[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2233 Introduced in Senate (IS)]
107th CONGRESS
2d Session
S. 2233
To amend title XVIII of the Social Security Act to establish a medicare
subvention demonstration project for veterans.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 23, 2002
Mr. Thomas (for himself, Mr. Rockefeller, Mr. Jeffords, Mr. Specter,
Mrs. Carnahan, Ms. Snowe, and Mr. Cleland) introduced the following
bill; which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to establish a medicare
subvention demonstration project for veterans.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Medicare Equity for Veterans Act of
2002''.
SEC. 2. ESTABLISHMENT OF MEDICARE SUBVENTION DEMONSTRATION PROJECT FOR
VETERANS.
Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is
amended by adding at the end the following new section:
``medicare subvention demonstration project for veterans
``Sec. 1897. (a) Definitions.--In this section:
``(1) Administering secretaries.--The term `administering
Secretaries' means the Secretary and the Secretary of Veterans
Affairs acting jointly.
``(2) Demonstration project.--The term `demonstration
project' means the demonstration project carried out under this
section.
``(3) Demonstration site.--
``(A) In general.--Subject to subparagraph (B), the
term `demonstration site' means a Veterans Affairs
medical facility that provides, alone or in conjunction
with other facilities under the jurisdiction of the
Secretary of Veterans Affairs and affiliated public or
private entities--
``(i) in the case of a coordinated care
health plan, the health care benefits
prescribed in subsection (c)(3) to targeted
medicare-eligible veterans residing within the
service area (as prescribed under regulations
for the Medicare+Choice program under part C);
and
``(ii) in the case of health care benefits
being provided on a preferred provider basis,
the health care benefits described in
subsection (d)(1) to targeted medicare-eligible
veterans.
``(B) Exclusion.--The term `demonstration site'
shall not include the entire catchment area of a
Veterans Integrated Services Network (VISN).
``(4) Medicare health care services.--The term `medicare
health care services' means items or services covered under
part A or part B.
``(5) Targeted medicare-eligible veteran.--The term
`targeted medicare-eligible veteran' means an individual who--
``(A) is a veteran (as defined in section 101 of
title 38, United States Code) who is enrolled in the
annual patient enrollment system under section
1705(a)(7) of title 38, United States Code;
``(B) has attained age 65;
``(C) is entitled to, or enrolled for, benefits
under part A;
``(D) is enrolled for benefits under part B; and
``(E) did not receive medical care from a Veterans
Affairs medical facility based on the individual's
eligibility for care and services under section
1710(a)(3) of title 38, United States Code, during the
period beginning on the date that the individual
attained age 65 and ending on September 30, 1998.
``(6) Trust funds.--The term `trust funds' means the
Federal Hospital Insurance Trust Fund established in section
1817 and the Federal Supplementary Medical Insurance Trust Fund
established in section 1841.
``(7) Veterans affairs medical facility.--The term
`Veterans Affairs medical facility' means a medical facility as
defined in section 8101 of title 38, United States Code.
``(b) Demonstration Project.--
``(1) In general.--
``(A) Establishment.--The administering Secretaries
are authorized to establish a demonstration project
(under agreements entered into by the administering
Secretaries) under which the Secretary shall reimburse
the Secretary of Veterans Affairs, from the trust
funds, for medicare health care services furnished to
targeted medicare-eligible veterans.
``(B) Separate agreements for coordinated care and
preferred provider models.--The administering
Secretaries shall enter into separate agreements with
regard to demonstration sites operating under a
coordinated care health plan model and a preferred
provider model, and shall include in each agreement
only such information that is applicable to that model.
``(2) Number of demonstration sites.--
``(A) In general.--Subject to the succeeding
provisions of this paragraph and subsection (k)(1)(B),
the demonstration project shall be conducted in not
more than 10 demonstration sites, designated jointly by
the administering Secretaries.
``(B) At least 1 coordinated care and 1 preferred
provider site.--The administrating Secretaries shall
ensure that at least 1 of the demonstration sites is
operated under a coordinated care health plan model and
at least 1 demonstration site is operated under a
preferred provider model.
