P.L. 106–554, Approved December 21, 2000 (114 Stat. 2763)

Consolidated Appropriations—FY 2001

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APPENDIX D—H.R. 5666

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DIVISION B

TITLE I

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SEC. 152.  TREATMENT OF CERTAIN CANCER HOSPITALS.

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(c) [42 U.S.C. 1395ww note]  Payment.—

(1)  Application to cost reporting periods.—Any classification by reason of section 1886(d)(1)(B)(v)(III) of the Social Security Act (as added by subsection (a)) shall apply to 12-month cost reporting periods beginning on or after July 1, 1999.

(2)  Base year.—Notwithstanding the provisions of section 1886(b)(3)(E) of such Act (42 U.S.C. 1395ww(b)(3)(E)) or other provisions to the contrary, the base cost reporting period for purposes of determining the target amount for any hospital classified by reason of section 1886(d)(1)(B)(v)(III) of such Act (as added by subsection (a)) shall be the 12-month cost reporting period beginning on July 1, 1995.

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APPENDIX F—H.R. 5661

TITLE I—MEDICARE BENEFICIARY IMPROVEMENTS

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Subtitle C—Demonstration Projects and Studies

SEC. 122. [42 U.S.C. 1395b-1 note]  CANCER PREVENTION AND TREATMENT DEMONSTRATION FOR ETHNIC AND RACIAL MINORITIES.

(a)  Demonstration.—

(1)  In general.—The Secretary of Health and Human Services (in this section referred to as the “Secretary”) shall conduct demonstration projects (in this section referred to as “demonstration projects”) for the purpose of developing models and evaluating methods that—

(A)  improve the quality of items and services provided to target individuals in order to facilitate reduced disparities in early detection and treatment of cancer;

(B)  improve clinical outcomes, satisfaction, quality of life, and appropriate use of medicare-covered services and referral patterns among those target individuals with cancer;

(C)  eliminate disparities in the rate of preventive cancer screening measures, such as pap smears and prostate cancer screenings, among target individuals; and

(D)  promote collaboration with community-based organizations to ensure cultural competency of health care professionals and linguistic access for persons with limited English proficiency.

(2)  Target individual defined.—In this section, the term “target individual” means an individual of a racial and ethnic minority group, as defined by section 1707 of the Public Health Service Act, who is entitled to benefits under part A, and enrolled under part B, of title XVIII of the Social Security Act.

(b)  Program Design.—

(1)  Initial design.—Not later than 1 year after the date of the enactment of this Act, the Secretary shall evaluate best practices in the private sector, community programs, and academic research of methods that reduce disparities among individuals of racial and ethnic minority groups in the prevention and treatment of cancer and shall design the demonstration projects based on such evaluation.

(2)  Number and project areas.—Not later than 2 years after the date of the enactment of this Act, the Secretary shall implement at least nine demonstration projects, including the following:

(A)  Two projects for each of the four following major racial and ethnic minority groups:

(i)  American Indians, including Alaska Natives, Eskimos, and Aleuts.

(ii)  Asian Americans and Pacific Islanders.

(iii)  Blacks.

(iv)  Hispanics.

The two projects must target different ethnic subpopulations.

(B)  One project within the Pacific Islands.

(C)  At least one project each in a rural area and inner-city area.

(3)  Expansion of projects; implementation of demonstration project results.—If the initial report under subsection (c) contains an evaluation that demonstration projects—

(A)  reduce expenditures under the medicare program under title XVIII of the Social Security Act; or

(B)  do not increase expenditures under the medicare program and reduce racial and ethnic health disparities in the quality of health care services provided to target individuals and increase satisfaction of beneficiaries and health care providers; the Secretary shall continue the existing demonstration projects and may expand the number of demonstration projects.

(c)  Report to Congress.—

(1)  In general.—Not later than 2 years after the date the Secretary implements the initial demonstration projects, and biannually thereafter, the Secretary shall submit to Congress a report regarding the demonstration projects.

(2)  Contents of report.—Each report under paragraph (1) shall include the following:

(A)  A description of the demonstration projects.

