and for which a waiver has been approved under
subsection (c), such sponsor shall meet solvency
standards established by the Secretary under subsection
(d).
(b) Contract Requirements.--
(1) In general.--The Secretary shall not permit the
enrollment under section 1860D-1 in a prescription drug
plan offered by a PDP sponsor under this part, and the
sponsor shall not be eligible for payments under
section 1860D-14 or 1860D-15, unless the Secretary has
entered into a contract under this subsection with the
sponsor with respect to the offering of such plan. Such
a contract with a sponsor may cover more than one
prescription drug plan. Such contract shall provide
that the sponsor agrees to comply with the applicable
requirements and standards of this part and the terms
and conditions of payment as provided for in this part.
(2) Limitation on entities offering fallback
prescription drug plans.--The Secretary shall not enter
into a contract with a PDP sponsor for the offering of
a prescription drug plan (other than a fallback
prescription drug plan) in a PDP region for a year if
the sponsor--
(A) submitted a bid under section 1860D-11(g)
for such year (as the first year of a contract
period under such section) to offer a fallback
prescription drug plan in any PDP region;
(B) offers a fallback prescription drug plan
in any PDP region during the year; or
(C) offered a fallback prescription drug plan
in that PDP region during the previous year.
For purposes of this paragraph, an entity shall be
treated as submitting a bid with respect to a
prescription drug plan or offering a fallback
prescription drug plan if the entity is acting as a
subcontractor of a PDP sponsor that is offering such a
plan. The previous sentence shall not apply to entities
that are subcontractors of an MA organization except
insofar as such organization is acting as a PDP sponsor
with respect to a prescription drug plan.
(3) Incorporation of certain medicare advantage
contract requirements.--Except as otherwise provided,
the following provisions of section 1857 shall apply to
contracts under this section in the same manner as they
apply to contracts under section 1857(a):
(A) Minimum enrollment.--Paragraphs (1) and
(3) of section 1857(b), except that--
(i) the Secretary may increase the
minimum number of enrollees required
under such paragraph (1) as the
Secretary determines appropriate; and
(ii) the requirement of such
paragraph (1) shall be waived during
the first contract year with respect to
an organization in a region.
(B) Contract period and effectiveness.--
Section 1857(c), except that in applying
paragraph (4)(B) of such section any reference
to payment amounts under section 1853 shall be
deemed payment amounts under section 1860D-15.
(C) Protections against fraud and beneficiary
protections.--Section 1857(d).
(D) Additional contract terms.--Section
1857(e); except that section 1857(e)(2) shall
apply as specified to PDP sponsors and payments
under this part to an MA-PD plan shall be
treated as expenditures made under part D.
Notwithstanding any other provision of law,
information provided to the Secretary under the
application of section 1857(e)(1) to contracts
under this section under the preceding
sentence--
(i) may be used for the purposes of
carrying out this part, improving
public health through research on the
utilization, safety, effectiveness,
quality, and efficiency of health care
services (as the Secretary determines
appropriate); and
(ii) shall be made available to
Congressional support agencies (in
accordance with their obligations to
support Congress as set out in their
authorizing statutes) for the purposes
of conducting Congressional oversight,
monitoring, making recommendations, and
analysis of the program under this
title.
(E) Intermediate sanctions.--Section 1857(g)
(other than paragraph (1)(F) of such section),
except that in applying such section the
reference in section 1857(g)(1)(B) to section
1854 is deemed a reference to this part.
(F) Procedures for termination.--Section
1857(h).
(4) Prompt payment of clean claims.--
(A) Prompt payment.--
(i) In general.--Each contract
entered into with a PDP sponsor under
this part with respect to a
prescription drug plan offered by such
sponsor shall provide that payment
shall be issued, mailed, or otherwise
transmitted with respect to all clean
claims submitted by pharmacies (other
than pharmacies that dispense drugs by
mail order only or are located in, or
contract with, a long-term care
facility) under this part within the
applicable number of calendar days
after the date on which the claim is
received.
(ii) Clean claim defined.--In this
paragraph, the term ``clean claim''
means a claim that has no defect or
impropriety (including any lack of any
required substantiating documentation)
or particular circumstance requiring
special treatment that prevents timely
payment from being made on the claim
under this part.
(iii) Date of receipt of claim.--In
this paragraph, a claim is considered
to have been received--
(I) with respect to claims
submitted electronically, on
the date on which the claim is
transferred; and
(II) with respect to claims
submitted otherwise, on the 5th
day after the postmark date of
the claim or the date specified
in the time stamp of the
transmission.
(B) Applicable number of calendar days
defined.--In this paragraph, the term
``applicable number of calendar days'' means--
(i) with respect to claims submitted
electronically, 14 days; and
(ii) with respect to claims submitted
otherwise, 30 days.
(C) Interest payment.--
(i) In general.--Subject to clause
(ii), if payment is not issued, mailed,
or otherwise transmitted within the
applicable number of calendar days (as
defined in subparagraph (B)) after a
clean claim is received, the PDP
sponsor shall pay interest to the
pharmacy that submitted the claim at a
rate equal to the weighted average of
interest on 3-month marketable Treasury
securities determined for such period,
increased by 0.1 percentage point for
the period beginning on the day after
the required payment date and ending on
the date on which payment is made (as
determined under subparagraph (D)(iv)).
Interest amounts paid under this
subparagraph shall not be counted
against the administrative costs of a
prescription drug plan or treated as
allowable risk corridor costs under
section 1860D-15(e).
(ii) Authority not to charge
interest.--The Secretary may provide
that a PDP sponsor is not charged
interest under clause (i) in the case
where there are exigent circumstances,
including natural disasters and other
unique and unexpected events, that
prevent the timely processing of
claims.
(D) Procedures involving claims.--
(i) Claim deemed to be clean.--A
claim is deemed to be a clean claim if
the PDP sponsor involved does not
provide notice to the claimant of any
deficiency in the claim--
(I) with respect to claims
submitted electronically,
within 10 days after the date
on which the claim is received;
and
(II) with respect to claims
submitted otherwise, within 15
days after the date on which
the claim is received.
(ii) Claim determined to not be a
clean claim.--
(I) In general.--If a PDP
sponsor determines that a
submitted claim is not a clean
claim, the PDP sponsor shall,
not later than the end of the
period described in clause (i),
notify the claimant of such
determination. Such
notification shall specify all
defects or improprieties in the
claim and shall list all
additional information or
documents necessary for the
proper processing and payment
of the claim.
(II) Determination after
submission of additional
information.--A claim is deemed
to be a clean claim under this
paragraph if the PDP sponsor
involved does not provide
notice to the claimant of any
defect or impropriety in the
claim within 10 days of the
date on which additional
information is received under
subclause (I).