``(C) Restriction.--A demonstration site may not
operate under both a coordinated care health plan model
and a preferred provider model.
``(D) Demonstration sites in rural areas.--At least
3 demonstration sites shall be sites that are located
in geographically diverse rural areas.
``(3) Restriction on new or expanded facilities.--No new
Veterans Affairs medical facilities may be built or expanded
with funds from the demonstration project.
``(4) Commencement of project.--The administering
Secretaries shall commence the demonstration project not later
than 6 months after the date of enactment of the Medicare
Equity for Veterans Act of 2002.
``(5) Duration.--Subject to subsection (k)(1)(A), the
authority of the administering Secretaries to conduct the
demonstration project shall terminate on the date that is 3
years after the date of the commencement of the demonstration
project.
``(c) Coordinated Care Health Plan Model.--
``(1) In general.--The Secretary of Veterans Affairs shall
establish and operate coordinated care health plans in order to
provide the health care benefits prescribed in paragraph (3) to
targeted medicare-eligible veterans participating in the
demonstration project consistent with part C.
``(2) Operation by or through a demonstration site.--Any
coordinated care health plan established in accordance with
paragraph (1) shall be operated by or through a demonstration
site.
``(3) Health care benefits.--
``(A) In general.--Subject to subparagraph (B), the
Secretary of Veterans Affairs shall prescribe the
health care benefits to be provided to a targeted
medicare-eligible veteran enrolled in a coordinated
care health plan under the demonstration project.
``(B) Minimum benefits.--The benefits prescribed by
the Secretary of Veterans Affairs pursuant to
subparagraph (A) shall include at least all medicare
health care services that are required to be provided
by a Medicare+Choice organization under part C.
``(4) Medicare requirements.--
``(A) In general.--
``(i) Requirements.--Except as provided in
clause (ii), a coordinated care health plan
operating under the demonstration project shall
meet all requirements applicable to a
Medicare+Choice plan under part C and
regulations pertaining thereto, and any other
requirements for receiving payments under this
title, except that the prohibition of payments
to Federal providers of services under sections
1814(c) and 1835(d), and paragraphs (2) and (3)
of section 1862(a), shall not apply.
``(ii) Waiver.--Except with respect to any
requirement described in subparagraph (B), the
Secretary is authorized to waive any
requirement described in clause (i), or approve
equivalent or alternative ways of meeting such
a requirement, but only if such waiver or
approval--
``(I) reflects the unique status of
the Department of Veterans Affairs as
an agency of the Federal Government;
and
``(II) is necessary to carry out,
or improve the efficiency of, the
demonstration project.
``(B) Beneficiary protections and other matters.--A
coordinated care health plan shall comply with the
requirements of part C that relate to beneficiary
protections and other related matters, including such
requirements relating to the following areas:
``(i) Enrollment and disenrollment.
``(ii) Nondiscrimination.
``(iii) Information provided to
beneficiaries.
``(iv) Cost-sharing limitations.
``(v) Appeal and grievance procedures.
``(vi) Provider participation.
``(vii) Access to services.
``(viii) Quality assurance and external
review.
``(ix) Advance directives.
``(x) Other areas of beneficiary
protections that the Secretary determines are
applicable to a coordinated health care plan
operating under the demonstration project.
``(d) Preferred Provider Model.--
``(1) In general.--The administering Secretaries shall
contract with a private entity to establish a preferred
provider model under which--
``(A) targeted medicare-eligible veterans
participating in the project shall receive medicare
health care services and additional health care
services determined appropriate by the administering
Secretaries; and
``(B) the Veterans Affairs medical facility
participating at the demonstration site is the
preferred provider under the plan.
``(2) Cost-sharing.--The administering Secretaries shall
establish cost-sharing requirements for targeted medicare-
eligible veterans that receive medicare health care services
under a preferred provider model at the Veterans Affairs
medical facility at the demonstration site. Such cost-sharing
requirements may be different than the cost-sharing
requirements required under this title.
