SEC. 15000. Short Title.
This division may be cited as the “Increasing Choice, Access, and Quality in Health Care for Americans Act”.
Division C — Increasing Choice, Access, and Quality in Health Care for Americans
DIVISION C Increasing Choice, Access, and Quality in Health Care for Americans
TITLE XV Provisions Relating to Medicare Part A
SEC. 15001. Development of Medicare Hcpcs Version of Ms–drg Codes for Similar Hospital Services.
Section 1886 of the Social Security Act (42 U.S.C. 1395ww) is amended by adding at the end the following new subsection:
“(t) Relating Similar Inpatient and Outpatient Hospital Services.—
“(1) Development of hcpcs version of ms–drg codes.—Not later than January 1, 2018, the Secretary shall develop HCPCS versions for MS–DRGs that are similar to the ICD–10–PCS for such MS–DRGs such that, to the extent possible, the MS–DRG assignment shall be similar for a claim coded with the HCPCS version as an identical claim coded with a ICD–10–PCS code.
“(2) Coverage of surgical ms–drgs.—In carrying out paragraph (1), the Secretary shall develop HCPCS versions of MS–DRG codes for not fewer than 10 surgical MS–DRGs.
“(3) Publication and dissemination of the hcpcs versions of ms–drgs.—
“(A) In general.—The Secretary shall develop a HCPCS MS–DRG definitions manual and software that is similar to the definitions manual and software for ICD–10–PCS codes for such MS–DRGs. The Secretary shall post the HCPCS MS–DRG definitions manual and software on the Internet website of the Centers for Medicare & Medicaid Services. The HCPCS MS–DRG definitions manual and software shall be in the public domain and available for use and redistribution without charge.
“(B) Use of previous analysis done by medpac.—In developing the HCPCS MS–DRG definitions manual and software under subparagraph (A), the Secretary shall consult with the Medicare Payment Advisory Commission and shall consider the analysis done by such Commission in translating outpatient surgical claims into inpatient surgical MS–DRGs in preparing chapter 7 (relating to hospital short-stay policy issues) of its ‘Medicare and the Health Care Delivery System’ report submitted to Congress in June 2015.
“(4) Definition and reference.—In this subsection:
“(A) HCPCS.—The term ‘HCPCS’ means, with respect to hospital items and services, the code under the Healthcare Common Procedure Coding System (HCPCS) (or a successor code) for such items and services.
“(B) ICD–10–PCS.—The term ‘ICD–10–PCS’ means the International Classification of Diseases, 10th Revision, Procedure Coding System, and includes any subsequent revision of such International Classification of Diseases, Procedure Coding System.”
SEC. 15002. Establishing Beneficiary Equity in the Medicare Hospital Readmission Program.
Transitional Adjustment for Dual Eligible Population.— Section 1886(q)(3) of the Social Security Act (42 U.S.C. 1395ww(q)(3)) is amended—
in subparagraph (A), by inserting “ subject to subparagraph (D),” after “ purposes of paragraph (1),”; and
by adding at the end the following new subparagraph:
“(D) Transitional adjustment for dual eligibles.—
“(i) In general.—In determining a hospital’s adjustment factor under this paragraph for purposes of making payments for discharges occurring during and after fiscal year 2019, and before the application of clause (i) of subparagraph (E), the Secretary shall assign hospitals to groups (as defined by the Secretary under clause (ii)) and apply the applicable provisions of this subsection using a methodology in a manner that allows for separate comparison of hospitals within each such group, as determined by the Secretary.
“(ii) Defining groups.—For purposes of this subparagraph, the Secretary shall define groups of hospitals, based on their overall proportion, of the inpatients who are entitled to, or enrolled for, benefits under part A, and who are full-benefit dual eligible individuals (as defined in section 1935(c)(6)). In defining groups, the Secretary shall consult the Medicare Payment Advisory Commission and may consider the analysis done by such Commission in preparing the portion of its report submitted to Congress in June 2013 relating to readmissions.
“(iii) Minimizing reporting burden on hospitals.—In carrying out this subparagraph, the Secretary shall not impose any additional reporting requirements on hospitals.
“(iv) Budget neutral design methodology.—The Secretary shall design the methodology to implement this subparagraph so that the estimated total amount of reductions in payments under this subsection equals the estimated total amount of reductions in payments that would otherwise occur under this subsection if this subparagraph did not apply.”
Changes in Risk Adjustment.— Section 1886(q)(3) of the Social Security Act (42 U.S.C. 1395ww(q)(3)), as amended by subsection (a), is further amended by adding at the end the following new subparagraph:
“(E) Changes in risk adjustment.—
“(i) Consideration of recommendations in impact reports.—The Secretary may take into account the studies conducted and the recommendations made by the Secretary under section 2(d)(1) of the IMPACT Act of 2014 (Public Law 113–185; 42 U.S.C. 1395lll note) with respect to the application under this subsection of risk adjustment methodologies. Nothing in this clause shall be construed as precluding consideration of the use of groupings of hospitals.
“(ii) Consideration of exclusion of patient cases based on v or other appropriate codes.—In promulgating regulations to carry out this subsection with respect to discharges occurring after fiscal year 2018, the Secretary may consider the use of V or other ICD-related codes for removal of a readmission. The Secretary may consider modifying measures under this subsection to incorporate V or other ICD-related codes at the same time as other changes are being made under this subparagraph.
“(iii) Removal of certain readmissions.—In promulgating regulations to carry out this subsection, with respect to discharges occurring after fiscal year 2018, the Secretary may consider removal as a readmission of an admission that is classified within one or more of the following: transplants, end-stage renal disease, burns, trauma, psychosis, or substance abuse. The Secretary may consider modifying measures under this subsection to remove readmissions at the same time as other changes are being made under this subparagraph.”
MedPAC Study on Readmissions Program.— The Medicare Payment Advisory Commission shall conduct a study to review overall hospital readmissions described in section 1886(q)(5)(E) of the Social Security Act (42 U.S.C. 1395ww(q)(5)(E)) and whether such readmissions are related to any changes in outpatient and emergency services furnished. The Commission shall submit to Congress a report on such study in its report to Congress in June 2018.
SEC. 15003. Five-Year Extension of the Rural Community Hospital Demonstration Program.
Extension.— Section 410A of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 42 U.S.C. 1395ww note) is amended—
in subsection (a)(5), by striking “ 5-year extension period” and inserting “ 10-year extension period”; and
in subsection (g)—
in the subsection heading, by striking “ Five-Year” and inserting “ Ten-Year”;
in paragraph (1), by striking “ additional 5-year” and inserting “ additional 10-year”;
by striking “ 5-year extension period” and inserting “ 10-year extension period” each place it appears;
in paragraph (4)(B)—
in the matter preceding clause (i), by inserting “ each 5-year period in” after “ hospital during”; and
in clause (i), by inserting “ each applicable 5-year period in” after “ the first day of”; and
by adding at the end the following new paragraphs:
“(5) Other hospitals in demonstration program.—During the second 5 years of the 10-year extension period, the Secretary shall apply the provisions of paragraph (4) to rural community hospitals that are not described in paragraph (4) but are participating in the demonstration program under this section as of December 30, 2014, in a similar manner as such provisions apply to rural community hospitals described in paragraph (4).
“(6) Expansion of demonstration program to rural areas in any state.—
“(A) In general.—The Secretary shall, notwithstanding subsection (a)(2) or paragraph (2) of this subsection, not later than 120 days after the date of the enactment of this paragraph, issue a solicitation for applications to select up to the maximum number of additional rural community hospitals located in any State to participate in the demonstration program under this section for the second 5 years of the 10-year extension period without exceeding the limitation under paragraph (3) of this subsection.
“(B) Priority.—In determining which rural community hospitals that submitted an application pursuant to the solicitation under subparagraph (A) to select for participation in the demonstration program, the Secretary—
“(i) shall give priority to rural community hospitals located in one of the 20 States with the lowest population densities (as determined by the Secretary using the 2015 Statistical Abstract of the United States); and
“(ii) may consider—
“(I) closures of hospitals located in rural areas in the State in which the rural community hospital is located during the 5-year period immediately preceding the date of the enactment of this paragraph; and
“(II) the population density of the State in which the rural community hospital is located.”