(iii) Obligation to pay.--A claim
submitted to a PDP sponsor that is not
paid or contested by the sponsor within
the applicable number of days (as
defined in subparagraph (B)) after the
date on which the claim is received
shall be deemed to be a clean claim and
shall be paid by the PDP sponsor in
accordance with subparagraph (A).
(iv) Date of payment of claim.--
Payment of a clean claim under such
subparagraph is considered to have been
made on the date on which--
(I) with respect to claims
paid electronically, the
payment is transferred; and
(II) with respect to claims
paid otherwise, the payment is
submitted to the United States
Postal Service or common
carrier for delivery.
(E) Electronic transfer of funds.--A PDP
sponsor shall pay all clean claims submitted
electronically by electronic transfer of funds
if the pharmacy so requests or has so requested
previously. In the case where such payment is
made electronically, remittance may be made by
the PDP sponsor electronically as well.
(F) Protecting the rights of claimants.--
(i) In general.--Nothing in this
paragraph shall be construed to
prohibit or limit a claim or action not
covered by the subject matter of this
section that any individual or
organization has against a provider or
a PDP sponsor.
(ii) Anti-retaliation.--Consistent
with applicable Federal or State law, a
PDP sponsor shall not retaliate against
an individual or provider for
exercising a right of action under this
subparagraph.
(G) Rule of construction.--A determination
under this paragraph that a claim submitted by
a pharmacy is a clean claim shall not be
construed as a positive determination regarding
eligibility for payment under this title, nor
is it an indication of government approval of,
or acquiescence regarding, the claim submitted.
The determination shall not relieve any party
of civil or criminal liability with respect to
the claim, nor does it offer a defense to any
administrative, civil, or criminal action with
respect to the claim.
(5) Submission of claims by pharmacies located in or
contracting with long-term care facilities.--Each
contract entered into with a PDP sponsor under this
part with respect to a prescription drug plan offered
by such sponsor shall provide that a pharmacy located
in, or having a contract with, a long-term care
facility shall have not less than 30 days (but not more
than 90 days) to submit claims to the sponsor for
reimbursement under the plan.
(6) Regular update of prescription drug pricing
standard.--If the PDP sponsor of a prescription drug
plan uses a standard for reimbursement of pharmacies
based on the cost of a drug, each contract entered into
with such sponsor under this part with respect to the
plan shall provide that the sponsor shall update such
standard not less frequently than once every 7 days,
beginning with an initial update on January 1 of each
year, to accurately reflect the market price of
acquiring the drug.
(7) Suspension of payments pending investigation of
credible allegations of fraud by pharmacies.--
(A) In general.--The provisions of section
1862(o) shall apply with respect to a PDP
sponsor with a contract under this part, a
pharmacy, and payments to such pharmacy under
this part in the same manner as such provisions
apply with respect to the Secretary, a provider
of services or supplier, and payments to such
provider of services or supplier under this
title.
(B) Rule of construction.--Nothing in this
paragraph shall be construed as limiting the
authority of a PDP sponsor to conduct
postpayment review.
(c) Waiver of Certain Requirements To Expand Choice.--
(1) Authorizing waiver.--
(A) In general.--In the case of an entity
that seeks to offer a prescription drug plan in
a State, the Secretary shall waive the
requirement of subsection (a)(1) that the
entity be licensed in that State if the
Secretary determines, based on the application
and other evidence presented to the Secretary,
that any of the grounds for approval of the
application described in paragraph (2) have
been met.
(B) Application of regional plan waiver
rule.--In addition to the waiver available
under subparagraph (A), the provisions of
section 1858(d) shall apply to PDP sponsors
under this part in a manner similar to the
manner in which such provisions apply to MA
organizations under part C, except that no
application shall be required under paragraph
(1)(B) of such section in the case of a State
that does not provide a licensing process for
such a sponsor.
(2) Grounds for approval.--
(A) In general.--The grounds for approval
under this paragraph are--
(i) subject to subparagraph (B), the
grounds for approval described in
subparagraphs (B), (C), and (D) of
section 1855(a)(2); and
(ii) the application by a State of
any grounds other than those required
under Federal law.
(B) Special rules.--In applying subparagraph
(A)(i)--
(i) the ground of approval described
in section 1855(a)(2)(B) is deemed to
have been met if the State does not
have a licensing process in effect with
respect to the PDP sponsor; and
(ii) for plan years beginning before
January 1, 2008, if the State does have
such a licensing process in effect,
such ground for approval described in
such section is deemed to have been met
upon submission of an application
described in such section.
(3) Application of waiver procedures.--With respect
to an application for a waiver (or a waiver granted)
under paragraph (1)(A) of this subsection, the
provisions of subparagraphs (E), (F), and (G) of
section 1855(a)(2) shall apply, except that clauses (i)
and (ii) of such subparagraph (E) shall not apply in
the case of a State that does not have a licensing
process described in paragraph (2)(B)(i) in effect.
(4) References to certain provisions.--In applying
provisions of section 1855(a)(2) under paragraphs (2)
and (3) of this subsection to prescription drug plans
and PDP sponsors--
(A) any reference to a waiver application
under section 1855 shall be treated as a
reference to a waiver application under
paragraph (1)(A) of this subsection; and
(B) any reference to solvency standards shall
be treated as a reference to solvency standards
established under subsection (d) of this
section.
(d) Solvency Standards for Non-Licensed Entities.--
(1) Establishment and publication.--The Secretary, in
consultation with the National Association of Insurance
Commissioners, shall establish and publish, by not
later than January 1, 2005, financial solvency and
capital adequacy standards for entities described in
paragraph (2).
(2) Compliance with standards.--A PDP sponsor that is
not licensed by a State under subsection (a)(1) and for
which a waiver application has been approved under
subsection (c) shall meet solvency and capital adequacy
standards established under paragraph (1). The
Secretary shall establish certification procedures for
such sponsors with respect to such solvency standards
in the manner described in section 1855(c)(2).
(e) Licensure Does Not Substitute for or Constitute
Certification.--The fact that a PDP sponsor is licensed in
accordance with subsection (a)(1) or has a waiver application
approved under subsection (c) does not deem the sponsor to meet
other requirements imposed under this part for a sponsor.
(f) Periodic Review and Revision of Standards.--
(1) In general.--Subject to paragraph (2), the
Secretary may periodically review the standards
established under this section and, based on such
review, may revise such standards if the Secretary
determines such revision to be appropriate.
(2) Prohibition of midyear implementation of
significant new regulatory requirements.--The Secretary
may not implement, other than at the beginning of a
calendar year, regulations under this section that
impose new, significant regulatory requirements on a
PDP sponsor or a prescription drug plan.
