Text: H.R.3982 — 102nd Congress (1991-1992)All Information (Except Text)

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HR 3982 IH
102d CONGRESS
1st Session
 H. R. 3982
To amend title XVIII of the Social Security Act to expand the Secretary of
Health and Human Services' authority to impose intermediate sanctions on
health maintenance organizations participating in the medicare program for
violation of any requirement of the program and to amend title XI of the
Social Security Act to prohibit providers of services under the medicare
program from offering certain inducements to beneficiaries or employees.
IN THE HOUSE OF REPRESENTATIVES
November 26, 1991
Mr. LEVIN of Michigan (for himself and Mr. STARK) introduced the following
bill; which was referred jointly to the Committees on Ways and Means and
Energy and Commerce
A BILL
To amend title XVIII of the Social Security Act to expand the Secretary of
Health and Human Services' authority to impose intermediate sanctions on
health maintenance organizations participating in the medicare program for
violation of any requirement of the program and to amend title XI of the
Social Security Act to prohibit providers of services under the medicare
program from offering certain inducements to beneficiaries or employees.
  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 HMO Sanction Reform and Anti-Fraud
  and Abuse Act of 1991'.
SEC. 2. INTERMEDIATE SANCTIONS FOR MEDICARE HEALTH MAINTENANCE ORGANIZATIONS.
  (a) APPLICATION OF INTERMEDIATE SANCTIONS FOR ANY PROGRAM VIOLATIONS-
  (1) IN GENERAL- Section 1876(i)(1) of the Social Security Act (42
  U.S.C. 1395mm(i)(1)) is amended by striking `the Secretary may terminate'
  and all that follows and inserting the following: `in accordance with
  procedures established under paragraph (9), the Secretary may at any
  time terminate any such contract or may impose the intermediate sanctions
  described in paragraph (6)(B) or (6)(C) (whichever is applicable) on the
  eligible organization if the Secretary determines that the organization--
  `(A) has failed substantially to carry out the contract;
  `(B) is carrying out the contract in a manner inconsistent with the
  efficient and effective administration of this section;
  `(C) is operating in a manner that is not in the best interests of the
  individuals covered under the contract; or
  `(D) no longer substantially meets the applicable conditions of subsections
  (b), (c), (e), and (f).'.
  (2) OTHER INTERMEDIATE SANCTIONS FOR MISCELLANEOUS PROGRAM VIOLATIONS-
  Section 1876(i)(6) of such Act (42 U.S.C. 1395mm(i)(6)) is amended by
  adding at the end the following new subparagraph:
  `(C) In the case of an eligible organization for which the Secretary makes
  a determination under paragraph (1) the basis of which is not described
  in subparagraph (A), the Secretary may apply the following intermediate
  sanctions:
  `(i) civil money penalties of not more than $25,000 for each determination
  under paragraph (1) if the deficiency that is the basis of the determination
  has directly adversely affected (or has the substantial likelihood of
  adversely affecting) an individual covered under the organization's contract;
  `(ii) civil money penalties of not more than $10,000 for each week beginning
  after the initiation of procedures by the Secretary under paragraph (9)
  during which the deficiency that is the basis of a determination under
  paragraph (1) exists; and
  `(iii) suspension of enrollment of individuals under this section after
  the date the Secretary notifies the organization of a determination under
  paragraph (1) and until the Secretary is satisfied that the deficiency
  that is the basis for the determination has been corrected and is not
  likely to occur.'.
  (3) PROCEDURES FOR IMPOSING SANCTIONS- Section 1876(i) of such Act
  (42 U.S.C. 1395mm(i)) is amended by adding at the end the following new
  paragraph:
  `(9) The Secretary may terminate a contract with an eligible organization
  under this section or may impose the intermediate sanctions described in
  paragraph (6) on the organization in accordance with formal investigation
  and compliance procedures established by the Secretary under which--
  `(A) the Secretary provides the organization with the opportunity to develop
  and implement a corrective action plan to correct the deficiencies that
  were the basis of the Secretary's determination under paragraph (1);
  `(B) the Secretary shall impose more severe sanctions on organizations
  that have a history of deficiencies or that have not taken steps to correct
  deficiencies the Secretary has brought to their attention;
  `(C) there are no unreasonable or unnecessary delays between the finding
  of a deficiency and the imposition of sanctions; and
  `(D) the Secretary provides the organization with reasonable notice and
  opportunity for hearing (including the right to appeal an initial decision)
  before imposing any sanction or terminating the contract.'.