Change in Timing for Report.— Subsection (e) of such section 410A is amended—
by striking “ Not later than 6 months after the completion of the demonstration program under this section” and inserting “ Not later than August 1, 2018”; and
by striking “ such program” and inserting “ the demonstration program under this section”.
SEC. 15004. Regulatory Relief for Ltchs.
Technical Change to the Medicare Long-Term Care Hospital Moratorium Exception.—
In general.— Section 114(d)(7) of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww note), as amended by sections 3106(b) and 10312(b) of Public Law 111–148, section 1206(b)(2) of the Pathway for SGR Reform Act of 2013 (division B of Public Law 113–67), and section 112 of the Protecting Access to Medicare Act of 2014 (Public Law 113–93), is amended by striking “ The moratorium under paragraph (1)(A)” and inserting “ Any moratorium under paragraph (1)”.
Effective date.— The amendment made by paragraph (1) shall take effect as if included in the enactment of section 112 of the Protecting Access to Medicare Act of 2014.
Modification to Medicare Long-Term Care Hospital High Cost Outlier Payments.— Section 1886(m) of the Social Security Act (42 U.S.C. 1395ww(m)) is amended by adding at the end the following new paragraph:
“(7) Treatment of high cost outlier payments.—
“(A) Adjustment to the standard federal payment rate for estimated high cost outlier payments.—Under the system described in paragraph (1), for fiscal years beginning on or after October 1, 2017, the Secretary shall reduce the standard Federal payment rate as if the estimated aggregate amount of high cost outlier payments for standard Federal payment rate discharges for each such fiscal year would be equal to 8 percent of estimated aggregate payments for standard Federal payment rate discharges for each such fiscal year.
“(B) Limitation on high cost outlier payment amounts.—Notwithstanding subparagraph (A), the Secretary shall set the fixed loss amount for high cost outlier payments such that the estimated aggregate amount of high cost outlier payments made for standard Federal payment rate discharges for fiscal years beginning on or after October 1, 2017, shall be equal to 99.6875 percent of 8 percent of estimated aggregate payments for standard Federal payment rate discharges for each such fiscal year.
“(C) Waiver of budget neutrality.—Any reduction in payments resulting from the application of subparagraph (B) shall not be taken into account in applying any budget neutrality provision under such system.
“(D) No effect on site neutral high cost outlier payment rate.—This paragraph shall not apply with respect to the computation of the applicable site neutral payment rate under paragraph (6).”
SEC. 15005. Savings from Ipps Macra Pay-For Through Not Applying Documentation and Coding Adjustments.
Section 7(b)(1)(B) of the TMA, Abstinence Education, and QI Programs Extension Act of 2007 (Public Law 110–90), as amended by section 631(b) of the American Taxpayer Relief Act of 2012 (Public Law 112–240) and section 414(1)(B)(iii) of the Medicare Access and CHIP Reauthorization Act of 2015 (Public Law 114–10), is amended in clause (iii) by striking “ an increase of 0.5 percentage points for discharges occurring during each of fiscal years 2018 through 2023” and inserting “ an increase of 0.4588 percentage points for discharges occurring during fiscal year 2018 and 0.5 percentage points for discharges occurring during each of fiscal years 2019 through 2023”.
SEC. 15006. Extension of Certain Ltch Medicare Payment Rules.
25–Percent Patient Threshold Payment Adjustment.— Section 114(c)(1)(A) of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww note), as amended by section 4302(a) of division B of the American Recovery and Reinvestment Act (Public Law 111–5), sections 3106(a) and 10312(a) of Public Law 111–148, and section 1206(b)(1)(B) of the Pathway for SGR Reform Act of 2013 (division B of Public Law 113–67), is amended by striking “ for a 9-year period” and inserting “ through June 30, 2016, and for discharges occurring on or after October 1, 2016, and before October 1, 2017”.
Payment for Hospitals-Within-Hospitals.— Section 114(c)(2) of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww note), as amended by section 4302(a) of division B of the American Recovery and Reinvestment Act (Public Law 111–5), sections 3106(a) and 10312(a) of Public Law 111–148, and section 1206(b)(1)(A) of the Pathway for SGR Reform Act of 2013 (division B of Public Law 113–67), is amended—
in subparagraph (A), by inserting “ or any similar provision,” after “ Regulations,”;
in subparagraph (B)—
in clause (i), by inserting “ or any similar provision,” after “ Regulations,”; and
in clause (ii), by inserting “ , or any similar provision,” after “ Regulations”; and
in subparagraph (C), by striking “ for a 9-year period” and inserting “ through June 30, 2016, and for discharges occurring on or after October 1, 2016, and before October 1, 2017”.
SEC. 15007. Application of Rules on the Calculation of Hospital Length of Stay to All Ltchs.
In General.— Section 1206(a)(3) of the Pathway for SGR Reform Act of 2013 (division B of Public Law 113–67; 42 U.S.C. 1395ww note) is amended—
by striking subparagraph (B);
by striking “ site neutral basis.—” and all that follows through “ For discharges occurring” and inserting “ site neutral basis.—For discharges occurring”;
by striking “ subject to subparagraph (B),”; and
by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively, and moving each of such subparagraphs (as so redesignated) 2 ems to the left.
Effective Date.— The amendments made by subsection (a) shall be effective as if included in the enactment of section 1206(a)(3) of the Pathway for SGR Reform Act of 2013 (division B of Public Law 113–67; 42 U.S.C. 1395ww note).
SEC. 15008. Change in Medicare Classification for Certain Hospitals.
In General.— Subsection (d)(1)(B)(iv) of section 1886 of the Social Security Act (42 U.S.C. 1395ww) is amended—
in subclause (I), by striking “ or” at the end;
in subclause (II)—
by striking “ , or” at the end and inserting a semicolon;
by redesignating such subclause as clause (vi) and by moving it to immediately follow clause (v); and
in clause (v), by striking the semicolon at the end and inserting “ , or”; and
by striking “ (iv)(I) a hospital” and inserting “ (iv) a hospital”.
Conforming Payment References.— The second sentence of subsection (d)(1)(B) of such section is amended—
by inserting “ (as in effect as of such date)” after “ clause (iv)”; and
by inserting “ (or, in the case of a hospital described in clause (iv)(II), as so in effect, shall be classified under clause (vi) on and after the effective date of such clause (vi) and for cost reporting periods beginning on or after January 1, 2015, shall not be subject to subsection (m) as of the date of such classification)” after “ so classified”.
Application.—
In general.— For cost reporting periods beginning on or after January 1, 2015, in the case of an applicable hospital (as defined in paragraph (3)), the following shall apply:
Payment for inpatient operating costs shall be made on a reasonable cost basis in the manner provided in section 412.526(c)(3) of title 42, Code of Federal Regulations (as in effect on January 1, 2015) and in any subsequent modifications.
Payment for capital costs shall be made in the manner provided by section 412.526(c)(4) of title 42, Code of Federal Regulations (as in effect on such date).
Claims for payment for Medicare beneficiaries who are discharged on or after January 1, 2017, shall be processed as claims which are paid on a reasonable cost basis as described in section 412.526(c) of title 42, Code of Federal Regulations (as in effect on such date).
Applicable hospital defined.— In this subsection, the term “applicable hospital” means a hospital that is classified under clause (iv)(II) of section 1886(d)(1)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(1)(B)) on the day before the date of the enactment of this Act and which is classified under clause (vi) of such section, as redesignated and moved by subsection (a), on or after such date of enactment.
Conforming Technical Amendments.—
Section 1899B(a)(2)(A)(iv) of the Social Security Act (42 U.S.C. 1395lll(a)(2)(A)(iv)) is amended by striking “ 1886(d)(1)(B)(iv)(II)” and inserting “ 1886(d)(1)(B)(vi)”.