``(3) Medicare requirements.--
``(A) In general.--Except as provided in
subparagraph (B), any entity or health care provider
that provides medicare health care services under the
demonstration project on a preferred provider basis
shall meet all of the requirements under this title,
except that the prohibition of payments to Federal
providers of services under sections 1814(c) and
1835(d), and paragraphs (2) and (3) of section 1862(a),
shall not apply.
``(B) Waiver.--The Secretary is authorized to waive
any requirement described under subparagraph (A), or
approve equivalent or alternative ways of meeting such
a requirement, but only if such waiver or approval--
``(i) reflects the unique status of the
Department of Veterans Affairs as an agency of
the Federal Government; and
``(ii) is necessary to carry out, or
improve the efficiency of, the demonstration
project.
``(4) Verification of eligibility.--
``(A) In general.--The Secretary of Veterans
Affairs shall establish procedures for determining
whether an individual is eligible to receive medicare
health care services on a preferred provider basis
under the demonstration project.
``(B) Restriction.--No payments shall be made under
this section for any medicare health care service
provided to an individual on a preferred provider basis
under the demonstration project unless the individual
has been determined to be eligible for the service
pursuant to the procedures established under
subparagraph (A).
``(e) Crediting of Payments.--A payment received by the Secretary
of Veterans Affairs under the demonstration project shall be credited
to the appropriation of the Department of Veterans Affairs for Medical
Care. Amounts credited to that appropriation for services furnished by
a demonstration site shall be credited to amounts in the appropriation
that are available for the demonstration site. Amounts so credited
shall be available without fiscal year limitation.
``(f) Waiver of Certain VA Requirements.--Notwithstanding any other
provision of law, the Secretary of Veterans Affairs shall furnish
medicare health care services to targeted medicare-eligible veterans
pursuant to the demonstration project.
``(g) Inspector General.--Nothing in any agreement entered into
under subsection (b)(1) shall limit the Inspector General of the
Department of Health and Human Services from investigating any matters
regarding the expenditure of funds under this title for the
demonstration project, including compliance with the provisions of this
title and all other relevant laws.
``(h) Information Provided to Secretary To Ensure Maintenance of
Effort.--Prior to the commencement of the demonstration project, the
Secretary of Veterans Affairs shall provide the Secretary with a list
of individuals who will not be eligible to receive benefits under the
demonstration project because of the application of subsection
(a)(5)(E).
``(i) Payments Based on Regular Medicare Payment Rates.--
``(1) Amount.--Subject to the succeeding provisions of this
subsection, the Secretary shall reimburse the Secretary of
Veterans Affairs for health care benefits provided under the
demonstration project at the following rates:
``(A) Coordinated care health plans.--In the case
of health care benefits provided under the
demonstration project to a targeted medicare-eligible
veteran enrolled in a coordinated care health plan, at
a rate equal to 100 percent of the amount paid to a
Medicare+Choice organization under part C for an
enrollee in a Medicare+Choice plan offered by such
organization (as risk adjusted under section
1853(a)(1)(B)).
``(B) Preferred provider model.--In the case of a
medicare health care service that is provided at a
demonstration site operating under a preferred provider
model, at a rate equal to 95 percent of the amounts
that otherwise would be payable under this title on a
noncapitated basis for such service if the
demonstration site was not part of this demonstration
project, was participating in the medicare program, and
imposed charges for such service.
``(2) Exclusion of certain amounts.--In computing the
amount of payment under paragraph (1), the following amounts
shall be excluded:
``(A) Disproportionate share hospital adjustment.--
Any amount attributable to an adjustment under section
1886(d)(5)(F).
``(B) Direct graduate medical education payments.--
Any amount attributable to a payment under section
1886(h).
``(C) Indirect medical education adjustment.--Any
amount attributable to the adjustment under section
1886(d)(5)(B).
``(D) Percentage of capital payments.--67 percent
of any amounts attributable to payments for capital-
related costs under medicare payment policies under
section 1886(g).