(B)  An evaluation of—

(i)  the cost-effectiveness of the demonstration projects;

(ii)  the quality of the health care services provided to target individuals under the demonstration projects; and

(iii)  beneficiary and health care provider satisfaction under the demonstration projects.

(C)  Any other information regarding the demonstration projects that the Secretary determines to be appropriate.

(d)  Waiver Authority.—The Secretary shall waive compliance with the requirements of title XVIII of the Social Security Act to such extent and for such period as the Secretary determines is necessary to conduct demonstration projects.

(e)  Funding.—

(1)  Demonstration projects.—

(A)  State projects.—Except as provided in subparagraph (B), the Secretary shall provide for the transfer from the Federal Hospital Insurance Trust Fund and the Federal Supplementary Insurance Trust Fund under title XVIII of the Social Security Act, in such proportions as the Secretary determines to be appropriate, of such funds as are necessary for the costs of carrying out the demonstration projects.

(B)  Territory projects.—In the case of a demonstration project described in subsection (b)(2)(B), amounts shall be available only as provided in any Federal law making appropriations for the territories.

(2)  Limitation.—In conducting demonstration projects, the Secretary shall ensure that the aggregate payments made by the Secretary do not exceed the sum of the amount which the Secretary would have paid under the program for the prevention and treatment of cancer if the demonstration projects were not implemented, plus $25,000,000.

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SEC. 128. [42 U.S.C. 1395b-1 note]  LIFESTYLE MODIFICATION PROGRAM DEMONSTRATION.

(a)  In General.—The Secretary of Health and Human Services shall carry out the demonstration project known as the Lifestyle Modification Program Demonstration, as described in the Health Care Financing Administration Memorandum of Understanding entered into on November 13, 2000, and as subsequently modified, (in this section referred to as the “project”) in accordance with the following requirements:

(1)  The project shall include no fewer than 1,800 medicare beneficiaries who complete under the project the entire course of treatment under the Lifestyle Modification Program.

(2)  The project shall be conducted over a course of 4 years.

(b)  Study on Cost-Effectiveness.—

(1)  Study.—The Secretary shall conduct a study on the cost-effectiveness of the Lifestyle Modification Program as conducted under the project. In determining whether such Program is cost-effective, the Secretary shall determine (using a control group under a matched paired experimental design) whether expenditures incurred for medicare beneficiaries enrolled under the project exceed expenditures for the control group of medicare beneficiaries with similar health conditions who are not enrolled under the project.

(2)  Reports.—

(A)  Initial report.—Not later than 1 year after the date on which 900 medicare beneficiaries have completed the entire course of treatment under the Lifestyle Modification Program under the project, the Secretary shall submit to Congress an initial report on the study conducted under paragraph (1).

(B)  Final report.—Not later than 1 year after the date on which 1,800 medicare beneficiaries have completed the entire course of treatment under such Program under the project, the Secretary shall submit to Congress a final report on the study conducted under paragraph (1).

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TITLE III—PROVISIONS RELATING TO PART A

Subtitle A—Inpatient Hospital Services

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SEC. 307.  PAYMENT FOR INPATIENT SERVICES OF LONG-TERM CARE.

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(b) [None Assigned]  Implementation of Prospective Payment System.—

(1)  Modification of requirement.—In developing the prospective payment system for payment for inpatient hospital services provided in long-term care hospitals described in section 1886(d)(1)(B)(iv) of the Social Security Act (42 U.S.C. 1395ww(d)(1)(B)(iv)) under the medicare program under title XVIII of such Act required under section 123 of BBRA[216], the Secretary of Health and Human Services shall examine the feasibility and the impact of basing payment under such a system on the use of existing (or refined) hospital diagnosis-related groups (DRGs) that have been modified to account for different resource use of long-term care hospital patients as well as the use of the most recently available hospital discharge data. The Secretary shall examine and may provide for appropriate adjustments to the long-term hospital payment system, including adjustments to DRG weights, area wage adjustments, geographic reclassification, outliers, updates, and a disproportionate share adjustment consistent with section 1886(d)(5)(F) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(F)).

