Teaching Hospital and Physican
Provisions in the Medicare, Medicaid and SCHIP Benefits Improvement
and Protection Act of 2000
On December 15, 2000 Congress passed a comprehensive legislative
package that includes H.R. 5661, the "Medicare, Medicaid and
SCHIP Benefits Improvement and Protection Act of 2000." The
President signed the legislation into law (P.L. 106-554) on
Dec. 21. Specifically, H.R. 5661 increases Medicare outlays
by approximately $36 billion over 5 years, providing relief
from the Balanced Budget Act of 1997 (BBA) to hospitals, physicians,
skilled nursing facilities, home health agencies, and Medicare+Choice
plans. Hospitals receive approximately $12 billion of the
total BBA relief spending. For teaching hospitals, H.R. 5661
includes some provision for the AAMC's three top BBA relief
2000 priorities: freezing the BBA's reductions in the Medicare
Indirect Medical Education (IME) adjustment; increasing the
inflation update adjustment to Medicare reimbursements for
inpatient services; and eliminating Medicaid Disproportionate
Share Hospital payment reductions.
Other important changes include increasing the floor of
the per resident amount which is used to calculate Medicare
Direct Graduate Medical Education (DGME) payments; creating
a transition period to comply with regulations in relation
to provider-based designation for hospital outpatient departments;
and codifying regulations which restrict the flexibility of
the Medicare upper payment limit policy used by states to
make Medicaid payments to hospitals and other providers. Regulations
implementing most of these changes will likely be published
in Spring, 2001.
Medicare Hospital Payment Provisions: Graduate Medical Education
Payments
Indirect Medical Education Payments
Current Law. IME payments to teaching hospitals were
reduced from 7.7 percent for every 10 percent increment in
a hospital's resident-to-bed ratio to 7.0 percent beginning
October 1, 1997 (FY 1998); to 6.5 percent in FY 1999; to 6.5
percent in FY 2000; to 6.25 percent in FY 2001, and 5.5 percent
in FY 2002 and subsequent years.
H.R. 5661. IME payments are frozen at 6.5 percent
in FYs 2001 and 2002 before being reduced to 5.5 percent in
FY 2003 and thereafter. (For operational purposes, from Oct.
1, 2000 through March 31, 2001, IME payments will be 6.25
percent; from April 1 through October 1, 2001 the IME payment
will be 6.75 percent for an average of 6.5 percent.) It is
estimated that this provision will provide $700 million to
teaching hospitals over five years.
Use of National Average Payment Methodology in Computing
Direct Graduate Medical Education Payments
Current Law. Medicare pays hospitals for its share
of DGME costs in approved training programs based on a 1984
hospital specific per resident amount, updated to the current
year for inflation, and a hospital's number of full time equivalent
(FTE) residents, not to exceed the count during the hospital's
cost reporting period ending on or before December 31, 1996.
In FY 2001, a hospital's primary care and non-primary care
per resident amounts will be compared to and adjusted according
to a "corridor" surrounding a locality-adjusted national average
per resident amount. The national average per resident amount
is calculated based on hospitals' combined primary care and
non-primary care per resident amounts for cost report periods
ending in FY 1997, standardized by the 1999 physician geographic
adjustment factor, and weighted by the number of FTE residents.
This amount will be updated in FY 2001 by the increase in
the consumer price index (CPI). A locality adjusted national
average will then be calculated by applying the geographic
adjustment factor used to adjust physician payments (the average
of the three geographic practice cost indices.)
A floor will be calculated for each hospital at 70 percent
of the locality-adjusted national average per resident amount.
A ceiling of 140 percent of the locality-adjusted national
average per resident amount also would be calculated. Each
hospital's primary care and non-primary care per resident
amounts would be compared to the floor and ceiling amounts.
If a hospital's per resident amount is below the 70 percent
floor, its per resident amount would be increased to the 70
percent level in FY 2001 and updated annually by the CPI increase.