  (4) CONFORMING AMENDMENTS- (A) Section 1876(i)(6)(B) of such Act (42
  U.S.C. 1395mm(i)(6)(B)) is amended by striking the second sentence.
  (B) Section 1876(i)(6) of such Act (42 U.S.C. 1395mm(i)(6)) is further
  amended by adding at the end the following new subparagraph:
  `(D) The provisions of section 1128A (other than subsections (a) and
  (b)) shall apply to a civil money penalty under subparagraph (A) or (B)
  in the same manner as they apply to a civil money penalty or proceeding
  under section 1128A(a).'.
  (b) AGREEMENTS WITH PEER REVIEW ORGANIZATIONS-
  (1) REQUIREMENT FOR WRITTEN AGREEMENT- Section 1876(i)(7)(A) of the
  Social Security Act (42 U.S.C. 1395mm(i)(7)(A)) is amended by striking
  `an agreement' and inserting `a written agreement'.
  (2) DEVELOPMENT OF MODEL AGREEMENT- Not later than July 1, 1993,
  the Secretary of Health and Human Services shall develop a model of the
  agreement that an eligible organization with a risk-sharing contract under
  section 1876 of the Social Security Act must enter into with an entity
  providing peer review services with respect to services provided by the
  organization under section 1876(i)(7)(A).
  (3) REPORT BY GAO-
  (A) STUDY- The Comptroller General shall conduct a study of the costs
  incurred by eligible organizations with risk-sharing contracts under section
  1876(b) of complying with the requirement of entering into a written
  agreement with an entity providing peer review services with respect to
  services provided by the organization, together with an analysis of how
  information generated by such entities is used by the Secretary of Health
  and Human Services to assess the quality of services provided by such
  eligible organizations.
  (B) REPORT TO CONGRESS- Not later than July 1, 1994, the Comptroller General
  shall submit a report to the Committee on Ways and Means and the Committee
  on Energy and Commerce of the House of Representatives and the Committee
  on Finance of the Senate on the study conducted under subparagraph (A).
  (c) EFFECTIVE DATE- The amendments made by this section shall apply with
  respect to contract years beginning on or after January 1, 1993.
SEC. 3. PROHIBITION AGAINST OFFERING INDUCEMENTS TO BENEFICIARIES OR EMPLOYERS.
  (a) INDUCEMENTS TO BENEFICIARIES- Section 1128A(a)(1) of the Social Security
  Act (42 U.S.C. 1320a-7a(a)(1)) is amended--
  (1) by striking `or' at the end of paragraph (1)(D);
  (2) by striking `, or' at the end of paragraph (2) and inserting a semicolon;
  (3) by striking the semicolon at the end of paragraph (3) and inserting
  `; or'; and
  (4) by inserting after paragraph (3) the following new paragraph:
  `(4) transfers anything for less than fair market value to (or for the
  benefit of) a beneficiary in order to influence the individual to receive
  from a particular provider, practitioner, or supplier a covered item or
  service for which payment may be made under title XVIII or XIX;'.
  (b) INDUCEMENTS TO EMPLOYEES- Section 1128A(a)(1) of such Act (42
  U.S.C. 1320a-7a(a)(1)), as amended by subsection (a), is further amended--
  (1) by striking `or' at the end of paragraph (3);
  (2) by striking the semicolon at the end of paragraph (4) and inserting
  `; or'; and
  (3) by inserting after paragraph (4) the following new paragraph:
  `(5) pays a bonus, reward, or other incentive to an employee to induce
  the employee to encourage individuals to seek or obtain covered items or
  services for which payment may be made under title XVIII or XIX where the
  amount of the incentive is in proportion to the activities of the employee
  in encouraging individuals to seek or obtain covered items or services;'.
  (c) EFFECTIVE DATE- The amendments made by subsections (a) and (b) shall
  apply to transfers or payments made on or after the date of the enactment
  of this Act.