(g) Prohibition of State Imposition of Premium Taxes;
Relation to State Laws.--The provisions of sections 1854(g) and
1856(b)(3) shall apply with respect to PDP sponsors and
prescription drug plans under this part in the same manner as
such sections apply to MA organizations and MA plans under part
C.
* * * * * * *
Part E--Miscellaneous Provisions
* * * * * * *
exclusions from coverage and medicare as secondary payer
Sec. 1862. (a) Notwithstanding any other provision of this
title, no payment may be made under part A or part B for any
expenses incurred for items or services--
(1)(A) which, except for items and services described
in a succeeding subparagraph or additional preventive
services (as described in section 1861(ddd)(1)), 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
section 1861(s)(10), which are not reasonable and
necessary for the prevention of illness,
(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 Medicare Payment Advisory
Commission or the Secretary, which are not reasonable
and necessary to carry out the purposes of section
1886(e)(6),
(E) in the case of research conducted pursuant to
section 1142, which is not reasonable and necessary to
carry out the purposes of that section,
(F) in the case of screening mammography, which is
performed more frequently than is covered under section
1834(c)(2) or which is not conducted by a facility
described in section 1834(c)(1)(B), in the case of
screening pap smear and screening pelvic exam, which is
performed more frequently than is provided under
section 1861(nn), and, in the case of screening for
glaucoma, which is performed more frequently than is
provided under section 1861(uu),
(G) in the case of prostate cancer screening tests
(as defined in section 1861(oo)), which are performed
more frequently than is covered under such section,
(H) in the case of colorectal cancer screening tests,
which are performed more frequently than is covered
under section 1834(d),
(I) the frequency and duration of home health
services which are in excess of normative guidelines
that the Secretary shall establish by regulation,
(J) in the case of a drug or biological specified in
section 1847A(c)(6)(C) for which payment is made under
part B that is furnished in a competitive area under
section 1847B, that is not furnished by an entity under
a contract under such section,
(K) in the case of an initial preventive physical
examination, which is performed more than 1 year after
the date the individual's first coverage period begins
under part B,
(L) in the case of cardiovascular screening blood
tests (as defined in section 1861(xx)(1)), which are
performed more frequently than is covered under section
1861(xx)(2),
(M) in the case of a diabetes screening test (as
defined in section 1861(yy)(1)), which is performed
more frequently than is covered under section
1861(yy)(3),
(N) in the case of ultrasound screening for abdominal
aortic aneurysm which is performed more frequently than
is provided for under section 1861(s)(2)(AA),
(O) in the case of kidney disease education services
(as defined in paragraph (1) of section 1861(ggg)),
which are furnished in excess of the number of sessions
covered under paragraph (4) of such section, and
(P) in the case of personalized prevention plan
services (as defined in section 1861(hhh)(1)), which
are performed more frequently than is covered under
such section;
(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 Act 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
section 1861(aa)(1), in the case of Federally qualified
health center services, as defined in section
1861(aa)(3), in the case of services for which payment
may be made under section 1880(e), and in such other
cases as the Secretary may specify;
(4) which are not provided within the United States
(except for inpatient hospital services furnished
outside the United States under the conditions
described in section 1814(f) and, subject to such
conditions, limitations, and requirements as are
provided under or pursuant to this title, physicians'
services and ambulance services furnished an individual
in conjunction with such inpatient hospital services
but only for the period during which such inpatient
hospital services were furnished);
(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
section 1861(s)(8)) or eye examinations for the purpose
of prescribing, fitting, or changing eyeglasses,
procedures performed (during the course of any eye
examination) to determine the refractive state of the
eyes, hearing aids or examinations therefor, or
immunizations (except as otherwise allowed under
section 1861(s)(10) and subparagraph (B), (F), (G),
(H), (K), or (P) of paragraph (1));
(8) where such expenses are for orthopedic shoes or
other supportive devices for the feet, other than shoes
furnished pursuant to section 1861(s)(12);
(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 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
section 1861(s)(2)(K), certified nurse-midwife
services, qualified psychologist services, and services
of a certified registered nurse anesthetist, and which
are furnished to an individual who is a patient of a
hospital or critical access hospital by an entity other
than the hospital or critical access hospital, unless
the services are furnished under arrangements (as
defined in section 1861(w)(1)) with the entity made by
the hospital or critical access hospital;
(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 quality
improvement organization (under part B of title XI) or
a carrier under section 1842 has approved of the use of
such an assistant in the surgical procedure based on
the existence of a complicating medical condition, or
(B) which are for services of an assistant at surgery
to which section 1848(i)(2)(B) applies;
(16) in the case in which funds may not be used for
such items and services under the Assisted Suicide
Funding Restriction Act of 1997;
(17) where the expenses are for an item or service
furnished in a competitive acquisition area (as
established by the Secretary under section 1847(a)) by
an entity other than an entity with which the Secretary
has entered into a contract under section 1847(b) for
the furnishing of such an item or service in that area,
unless the Secretary finds that the expenses were
incurred in a case of urgent need, or in other
circumstances specified by the Secretary;
(18) which are covered skilled nursing facility
services described in section 1888(e)(2)(A)(i) and
which are furnished to an individual who is a resident
of a skilled nursing facility during a period in which
the resident is provided covered post-hospital extended
care services (or, for services described in section
1861(s)(2)(D), which are furnished to such an
individual without regard to such period), by an entity
other than the skilled nursing facility, unless the
services are furnished under arrangements (as defined
in section 1861(w)(1)) with the entity made by the
skilled nursing facility;
(19) which are for items or services which are
furnished pursuant to a private contract described in
section 1802(b);
(20) in the case of outpatient physical therapy
services, outpatient speech-language pathology
services, or outpatient occupational 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 subsection (g)
or (ll)(2) of section 1861) as such standards and
conditions would apply to such therapy services if
furnished by a therapist;
(21) where such expenses are for home health services
(including medical supplies described in section
1861(m)(5), but excluding durable medical equipment to
the extent provided for in such section) furnished to
an individual who is under a plan of care of the home
health agency if the claim for payment for such
services is not submitted by the agency;
(22) subject to subsection (h), for which a claim is
submitted other than in an electronic form specified by
the Secretary;
(23) which are the technical component of advanced
diagnostic imaging services described in section
1834(e)(1)(B) for which payment is made under the fee
schedule established under section 1848(b) and that are
furnished by a supplier (as defined in section
1861(d)), if such supplier is not accredited by an
accreditation organization designated by the Secretary
under section 1834(e)(2)(B);
(24) where such expenses are for renal dialysis
services (as defined in subparagraph (B) of section
1881(b)(14)) for which payment is made under such
section unless such payment is made under such section
to a provider of services or a renal dialysis facility
for such services; or
(25) not later than January 1, 2014, for which the
payment is other than by electronic funds transfer
(EFT) or an electronic remittance in a form as
specified in ASC X12 835 Health Care Payment and
Remittance Advice or subsequent standard.