If a hospital's per resident amount is above the 140 percent
ceiling the per resident amount would be frozen at FY 2001
levels for FYs 2001 and 2002. In FYs 2003-2005, the per resident
amount would be updated by the CPI increase minus two percentage
points. If a hospital's per resident amount is between 70
percent and 140 percent of the locality-adjusted national
average, the per resident amount would continue at current
levels, updated annually by the CPI increase
H.R. 5661. Beginning in FY 2002, the payment floor
per resident amount is increased from 70 percent to 85 percent
of the locality adjusted national average.
According to an AAMC analysis, the provision to raise the
floor from 70 to 85 percent will result in increased DGME
payments totaling approximately $300 million for approximately
513 hospitals over five years. Of the 513 hospitals, 216 hospitals
will receive payments solely as a result of the increased
payment floor set forth in H.R. 5661. (The remaining hospital
receive additional payment due to both the BBRA and H.R. 5661.)
Hospital-specific estimates from the analysis are available.
(You will be prompted for your COTH, COD, or CAS user name
and password before being allowed access to the estimates.)
Medicare+Choice Nursing and Allied Health Education DGME
Payments
Current Law. Medicare currently pays teaching hospitals
for nursing and allied health training programs for every
fee for service (FFS) and Medicare+ Choice enrollee treated
overall. Medicare pays teaching hospitals on a cost basis
for FFS enrollees. Nursing and allied health payments associated
with Medicare+Choice enrollees are determined (effective with
cost report periods beginning in FY 2000) by the ratio of
managed care DGME payments to total DGME payments applied
to total nursing and allied health FFS payments. These monies
are funded by reducing hospitals' DGME payments associated
with Medicare+Choice enrollees. The nursing and allied health
payments associated with Medicare+ Choice enrollees must total
no more than $60 million. Eligible hospitals receive a percentage
of nursing and allied health payments associated with Medicare+Choice
enrollees based on their current share of total FFS nursing
and allied health payments.
H.R. 5661. Effective with cost report periods beginning
on or after January 1, 2001, the amount of Medicare+Choice
nursing and allied health payments would be based, in part,
on the volume of Medicare+Choice patients a hospital treated.
Medicare Provisions Related to Inpatient Services
Inpatient Payment Update
Current Law. Standardized payments for inpatient services
are updated each year using an "update factor" which is based
on the hospital market basket (MB). The MB measures the increase
in the cost of goods and services purchased by hospitals in
a given year. The update to hospital inpatient Medicare prospective
payment rates (PPS) is the market basket percentage increase
(MB) minus 1.1 percentage points in FYs 2001 and 2002. In
FY 2003 and thereafter, the market basket update is scheduled
to be the full increase in the MB.
H.R. 5661. The update to the hospital Medicare prospective
payment rates will be MB minus zero in FY 2001. (From Oct.
1, 2000 through March 31, 2001, hospitals will receive MB
minus 1.1 percentage points. From April 1 through September
31, 2001, hospitals would receive MB plus 1.1 percentage points,
therefore averaging a full market basket update.) In FYs 2002
and 2003, hospital would receive MB minus .55 percentage points.
The market basket provisions are estimated to increase payments
to hospitals by $3.7 billion over five years.
The Secretary is also directed to consider the prices of
blood and blood products purchased by hospitals in the next
rebasing and revision of the hospital market basket to determine
whether those prices are adequately reflected in the market
basket index.
The Medicare Payment Advisory Committee (MedPAC) is directed
to conduct a study on increased hospital costs attributable
to complying with new blood safety measures and providing
such services using new technologies. MedPAC is also to consider
the extent to which the current payment system recognizes
such increased costs and whether mechanisms should be established
in the current payment system to provide for more timely and
accurate recognition of such cost increases. In conducting
the study, MedPAC shall consult with hospitals; organizations
involved in the collection, processing and delivery of blood;
and organizations involved in the development of new blood
safety technologies. The report and any legislative or regulatory
recommendations shall be submitted to Congress no later than
Dec. 21, 2001.