Section 1886(m)(5)(F) of such Act (42 U.S.C. 1395ww(m)(5)(F)) is amended in each of clauses (i) and (ii) by striking “ (d)(1)(B)(iv)(II)” and inserting “ (d)(1)(B)(vi)”.
SEC. 15009. Temporary Exception to the Application of the Medicare Ltch Site Neutral Provisions for Certain Spinal Cord Specialty Hospitals.
in subparagraph (A)(i), by striking “ and (E)” and inserting “ , (E), and (F)”; and
by adding at the end the following new subparagraph:
“(F) Temporary exception for certain spinal cord specialty hospitals.—For discharges in cost reporting periods beginning during fiscal years 2018 and 2019, subparagraph (A)(i) shall not apply (and payment shall be made to a long-term care hospital without regard to this paragraph) if such discharge is from a long-term care hospital that meets each of the following requirements:
“(i) Not-for-profit.—The long-term care hospital was a not-for-profit long-term care hospital on June 1, 2014, as determined by cost report data.
“(ii) Primarily providing treatment for catastrophic spinal cord or acquired brain injuries or other paralyzing neuromuscular conditions.—Of the discharges in calendar year 2013 from the long-term care hospital for which payment was made under this section, at least 50 percent were classified under MS–LTCH–DRGs 28, 29, 52, 57, 551, 573, and 963.
“(iii) Significant out-of-state admissions.—
“(I) In general.—The long-term care hospital discharged inpatients (including both individuals entitled to, or enrolled for, benefits under this title and individuals not so entitled or enrolled) during fiscal year 2014 who had been admitted from at least 20 of the 50 States, determined by the States of residency of such inpatients and based on such data submitted by the hospital to the Secretary as the Secretary may require.
“(II) Implementation.—Notwithstanding any other provision of law, the Secretary may implement subclause (I) by program instruction or otherwise.
“(III) Non-application of paperwork reduction act.—Chapter 35 of title 44, United States Code, shall not apply to data collected under this clause.”
Study and Report on the Status and Viability of Certain Spinal Cord Specialty Long-Term Care Hospitals.—
Study.— The Comptroller General of the United States shall conduct a study on long-term care hospitals described in section 1886(m)(6)(F) of the Social Security Act, as added by subsection (a). Such report shall include an analysis of the following:
The impact on such hospitals of the classification and facility licensure by State agencies of such hospitals.
The Medicare payment rates for such hospitals.
Data on the number and health care needs of Medicare beneficiaries who have been diagnosed with catastrophic spinal cord or acquired brain injuries or other paralyzing neuromuscular conditions (as described within the discharge classifications specified in clause (ii) of such section) who are receiving services from such hospitals.
Report.— Not later than October 1, 2018, the Comptroller General shall submit to Congress a report on the study conducted under paragraph (1), including recommendations for such legislation and administrative action as the Comptroller General determines appropriate.
SEC. 15010. Temporary Extension to the Application of the Medicare Ltch Site Neutral Provisions for Certain Discharges with Severe Wounds.
In General.— Section 1886(m)(6) of the Social Security Act (42 U.S.C. 1395ww(m)(6)), as amended by section 15009, is further amended—
in subparagraph (A)(i) by striking “ and (F)” and inserting “ (F), and (G)”;
in subparagraph (E)(i)(I)(aa), by striking “ the amendment made” and all that follows before the semicolon and inserting “ the last sentence of subsection (d)(1)(B)”; and
by adding at the end the following new subparagraph:
“(G) Additional temporary exception for certain severe wound discharges from certain long-term care hospitals.—
“(i) In general.—For a discharge occurring in a cost reporting period beginning during fiscal year 2018, subparagraph (A)(i) shall not apply (and payment shall be made to a long-term care hospital without regard to this paragraph) if such discharge—
“(I) is from a long-term care hospital identified by the last sentence of subsection (d)(1)(B);
“(II) is classified under MS–LTCH–DRG 602, 603, 539, or 540; and
“(III) is with respect to an individual treated by a long-term care hospital for a severe wound.
“(ii) Severe wound defined.—In this subparagraph, the term ‘severe wound’ means a wound which is a stage 3 wound, stage 4 wound, unstageable wound, non-healing surgical wound, or fistula as identified in the claim from the long-term care hospital.
“(iii) Wound defined.—In this subparagraph, the term ‘wound’ means an injury involving division of tissue or rupture of the integument or mucous membrane with exposure to the external environment.”
Study and Report to Congress.—
Study.— The Comptroller General of the United States shall, in consultation with relevant stakeholders, conduct a study on the treatment needs of individuals entitled to benefits under part A of title XVIII of the Social Security Act or enrolled under part B of such title who require specialized wound care, and the cost, for such individuals and the Medicare program under such title, of treating severe wounds in rural and urban areas. Such study shall include an assessment of—
access of such individuals to appropriate levels of care for such cases;
the potential impact that section 1886(m)(6)(A)(i) of such Act (42 U.S.C. 1395ww(m)(6)(A)(i)) will have on the access, quality, and cost of care for such individuals; and
how to appropriately pay for such care under the Medicare program under such title.
Report.— Not later than October 1, 2020, the Comptroller General shall submit to Congress a report on the study conducted under paragraph (1), including recommendations for such legislation and administrative action as the Comptroller General determines appropriate.
TITLE XVI Provisions Relating to Medicare Part B
SEC. 16001. Continuing Medicare Payment under Hopd Prospective Payment System for Services Furnished by Mid-Build Off-Campus Outpatient Departments of Providers.
in subparagraph (B)—
in clause (i), by striking “ clause (ii)” and inserting “ the subsequent provisions of this subparagraph”; and
by adding at the end the following new clauses:
“(iii) Deemed treatment for 2017.—For purposes of applying clause (ii) with respect to applicable items and services furnished during 2017, a department of a provider (as so defined) not described in such clause is deemed to be billing under this subsection with respect to covered OPD services furnished prior to November 2, 2015, if the Secretary received from the provider prior to December 2, 2015, an attestation (pursuant to section 413.65(b)(3) of title 42 of the Code of Federal Regulations) that such department was a department of a provider (as so defined).
“(iv) Alternative exception beginning with 2018.—For purposes of paragraph (1)(B)(v) and this paragraph with respect to applicable items and services furnished during 2018 or a subsequent year, the term ‘off-campus outpatient department of a provider’ also shall not include a department of a provider (as so defined) that is not described in clause (ii) if—
“(I) the Secretary receives from the provider an attestation (pursuant to such section 413.65(b)(3)) not later than December 31, 2016 (or, if later, 60 days after the date of the enactment of this clause), that such department met the requirements of a department of a provider specified in section 413.65 of title 42 of the Code of Federal Regulations;
“(II) the provider includes such department as part of the provider on its enrollment form in accordance with the enrollment process under section 1866(j); and
“(III) the department met the mid-build requirement of clause (v) and the Secretary receives, not later than 60 days after the date of the enactment of this clause, from the chief executive officer or chief operating officer of the provider a written certification that the department met such requirement.
“(v) Mid-build requirement described.—The mid-build requirement of this clause is, with respect to a department of a provider, that before November 2, 2015, the provider had a binding written agreement with an outside unrelated party for the actual construction of such department.
“(vii) Audit.—Not later than December 31, 2018, the Secretary shall audit the compliance with requirements of clause (iv) with respect to each department of a provider to which such clause applies. If the Secretary finds as a result of an audit under this clause that the applicable requirements were not met with respect to such department, the department shall not be excluded from the term ‘off-campus outpatient department of a provider’ under such clause.
“(viii) Implementation.—For purposes of implementing clauses (iii) through (vii):
“(I) Notwithstanding any other provision of law, the Secretary may implement such clauses by program instruction or otherwise.
“(II) Subchapter I of chapter 35 of title 44, United States Code, shall not apply.
“(III) For purposes of carrying out this subparagraph with respect to clauses (iii) and (iv) (and clause (vii) insofar as it relates to clause (iv)), $10,000,000 shall be available from the Federal Supplementary Medical Insurance Trust Fund under section 1841, to remain available until December 31, 2018.”