Paragraph (7) shall not apply to Federally qualified health
center services described in section 1861(aa)(3)(B). In making
a national coverage determination (as defined in paragraph
(1)(B) of section 1869(f)) the Secretary shall ensure
consistent with subsection (l) that the public is afforded
notice and opportunity to comment prior to implementation by
the Secretary of the determination; meetings of advisory
committees with respect to the determination are made on the
record; in making the determination, the Secretary has
considered applicable information (including clinical
experience and medical, technical, and scientific evidence)
with respect to the subject matter of the determination; and in
the determination, provide a clear statement of the basis for
the determination (including responses to comments received
from the public), the assumptions underlying that basis, and
make available to the public the data (other than proprietary
data) considered in making the determination.
(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 title under
section 226(a), and
(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 section 226) would
upon application be, entitled to
benefits under section 226A.
(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 (iii)) 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 title under section
226(b).
(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 section 226) would
upon application be, entitled to
benefits under section 226A.
(iii) 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 title under
section 226A during the 12-month period
which begins with the first month in
which the individual becomes entitled
to benefits under part A under the
provisions of section 226A, or, if
earlier, the first month in which the
individual would have been entitled to
benefits under such part under the
provisions of section 226A if the
individual had filed an application for
such benefits; and
(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
title when an individual is entitled to or
eligible for benefits under this title under
section 226A after the end of the 12-month
period described in clause (i). Effective for
items and services furnished on or after
February 1, 1991, and before the date of
enactment of the Balanced Budget Act of 1997
(with respect to periods beginning on or after
February 1, 1990), this subparagraph shall be
applied by substituting ``18- month'' for ``12-
month'' each place it appears. Effective for
items and services furnished on or after the
date of enactment of the Balanced Budget Act of
1997, (with respect to periods beginning on or
after the date that is 18 months prior to such
date), clauses (i) and (ii) shall be applied by
substituting ``30-month'' for ``12-month'' each
place it appears.
(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.
(F) Limitation on beneficiary liability.--An
individual who is entitled to benefits under
this title and is furnished an item or service
for which such benefits are incorrectly paid is
not liable for repayment of such benefits under
this paragraph unless payment of such benefits
was made to the individual.
(2) Medicare secondary payer.--
(A) In general.--Payment under this title 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 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 the 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. An entity that engages in a business,
trade, or profession shall be deemed to have a
self-insured plan if it carries its own risk
(whether by a failure to obtain insurance, or
otherwise) in whole or in part.
(B) Conditional payment.--
(i) Authority to make conditional
payment.--The Secretary may make
payment under this title with respect
to an item or service if a primary plan
described in subparagraph (A)(ii) has
not made or cannot reasonably be
expected to make payment with respect
to such item or service promptly (as
determined in accordance with
regulations). Any such payment by the
Secretary shall be conditioned on
reimbursement to the appropriate Trust
Fund in accordance with the succeeding
provisions of this subsection.
(ii) Repayment required.--Subject to
paragraph (9), a primary plan, and an
entity that receives payment from a
primary plan, shall reimburse the
appropriate Trust Fund for any payment
made by the Secretary under this title
with respect to an item or service if
it is demonstrated that such primary
plan has or had a responsibility to
make payment with respect to such item
or service. A primary plan's
responsibility for such payment may be
demonstrated by a judgment, a payment
conditioned upon the recipient's
compromise, waiver, or release (whether
or not there is a determination or
admission of liability) of payment for
items or services included in a claim
against the primary plan or the primary
plan's insured, or by other means. If
reimbursement is not made to the
appropriate Trust Fund before the
expiration of the 60-day period that
begins on the date notice of, or
information related to, a primary
plan's responsibility for such payment
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).
(iii) Action by united states.--In
order to recover payment made under
this title for an item or service, the
United States may bring an action
against any or all entities that are or
were required or responsible (directly,
as an insurer or self-insurer, as a
third-party administrator, as an
employer that sponsors or contributes
to a group health plan, or large group
health plan, or otherwise) to make
payment with respect to the same item
or service (or any portion thereof)
under a primary plan. The United States
may, in accordance with paragraph
(3)(A) collect double damages against
any such entity. In addition, the
United States may recover under this
clause from any entity that has
received payment from a primary plan or
from the proceeds of a primary plan's
payment to any entity. The United
States may not recover from a third-
party administrator under this clause
in cases where the third-party
administrator would not be able to
recover the amount at issue from the
employer or group health plan and is
not employed by or under contract with
the employer or group health plan at
the time the action for recovery is
initiated by the United States or for
whom it provides administrative
services due to the insolvency or
bankruptcy of the employer or plan. An
action may not be brought by the United
States under this clause with respect
to payment owed unless the complaint is
filed not later than 3 years after the
date of the receipt of notice of a
settlement, judgment, award, or other
payment made pursuant to paragraph (8)
relating to such payment owed.
(iv) Subrogation rights.--The United
States shall be subrogated (to the
extent of payment made under this title
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.
(v) 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 title.
(vi) Claims-filing period.--
Notwithstanding any other time limits
that may exist for filing a claim under
an employer group health plan, the
United States may seek to recover
conditional payments in accordance with
this subparagraph where the request for
payment is submitted to the entity
required or responsible under this
subsection to pay with respect to the
item or service (or any portion
thereof) under a primary plan within
the 3-year period beginning on the date
on which the item or service was
furnished.
(vii) Use of website to determine
final conditional reimbursement
amount.--
(I) Notice to secretary of
expected date of a settlement,
judgment, etc.--In the case of
a payment made by the Secretary
pursuant to clause (i) for
items and services provided to
the claimant, the claimant or
applicable plan (as defined in
paragraph (8)(F)) may at any
time beginning 120 days before
the reasonably expected date of
a settlement, judgment, award,
or other payment, notify the
Secretary that a payment is
reasonably expected and the
expected date of such payment.
(II) Secretarial providing
access to claims information
through a website.--The
Secretary shall maintain and
make available to individuals
to whom items and services are
furnished under this title (and
to authorized family or other
representatives recognized
under regulations and to an
applicable plan which has
obtained the consent of the
individual) access to
information on the claims for
such items and services
(including payment amounts for
such claims), including those
claims that relate to a
potential settlement, judgment,
award, or other payment. Such
access shall be provided to an
individual, representative, or
plan through a website that
requires a password to gain
access to the information. The
Secretary shall update the
information on claims and
payments on such website in as
timely a manner as possible but
not later than 15 days after
the date that payment is made.