For discharges occurring on or after Oct. 1, 2001, the Secretary
may be able to adjust the average standardized amount in future
fiscal years to correct for changes in the aggregate Medicare
payments caused by adjustments to the DRG weighting factors
in a previous fiscal year (or estimates that such adjustments
for a future fiscal year) that did not take into account coding
improvements, changes in discharge classification, and/or
did not accurately reflect changes in case mix.
Disproportionate Share Hospital Payments
Current Law. Disproportionate share hospital (DSH)
payments are paid to hospitals that serve a disproportionate
share of low income patients. Hospital DSH payments are determined
by a complex formula that vary depending on the size and location
of qualifying hospitals. To qualify for a DSH payment, a hospital
must have or exceed a certain Disproportionate Share Patient
Percentage that reflects a hospital's share of Medicaid and
Medicare SSI patients. Total DSH payments were reduced by
1 percent in FY 1998, by 2 percent in FY 1999 and 3 percent
in FYs 2000 and 2001. In FY 2002, DSH payments were scheduled
to be reduced by 4 percent. In FY 2003 and in each subsequent
year, payments are scheduled to return to pre-BBA levels.
H.R. 5661. DSH payments are reduced by 2 percent
in FY 2001 and 3 percent in FY 2002. (From Oct. 1, 2000 through
March 31, 2001, DSH payments will be reduced by 3 percent;
from April 1 through Sept. 31, DSH payments will be reduced
by 1 percent, therefore averaging a 2 percent reduction in
FY 2001.) In FY 2003 and thereafter, DSH payments return to
pre-BBA levels.
Beginning April 1, 2001, all hospitals are eligible to receive
DSH payments when their Disproportionate Share Patient percentage
exceeds 15 percent. (Individual hospital DSH payments will
continue to vary.) While rural hospitals would benefit from
this provision, the provision also benefits smaller urban
hospitals.
These provisions will restore in total approximately $1.45
billion from FYs 2001-2005.
Wage Index
Current Law. The hospital wage index is used to adjust
the national standardized Medicare per case amount to account
for the wage level in the area where a hospital is located.
A hospital can seek to have its wage index changed by submitting
an application to the Medicare Geographic Classification Review
Board (MGCRB).
H.R. 5661. For FY 2001 and thereafter, a decision
made by the Medicare Geographic Classification Review Board
(MGCRB) to reclassify a PPS hospital's wage index would be
effective for three years. The Secretary would also establish
a process whereby a hospital could elect to terminate the
reclassification decision before the end of the three year
period. For FY 2003 and thereafter, MGCRB would base any comparison
of the average hourly wage of the hospital with the average
hourly wage for hospitals in the area using data from each
of the two preceding surveys as well as data from the most
recently published hospital wage survey.
The Secretary shall also establish a process whereby beginning
on or after October 1, 2001, a single wage index could be
computed for all geographic areas in the state. If the Secretary
applies a statewide geographic index, an application by an
individual hospital would not be considered.
The Secretary shall also collect occupational data every
three years in order to construct an occupational mix adjustment
for the hospital area wage index. The first complete data
collection effort shall occur no later than Sept. 30, 2003
for application beginning Oct. 1, 2004. This provision would
likely lower the wage indices for teaching hospitals.
Bad Debt
Current Law. Payments to hospitals for the bad debts
of Medicare beneficiaries are reduced by 25 percent in FY
1998; 40 percent in FY 1999; and by 45 percent in FY 2000
and subsequent years.
H.R. 5661. Beginning in FY 2001, Medicare will reimburse
70 percent of Medicare beneficiaries' bad debts. This provision
provides $700 million in additional payments to hospitals
over five years.