; and
in subparagraph (E), by adding at the end the following new clause:
“(iv) The determination of an audit under subparagraph (B)(vii).”
Effective Date.— The amendments made by this section shall be effective as if included in the enactment of section 603 of the Bipartisan Budget Act of 2015 (Public Law 114–74).
SEC. 16002. Treatment of Cancer Hospitals in Off-Campus Outpatient Department of a Provider Policy.
In General.— Section 1833(t)(21)(B) of the Social Security Act (42 U.S.C. 1395l(t)(21)(B)), as amended by section 16001(a), is amended—
by inserting after clause (v) the following new clause:
“(vi) Exclusion for certain cancer hospitals.—For purposes of paragraph (1)(B)(v) and this paragraph with respect to applicable items and services furnished during 2017 or a subsequent year, the term ‘off-campus outpatient department of a provider’ also shall not include a department of a provider (as so defined) that is not described in clause (ii) if the provider is a hospital described in section 1886(d)(1)(B)(v) and—
“(I) in the case of a department that met the requirements of section 413.65 of title 42 of the Code of Federal Regulations after November 1, 2015, and before the date of the enactment of this clause, the Secretary receives from the provider an attestation that such department met such requirements not later than 60 days after such date of enactment; or
“(II) in the case of a department that meets such requirements after such date of enactment, the Secretary receives from the provider an attestation that such department meets such requirements not later than 60 days after the date such requirements are first met with respect to such department.”
in clause (vii), by inserting after the first sentence the following: “ Not later than 2 years after the date the Secretary receives an attestation under clause (vi) relating to compliance of a department of a provider with requirements referred to in such clause, the Secretary shall audit the compliance with such requirements with respect to the department.”; and
in clause (viii)(III), by adding at the end the following: “ For purposes of carrying out this subparagraph with respect to clause (vi) (and clause (vii) insofar as it relates to such clause), $2,000,000 shall be available from the Federal Supplementary Medical Insurance Trust Fund under section 1841, to remain available until expended.”.
Offsetting Savings.— Section 1833(t)(18) of the Social Security Act (42 U.S.C. 1395l(t)(18)) is amended—
in subparagraph (B), by inserting “ , subject to subparagraph (C),” after “ shall”; and
by adding at the end the following new subparagraph:
“(C) Target pcr adjustment.—In applying section 419.43(i) of title 42 of the Code of Federal Regulations to implement the appropriate adjustment under this paragraph for services furnished on or after January 1, 2018, the Secretary shall use a target PCR that is 1.0 percentage points less than the target PCR that would otherwise apply. In addition to the percentage point reduction under the previous sentence, the Secretary may consider making an additional percentage point reduction to such target PCR that takes into account payment rates for applicable items and services described in paragraph (21)(C) other than for services furnished by hospitals described in section 1886(d)(1)(B)(v). In making any budget neutrality adjustments under this subsection for 2018 or a subsequent year, the Secretary shall not take into account the reduced expenditures that result from the application of this subparagraph.”
Effective Date.— The amendments made by this section shall be effective as if included in the enactment of section 603 of the Bipartisan Budget Act of 2015 (Public Law 114–74).
SEC. 16003. Treatment of Eligible Professionals in Ambulatory Surgical Centers for Meaningful Use and Mips.
Section 1848(a)(7)(D) of the Social Security Act (42 U.S.C. 1395w–4(a)(7)(D)) is amended—
by striking “ hospital-based eligible professionals” and all that follows through “ No payment” and inserting the following:
“(i) Hospital-based.—No payment”
; and
by adding at the end the following new clauses:
“(ii) Ambulatory surgical center-based.—Subject to clause (iv), no payment adjustment may be made under subparagraph (A) for 2017 and 2018 in the case of an eligible professional with respect to whom substantially all of the covered professional services furnished by such professional are furnished in an ambulatory surgical center.
“(iii) Determination.—The determination of whether an eligible professional is an eligible professional described in clause (ii) may be made on the basis of—
“(I) the site of service (as defined by the Secretary); or
“(II) an attestation submitted by the eligible professional.
“(iv) Sunset.—Clause (ii) shall no longer apply as of the first year that begins more than 3 years after the date on which the Secretary determines, through notice and comment rulemaking, that certified EHR technology applicable to the ambulatory surgical center setting is available.”
SEC. 16004. Continuing Access to Hospitals Act of 2016.
Extension of Enforcement Instruction on Supervision Requirements for Outpatient Therapeutic Services in Critical Access and Small Rural Hospitals Through 2016.— Section 1 of Public Law 113–198, as amended by section 1 of Public Law 114–112, is amended—
in the heading, by striking “ 2014 and 2015” and inserting “ 2016”; and
by striking “ and 2015” and inserting “ , 2015, and 2016”.
Report.— Not later than 1 year after the date of the enactment of this Act, the Medicare Payment Advisory Commission (established under section 1805 of the Social Security Act (42 U.S.C. 1395b–6)) shall submit to Congress a report analyzing the effect of the extension of the enforcement instruction under section 1 of Public Law 113–198, as amended by section 1 of Public Law 114–112 and subsection (a) of this section, on the access to health care by Medicare beneficiaries, on the economic impact and the impact upon hospital staffing needs, and on the quality of health care furnished to such beneficiaries.
SEC. 16005. Delay of Implementation of Medicare Fee Schedule Adjustments for Wheelchair Accessories and Seating Systems When Used in Conjunction with Complex Rehabilitation Technology (crt) Wheelchairs.
Section 2(a) of the Patient Access and Medicare Protection Act (42 U.S.C. 1305 note) is amended by striking “ January 1, 2017” and inserting “ July 1, 2017”.
SEC. 16006. Allowing Physical Therapists to Utilize Locum Tenens Arrangements under Medicare.
In General.— The first sentence of section 1842(b)(6) of the Social Security Act (42 U.S.C. 1395u(b)(6)), as amended by section 5012, is further amended—
by striking “ and” before “ (I)”; and
by inserting before the period at the end the following: “ , and (J) in the case of outpatient physical therapy services furnished by physical therapists in a health professional shortage area (as defined in section 332(a)(1)(A) of the Public Health Service Act), a medically underserved area (as designated pursuant to section 330(b)(3)(A) of such Act), or a rural area (as defined in section 1886(d)(2)(D)), subparagraph (D) of this sentence shall apply to such services and therapists in the same manner as such subparagraph applies to physicians’ services furnished by physicians”.
Effective Date; Implementation.—
Effective date.— The amendments made by subsection (a) shall apply to services furnished beginning not later than six months after the date of the enactment of this Act.
Implementation.— The Secretary of Health and Human Services may implement subparagraph (J) of section 1842(b)(6) of the Social Security Act (42 U.S.C. 1395u(b)(6)), as added by subsection (a)(2), by program instruction or otherwise.
SEC. 16007. Extension of the Transition to New Payment Rates for Durable Medical Equipment under the Medicare Program.
In General.— The Secretary of Health and Human Services shall extend the transition period described in clause (i) of section 414.210(g)(9) of title 42, Code of Federal Regulations, from June 30, 2016, to December 31, 2016 (with the full implementation described in clause (ii) of such section applying to items and services furnished with dates of service on or after January 1, 2017).
Study and Report.—
Study.—
In general.— The Secretary of Health and Human Services shall conduct a study that examines the impact of applicable payment adjustments upon—
the number of suppliers of durable medical equipment that, on a date that is not before January 1, 2016, and not later than December 31, 2016, ceased to conduct business as such suppliers; and
the availability of durable medical equipment, during the period beginning on January 1, 2016, and ending on December 31, 2016, to individuals entitled to benefits under part A of title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) or enrolled under part B of such title.
Definitions.— For purposes of this subsection, the following definitions apply:
Supplier; durable medical equipment.— The terms “supplier” and “durable medical equipment” have the meanings given such terms by section 1861 of the Social Security Act (42 U.S.C. 1395x).