``(3) Periodic payments from medicare trust funds.--
Payments under this subsection shall be made--
``(A) on a periodic basis consistent with the
periodicity of payments under this title; and
``(B) in appropriate part, as determined by the
Secretary, from the trust funds.
``(4) Annual limit on medicare payments.--
``(A) Coordinated care health plan model.--Subject
to subparagraph (C), the aggregate amount that may be
paid to the Department of Veterans Affairs under this
subsection for enrollees in coordinated care health
plans for any of the 3 consecutive 12-month periods
(the first of which begins on the date of the
commencement of the demonstration project) shall be
equal to an amount determined appropriate by the
administering Secretaries.
``(B) Preferred provider model.--Subject to
subparagraph (C), the aggregate amount that may be paid
to the Department of Veterans Affairs under this
subsection for medicare health care services provided
on a preferred provider basis at a demonstration site
for any of the 3 consecutive 12-month periods described
in subparagraph (A) shall be equal to an amount
determined appropriate by the administering
Secretaries.
``(C) Cap.--The aggregate amount to be paid to the
Department of Veterans Affairs under this section--
``(i) during the first 12-month period
described in subparagraph (A) shall not exceed
$75,000,000;
``(ii) during the second 12-month period so
described shall not exceed $75,000,000; and
``(iii) during the third 12-month period so
described shall not exceed $75,000,000.
``(j) GAO Evaluation and Reports.--
``(1) Evaluation.--
``(A) In general.--The Comptroller General of the
United States shall conduct an evaluation of the
demonstration project, including--
``(i) an evaluation of demonstration sites
operating under a coordinated care health plan
model and under a preferred provider model; and
``(ii) where appropriate, a comparison of
such models.
``(B) Contents.--Any evaluation conducted under
subparagraph (A) shall include an assessment, based on
the agreements entered into under subsection (b)(1), of
the following:
``(i) Any savings or costs to the medicare
program under this title resulting from the
demonstration project.
``(ii) Compliance of participating
demonstration sites with applicable measures of
quality of care, compared to such compliance by
other entities that participate in medicare and
are not Veterans Affairs medical facilities.
``(iii) Compliance by the Department of
Veterans Affairs with the requirements under
this title.
``(iv) The number of targeted medicare-
eligible veterans opting to receive health care
benefits under the demonstration project
instead of receiving such benefits through
another health insurance plan (including health
care benefits under this title).
``(v) A comparison of the costs of
participation of the demonstration sites in the
project with the reimbursements for health care
services provided by such sites.
``(vi) Any impact the demonstration project
has on the access to health care services, or
the quality of such services, for--
``(I) targeted medicare-eligible
veterans receiving health care benefits
under the demonstration project; and
``(II) veterans (including targeted
medicare-eligible veterans) that are
not receiving health care benefits
under the demonstration project.
``(vii) Any impact the demonstration
project has on private health care providers
and on beneficiaries under this title that are
not receiving health care benefits under the
demonstration project.
``(viii) Any effect that the demonstration
project has on the enrollment in
Medicare+Choice plans offered by
Medicare+Choice organizations under part C in
the established demonstration site areas.
``(ix) Any impact that the exclusion of the
amounts described in subsection (i)(2) from the
reimbursement amounts under the demonstration
has on the Department of Veterans Affairs or on
targeted medicare-eligible veterans.
``(x) A description of the difficulties (if
any) experienced by--
``(I) the Department of Veterans
Affairs in managing the demonstration
project; or
``(II) the Department of Health and
Human Services in overseeing the
demonstration project.
``(xi) The quality and precision of billing
procedures utilized by demonstration sites.
``(xii) The timeliness of billing at
demonstration sites.
``(xiii) The timeliness of reimbursement by
the Secretary under the demonstration project.
``(xiv) The satisfaction level of targeted
medicare-eligible veterans participating in the
demonstration project.
``(xv) The quality of the care provided at
demonstration sites.