Recognition of New Technologies Under the Medicare Inpatient
Hospital PPS
Current Law. New technologies are reimbursed by Medicare
as they are folded into DRG payments as determined by HCFA.
H.R. 5661. Requires the Secretary to submit a report
to Congress no later than April 1, 2001 on potential methods
for incorporating more quickly new medical services and technologies
into the inpatient coding system. The Secretary would be required
to identify the preferred methods for expediting these coding
modifications, and to implement such a method by Oct. 1, 2001.
Effective for discharges beginning on or after Oct. 1, 2001,
the Secretary shall establish a mechanism to recognize the
costs of new medical services and technologies. The mechanism
shall include collection of data on the costs of new medical
technologies for a minimum of two and not more than three
years. Additional hospital payments could be made by means
of a new technology group DRG, an add-on payment, payment
adjustment or other mechanism. Separate fee schedules for
additional new technology payments would not be permitted.
Such payments would be implemented on a budget-neutral basis.
GAO Report on Impact of Emergency Medical Treatment and
Active Labor Act (EMTALA)
Current Law. No provision.
H.R. 5661. Requires the U.S. Government Accounting
Office (GAO) to evaluate the impact of EMTALA on hospitals,
emergency physicians and on-call physicians covering emergency
departments. A report must be submitted to Congress by May
1, 2001.
Medicare Provisions related to Hospital-Based Outpatient
Department Payments
Hospital Outpatient PPS Payment Update
Current Law. In FYs 2001 and FY 2002, hospital outpatient
PPS update payments are MB minus 1 percentage point.
H.R. 5661. Updates outpatient payments in FY 2001
by the full market basket. In FY 2002, the update will continue
as under current law which is the MB increase minus 1 percentage
point. Effective as if the provisions were included in the
Balanced Budget Act of 1997, if the Secretary determines that
updates to the adjustment factor used to convert the relative
utilization weights under the PPS into payment amounts have,
or are likely to, result in hospitals changing their coding
or classification of covered services, thereby changing aggregate
payments, the Secretary may be authorized to adjust the conversion
factor in later years to eliminate the effect of coding or
classification changes.
Pass-Through Payments Related to Devices
Current Law. For a limited period of time (not less
than two but no more than three years) outpatient payments
for innovative medical devices, drugs, and biologicals, including
orphan drugs, cancer therapy drugs and biologicals, radiopharmaceuticals,
and certain "new" medical devices, drugs, and biologicals
will be paid on a "pass through" basis. Like outlier payments,
this provision is funded through reductions to base payment
rates and may not exceed 2.5 percent of total outpatient PPS
payments for years before 2004 and 2 percent in 2004 and thereafter.
The Secretary of HHS is given discretion to base the system's
relative payment weights on the mean or the median of hospital
costs. Furthermore, the most costly service or item included
in a single APC may not have a mean or median cost that is
more than twice that for the least costly item or service
in that group. Low volume items or services may be exempt
from the limitation requirement.
The Secretary of HHS is required to review the APC groups
annually and to update them as necessary. In addition, the
Secretary must consult with an outside advisory panel to review
the clinical integrity of the groups and weights.
H.R. 5661. The provision would modify the procedures
and standards by which certain medical devices are eligible
for pass-through payments. The Secretary is required to establish
categories of medical devices by April 1, 2001 for those devices
currently authorized for payment as of Jan. 1, 2001. The categories
would be established in consultation with hospital groups,
medical device manufacturers and other affected parties.
The Secretary is required to also establish criteria by July
1, 2001 for additional categories.
All created categories would be in effect for at least two,
but not more than three years.
Provider-Based Entities
Current Law. Hospital outpatient departments must
be designated as provider-based entities in order for the
outpatient services to be paid under the new outpatient prospective
payment system. If a facility does not qualify as a hospital-based
provider, then in most instances it will be considered a physician
office or freestanding clinic and payment for services will
be determined by the physician fee schedule or ambulatory
surgery center (ASC) rates. In an April 7, 2000 Final Rule,
HCFA set forth criteria for determining whether an entity
would be considered provider-based for purposes of Medicare
reimbursement. The requirements are effective with cost reporting
periods beginning on or after Jan. 10, 2001.