Applicable payment adjustment.— The term “applicable payment adjustment” means a payment adjustment described in section 414.210(g) of title 42, Code of Federal Regulations, that is phased in by paragraph (9)(i) of such section. For purposes of the preceding sentence, a payment adjustment that is phased in pursuant to the extension under subsection (a) shall be considered a payment adjustment that is phased in by such paragraph (9)(i).
Report.— The Secretary of Health and Human Services shall, not later than January 12, 2017, submit to the Committees on Ways and Means and on Energy and Commerce of the House of Representatives, and to the Committee on Finance of the Senate, a report on the findings of the study conducted under paragraph (1).
SEC. 16008. Requirements in Determining Adjustments Using Information from Competitive Bidding Programs.
In General.— Section 1834(a)(1)(G) of the Social Security Act (42 U.S.C. 1395m(a)(1)(G)) is amended by adding at the end the following new sentence:
“(i) solicit and take into account stakeholder input; and
“(ii) take into account the highest amount bid by a winning supplier in a competitive acquisition area and a comparison of each of the following with respect to non-competitive acquisition areas and competitive acquisition areas:
“(I) The average travel distance and cost associated with furnishing items and services in the area.
“(II) The average volume of items and services furnished by suppliers in the area.
“(III) The number of suppliers in the area.”
Conforming Amendments.—
Section 1834(h)(1)(H)(ii) of the Social Security Act (42 U.S.C. 1395m(h)(1)(H)(ii)) is amended by striking “ the Secretary” and inserting “ subject to subsection (a)(1)(G), the Secretary”.
Section 1842(s)(3)(B) of the Social Security Act (42 U.S.C. 1395m(s)(3)(B)) is amended by striking “ the Secretary” and inserting “ subject to section 1834(a)(1)(G), the Secretary”.
TITLE XVII Other Medicare Provisions
SEC. 17001. Delay in Authority to Terminate Contracts for Medicare Advantage Plans Failing to Achieve Minimum Quality Ratings.
Findings.— Consistent with the studies provided under the IMPACT Act of 2014 (Public Law 113–185), it is the intent of Congress—
to continue to study and request input on the effects of socioeconomic status and dual-eligible populations on the Medicare Advantage STARS rating system before reforming such system with the input of stakeholders; and
pending the results of such studies and input, to provide for a temporary delay in authority of the Centers for Medicare & Medicaid Services (CMS) to terminate Medicare Advantage plan contracts solely on the basis of performance of plans under the STARS rating system.
Delay in MA Contract Termination Authority for Plans Failing To Achieve Minimum Quality Ratings.— Section 1857(h) of the Social Security Act (42 U.S.C. 1395w–27(h)) is amended by adding at the end the following new paragraph:
“(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).”
SEC. 17002. Requirement for Enrollment Data Reporting for Medicare.
Section 1874 of the Social Security Act (42 U.S.C. 1395kk) is amended by adding at the end the following new subsection:
“(g) Requirement for Enrollment Data Reporting.—
“(1) In general.—Each year (beginning with 2016), the Secretary shall submit to the Committees on Ways and Means and Energy and Commerce of the House of Representatives and the Committee on Finance of the Senate a report on Medicare enrollment data (and, in the case of part A, on data on individuals receiving benefits under such part) as of a date in such year specified by the Secretary. Such data shall be presented—
“(A) by Congressional district and State; and
“(B) in a manner that provides for such data based on—
“(i) fee-for-service enrollment (as defined in paragraph (2));
“(ii) enrollment under part C (including separate for aggregate enrollment in MA–PD plans and aggregate enrollment in MA plans that are not MA–PD plans); and
“(iii) enrollment under part D.
“(2) Fee-for-service enrollment defined.—For purpose of paragraph (1)(B)(i), the term ‘fee-for-service enrollment’ means aggregate enrollment (including receipt of benefits other than through enrollment) under—
“(A) part A only;
“(B) part B only; and
“(C) both part A and part B.”
SEC. 17003. Updating the Welcome to Medicare Package.
In General.— Not later than 12 months after the last day of the period for the request of information described in subsection (b), the Secretary of Health and Human Services shall, taking into consideration information collected pursuant to subsection (b), update the information included in the Welcome to Medicare package to include information, presented in a clear and simple manner, about options for receiving benefits under the Medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.), including through the original medicare fee-for-service program under parts A and B of such title (42 U.S.C. 1395c et seq., 42 U.S.C. 1395j et seq.), Medicare Advantage plans under part C of such title (42 U.S.C. 1395w–21 et seq.), and prescription drug plans under part D of such title (42 U.S.C. 1395w–101 et seq.)). The Secretary shall make subsequent updates to the information included in the Welcome to Medicare package as appropriate.
Request for Information.— Not later than 6 months after the date of the enactment of this Act, the Secretary of Health and Human Services shall request information, including recommendations, from stakeholders (including patient advocates, issuers, and employers) on information included in the Welcome to Medicare package, including pertinent data and information regarding enrollment and coverage for Medicare eligible individuals.
SEC. 17004. No Payment for Items and Services Furnished by Newly Enrolled Providers or Suppliers Within a Temporary Moratorium Area.
in the paragraph heading, by inserting “ ; nonpayment” before the period; and
by adding at the end the following new subparagraph:
“(C) Nonpayment.—
“(i) In general.—No payment may be made under this title or under a program described in subparagraph (A) with respect to an item or service described in clause (ii) furnished on or after October 1, 2017.
“(ii) Item or service described.—An item or service described in this clause is an item or service furnished—
“(I) within a geographic area with respect to which a temporary moratorium imposed under subparagraph (A) is in effect; and
“(II) by a provider of services or supplier that meets the requirements of clause (iii).
“(iii) Requirements.—For purposes of clause (ii), the requirements of this clause are that a provider of services or supplier—
“(I) enrolls under this title on or after the effective date of such temporary moratorium; and
“(II) is within a category of providers of services and suppliers (as described in subparagraph (A)) subject to such temporary moratorium.
“(iv) Prohibition on charges for specified items or services.—In no case shall a provider of services or supplier described in clause (ii)(II) charge an individual or other person for an item or service described in clause (ii) furnished on or after October 1, 2017, to an individual entitled to benefits under part A or enrolled under part B or an individual under a program specified in subparagraph (A).”
Conforming Amendments.—
Medicaid.—
In general.— Section 1903(i)(2) of the Social Security Act (42 U.S.C. 1396b(i)(2)), as amended by section 5005(a)(4), is further amended—
in subparagraph (C), by striking “ or” at the end; and
by adding at the end the following new subparagraph:
“(E) with respect to any amount expended for such an item or service furnished during calendar quarters beginning on or after October 1, 2017, subject to section 1902(kk)(4)(A)(ii)(II), within a geographic area that is subject to a moratorium imposed under section 1866(j)(7) by a provider or supplier that meets the requirements specified in subparagraph (C)(iii) of such section, during the period of such moratorium; or”
Exception with respect to access.— Section 1902(kk)(4)(A)(ii) of the Social Security Act (42 U.S.C. 1396a(kk)(4)(A)(ii)) is amended to read as follows:
“(ii) Exceptions.—
“(I) Compliance with moratorium.—A State shall not be required to comply with a temporary moratorium described in clause (i) if the State determines that the imposition of such temporary moratorium would adversely impact beneficiaries’ access to medical assistance.
“(II) FFP available.—Notwithstanding section 1903(i)(2)(E), payment may be made to a State under this title with respect to amounts expended for items and services described in such section if the Secretary, in consultation with the State agency administering the State plan under this title (or a waiver of the plan), determines that denying payment to the State pursuant to such section would adversely impact beneficiaries’ access to medical assistance. ”
State plan requirement with respect to limitation on charges to beneficiaries.— Section 1902(kk)(4)(A) of the Social Security Act (42 U.S.C. 1396a(kk)(4)(A)) is amended by adding at the end the following new clause:
“(iii) Limitation on charges to beneficiaries.—With respect to any amount expended for items or services furnished during calendar quarters beginning on or after October 1, 2017, the State prohibits, during the period of a temporary moratorium described in clause (i), a provider meeting the requirements specified in subparagraph (C)(iii) of section 1866(j)(7) from charging an individual or other person eligible to receive medical assistance under the State plan under this title (or a waiver of the plan) for an item or service described in section 1903(i)(2)(E) furnished to such an individual.”