Information related to claims
and payments subject to the
notice under subclause (I)
shall be maintained and made
available consistent with the
following:
(aa) The information
shall be as complete as
possible and shall
include provider or
supplier name,
diagnosis codes (if
any), dates of service,
and conditional payment
amounts.
(bb) The information
accurately identifies
those claims and
payments that are
related to a potential
settlement, judgment,
award, or other payment
to which the provisions
of this subsection
apply.
(cc) The website
provides a method for
the receipt of secure
electronic
communications with the
individual,
representative, or plan
involved.
(dd) The website
provides that
information is
transmitted from the
website in a form that
includes an official
time and date that the
information is
transmitted.
(ee) The website
shall permit the
individual,
representative, or plan
to download a statement
of reimbursement
amounts (in this clause
referred to as a
``statement of
reimbursement amount'')
on payments for claims
under this title
relating to a potential
settlement, judgment,
award, or other
payment.
(III) Use of timely web
download as basis for final
conditional amount.--If an
individual (or other claimant
or applicable plan with the
consent of the individual)
obtains a statement of
reimbursement amount from the
website during the protected
period as defined in subclause
(V) and the related settlement,
judgment, award or other
payment is made during such
period, then the last statement
of reimbursement amount that is
downloaded during such period
and within 3 business days
before the date of the
settlement, judgment, award, or
other payment shall constitute
the final conditional amount
subject to recovery under
clause (ii) related to such
settlement, judgment, award, or
other payment.
(IV) Resolution of
discrepancies.--If the
individual (or authorized
representative) believes there
is a discrepancy with the
statement of reimbursement
amount, the Secretary shall
provide a timely process to
resolve the discrepancy. Under
such process the individual (or
representative) must provide
documentation explaining the
discrepancy and a proposal to
resolve such discrepancy.
Within 11 business days after
the date of receipt of such
documentation, the Secretary
shall determine whether there
is a reasonable basis to
include or remove claims on the
statement of reimbursement. If
the Secretary does not make
such determination within the
11 business-day period, then
the proposal to resolve the
discrepancy shall be accepted.
If the Secretary determines
within such period that there
is not a reasonable basis to
include or remove claims on the
statement of reimbursement, the
proposal shall be rejected. If
the Secretary determines within
such period that there is a
reasonable basis to conclude
there is a discrepancy, the
Secretary must respond in a
timely manner by agreeing to
the proposal to resolve the
discrepancy or by providing
documentation showing with good
cause why the Secretary is not
agreeing to such proposal and
establishing an alternate
discrepancy resolution. In no
case shall the process under
this subclause be treated as an
appeals process or as
establishing a right of appeal
for a statement of
reimbursement amount and there
shall be no administrative or
judicial review of the
Secretary's determinations
under this subclause.
(V) Protected period.--In
subclause (III), the term
``protected period'' means,
with respect to a settlement,
judgment, award or other
payment relating to an injury
or incident, the portion (if
any) of the period beginning on
the date of notice under
subclause (I) with respect to
such settlement, judgment,
award, or other payment that is
after the end of a Secretarial
response period beginning on
the date of such notice to the
Secretary. Such Secretarial
response period shall be a
period of 65 days, except that
such period may be extended by
the Secretary for a period of
an additional 30 days if the
Secretary determines that
additional time is required to
address claims for which
payment has been made. Such
Secretarial response period
shall be extended and shall not
include any days for any part
of which the Secretary
determines (in accordance with
regulations) that there was a
failure in the claims and
payment posting system and the
failure was justified due to
exceptional circumstances (as
defined in such regulations).
Such regulations shall define
exceptional circumstances in a
manner so that not more than 1
percent of the repayment
obligations under this
subclause would qualify as
exceptional circumstances.
(VI) Effective date.--The
Secretary shall promulgate
final regulations to carry out
this clause not later than 9
months after the date of the
enactment of this clause.
(VII) Website including
successor technology.--In this
clause, the term ``website''
includes any successor
technology.
(viii) Right of appeal for secondary
payer determinations relating to
liability insurance (including self-
insurance), no fault insurance, and
workers' compensation laws and plans.--
The Secretary shall promulgate
regulations establishing a right of
appeal and appeals process, with
respect to any determination under this
subsection for a payment made under
this title for an item or service for
which the Secretary is seeking to
recover conditional payments from an
applicable plan (as defined in
paragraph (8)(F)) that is a primary
plan under subsection (A)(ii), under
which the applicable plan involved, or
an attorney, agent, or third party
administrator on behalf of such plan,
may appeal such determination. The
individual furnished such an item or
service shall be notified of the plan's
intent to appeal such determination
(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 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 title 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 section 1128A (other than
subsections (a) and (b)) shall apply to a civil
money penalty under the previous sentence in
the same manner as such provisions apply to a
penalty or proceeding under section 1128A(a).
(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
title (without regard to deductibles and coinsurance
under this title) for the remainder of such charge,
but--
(A) payment under this title may not exceed
an amount which would be payable under this
title for such item or service if paragraph
(2)(A) did not apply; and
(B) payment under this title, 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 title on the basis of reasonable
cost (or other cost-related basis) or
under section 1886, the amount which
would be payable under this title on
such basis, and
(ii) in the case of an item or
service for which payment is authorized
under this title 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 title
(without regard to deductibles
and coinsurance under this
title),
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 that
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 Centers for
Medicare & Medicaid Services 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 title 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 subparagraph (A) 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), 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
provision of section 1128A (other than
subsections (a) and (b)) shall apply to
a civil money penalty under the
previous sentence in the same manner as
such provisions apply to a penalty or
proceeding under section 1128A(a).
(D) Obtaining information from
beneficiaries.--Before an individual applies
for benefits under part A or enrolls under part
B, 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.
(E) End date.--The provisions of this
paragraph shall not apply to information
required to be provided on or after July 1,
2016.
(6) Screening requirements for providers and
suppliers.--
(A) In general.--Notwithstanding any other
provision of this title, no payment may be made
for any item or service furnished under part B
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 section 1128A (other than
subsections (a) and (b)) shall apply to a civil
money penalty under the previous sentence in
the same manner as such provisions apply to a
penalty or proceeding under section 1128A(a).