H.R. 5661. The provision grandfathers existing arrangements
designated as provider based entities for two years beginning
Oct. 1, 2000 in order to allow entities to transition to new
proposed provider-based status requirements set forth in the
April 7, 2000 regulations. If a facility or organization requests
approval for provider-based status during the period of Oct.
1, 2000 through Sept. 21, 2002, it would not be treated as
if it did not have such status during the period of time the
determination is pending.
The legislation also modifies the requirements in the April
7, 2000 Final Rule to permit outpatient departments that are
affiliated with public hospitals or located not more than
35 miles from the main campus or the hospital to be considered
provider-based if all other requirements are met.
Medicaid Hospital Payment Provisions
Increase in Disproportionate Share Hospital Allotments
Current Law. Medicaid DSH payments are subject to
a series of caps, both on the amount of DSH money an individual
hospital can receive as well as on the total amount of DSH
payments states receive from the federal government. State
DSH allotments, which vary, are specified by law and are prohibited
from increasing above 12 percent of a state's Medicaid spending.
State allotments would have been reduced overall by 30 percent
in FY 2001 and 37 percent in FY 2002. Hospital-specific DSH
caps can not exceed 100 percent of a hospital's uncompensated
care costs.
H.R. 5661. Eliminates state DSH allotment reductions
in FYs 2001 and 2002. In FY 2001, state DSH allotments are
at the FY 2000 level, updated by inflation. In FY 2002, state
DSH allotments are at the FY 2001 level, updated by inflation,
assuming DSH spending would not increase above 12 percent
of a state's Medicaid spending. In FY 2003, DSH allotments
revert to pre-BIPA levels, which is the pre-BIPA FY 2002 allotments,
adjusted by inflation.
For states with low DSH allotments, (those states whose
FY 1999 federal and state DSH expenditures are greater than
zero but less than one percent of the state's total medical
assistance expenditures during that fiscal year,) the DSH
allotments for FY 2001 would be equal to 1 percent of the
state's total amount of expenditures under their plan for
such assistance during that fiscal year.
These DSH allotment provisions are projected to restore $1.25
billion over five years in Medicaid payments to hospitals.
Other DSH Provisions
Current Law. None
H.R. 5661. Effective January 1, 2001, Medicaid managed
care entities are required to report either information on
hospital services provided to Medicaid managed care patients
for the purposes of Medicare and Medicaid DSH or allow a sponsorship
code to facilitate hospital identification of Medicaid managed
care patients.
Effective January 1, 2001, states must include Medicaid
managed care patients in the determination of baseline eligibility
for Medicaid DSH under either the low-income utilization rate
or the Medicaid inpatient utilization rate.
Upper Payment Limit Issues
Current Law. Under Medicaid, states have much flexibility
in making payments to providers. The contribution by the federal
government is limited to the amount that Medicare would pay
for similar services, known as the Medicare upper payment
limit (UPL). Current regulations apply these limitations on
the inpatient side separately to long term care facilities,
hospital inpatient services, and hospital outpatient services
in the aggregate for each category of service. A separate
upper payment limit has been established for state operated
facilities. With respect to outpatient hospital and clinic
services, there is a single upper payment limit on aggregate
payments to all facilities.
From these upper payment limits, a number of states have
calculated the aggregate differential between payments and
the limit in one or more of these categories, developing various
methodologies for making additional payments to providers
based on these differentials.
H.R. 5661. Directs the Secretary of Health and Human
Services to finalize Oct. 10, 2000 proposed regulations1
restricting the flexibility of the Medicaid upper payment
limit policy by Dec. 31, 2000.