Correcting amendments to related provisions.—
in paragraph (1)(A)—
by striking “ paragraph (4)” and inserting “ paragraph (5)”;
by striking “ moratoria in accordance with paragraph (5)” and inserting “ moratoria in accordance with paragraph (7)”; and
by striking “ paragraph (6)” and inserting “ paragraph (9)”; and
by redesignating the second paragraph (8) (redesignated by section 1304(1) of Public Law 111–152) as paragraph (9).
in paragraph (1), by striking “ section 1886(j)(2)” and inserting “ section 1866(j)(2)”;
in paragraph (2), by striking “ section 1886(j)(3)” and inserting “ section 1866(j)(3)”;
in paragraph (3), by striking “ section 1886(j)(4)” and inserting “ section 1866(j)(5)”; and
in paragraph (4)(A), by striking “ section 1886(j)(6)” and inserting “ section 1866(j)(7)”.
SEC. 17005. Preservation of Medicare Beneficiary Choice under Medicare Advantage.
Section 1851(e)(2) of the Social Security Act (42 U.S.C. 1395w–21(e)(2)) is amended—
in subparagraph (C)—
in the heading, by inserting “ from 2011 through 2018” after “ 45-day period”; and
by inserting “ and ending with 2018” after “ beginning with 2011”; and
by adding at the end the following new subparagraph:
“(G) Continuous open enrollment and disenrollment for first 3 months in 2016 and subsequent years.—
“(i) In general.—Subject to clause (ii) and subparagraph (D)—
“(I) in the case of an MA eligible individual who is enrolled in an MA plan, at any time during the first 3 months of a year (beginning with 2019); or
“(II) in the case of an individual who first becomes an MA eligible individual during a year (beginning with 2019) and enrolls in an MA plan, during the first 3 months during such year in which the individual is an MA eligible individual;
“(ii) Limitation of one change during open enrollment period each year.—An individual may change the election pursuant to clause (i) only once during the applicable 3-month period described in such clause in each year. The limitation under this clause shall not apply to changes in elections effected during an annual, coordinated election period under paragraph (3) or during a special enrollment period under paragraph (4).
“(iii) Limited application to part d.—Clauses (i) and (ii) of this subparagraph shall only apply with respect to changes in enrollment in a prescription drug plan under part D in the case of an individual who, previous to such change in enrollment, is enrolled in a Medicare Advantage plan.
“(iv) Limitations on marketing.—Pursuant to subsection (j), no unsolicited marketing or marketing materials may be sent to an individual described in clause (i) during the continuous open enrollment and disenrollment period established for the individual under such clause, notwithstanding marketing guidelines established by the Centers for Medicare & Medicaid Services.”
SEC. 17006. Allowing End-Stage Renal Disease Beneficiaries to Choose a Medicare Advantage Plan.
Removing Prohibition.—
by striking subparagraph (B); and
by striking “ eligible individual” and all that follows through “ In this title, subject to subparagraph (B),” and inserting “ eligible individual.—In this title,”.
Conforming amendments.—
Section 1852(b)(1) of the Social Security Act (42 U.S.C. 1395w–22(b)(1)) is amended—
by striking subparagraph (B); and
by striking “ Beneficiaries” and all that follows through “ A Medicare+Choice organization” and inserting “ Beneficiaries.—A Medicare Advantage organization”.
Section 1859(b)(6) of the Social Security Act (42 U.S.C. 1395w–28(b)(6)) is amended, in the last sentence, by striking “ may waive” and all that follows through “ subparagraph and”.
Effective date.— The amendments made by this subsection shall apply with respect to plan years beginning on or after January 1, 2021.
Excluding Costs for Kidney Acquisitions From MA Benchmark.— Section 1853 of the Social Security Act (42 U.S.C. 1395w–23) is amended—
in subsection (k)—
in paragraph (1)—
in the matter preceding subparagraph (A), by striking “ paragraphs (2) and (4)” and inserting “ paragraphs (2), (4), and (5)”; and
in subparagraph (B)(i), by striking “ paragraphs (2) and (4)” and inserting “ paragraphs (2), (4), and (5)”; and
by adding at the end the following new paragraph:
“(5) Exclusion of costs for kidney acquisitions from capitation rates.—After determining the applicable amount for an area for a year under paragraph (1) (beginning with 2021), the Secretary shall adjust such applicable amount to exclude from such applicable amount the Secretary’s estimate of the standardized costs for payments for organ acquisitions for kidney transplants covered under this title (including expenses covered under section 1881(d)) in the area for the year.”
; and
in subsection (n)(2)—
in subparagraph (A)(i), by inserting “ and, for 2021 and subsequent years, the exclusion of payments for organ acquisitions for kidney transplants from the capitation rate as described in subsection (k)(5)” before the semicolon at the end;
in subparagraph (E), in the matter preceding clause (i), by striking “ subparagraph (F)” and inserting “ subparagraphs (F) and (G)”; and
by adding at the end the following new subparagraph:
“(G) Application of kidney acquisitions adjustment.—The base payment amount specified in subparagraph (E) for a year (beginning with 2021) shall be adjusted in the same manner under paragraph (5) of subsection (k) as the applicable amount is adjusted under such subsection.”
FFS Coverage of Kidney Acquisitions.—
In general.— Section 1852(a)(1)(B)(i) of the Social Security Act (42 U.S.C. 1395w–22(a)(1)(B)(i)) is amended by inserting “ or coverage for organ acquisitions for kidney transplants, including as covered under section 1881(d)” after “ hospice care”.
Conforming amendment.— Section 1851(i) of the Social Security Act (42 U.S.C. 1395w–21(i)) is amended by adding at the end the following new paragraph:
“(3) FFS payment for expenses for kidney acquisitions.—Paragraphs (1) and (2) shall not apply with respect to expenses for organ acquisitions for kidney transplants described in section 1852(a)(1)(B)(i).”
Effective date.— The amendments made by this subsection shall apply with respect to plan years beginning on or after January 1, 2021.
Evaluation of Quality.—
In general.— The Secretary of Health and Human Services (in this subsection referred to as the “Secretary”) shall conduct an evaluation of whether the 5-star rating system based on the data collected under section 1852(e) of the Social Security Act (42 U.S.C. 1395w–22(e)) should include a quality measure specifically related to care for enrollees in Medicare Advantage plans under part C of title XVIII of such Act determined to have end-stage renal disease.
Public availability.— Not later than April 1, 2020, the Secretary shall post on the Internet website of the Centers for Medicare & Medicaid Services the results of the evaluation under paragraph (1).
Report.— Not later than December 31, 2023, the Secretary of Health and Human Services (in this subsection referred to as the “Secretary”) shall submit to Congress a report on the impact of the provisions of, and amendments made by, this section with respect to the following:
Spending under—
the original Medicare fee-for-service program under parts A and B of title XVIII of the Social Security Act; and
the Medicare Advantage program under part C of such title.
The number of enrollees determined to have end-stage renal disease—
in the original Medicare fee-for-service program; and
in the Medicare Advantage program.
The sufficiency of the amount of data under the original Medicare fee-for-service program for individuals determined to have end-stage renal disease for purposes of determining payment rates for end-stage renal disease under the Medicare Advantage program.
Improvements to Risk Adjustment Under Medicare Advantage.—
in subparagraph (C)(i), by striking “ The Secretary” and inserting “ Subject to subparagraph (I), the Secretary”; and
by adding at the end the following new subparagraph:
“(I) Improvements to risk adjustment for 2019 and subsequent years.—
“(i) In general.—In order to determine the appropriate adjustment for health status under subparagraph (C)(i), the following shall apply:
“(I) Taking into account total number of diseases or conditions.—The Secretary shall take into account the total number of diseases or conditions of an individual enrolled in an MA plan. The Secretary shall make an additional adjustment under such subparagraph as the number of diseases or conditions of an individual increases.