(7) Required submission of information by group
health plans.--
(A) Requirement.--On and after the first day
of the first calendar quarter beginning after
the date that is 1 year after the date of the
enactment of this paragraph, an entity serving
as an insurer or third party administrator for
a group health plan, as defined in paragraph
(1)(A)(v), and, in the case of a group health
plan that is self-insured and self-
administered, a plan administrator or
fiduciary, shall--
(i) secure from the plan sponsor and
plan participants such information as
the Secretary shall specify for the
purpose of identifying situations where
the group health plan is or has been a
primary plan to the program under this
title; and
(ii) submit such information to the
Secretary in a form and manner
(including frequency) specified by the
Secretary.
(B) Enforcement.--
(i) In general.--An entity, a plan
administrator, or a fiduciary described
in subparagraph (A) that fails to
comply with the requirements under such
subparagraph shall be subject to a
civil money penalty of $1,000 for each
day of noncompliance for each
individual for which the information
under such subparagraph should have
been submitted. The provisions of
subsections (e) and (k) of section
1128A shall apply to a civil money
penalty under the previous sentence in
the same manner as such provisions
apply to a penalty or proceeding under
section 1128A(a). A civil money penalty
under this clause shall be in addition
to any other penalties prescribed by
law and in addition to any Medicare
secondary payer claim under this title
with respect to an individual.
(ii) Deposit of amounts collected.--
Any amounts collected pursuant to
clause (i) shall be deposited in the
Federal Hospital Insurance Trust Fund
under section 1817.
(C) Sharing of information.--Notwithstanding
any other provision of law, under terms and
conditions established by the Secretary, the
Secretary--
(i) shall share information on
entitlement under Part A and enrollment
under Part B under this title with
entities, plan administrators, and
fiduciaries described in subparagraph
(A);
(ii) may share the entitlement and
enrollment information described in
clause (i) with entities and persons
not described in such clause; and
(iii) may share information collected
under this paragraph as necessary for
purposes of the proper coordination of
benefits.
(D) Implementation.--Notwithstanding any
other provision of law, the Secretary may
implement this paragraph by program instruction
or otherwise.
(8) Required submission of information by or on
behalf of liability insurance (including self-
insurance), no fault insurance, and workers'
compensation laws and plans.--
(A) Requirement.--On and after the first day
of the first calendar quarter beginning after
the date that is 18 months after the date of
the enactment of this paragraph, an applicable
plan shall--
(i) determine whether a claimant
(including an individual whose claim is
unresolved) is entitled to benefits
under the program under this title on
any basis; and
(ii) if the claimant is determined to
be so entitled, submit the information
described in subparagraph (B) with
respect to the claimant to the
Secretary in a form and manner
(including frequency) specified by the
Secretary.
(B) Required information.--The information
described in this subparagraph is--
(i) the identity of the claimant for
which the determination under
subparagraph (A) was made; and
(ii) such other information as the
Secretary shall specify in order to
enable the Secretary to make an
appropriate determination concerning
coordination of benefits, including any
applicable recovery claim.
Not later than 18 months after the date of
enactment of this sentence, the Secretary shall
modify the reporting requirements under this
paragraph so that an applicable plan in
complying with such requirements is permitted
but not required to access or report to the
Secretary beneficiary social security account
numbers or health identification claim numbers,
except that the deadline for such modification
shall be extended by one or more periods
(specified by the Secretary) of up to 1 year
each if the Secretary notifies the committees
of jurisdiction of the House of Representatives
and of the Senate that the prior deadline for
such modification, without such extension,
threatens patient privacy or the integrity of
the secondary payer program under this
subsection. Any such deadline extension notice
shall include information on the progress being
made in implementing such modification and the
anticipated implementation date for such
modification.
(C) Timing.--Information shall be submitted
under subparagraph (A)(ii) within a time
specified by the Secretary after the claim is
resolved through a settlement, judgment, award,
or other payment (regardless of whether or not
there is a determination or admission of
liability).
(D) Claimant.--For purposes of subparagraph
(A), the term ``claimant'' includes--
(i) an individual filing a claim
directly against the applicable plan;
and
(ii) an individual filing a claim
against an individual or entity insured
or covered by the applicable plan.
(E) Enforcement.--
(i) In general.--An applicable plan
that fails to comply with the
requirements under subparagraph (A)
with respect to any claimant may be
subject to a civil money penalty of up
to $1,000 for each day of noncompliance
with respect to each claimant. The
provisions of subsections (e) and (k)
of section 1128A shall apply to a civil
money penalty under the previous
sentence in the same manner as such
provisions apply to a penalty or
proceeding under section 1128A(a). A
civil money penalty under this clause
shall be in addition to any other
penalties prescribed by law and in
addition to any Medicare secondary
payer claim under this title with
respect to an individual.
(ii) Deposit of amounts collected.--
Any amounts collected pursuant to
clause (i) shall be deposited in the
Federal Hospital Insurance Trust Fund.
(F) Applicable plan.--In this paragraph, the
term ``applicable plan'' means the following
laws, plans, or other arrangements, including
the fiduciary or administrator for such law,
plan, or arrangement:
(i) Liability insurance (including
self-insurance).
(ii) No fault insurance.
(iii) Workers' compensation laws or
plans.
(G) Sharing of information.--The Secretary
may share information collected under this
paragraph as necessary for purposes of the
proper coordination of benefits.
(H) Implementation.--Notwithstanding any
other provision of law, the Secretary may
implement this paragraph by program instruction
or otherwise.
(I) Regulations.--Not later than 60 days
after the date of the enactment of this
subparagraph, the Secretary shall publish a
notice in the Federal Register soliciting
proposals, which will be accepted during a 60-
day period, for the specification of practices
for which sanctions will and will not be
imposed under subparagraph (E), including not
imposing sanctions for good faith efforts to
identify a beneficiary pursuant to this
paragraph under an applicable entity
responsible for reporting information. After
considering the proposals so submitted, the
Secretary, in consultation with the Attorney
General, shall publish in the Federal Register,
including a 60-day period for comment, proposed
specified practices for which such sanctions
will and will not be imposed. After considering
any public comments received during such
period, the Secretary shall issue final rules
specifying such practices.
(9) Exception.--
(A) In general.--Clause (ii) of paragraph
(2)(B) and any reporting required by paragraph
(8) shall not apply with respect to any
settlement, judgment, award, or other payment
by an applicable plan arising from liability
insurance (including self-insurance) and from
alleged physical trauma-based incidents
(excluding alleged ingestion, implantation, or
exposure cases) constituting a total payment
obligation to a claimant of not more than the
single threshold amount calculated by the
Secretary under subparagraph (B) for the year
involved.
(B) Annual computation of threshold.--
(i) In general.--Not later than
November 15 before each year, the
Secretary shall calculate and publish a
single threshold amount for
settlements, judgments, awards, or
other payments for obligations arising
from liability insurance (including
self-insurance) and for alleged
physical trauma-based incidents
(excluding alleged ingestion,
implantation, or exposure cases)
subject to this section for that year.