In addition, the legislation includes additional provisions
to allow certain states and hospitals to transition to the
new regulations:
- All states are allowed to increase DSH reimbursement
to public hospitals up to 175 percent of the current hospital-specific
limit (a hospital's shortfall plus its uncompensated care)
for two years beginning in the state fiscal year that
follows Sept. 30, 2002.
- States with Medicaid 1115 waivers can increase reimbursement
to public hospitals up to 175 percent of the current hospital-specific
limit (a hospital's Medicaid shortfall plus its uncompensated
care) for two years beginning in the state fiscal year
that follows Sept. 30, 2002.
- States with UPL payment arrangements in effect on or
before Oct. 1, 1992 would receive an additional five years
to transition from current programs. Beginning in FY 2003
and ending in FY 2007, those states must reduce their
excess payments by a certain percentage a year.
- For a state that has a hospital with a low-income utilization
rate of 65 percent and did not receive Medicaid DSH as
of Sept. 30, 2000, an increase of that state's federal
DSH allotments is provided for five years
The bill also requires the Secretary of HHS to implement
no later than Sept. 30, 2002, accountability standards to
ensure that federal DSH dollars are made in accordance with
DSH requirements.
These provisions save the Medicaid program $21 billion over
five years.
Provisions Related to Physicians
Expansion of Medicare Payment for Telehealth Services
Current Law. Authorizes Medicare payment for professional
consultations via telecommunications systems to beneficiaries
residing in a rural area designated as a Health Professional
Shortage Area (HPSA). The law also requires that payment be
shared between the referring clinic and the physician providing
the service.
H.R. 5661. Effective no later than Oct. 1, 2001, the
Secretary shall provide payment for services that are provided
via a telecommunications system by a physician or practitioner
to an eligible Medicare beneficiary residing in all HPSA designated
areas (the rural requirement is deleted). Requires the Secretary
to make payments for telehealth services to the physican or
practicioner at the distant site in an amount equal to the
amount that would have been paid to such physician or practioner
if the services had been furnished to the beneficiary without
the use of a telecommunications system. Provides for a facility
fee to be paid to the originating site. Originating sites
will include a physician or practioner office, a Critical
Access Hospital, a Rural Health Clinic, a federally qualified
health center or a hospital. The fee splitting requirement
is deleted and instead the Secretary will provide to the originating
site a facility fee of $20.00. Telemedicine services eligible
for reimbursement will include professional consultations,
office visits, office psychiatry services, including any service
identified as of July 1, 2000, by HCPCS codes 99241-99275,
99201-99215, 90804-90809, and 90862, and any additional item
or service specified by the Secretary. Home health services
provided via telemedicine will also be reimbursed under its
PPS system.
Requires the Secretary of HHS to conduct a study and submit
recommendations to Congress identifying additional settings,
sites, practitioners, and geographic areas that would be appropriate
for telehealth services. The study and recommendations shall
be submitted to Congress no later than Dec. 21, 2002.
This provisions will provide an additional $25 million over
five years for telehealth services.
GAO Study on Practice Expense
Current Law. No provision.
H.R. 5661. Requires the General Accounting Office
(GAO) to conduct a study on the refinements to the resource-based
practice expense relative value units during the transition
to a resource-based expense system for physician payments.
The GAO shall examine how the Secretary of HHS has accepted
and used the practice expense data submitted under the Balanced
Budget Refinement Act of 1999. The report shall be submitted
no later than July 1, 2001, with recommendations for: improvements
in the process for acceptance and use of practice expense
data and changes appropriate to ensure beneficiary access
to care.
GAO Study of Specialist Physicians' Services Furnished
in Physicians' Offices and Hospital Outpatient Department
Services
Current Law. No provision.