“(II) Using at least 2 years of diagnostic data.—The Secretary may use at least 2 years of diagnosis data.
“(III) Providing separate adjustments for dual eligible individuals.—With respect to individuals who are dually eligible for benefits under this title and title XIX, the Secretary shall make separate adjustments for each of the following:
“(aa) Full-benefit dual eligible individuals (as defined in section 1935(c)(6)).
“(bb) Such individuals not described in item (aa).
“(IV) Evaluation of mental health and substance use disorders.—The Secretary shall evaluate the impact of including additional diagnosis codes related to mental health and substance use disorders in the risk adjustment model.
“(V) Evaluation of chronic kidney disease.—The Secretary shall evaluate the impact of including the severity of chronic kidney disease in the risk adjustment model.
“(VI) Evaluation of payment rates for end-stage renal disease.—The Secretary shall evaluate whether other factors (in addition to those described in subparagraph (H)) should be taken into consideration when computing payment rates under such subparagraph.
“(ii) Phased-in implementation.—The Secretary shall phase-in any changes to risk adjustment payment amounts under subparagraph (C)(i) under this subparagraph over a 3-year period, beginning with 2019, with such changes being fully implemented for 2022 and subsequent years.
“(iii) Opportunity for review and public comment.—The Secretary shall provide an opportunity for review of the proposed changes to such risk adjustment payment amounts under this subparagraph and a public comment period of not less than 60 days before implementing such changes.”
Studies and reports.—
Reports on the risk adjustment system.—
Medpac evaluation and report.—
Evaluation.— The Medicare Payment Advisory Commission shall conduct an evaluation of the impact of the provisions of, and amendments made by, this section on risk scores for enrollees in Medicare Advantage plans under part C of title XVIII of the Social Security Act and payments to Medicare Advantage plans under such part, including the impact of such provisions and amendments on the overall accuracy of risk scores under the Medicare Advantage program.
Report.— Not later than July 1, 2020, the Medicare Payment Advisory Commission shall submit to Congress a report on the evaluation under subclause (I), together with recommendations for such legislation and administrative action as the Commission determines appropriate.
Reports by secretary of health and human services.— Not later than December 31, 2018, and every 3 years thereafter, the Secretary of Health and Human Services shall submit to Congress a report on the risk adjustment model and the ESRD risk adjustment model under the Medicare Advantage program under part C of title XVIII of the Social Security Act, including any revisions to either such model since the previous report. Such report shall include information on how such revisions impact the predictive ratios under either such model for groups of enrollees in Medicare Advantage plans, including very high and very low cost enrollees, and groups defined by the number of chronic conditions of enrollees.
Study and report on functional status.—
Study.— The Comptroller General of the United States (in this subparagraph referred to as the “Comptroller General”) shall conduct a study on how to most accurately measure the functional status of enrollees in Medicare Advantage plans and whether the use of such functional status would improve the accuracy of risk adjustment payments under the Medicare Advantage program under part C of title XVIII of the Social Security Act. Such study shall include an analysis of the challenges in collecting and reporting functional status information for Medicare Advantage plans under such part, providers of services and suppliers under the Medicare program, and the Centers for Medicare & Medicaid Services.
Report.— Not later than June 30, 2018, the Comptroller General shall submit to Congress a report containing the results of the study under clause (i), together with recommendations for such legislation and administrative action as the Comptroller General determines appropriate.
SEC. 17007. Improvements to the Assignment of Beneficiaries under the Medicare Shared Savings Program.
Section 1899(c) of the Social Security Act (42 U.S.C. 1395jjj(c)) is amended—
by striking “ utilization of primary” and inserting
“(1) in the case of performance years beginning on or after April 1, 2012, primary”
in paragraph (1), as added by paragraph (1) of this section, by striking the period at the end and inserting “ ; and”;
by adding at the end the following new paragraph:
“(2) in the case of performance years beginning on or after January 1, 2019, services provided under this title by a Federally qualified health center or rural health clinic (as those terms are defined in section 1861(aa)), as may be determined by the Secretary.”
TITLE XVIII Other Provisions
SEC. 18001. Exception from Group Health Plan Requirements for Qualified Small Employer Health Reimbursement Arrangements.
Amendments to the Internal Revenue Code of 1986 and the Patient Protection and Affordable Care Act.—
In general.— Section 9831 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
“(d) Exception for Qualified Small Employer Health Reimbursement Arrangements.—
“(1) In general.—For purposes of this title (except as provided in section 4980I(f)(4) and notwithstanding any other provision of this title), the term ‘group health plan’ shall not include any qualified small employer health reimbursement arrangement.
“(2) Qualified small employer health reimbursement arrangement.—For purposes of this subsection—
“(A) In general.—The term ‘qualified small employer health reimbursement arrangement’ means an arrangement which—
“(i) is described in subparagraph (B), and
“(ii) is provided on the same terms to all eligible employees of the eligible employer.
“(B) Arrangement described.—An arrangement is described in this subparagraph if—
“(i) such arrangement is funded solely by an eligible employer and no salary reduction contributions may be made under such arrangement,
“(ii) such arrangement provides, after the employee provides proof of coverage, for the payment of, or reimbursement of, an eligible employee for expenses for medical care (as defined in section 213(d)) incurred by the eligible employee or the eligible employee’s family members (as determined under the terms of the arrangement), and
“(iii) the amount of payments and reimbursements described in clause (ii) for any year do not exceed $4,950 ($10,000 in the case of an arrangement that also provides for payments or reimbursements for family members of the employee).
“(C) Certain variation permitted.—For purposes of subparagraph (A)(ii), an arrangement shall not fail to be treated as provided on the same terms to each eligible employee merely because the employee’s permitted benefit under such arrangement varies in accordance with the variation in the price of an insurance policy in the relevant individual health insurance market based on—
“(i) the age of the eligible employee (and, in the case of an arrangement which covers medical expenses of the eligible employee’s family members, the age of such family members), or
“(ii) the number of family members of the eligible employee the medical expenses of which are covered under such arrangement.
“(D) Rules relating to maximum dollar limitation.—
“(i) Amount prorated in certain cases.—In the case of an individual who is not covered by an arrangement for the entire year, the limitation under subparagraph (B)(iii) for such year shall be an amount which bears the same ratio to the amount which would (but for this clause) be in effect for such individual for such year under subparagraph (B)(iii) as the number of months for which such individual is covered by the arrangement for such year bears to 12.
“(ii) Inflation adjustment.—In the case of any year beginning after 2016, each of the dollar amounts in subparagraph (B)(iii) shall be increased by an amount equal to—
“(I) such dollar amount, multiplied by
“(II) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting ‘calendar year 2015’ for ‘calendar year 1992’ in subparagraph (B) thereof.
“(3) Other definitions.—For purposes of this subsection—
“(A) Eligible employee.—The term ‘eligible employee’ means any employee of an eligible employer, except that the terms of the arrangement may exclude from consideration employees described in any clause of section 105(h)(3)(B) (applied by substituting ‘90 days’ for ‘3 years’ in clause (i) thereof).
“(B) Eligible employer.—The term ‘eligible employer’ means an employer that—
“(i) is not an applicable large employer as defined in section 4980H(c)(2), and
“(ii) does not offer a group health plan to any of its employees.
“(C) Permitted benefit.—The term ‘permitted benefit’ means, with respect to any eligible employee, the maximum dollar amount of payments and reimbursements which may be made under the terms of the qualified small employer health reimbursement arrangement for the year with respect to such employee.
“(4) Notice.—
“(A) In general.—An employer funding a qualified small employer health reimbursement arrangement for any year shall, not later than 90 days before the beginning of such year (or, in the case of an employee who is not eligible to participate in the arrangement as of the beginning of such year, the date on which such employee is first so eligible), provide a written notice to each eligible employee which includes the information described in subparagraph (B).