(2)  Default implementation of system based on existing drg methodology.—If the Secretary is unable to implement the prospective payment system under section 123 of the BBRA by October 1, 2002, the Secretary shall implement a prospective payment system for such hospitals that bases payment under such a system using existing hospital diagnosis- related groups (DRGs), modified where feasible to account for resource use of long-term care hospital patients using the most recently available hospital discharge data for such services furnished on or after that date.

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TITLE IV—PROVISIONS RELATING TO PART B

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Subtitle C—Other Services

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SEC. 422. UPDATE IN RENAL DIALYSIS COMPOSITE RATE.

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(2) [42 U.S.C. 1395rr note]  Prohibition on exceptions.—

(A)  In general.—Subject to subparagraphs (B), (C) and (D), the Secretary of Health and Human Services may not provide for an exception under section 1881(b)(7) of the Social Security Act (42 U.S.C. 1395rr(b)(7)) on or after December 31, 2000.

(B)  Deadline for new applications.—Subject to subparagraph (D), in the case of a facility that during 2000 did not file for an exception rate under such section, the facility may submit an application for an exception rate by not later than July 1, 2001.

(C)  Protection of approved exception rates.—Any exception rate under such section in effect on December 31, 2000 (or, in the case of an application under subparagraph (B), as approved under such application) shall continue in effect so long as such rate is greater than the composite rate as updated by the amendment made by paragraph (1).

(D)  Inapplicability to pediatric facilities.—Subparagraphs (A) and (B) shall not apply, as of October 1, 2002, to pediatric facilities that do not have an exception rate described in subparagraph (C) in effect on such date. For purposes of this subparagraph, the term “pediatric facility” means a renal facility at least 50 percent of whose patients are individuals under 18 years of age.

(b) [None Assigned]  Development of ESRD Market Basket.—

(1)  Development.—The Secretary of Health and Human Services shall collect data and develop an ESRD market basket whereby the Secretary can estimate, before the beginning of a year, the percentage by which the costs for the year of the mix of labor and nonlabor goods and services included in the ESRD composite rate under section 1881(b)(7) of the Social Security Act (42 U.S.C. 1395rr(b)(7)) will exceed the costs of such mix of goods and services for the preceding year. In developing such index, the Secretary may take into account measures of changes in—

(A)  technology used in furnishing dialysis services;

(B)  the manner or method of furnishing dialysis services; and

(C)  the amounts by which the payments under such section for all services billed by a facility for a year exceed the aggregate allowable audited costs of such services for such facility for such year.

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(c) [None Assigned]  Inclusion of Additional Services in Composite Rate.—

(1)  Development.—The Secretary of Health and Human Services shall develop a system which includes, to the maximum extent feasible, in the composite rate used for payment under section 1881(b)(7) of the Social Security Act (42 U.S.C. 1395rr(b)(7)), payment for clinical diagnostic laboratory tests and drugs (including drugs paid under section 1881(b)(11)(B) of such Act (42 U.S.C. 1395rr(b)(11)(B)) that are routinely used in furnishing dialysis services to medicare beneficiaries but which are currently separately billable by renal dialysis facilities.

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TITLE V—PROVISIONS RELATING TO PART A AND B

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Subtitle E—Other Provisions

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SEC. 542. [42 U.S.C. 1395w-4 note]  TREATMENT OF CERTAIN PHYSICIAN PATHOLOGY SERVICES UNDER MEDICARE.

(a)  In General.—When an independent laboratory furnishes the technical component of a physician pathology service to a fee-for-service medicare beneficiary who is an inpatient or outpatient of a covered hospital, the Secretary of Health and Human Services shall treat such component as a service for which payment shall be made to the laboratory under section 1848 of the Social Security Act (42 U.S.C. 1395w-4) and not as an inpatient hospital service for which payment is made to the hospital under section 1886(d) of such Act (42 U.S.C. 1395ww(d)) or as an outpatient hospital service for which payment is made to the hospital under section 1833(t) of such Act (42 U.S.C. 1395l(t)).