``(xvi) The ability of targeted medicare-
eligible veterans participating in the
demonstration project to access care, including
documentation of mean and medium waiting
periods.
``(xvii) Patient safety under the
demonstration project.
``(xviii) The ability of a demonstration
site to deliver totality of care in the local
service area.
``(xix) The percent of targeted medicare-
eligible veterans participating in the
demonstration project that required referral
for health care services and the cost of such
referrals relative to the cost of care
delivered locally.
``(xx) The satisfaction of Veterans Affairs
medical facilities participating in the
demonstration project with the operation of the
project.
``(xxi) The average pharmacy cost relative
to matched Veterans Affairs population.
``(xxii) The in-patient care cost compared
to a Veterans Affairs medical facility not
participating in the demonstration project.
``(xxiii) Regional variations in the
operation of the demonstration project.
``(xxiv) Differences in demonstration sites
located in rural areas and demonstration sites
located in urban areas.
``(xxv) The economic profile of targeted
medicare-eligible veterans participating in the
demonstration.
``(xxvi) Any additional elements specified
in the agreements entered into under subsection
(b)(1).
``(xxvii) Any additional elements that the
Comptroller General of the United States
determines are appropriate to assess regarding
the demonstration project.
``(2) Initial report.--
``(A) In general.--During the 6-month period that
begins on the 2-year anniversary of the commencement of
the demonstration project, the Comptroller General of
the United States shall submit a report to the
administering Secretaries and to the committees of
jurisdiction of Congress on the evaluation conducted
under paragraph (1), together with the recommendations
described in subparagraph (B).
``(B) Recommendations.--The recommendations
described in this subparagraph are recommendations
regarding--
``(i) how best to replicate the
demonstration sites operating under a
coordinated care health plan model and under
a preferred provider model in various demographic and geographic
settings; and
``(ii) whether the administrating
Secretaries should extend and expand the
demonstration project, and if so, the
configuration and timing for the expansion
(broken down by demographic, geographic, and
care delivery model factors).
``(3) Subsequent reports if project is extended.--
``(A) In general.--If the administrating
Secretaries extend the demonstration project pursuant
to subsection (k)(1)(A), the Comptroller General of the
United States, on the 4-year, 6-year, and 8-year
anniversary of the commencement of the demonstration
project, shall submit a report to the administering
Secretaries and to the committees of jurisdiction of
Congress on the evaluation conducted under paragraph
(1), together with the recommendations described in
paragraph (2)(B).
``(B) Reports not required if project terminated.--
No report shall be required under subparagraph (A) if
the reporting date is after the date that the
demonstration project is terminated by the
administrating Secretaries.
``(k) Continuing Authority To Extend and Expand the Demonstration
Project.--
``(1) Authority.--If, after review of the operation of the
demonstration project and the evaluations and reports submitted
by the Comptroller General of the United States under
subsection (j), the administrating Secretaries determine
appropriate, the administrating Secretaries may modify the
agreements entered into under subsection (b)(1) in the
following manner:
``(A) Notwithstanding subsection (b)(5), the
administering Secretaries may continue to conduct the
demonstration project beyond the date described in such
subsection.
``(B) Notwithstanding subsection (b)(2)(A), the
demonstration project may be conducted at any
demonstration site designated jointly by the
administering Secretaries.
``(C) Notwithstanding subsection (i)(4)(C), the
Administering Secretaries may establish a cap for any
12-month period after the period described in clause
(iii) of such subsection that is greater than the cap
described in such clause.
``(2) Annual reports.--
``(A) In general.--If the administrating
Secretaries extend the demonstration project pursuant
to paragraph (1)(A), the administering Secretaries
shall submit, for as long as the demonstration project
is being conducted, annual reports to the committees of
jurisdiction of Congress on the demonstration project.
``(B) Required elements.--Each report submitted
under subparagraph (A) shall include a detailed
description of--
``(i) the administrating Secretaries plans
for future expansion and extension of the
demonstration project;
``(ii) justifications for such expansion
and extension; and
``(iii) performance measures under the
demonstration project.''.
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