H.R. 5661. Requires the General Accounting Office
(GAO) to conduct a study on the appropriateness of furnishing
in physician offices specialist services that are ordinarily
furnished in hospital outpatient departments. The GAO is asked
to review safety in performing procedures in both settings;
assess Medicare beneficiary access to care if services weren't
covered in physicians' offices and assess whether the resource-based
practice expense values create incentives to furnish specialist
physicians' services in offices versus hospital outpatient
settings. The report, with recommendations, is required for
submission to Congress not later than July 1, 2001.
Physician Group Practice Demonstration
Current Law. No demonstration project currently exists.
H.R. 5661. The Secretary of HHS is authorized to
conduct demonstration projects to test, and if proven effective,
expand the use of incentives to health care groups participating
under Medicare. Such incentives would be designed to encourage
the coordination of care furnished under Medicare Parts A
and B by institutional and other providers and practitioners;
to encourage investment in administrative structures and processes
to encourage efficient service delivery; and to reward physicians
for improving health outcomes. The Secretary shall establish
for each health care group participating in the demonstration
project a base expenditure amount equal to the average total
payments under Medicare parts A and B for patients served
by the health care group on a fee-for-service basis. Health
care groups that are able to realize savings relative to their
specific target amount will be paid a bonus equal to a portion
of the amount saved. Bonus payments will be limited to ensure
that the aggregate expenditures do not exceed the amount which
the Secretary estimates would be expended if the demonstration
project were not implemented. A health care group participating
in the demonstration shall report to the Secretary such data,
at such times and in such formats as the Secretary may require.
GAO Study on Enrollment Procedures for Groups that Retain
Independent Contactor Physicians
Current Law. No provisions.
H.R. 5661. Not later than Dec. 21, 2001, the GAO shall
submit a report to Congress on the study and improvement of
the current Medicare enrollment process for groups that retain
independent contractor physicians (such as hospital-based
physicians and emergency department staffing groups). The
GAO shall: consult with groups that retain independent contractor
physicians; review potential abuses related to issuing individual
Medicare provider numbers; and review direct and indirect
costs associated with the current process incurred by the
Medicare program and groups that retain independent contractor
physicians.
GAO Studies and Reports on Medicare Payments
Current Law. No provision.
H.R. 5661. Requires by June 21, 2002 the GAO to study
the post-payment audit process for physician services. The
study would include the proper level of resources HCFA should
devote to educating physician regarding coding and billing,
documentation requirements, and calculation of overpayments.
The study shall include recommendations to change or improve
the post-payment audit process.
The GAO is also required by June 21, 2002 to conduct a study
of the aggregate effects of regulatory, audit, oversight and
paperwork burdens on physicians and other health care providers
participating in Medicare. The GAO would be required to include
recommendations regarding a reduction in paperwork; an appropriate
change in oversight, additional payments or education to assist
physicians and others in understanding and complying with
any legal or regulatory requirements.
Miscellaneous Provisions
Extension of Advisory Opinion Authority
Current Law. BBA 97 authorized the Secretary of HHS
to issue written advisory opinions concerning whether a referral
relating to designated health services (other than clinical
laboratory services) is prohibited. The authority was set
to expire after 2000.
H.R. 5661. The authority of the Secretary of HHS to
issue advisory opinions is made permanent.
1.The rule creates three different
categories for the calculation of aggregate limits: private
facilities; state-owned or operated facilities; and other
government-owned or operated facilities. The rule also applies
a special allowance for payments to public hospitals that
are government-owned or operated, permitting public hospital
Medicaid payments, in the aggregate, to be 150 percent of
the amount that would be paid under Medicare. Additionally,
the rule creates a transition period for states with existing
programs that do not comply with new rules: states with plans
effective before Oct. 1, 1999 and states with plans in effective
after Oct. 1, 1999 and before the final rule is published.
States with plans in effect before Oct. 1, 1999 get a two
year transition and three additional years (beginning in FY
2003) to phase down their program in order to comply. The
pahse down allows states to exceed the payment limit in accordance
with a schedule. [Back]
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