The annual single threshold amount for
a year shall be set such that the
estimated average amount to be credited
to the Medicare trust funds of
collections of conditional payments
from such settlements, judgments,
awards, or other payments arising from
liability insurance (including self-
insurance) and for such alleged
incidents subject to this section shall
equal the estimated cost of collection
incurred by the United States
(including payments made to
contractors) for a conditional payment
arising from liability insurance
(including self-insurance) and for such
alleged incidents subject to this
section for the year. At the time of
calculating, but before publishing, the
single threshold amount for 2014, the
Secretary shall inform, and seek review
of, the Comptroller General of the
United States with regard to such
amount.
(ii) Publication.--The Secretary
shall include, as part of such
publication for a year--
(I) the estimated cost of
collection incurred by the
United States (including
payments made to contractors)
for a conditional payment
arising from liability
insurance (including self-
insurance) and for such alleged
incidents; and
(II) a summary of the
methodology and data used by
the Secretary in computing such
threshold amount and such cost
of collection.
(C) Exclusion of ongoing expenses.--For
purposes of this paragraph and with respect to
a settlement, judgment, award, or other payment
not otherwise addressed in clause (ii) of
paragraph (2)(B) that includes ongoing
responsibility for medical payments (excluding
settlements, judgments, awards, or other
payments made by a workers' compensation law or
plan or no fault insurance), the amount
utilized for calculation of the threshold
described in subparagraph (A) shall include
only the cumulative value of the medical
payments made under this title.
(D) Report to congress.--Not later than
November 15 before each year, the Secretary
shall submit to the Congress a report on the
single threshold amount for settlements,
judgments, awards, or other payments for
conditional payment obligations arising from
liability insurance (including self-insurance)
and alleged incidents described in subparagraph
(A) for that year and on the establishment and
application of similar thresholds for such
payments for conditional payment obligations
arising from worker compensation cases and from
no fault insurance cases subject to this
section for the year. For each such report, the
Secretary shall--
(i) calculate the threshold amount by
using the methodology applicable to
certain liability claims described in
subparagraph (B); and
(ii) include a summary of the
methodology and data used in
calculating each threshold amount and
the amount of estimated savings under
this title achieved by the Secretary
implementing each such threshold.
(c) No payment may be made under part B 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 section 505 of the Federal
Food, Drug, and Cosmetic Act on a proposed
order of the Secretary to withdraw approval of
an application for such drug product under such
section because the Secretary has determined
that the drug is less than effective for all
conditions of use prescribed, recommended, or
suggested in its labeling, and
(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) For purposes of subsection (a)(1)(A), in the case of any
item or service that is required to be provided pursuant to
section 1867 to an individual who is entitled to benefits under
this title, determinations as to whether the item or service is
reasonable and necessary shall be made on the basis of the
information available to the treating physician or practitioner
(including the patient's presenting symptoms or complaint) at
the time the item or service was ordered or furnished by the
physician or practitioner (and not on the patient's principal
diagnosis). When making such determinations with respect to
such an item or service, the Secretary shall not consider the
frequency with which the item or service was provided to the
patient before or after the time of the admission or visit.
(e)(1) No payment may be made under this title 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
section 1128, 1128A, 1156 or 1842(j)(2) from
participation in the program under this title; or
(B) at the medical direction or on the prescription
of a physician during the period when he is excluded
pursuant to section 1128, 1128A, 1156 or 1842(j)(2)
from participation in the program under this title and
when the person furnishing such item or service knew or
had reason to know of the exclusion (after a reasonable
time period after reasonable notice has been furnished
to the person).
(2) Where an individual eligible for benefits under this
title submits a claim for payment for items or services
furnished by an individual or entity excluded from
participation in the programs under this title, pursuant to
section 1128, 1128A, 1156, 1160 (as in effect on September 2,
1982), 1842(j)(2), 1862(d) (as in effect on the date of the
enactment of the Medicare and Medicaid Patient and Program
Protection Act of 1987), or l866, 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 title, 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) 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), under part
A or part B 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) The Secretary shall, in making the determinations under
paragraphs (1) and (9) of subsection (a), 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
title, enter into contracts with quality improvement
organizations pursuant to part B of title XI of this Act.
(h)(1) The Secretary--
(A) shall waive the application of subsection (a)(22)
in cases in which--
(i) there is no method available for the
submission of claims in an electronic form; or
(ii) the entity submitting the claim is a
small provider of services or supplier; and
(B) may waive the application of such subsection in
such unusual cases as the Secretary finds appropriate.
(2) For purposes of this subsection, the term ``small
provider of services or supplier'' means--
(A) a provider of services with fewer than 25 full-
time equivalent employees; or
(B) a physician, practitioner, facility, or supplier
(other than provider of services) with fewer than 10
full-time equivalent employees.
(i) In order to supplement the activities of the Medicare
Payment Advisory Commission under section 1886(e) in assessing
the safety, efficacy, and cost-effectiveness of new and
existing medical procedures, the Secretary may carry out, or
award grants or contracts for, original research and
experimentation of the type described in clause (ii) of section
1886(e)(6)(E) with respect to such a procedure if the Secretary
finds that--
(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.
(j)(1) Any advisory committee appointed to advise the
Secretary on matters relating to the interpretation,
application, or implementation of subsection (a)(1) shall
assure the full participation of a nonvoting member in the
deliberations of the advisory committee, and shall provide such
nonvoting member access to all information and data made
available to voting members of the advisory committee, other
than information that--
(A) is exempt from disclosure pursuant to subsection
(a) of section 552 of title 5, United States Code, by
reason of subsection (b)(4) of such section (relating
to trade secrets); or
(B) the Secretary determines would present a conflict
of interest relating to such nonvoting member.
(2) If an advisory committee described in paragraph (1)
organizes into panels of experts according to types of items or
services considered by the advisory committee, any such panel
of experts may report any recommendation with respect to such
items or services directly to the Secretary without the prior
approval of the advisory committee or an executive committee
thereof.
(k)(1) Subject to paragraph (2), a group health plan (as
defined in subsection (a)(1)(A)(v)) providing supplemental or
secondary coverage to individuals also entitled to services
under this title shall not require a medicare claims
determination under this title for dental benefits specifically
excluded under subsection (a)(12) as a condition of making a
claims determination for such benefits under the group health
plan.
(2) A group health plan may require a claims determination
under this title in cases involving or appearing to involve
inpatient dental hospital services or dental services expressly
covered under this title pursuant to actions taken by the
Secretary.