(b)  Definitions.—For purposes of this section:

(1)  Covered hospital.—The term “covered hospital” means, with respect to an inpatient or an outpatient, a hospital that had an arrangement with an independent laboratory that was in effect as of July 22, 1999, under which a laboratory furnished the technical component of physician pathology services to fee-for-service medicare beneficiaries who were hospital inpatients or outpatients, respectively, and submitted claims for payment for such component to a medicare carrier (that has a contract with the Secretary under section 1842 of the Social Security Act, 42 U.S.C. 1395u) and not to such hospital.

(2)  Fee-for-service medicare beneficiary.—The term “fee-for-service medicare beneficiary” means an individual who—

(A)  is entitled to benefits under part A, or enrolled under part B, or both, of such title; and

(B)  is not enrolled in any of the following:

(i)  A Medicare+Choice plan under part C of such title.

(ii)  A plan offered by an eligible organization under section 1876 of such Act (42 U.S.C. 1395mm).

(iii)  A program of all-inclusive care for the elderly (PACE) under section 1894 of such Act (42 U.S.C. 1395eee).

(iv)  A social health maintenance organization (SHMO) demonstration project established under section 4018(b) of the Omnibus Budget Reconciliation Act of 1987 (Public Law 100-203).

(c)  Effective Date.—This section shall apply to services furnished during the 2-year period beginning on January 1, 2001, and for services furnished during 2005, 2006, 2007, 2008, 2009, 2010, and 2011, and the first six months of 2012[217].[218]

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TITLE VII—MEDICAID

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SEC. 701.  DSH PAYMENTS.

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(d) [42 U.S.C. 1396r-4 note]  Assistance for Certain Public Hospitals.—

(1)  In general.—Beginning with fiscal year 2002, notwithstanding section 1923(f) of the Social Security Act (42 U.S.C. 1396r-4(f)) and subject to paragraph (3), with respect to a State, payment adjustments made under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.) to a hospital described in paragraph (2) shall be made without regard to the DSH allotment limitation for the State determined under section 1923(f) of that Act (42 U.S.C. 1396r-4(f)).

(2)  Hospital described.—A hospital is described in this paragraph if the hospital—

(A)  is owned or operated by a State (as defined for purposes of title XIX of the Social Security Act), or by an instrumentality or a unit of government within a State (as so defined);

(B)  as of October 1, 2000—

(i)  is in existence and operating as a hospital described in subparagraph (A); and

(ii)  is not receiving disproportionate share hospital payments from the State in which it is located under title XIX of such Act; and

(C)  has a low-income utilization rate (as defined in section 1923(b)(3) of the Social Security Act (42 U.S.C. 1396r-4(b)(3))) in excess of 65 percent.

(3)  Limitation on expenditures.—

(A)  In general.—With respect to any fiscal year, the aggregate amount of Federal financial participation that may be provided for payment adjustments described in paragraph (1) for that fiscal year for all States may not exceed the amount described in subparagraph (B) for the fiscal year.

(B)  Amount described.—The amount described in this subparagraph for a fiscal year is as follows:

(i)  For fiscal year 2002, $15,000,000.

(ii)  For fiscal year 2003, $176,000,000.

(iii)  For fiscal year 2004, $269,000,000.

(iv)  For fiscal year 2005, $330,000,000.

(v)  For fiscal year 2006 and each fiscal year thereafter, $375,000,000.

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[Internal References.—SSAct Title XVIII and §§1848, 1886, and 1923 headings and have footnotes referring to P.L. 106-554.]



[216]  See the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999, P.L. 106-113, Title VII, §123 (this Volume).

[217]  P.L. 112-78, §305, struck out “and 2011” and inserted “2011, and the first two months of 2012.” effective December 23, 2011.

[218]  P.L. 112-96, §3006, struck out “and the first two months of 2012” and inserted “2011, and the first six months of 2012.” effective December 23, 2011.