“(B) Contents of notice.—The notice required under subparagraph (A) shall include each of the following:
“(i) A statement of the amount which would be such eligible employee’s permitted benefit under the arrangement for the year.
“(ii) A statement that the eligible employee should provide the information described in clause (i) to any health insurance exchange to which the employee applies for advance payment of the premium assistance tax credit.
“(iii) A statement that if the employee is not covered under minimum essential coverage for any month the employee may be subject to tax under section 5000A for such month and reimbursements under the arrangement may be includible in gross income.”
Limitation on exclusion from gross income.— Section 106 of such Code is amended by adding at the end the following:
“(g) Qualified Small Employer Health Reimbursement Arrangement.—For purposes of this section and section 105, payments or reimbursements from a qualified small employer health reimbursement arrangement (as defined in section 9831(d)) of an individual for medical care (as defined in section 213(d)) shall not be treated as paid or reimbursed under employer-provided coverage for medical expenses under an accident or health plan if for the month in which such medical care is provided the individual does not have minimum essential coverage (within the meaning of section 5000A(f)).”
Coordination with health insurance premium credit.— Section 36B(c) of such Code is amended by adding at the end the following new paragraph:
“(4) Special rules for qualified small employer health reimbursement arrangements.—
“(A) In general.—The term ‘coverage month’ shall not include any month with respect to an employee (or any spouse or dependent of such employee) if for such month the employee is provided a qualified small employer health reimbursement arrangement which constitutes affordable coverage.
“(B) Denial of double benefit.—In the case of any employee who is provided a qualified small employer health reimbursement arrangement for any coverage month (determined without regard to subparagraph (A)), the credit otherwise allowable under subsection (a) to the taxpayer for such month shall be reduced (but not below zero) by the amount described in subparagraph (C)(i)(II) for such month.
“(C) Affordable coverage.—For purposes of subparagraph (A), a qualified small employer health reimbursement arrangement shall be treated as constituting affordable coverage for a month if—
“(i) the excess of—
“(I) the amount that would be paid by the employee as the premium for such month for self-only coverage under the second lowest cost silver plan offered in the relevant individual health insurance market, over
“(II) 1⁄12 of the employee’s permitted benefit (as defined in section 9831(d)(3)(C)) under such arrangement, does not exceed—
“(ii) 1⁄12 of 9.5 percent of the employee’s household income.
“(D) Qualified small employer health reimbursement arrangement.—For purposes of this paragraph, the term ‘qualified small employer health reimbursement arrangement’ has the meaning given such term by section 9831(d)(2).
“(E) Coverage for less than entire year.—In the case of an employee who is provided a qualified small employer health reimbursement arrangement for less than an entire year, subparagraph (C)(i)(II) shall be applied by substituting ‘the number of months during the year for which such arrangement was provided’ for ‘12’.
“(F) Indexing.—In the case of plan years beginning in any calendar year after 2014, the Secretary shall adjust the 9.5 percent amount under subparagraph (C)(ii) in the same manner as the percentages are adjusted under subsection (b)(3)(A)(ii).”
Application of excise tax on high cost employer-sponsored health coverage.—
In general.— Section 4980I(f)(4) of such Code is amended by adding at the end the following: “ Section 9831(d)(1) shall not apply for purposes of this section.”.
Determination of cost of coverage.— Section 4980I(d)(2) of such Code is amended by redesignating subparagraph (D) as subparagraph (E) and by inserting after subparagraph (C) the following new subparagraph:
“(D) Qualified small employer health reimbursement arrangements.—In the case of applicable employer-sponsored coverage consisting of coverage under any qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2)), the cost of coverage shall be equal to the amount described in section 6051(a)(15).”
Enforcement of notice requirement.— Section 6652 of such Code is amended by adding at the end the following new subsection:
“(o) Failure to Provide Notices With Respect to Qualified Small Employer Health Reimbursement Arrangements.—In the case of each failure to provide a written notice as required by section 9831(d)(4), unless it is shown that such failure is due to reasonable cause and not willful neglect, there shall be paid, on notice and demand of the Secretary and in the same manner as tax, by the person failing to provide such written notice, an amount equal to $50 per employee per incident of failure to provide such notice, but the total amount imposed on such person for all such failures during any calendar year shall not exceed $2,500.”
Reporting.—
W–2 reporting.— Section 6051(a) of such Code is amended by striking “ and” at the end of paragraph (13), by striking the period at the end of paragraph (14) and inserting “ , and”, and by inserting after paragraph (14) the following new paragraph:
“(15) the total amount of permitted benefit (as defined in section 9831(d)(3)(C)) for the year under a qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2)) with respect to the employee.”
Information required to be provided by exchange subsidy applicants.— Section 1411(b)(3) of the Patient Protection and Affordable Care Act is amended by redesignating subparagraph (B) as subparagraph (C) and by inserting after subparagraph (A) the following new subparagraph:
“(B) Certain individual health insurance policies obtained through small employers.—The amount of the enrollee’s permitted benefit (as defined in section 9831(d)(3)(C) of the Internal Revenue Code of 1986) under a qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2) of such Code).”
Effective dates.—
In general.— Except as otherwise provided in this paragraph, the amendments made by this subsection shall apply to years beginning after December 31, 2016.
Transition relief.— The relief under Treasury Notice 2015–17 shall be treated as applying to any plan year beginning on or before December 31, 2016.
Coordination with health insurance premium credit.— The amendments made by paragraph (3) shall apply to taxable years beginning after December 31, 2016.
Employee notice.—
In general.— The amendments made by paragraph (5) shall apply to notices with respect to years beginning after December 31, 2016.
Transition relief.— For purposes of section 6652(o) of the Internal Revenue Code of 1986 (as added by this Act), a person shall not be treated as failing to provide a written notice as required by section 9831(d)(4) of such Code if such notice is so provided not later than 90 days after the date of the enactment of this Act.
W–2 reporting.— The amendments made by paragraph (6)(A) shall apply to calendar years beginning after December 31, 2016.
Information provided by exchange subsidy applicants.—
In general.— The amendments made by paragraph (6)(B) shall apply to applications for enrollment made after December 31, 2016.
Verification.— Verification under section 1411 of the Patient Protection and Affordable Care Act of information provided under section 1411(b)(3)(B) of such Act shall apply with respect to months beginning after October 2016.
Transitional relief.— In the case of an application for enrollment under section 1411(b) of the Patient Protection and Affordable Care Act made before April 1, 2017, the requirement of section 1411(b)(3)(B) of such Act shall be treated as met if the information described therein is provided not later than 30 days after the date on which the applicant receives the notice described in section 9831(d)(4) of the Internal Revenue Code of 1986.
Substantiation requirements.— The Secretary of the Treasury (or his designee) may issue substantiation requirements as necessary to carry out this subsection.
Amendments to the Employee Retirement Income Security Act of 1974.—
In general.— Section 733(a)(1) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1191b(a)(1)) is amended by adding at the end the following: “ Such term shall not include any qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2) of the Internal Revenue Code of 1986).”.
Exception from continuation coverage requirements, etc.— Section 607(1) of such Act (29 U.S.C. 1167(1)) is amended by adding at the end the following: “ Such term shall not include any qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2) of the Internal Revenue Code of 1986).”.
Effective date.— The amendments made by this subsection shall apply to plan years beginning after December 31, 2016.
Amendments to the Public Health Service Act.—
In general.— Section 2791(a)(1) of the Public Health Service Act (42 U.S.C. 300gg–91(a)(1)) is amended by adding at the end the following: “ Except for purposes of part C of title XI of the Social Security Act (42 U.S.C. 1320d et seq.), such term shall not include any qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2) of the Internal Revenue Code of 1986).”.
Exception from continuation coverage requirements.— Section 2208(1) of the Public Health Service Act (42 U.S.C. 300bb–8(1)) is amended by adding at the end the following: “ Such term shall not include any qualified small employer health reimbursement arrangement (as defined in section 9831(d)(2) of the Internal Revenue Code of 1986).”.
Effective date.— The amendments made by this subsection shall apply to plan years beginning after December 31, 2016.