(l) National and Local Coverage Determination Process.--
(1) Factors and evidence used in making national
coverage determinations.--The Secretary shall make
available to the public the factors considered in
making national coverage determinations of whether an
item or service is reasonable and necessary. The
Secretary shall develop guidance documents to carry out
this paragraph in a manner similar to the development
of guidance documents under section 701(h) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C.
371(h)).
(2) Timeframe for decisions on requests for national
coverage determinations.--In the case of a request for
a national coverage determination that--
(A) does not require a technology assessment
from an outside entity or deliberation from the
Medicare Coverage Advisory Committee, the
decision on the request shall be made not later
than 6 months after the date of the request; or
(B) requires such an assessment or
deliberation and in which a clinical trial is
not requested, the decision on the request
shall be made not later than 9 months after the
date of the request.
(3) Process for public comment in national coverage
determinations.--
(A) Period for proposed decision.--Not later
than the end of the 6-month period (or 9-month
period for requests described in paragraph
(2)(B)) that begins on the date a request for a
national coverage determination is made, the
Secretary shall make a draft of proposed
decision on the request available to the public
through the Internet website of the Centers for
Medicare & Medicaid Services or other
appropriate means.
(B) 30-day period for public comment.--
Beginning on the date the Secretary makes a
draft of the proposed decision available under
subparagraph (A), the Secretary shall provide a
30-day period for public comment on such draft.
(C) 60-day period for final decision.--Not
later than 60 days after the conclusion of the
30-day period referred to under subparagraph
(B), the Secretary shall--
(i) make a final decision on the
request;
(ii) include in such final decision
summaries of the public comments
received and responses to such
comments;
(iii) make available to the public
the clinical evidence and other data
used in making such a decision when the
decision differs from the
recommendations of the Medicare
Coverage Advisory Committee; and
(iv) in the case of a final decision
under clause (i) to grant the request
for the national coverage
determination, the Secretary shall
assign a temporary or permanent code
(whether existing or unclassified) and
implement the coding change.
(4) Consultation with outside experts in certain
national coverage determinations.--With respect to a
request for a national coverage determination for which
there is not a review by the Medicare Coverage Advisory
Committee, the Secretary shall consult with appropriate
outside clinical experts.
(5) Local coverage determination process.--
(A) Plan to promote consistency of coverage
determinations.--The Secretary shall develop a
plan to evaluate new local coverage
determinations to determine which
determinations should be adopted nationally and
to what extent greater consistency can be
achieved among local coverage determinations.
(B) Consultation.--The Secretary shall
require the fiscal intermediaries or carriers
providing services within the same area to
consult on all new local coverage
determinations within the area.
(C) Dissemination of information.--The
Secretary should serve as a center to
disseminate information on local coverage
determinations among fiscal intermediaries and
carriers to reduce duplication of effort.
(D) Local coverage determinations.--The
Secretary shall require each Medicare
administrative contractor that develops a local
coverage determination to make available on the
Internet website of such contractor and on the
Medicare Internet website, at least 45 days
before the effective date of such
determination, the following information:
(i) Such determination in its
entirety.
(ii) Where and when the proposed
determination was first made public.
(iii) Hyperlinks to the proposed
determination and a response to
comments submitted to the contractor
with respect to such proposed
determination.
(iv) A summary of evidence that was
considered by the contractor during the
development of such determination and a
list of the sources of such evidence.
(v) An explanation of the rationale
that supports such determination.
(6) National and local coverage determination
defined.--For purposes of this subsection--
(A) National coverage determination.--The
term ``national coverage determination'' means
a determination by the Secretary with respect
to whether or not a particular item or service
is covered nationally under this title.
(B) Local coverage determination.--The term
``local coverage determination'' has the
meaning given that in section 1869(f)(2)(B).
(m) Coverage of Routine Costs Associated With Certain
Clinical Trials of Category A Devices.--
(1) In general.--In the case of an individual
entitled to benefits under part A, or enrolled under
part B, or both who participates in a category A
clinical trial, the Secretary shall not exclude under
subsection (a)(1) payment for coverage of routine costs
of care (as defined by the Secretary) furnished to such
individual in the trial.
(2) Category a clinical trial.--For purposes of
paragraph (1), a ``category A clinical trial'' means a
trial of a medical device if--
(A) the trial is of an experimental/
investigational (category A) medical device (as
defined in regulations under section 405.201(b)
of title 42, Code of Federal Regulations (as in
effect as of September 1, 2003));
(B) the trial meets criteria established by
the Secretary to ensure that the trial conforms
to appropriate scientific and ethical
standards; and
(C) in the case of a trial initiated before
January 1, 2010, the device involved in the
trial has been determined by the Secretary to
be intended for use in the diagnosis,
monitoring, or treatment of an immediately
life-threatening disease or condition.
(n) Requirement of a Surety Bond for Certain Providers of
Services and Suppliers.--
(1) In general.--The Secretary may require a provider
of services or supplier described in paragraph (2) to
provide the Secretary on a continuing basis with a
surety bond in a form specified by the Secretary in an
amount (not less than $50,000) that the Secretary
determines is commensurate with the volume of the
billing of the provider of services or supplier. The
Secretary may waive the requirement of a bond under the
preceding sentence in the case of a provider of
services or supplier that provides a comparable surety
bond under State law.
(2) Provider of services or supplier described.--A
provider of services or supplier described in this
paragraph is a provider of services or supplier the
Secretary determines appropriate based on the level of
risk involved with respect to the provider of services
or supplier, and consistent with the surety bond
requirements under sections 1834(a)(16)(B) and
1861(o)(7)(C).
(o) Suspension of Payments Pending Investigation of Credible
Allegations of Fraud.--
(1) In general.--The Secretary may suspend payments
to a provider of services or supplier under this title
pending an investigation of a credible allegation of
fraud against the provider of services or supplier,
unless the Secretary determines there is good cause not
to suspend such payments.
(2) Consultation.--The Secretary shall consult with
the Inspector General of the Department of Health and
Human Services in determining whether there is a
credible allegation of fraud against a provider of
services or supplier.
(3) Promulgation of regulations.--The Secretary shall
promulgate regulations to carry out this subsection,
section 1860D-12(b)(7) (including as applied pursuant
to section 1857(f)(3)(D)), and section 1903(i)(2)(C).
(4) Credible allegation of fraud.--In carrying out
this subsection, section 1860D-12(b)(7) (including as
applied pursuant to section 1857(f)(3)(D)), and section
1903(i)(2)(C), a fraud hotline tip (as defined by the
Secretary) without further evidence shall not be
treated as sufficient evidence for a credible
allegation of fraud.
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